A recent study by the JPMorgan Chase Institute has highlighted the changes that have occurred in the financial habits of higher-income Americans during the year 2025. This trend is moving away from the use of traditional savings or keeping balances in checking accounts, as the returns they offer are minimal. These Americans are leaning more towards more competitive financial instruments, such as high-yield accounts, long-term deposits, and money market funds, mainly driven by inflation around 3% compared to bank interest rates of 0.4%. This strategy is related to users’ intention and preference to move their money in order for it to continue generating returns, rather than leaving it in a checking account.
Changes in the socioeconomic scene in 2025
The use of checking accounts as a safe place for excess cash has always been common. However, the economic and financial landscape of this past 2025 has undergone several changes, including the abandonment of conventional bank accounts, which offer low interest, for accumulating capital.
The study conducted by JPMorgan Chase Institute, with a sample of 4.7 million Chase households, showed that the real balances of these accounts have fallen by approximately 2% as of October of last month in 2025. This is a response to a scenario in which the cost of living continues to rise with an annual inflation of 3%, compared to an average rate of 0.4% for keeping money in these accounts, which translates into a loss of their value.
High-Performance alternatives
The search for profitability has led savers to explore various options that offer a balance between accessibility and growth:
- High-yield savings accounts. Digital banks have captured a large portion of this cash flow by offering rates close to 5% by the end of 2025, while also allowing nearly immediate liquidity.
- Certificates of Deposit (CDs) and Money Market Funds. CDs have regained appeal by allowing rates to be locked in before the Federal Reserve makes further adjustments. On the other hand, money market funds position themselves as an intermediate option, investing in short-term government debt to offer competitive returns without sacrificing stability.
- Brokerage accounts and retirement plans. Surplus capital is also being directed into diversified portfolios of stocks and bonds, as well as 401(k) and IRA plans, aiming to take advantage of both market growth and the associated tax benefits.
Capital management for the average saver
While it is true that the study was conducted with data from higher-income households, the conclusion is the same for any household and type of capital. Nevertheless, experts recommend personalized savings planning with the goal of achieving long-term financial success.
Frequently asked questions
Why is money decreasing in traditional bank accounts?
Because inflation is at 3% while banks only pay 0.4% interest. This causes money to lose value, so savers prefer to move their capital to places where it can earn higher returns.
What options are savers choosing to replace their checking accounts?
They are moving their money to high-yield accounts in digital banks (with rates close to 5%), certificates of deposit (CDs) to secure fixed interest, and money market funds that offer returns without losing stability.
Where is the surplus money for the future being directed?
Excess capital is being invested in diversified portfolios of stocks and bonds, as well as retirement plans like 401(k)s and IRAs, aiming to take advantage of both market growth and tax benefits.
