Like canned goods and toilet paper, Americans continue to stockpile their money as the coronavirus pandemic continues in 2021.

As of January 2021, Americans saved  20.5 percent of their disposable income, an increase of 7 percentage points compared to December, 2020.  While that’s down from a record savings rate of 33 percent in April, 2020, Americans are still spending less than they did before the pandemic, likely because of continued shutdowns and restrictions in place in many states. 

The financial stress caused by the pandemic has also likely pushed more consumers to save their money instead of spending it. The current unemployment rate in the U.S. is 6.2 percent, down from a high of 14.7 percent in April, 2020.

Another reason is that federal rescue programs, including an increase to unemployment insurance benefits and stimulus checks, has temporarily increased consumer incomes, according to reports.

If you need to, continue to lean on your emergency fund and save your money carefully. If, however, you’ve found yourself saving more money than you usually do, you may want to consider these strategies for maximizing your savings and improving your financial situation in the long term.

Increase your retirement contributions

Start building retirement savings now if you haven’t yet. There are two main types of retirement accounts: 401(k)s and individual retirement accounts (IRAs). A 401(k) is an employer-provided retirement account that allows you to contribute pre-tax earnings to retirement. Some employers even match your contributions. An IRA is a type of account that anyone can set up. With a Traditional IRA, you can make contributions on a pre-tax basis. With a Roth IRA, you can make contributions after taxes. 

If you already have retirement accounts, you probably also already make regular contributions to those accounts. Consider increasing those regular contributions, especially if your employer will match contributions. 

Keep in mind that there’s a limit to how much you can contribute to your retirement accounts per year. For the 2020 tax year, you can contribute up to $19,500 to a 401(k) and $6,000 to an IRA. If you’re older than 50, you can make catch-up contributions, up to $7,000 into an IRA or $26,000 into a 401(k). Taxpayers can make contributions until April 15, 2021.

Pay off a chunk of your debt

Now might also be a good time to make pay down your debt. No matter how much money you save, your debt isn’t going to go away and the longer it sticks around, the more interest it will accrue and the more difficult it will be to pay off. 

So if you have a lot of credit card debt or student loan debt, for example, try to increase the monthly payments you’re making. While some credit card companies extended deadlines and waived interest early on in the pandemic, they may not be doing so now. Consider paying your credit card bills in full so that they don’t stack up. 


For your student loans, keep making payments (and even bigger payments if possible) to take advantage of a zero-interest period, if it applies to your loans. Federal student loans aren’t accruing any interest through at least September 30, 2021 thanks to the Coronavirus Aid, Relief, and Economic Security (CARES) Act and other more recent emergency relief measures. Making payments now could help you get paid off more quickly. If you have multiple student loans, you may also want to take advantage of the zero-interest period by paying off the loans that have the highest interest rate.

Put money in a high-yield savings account1

You can probably make your money work harder than it already is by putting it into a savings account with a high yield. The annual percentage yield (APY) on a savings account can tell you by how much your savings will grow each year in your account. The average APY on a savings account is .06%, but you can find accounts with much higher APYs, even more than 1%. 

Some high-yield savings accounts have higher minimum balance requirements. So if you have an amount of money that you’re willing to put away for a while to gain interest, this might be a good option for you. If you haven’t touched your federal stimulus check, for example, you could potentially put it away in one of these accounts.

Start investing small amounts or increase your usual amount

Maybe you’ve never been able to make room for investing in your budget. You might want to use some of your extra savings to start investing. You can start by investing just a little piece of your savings each month. 

Apps such as Stash allow you to invest small amounts of money and buy fractional shares, or portions of shares in stocks and exchange-traded funds (ETFs). You can also use Auto-Stash to set up regular investments. If you’re already investing, you might want to increase your regular investments if you’re able. 

However you decide to manage your money during this time of uncertainty, it’s important to prioritize your financial wellbeing and security. These strategies can help you make the most of your savings for the long-term.

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