American Saving Strategies by Decade: 1920s to 2020s

Tom Kelley Archive / Getty Images

From flappers to social influencers, each decade in America has had its unique financial challenges and opportunities.

Over the last century, economic landscapes have shifted dramatically, and with them, the strategies that Americans have used to save money. Here’s a whirlwind tour of the nation’s saving strategies by decade:

1920s: The Roaring Twenties

• Invest in Stocks on Margin: This decade saw an enormous bull market. Many Americans bought stocks on margin, meaning they borrowed money to purchase them. While this strategy yielded high returns, it was risky and contributed to the 1929 stock market crash.
• Bank Savings Accounts: With a growing urban population and increased wages, many people began keeping their money in banks.
• Frugality from Previous Era: Having come out of World War I and heading towards the Great Depression at the end of the decade, many practices from earlier times, like reusing and repairing items, were still common.
• Homemade Goods: People often made their own clothing, food, and even furniture at home to save money.

1930s: The Great Depression Era

• Hoarding Cash: The stock market crash and subsequent bank failures led many to distrust financial institutions. People stashed cash at home.
• Bartering: With money being tight, Americans returned to the age-old practice of exchanging goods and services without cash.
• Gardening: Many Americans grew “victory gardens” to produce their own vegetables.
• Shared Housing: Multiple generations often lived under one roof to pool resources.

1940s: The War-Time Decade

• War Bonds: To finance World War II, the government sold war bonds. Americans viewed buying these bonds both as a patriotic duty and an investment.
• Frugality: Resources were rationed during the war, leading to a culture of making do and mending.
• Rationing: Goods like gas, meat, and sugar were rationed, leading to frugal consumption.
• Reuse and Recycle: The wartime effort also emphasized repurposing and recycling materials.

1950s: Post-War Prosperity

• Homeownership: With the GI Bill offering low-interest mortgages, many veterans bought homes. Real estate became a popular investment.
• Pensions and Retirement Accounts: As companies grew, they began offering pension plans, and Americans started thinking more about retirement savings.
• DIY Home Projects: The post-war housing boom led to a rise in DIY home maintenance and repair.
• Couponing: As consumer culture grew, using coupons for groceries and household items became more popular.

1960s: Social Changes and Spending

• Mutual Funds: With the stock market becoming more accessible, mutual funds gained popularity, offering diversification to average investors.
• Credit Cards: The introduction of credit cards changed consumer habits. While they offered convenience, they also posed the risk of accumulating debt.
• Bulk Buying: The advent of wholesale club stores allowed consumers to buy in bulk, saving money in the long run.
• Homemade and Handmade: With the rise of the counterculture, there was a renewed interest in making things at home, from clothes to food.

1970s: The Age of Stagflation

• Gold and Precious Metals: With the dollar’s value dropping, many turned to gold and other commodities as a hedge against inflation.
• Real Estate Investment: Despite economic hardships, real estate remained a stable and popular investment option.
• Energy Conservation: The oil crisis encouraged people to save gas and electricity.
• Generic Brands: Supermarkets started offering generic-brand products at lower prices than name brands.

1980s: The Dawn of Consumerism

• Stock Market Boom: Aided by deregulation, the stock market saw substantial growth, attracting many individual investors.
• 401(k) Plans: Introduced in the late ’70s but gaining traction in the ’80s, these employer-sponsored retirement accounts became essential savings tools.
• Refinancing: As interest rates fluctuated, homeowners often refinanced their mortgages to save on interest.

1990s: The Digital Revolution

• Tech Stocks: The dot-com bubble was characterized by a rush to invest in anything internet-related.
• Diversification: As markets became global and interconnected, diversifying investments across sectors and regions became crucial.
• Online Shopping: The rise of the internet allowed consumers to compare prices and find deals online.
• Rewards Programs: Many companies introduced loyalty programs that provided discounts and rewards for frequent purchases.

2000s: Navigating the Downturn

• Real Estate (Before the Crash): Early in the decade, real estate seemed like a can’t-lose investment until the bubble burst in 2007-2008.
• High-Yield Savings Accounts: Post-crash, many turned to these accounts as a safe place to park money and earn interest.
• Coupon Websites: Websites offering digital coupons and discount codes became popular.
• DIY Culture: Websites like YouTube provided tutorials on how to do almost anything yourself, potentially saving on costs.

2010s: The Rise of Passive Income

• Index Funds and ETFs: Lower fees and the appeal of following the broader market led many to choose passive investment strategies.
• Gig Economy: With platforms like Uber and Airbnb, many Americans found new ways to earn and save.
• Subscription Services: For things like streaming, which can sometimes be more cost-effective than traditional cable or buying physical media.
• Budgeting Apps: With the proliferation of smartphones, numerous apps emerged to help people budget and track their expenses.

2020s: Digital Age and Uncertainty

• Cryptocurrency: Despite its volatility, crypto has become a new frontier for investment and savings for some.
• Emergency Funds: The COVID-19 pandemic emphasized the importance of having a rainy-day fund.
• Gig Economy: Many Americans began using gig work platforms to earn extra income.
• Digital Finance Tools: Continued growth in fintech apps and platforms that offer better savings rates, low-fee investing, and financial education.
• Sustainability: Buying quality over quantity, repairing items, and upcycling are part of both a sustainability push and money-saving strategies.

America’s financial journey from the 1920s to the 2020s has been marked by innovation, crises, and changing societal norms. While the tools and strategies may evolve, the desire to save for a better future remains a constant.

Editor's note: This article was produced via automated technology and then fine-tuned and verified for accuracy by a member of GOBankingRates' editorial team.

More From GOBankingRates

• Living Frugally: Adopting Lessons From the Great Depression
• The Average Retirement Age in 2023 in the US vs Canada
• 3 Things You Must Do When Your Savings Reach $50,000
• 7 Ways To Squeeze the Absolute Most Out of an Average Salary

Share This Article: