More Americans shift money from checking and savings to accounts with investment income, study says

WASHINGTON AP New research finds that more Americans are shifting their money from checking and savings accounts into financial vehicles that pay an funding income a trend that helps to explain the resilience of the U S business sector after a bout of high inflation and latest uncertainty due to tariffs The analysis by JPMorganChase Institute examined the accounts of million households and determined that people s total cash reserves are increasing when including new amounts going into brokerage accounts money domain funds and certificates of deposit to assess people s well-being Inflation-adjusted cash balances in checking and savings accounts remain low with a flat-growth trajectory but since the middle of total cash reserves have been increasing and approaching historical improvement trends once the additional accounts are included the analysis reported Families across several income bands are now seeing a turnaround in their total cash disclosed Chris Wheat president of the institute Wheat noted it had been hard to square the circle of consumer spending staying strong despite the lack of improvement in checking and savings accounts an issue that can now be explained by people in a higher-interest rate conditions shifting more money into accounts that yield funding returns He stated people appear to be using the other accounts to manage their cash rather than totally making long-term investments Wheat cautioned however that the trend might be short term and that the institute doesn t have a basis yet as to whether it will continue The analysis also revealed that households with incomes generally lower than had their total cash balances increase at an annual rate of to The lowest income quartile tend to have checking and savings account balance of just over while the median balances of the highest income quartile are above