State of Savings: August 2020

Our proprietary data reveals how individuals in the U.S. have changed their savings behaviors over the course of the COVID-19 pandemic as business and travel restrictions disrupted our economy. Throughout the summer months, we’ve started to see some very early signs of recovery.

Employers that dialed back matching or discretionary contributions to their retirement plan are reconsidering this decision. Individuals continue to make relatively lower one-time 529 account contributions compared to last year, but they’re also refraining from withdrawing existing savings as they determine what the outlook will be for their beneficiaries’ education plans. The number of debit card transactions from consumer-directed healthcare accounts spiked above projections for the month of July, as individuals tapped into their health savings to access services from their healthcare providers who might have previously experienced business closures or delays in service.


  • Though there was a 5.5% decrease in the total amount of employer contributions in March through July based on projections, this represents a 2 percentage point improvement over June.
  • Positively, 7.0% of employers have returned their plan match to pre-COVID levels.
  • We’ve seen moderate to low employer adoption of CARES Act distribution and loan options relative to early industry projections. However, larger plans (101+ savers), are adopting at a significantly higher rate (40.2%) than the smallest plans with 25 or fewer savers (8.8%).
  • In January through July, only 1.4% of savers stopped their deferrals entirely, and only 2.1% reduced their retirement savings rate.
  • The number of standard retirement account withdrawals has been 22.7% below projections in March through July. In addition to this decrease in standard withdrawals, we’ve also seen lower-than-projected loan activity and low utilization of coronavirus-related distributions (CRDs) and CARES loans. Together, these factors suggest that savers could be using other means to manage financial needs through this period or that they’re delaying otherwise planned retirement or job changes.

Education Savings

  • Notably, average one-time 529 contribution amounts were actually 17.9% higher than 2019 levels in January through February of 2020, with the number of one-time contributions in line with the prior year. Since the COVID-19 pandemic hit the U.S. in March, the cumulative number of one-time contributions is 7.6% lower and the average contribution amount is 5.6% lower than 2019 levels. Historically, a significant amount of these contributions are made near the end of the year, so the annual outlook for one-time 529 contributions won’t be clear for several months.
  • 529 withdrawal activity remained low in July, but it began to approach 2019 levels in the last week of the month. The early weeks of August showed continued increases in withdrawal activity at or slightly above 2019 levels. The next few months, as students begin the 2020-2021 school year, will offer more insight into the annual outlook for 529 withdrawal behavior.

Health and Benefits

  • According to data from Chard Snyder, an Ascensus company, there was a 2.1% increase in the number of COBRA qualifying events March through July, with the most significant increase March through May.
  • In July, debit card activity linked to consumer-directed healthcare accounts (including HSAs, HRAs, and FSAs) was more than 6% above projections, with the number of transactions 6.2% higher and the average amount per transaction 6.8% higher than expected.

View and download the complete State of Savings report here.

Reference last month’s report here. To learn more about available coronavirus relief and the latest regulatory updates, visit