The FRED^® Blog

The takeaway

The Fed’s monetary aggregates measure the amount of money in the economy. One such measure is M2, which includes liquid assets such as checking accounts but excludes non-liquid assets such as individual retirement accounts.

What is M2?

M2 measures how much money is readily available in the economy. That is, funds easily converted to cash. As of June 2026, M2 amounted to $23 trillion.

Our FRED graph above shows the components of M2:

• M1 in blue, which itself includes cash and checking and savings accounts
• Small-denomination time deposits in green
• Retail money market funds in brown
• The total value of individual retirement account (IRA) and Keogh retirement account balances, in purple, is subtracted from this measure. These funds carry large penalties for preretirement withdrawals and, therefore, aren’t considered liquid.

Recent changes

Surveys by the Board of Governors of the Federal Reserve System in recent years show that a growing share of IRA and Keogh balances held at depository institutions now sit in savings and checking-type accounts, rather than in small-denomination time deposits or in retail money market funds.

Starting July 28, 2026, these IRA and Keogh balances have been subtracted from the total value of M2, rather than from the individual values of the small-denomination time deposits and retail money market funds. This had almost no impact on the total value of M2, but it did result in the recalculation of those two components.

Graph these changes

ALFRED stores vintages of FRED data and allows you to see the historical values of both small-denomination time deposits and retail money market funds before and after this reporting changes. Both data series now show higher values.

More details

M2 data come from the Fed’s H.6 statistical release, Money Stock Measures, published weekly by the Federal Reserve Board. Keep up with their announcements here.

What about that orange area in the graph? It shows saving deposits. As of April 2020, this component was reclassified from a category of M2 into M1, so our graph doesn’t show the value past that date. Learn more about this regulatory change here.

How this graph was created: Search FRED for “M1.” Click the “Edit Graph” button and select the “Add Line” tab to search for “Small-Denomination Time Deposits: Total.” Don’t forget to click “Add data series.” Repeat this last step to search for and add the other two series: “Retail Money Market Funds” and “IRA and Keogh Accounts: Total.” Next, use the “Select Area” dropdown menu to customize “Line 4 – IRA and Keogh Accounts” by typing the formula -a and clicking on “Apply Formula.” Last, select the “Format” panel to pick “Graph type: Area” and “Stacking: Normal.”

Suggested by Maria Arias and Diego Mendez-Carbajo.

The takeaway

The New York Fed’s consumer credit dataset is now calculated with a different methodology—one that includes 33 million more borrowers than before.

The Consumer Credit Panel

With a data update on August 10, 2026, the New York Fed has changed the way it measures subprime credit risk in their Consumer Credit Panel, moving from the old/discontinued methodology of Equifax Risk Score 3.0 to the new methodology of Vantage Score 4.0.

Our FRED map above shows, for each U.S. county, the percent of the resident population with a credit score below 660 in Q4 of 2025—again, with data from the revised version of their Consumer Credit Panel.

The New York Fed advises users to “exercise caution when comparing credit score distribution changes from 2025:Q4 to 2026:Q1, as differences may reflect the change in scoring model rather than changes in borrower credit quality.”

Comparing the old and new measures

We can use our archival ALFRED database to compare the data vintages of the new Vantage Score 4.0 methodology with the vintages of the old/discontinued Equifax Risk Score 3.0 methodology. The graph shows the data for New York County (i.e., Manhattan). Clearly, these percentages are substantially higher now than they had been. For example, the current subprime share of 30.27% (green line, for Q4 2025) had been 17.72% (blue line, for Q4 2025) before the methodology was revised.

What changed, exactly?

Vantage Score 4.0 is a credit-scoring model that uses a broader set of personal finance information details than the Equifax Risk Score 3.0 it replaced. By casting a broader scoring net, 33 million additional borrowers that previously were unscored are now factored into the calculations of subprime lenders as a fraction of overall populations. And, in a fraction, when the numerator rises more than the denominator, the resulting ratio rises.

Read more from the New York Fed about this switch in methodology and its potential implications for analysts and researchers.

How the FRED map and ALFRED graphs were created: For the map, search FRED for and select “Equifax Subprime Credit Population for New York County, NY.” Click on “View Map” and select the date “2025-10-01.” For the graph: Search ALFRED for and select “Equifax Subprime Credit Population for New York County, NY.” Click on “Edit Graph” and select the “Format” tab. Use the dropdown menu to select “Graph Type: Line.” Last, adjust the date range by clicking on the “Max” option above the graph canvas.

Suggested by Diego Mendez-Carbajo.

The takeaway

Measures of household financial well-being don’t always align with consumer sentiment. You can feel relatively secure about your finances while still being pessimistic about the overall economy.

Are you doing OK?

In an earlier post, we described a measure of household financial well-being from the Federal Reserve Board’s Survey of Household Economics and Decisionmaking (SHED). In this post, we add a way to measure households’ view of the economy: the University of Michigan’s Index of Consumer Sentiment.

Our FRED graph above tracks, side by side, the share of adults who say they’re “doing okay financially” from the SHED and the index values of consumer sentiment from the University of Michigan.

Before the COVID-19 pandemic, these two measures moved in the same direction. The share of adults doing at least okay financially increased, while consumer sentiment was also relatively high. The story looks different after the pandemic. Consumer sentiment fell sharply and remains low: Its value averaged 95.9 in 2019 and was 71.7 in January 2025. The share of adults saying they’re doing at least okay, though, has remained relatively high: It was 75% in 2019 and it was 73% in 2025.

There seems to be a disconnect. Most respondents continue to report financial stability while overall consumer sentiment is much more pessimistic than it was before the pandemic.

Are you worse off today?

The SHED also asks a more specific question: Are you worse off financially than you were 12 months ago?

Our second FRED graph, above, compares this measure with the same Michigan Consumer Sentiment Index. (We plot 100 minus the percentage so that an increase in one series is consistent with a increase in the other.)

Here, the two measures tell a more similar story. Before the pandemic, the share of adults reporting they were not worse off than they were a year earlier was increasing. After the pandemic, that share dropped sharply and has remained low. Measured this way, households’ assessments of their own finances are more consistent with the decline in overall consumer sentiment.

The difference between the two SHED measures may partly reflect what each question is asking. Saying you’re doing okay financially describes your current financial position. Saying you’re worse off than a year ago describes how that position has changed. It’s not hard to imagine a household reporting both these things at the same time.

It’s also possible that financial experiences have become more uneven across households, with some households doing relatively well while others have seen their financial situations deteriorate, consistent with the divergence of the two SHED measures.

And there’s another possibility. People may feel relatively secure about their own finances while still being pessimistic about the economy overall. The SHED explicitly asks about respondents’ own financial situations. The Michigan index is broader, incorporating views about personal finances, business conditions, and buying conditions. That leaves room for a disconnect between how people assess their own circumstances and how they assess economic conditions more generally.

The graphs don’t tell us exactly what’s driving the difference, but they show people’s assessments of their own finances can look quite different from their assessments of the broader economy.

How the graphs were created:
For the first graph, search FRED for and select “Survey of Household Economics and Decisionmaking: At Least Doing Okay Financially: All Adults” (series ID ATLEASTDOINGOKAYFINANCIAL). Click “Edit Graph,” click “Add Line,”  and search for and select “University of Michigan: Consumer Sentiment” (series ID UMCSENT). Click “Add Data Series.” Next, select the University of Michigan series under “Edit Lines” and open the “Format” tab. Set its y-axis position to “Right.” Set this graph to begin on January 1, 2013. and end on January 1, 2025, corresponding to the first and last years, respectively, available for this SHED measure.
For the second graph, repeat the same steps, replacing the first SHED series with “Survey of Household Economics and Decisionmaking: Worse Off Financially Than 12 Months Ago: All Adults” (series ID WORSEOFFFINANCIALLYALLADU). For this series, enter 100-a in the formula field. Again, add UMCSENT as the second line and place it on the right y-axis. Set this graph to begin on January 1, 2014, and end on January 1, 2025, corresponding to the first and last years, respectively, available for this SHED measure.

Suggested by Victoria Gregory.