Savings rate


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Savings rate

Personal savings as a percentage of disposable personal income.

Savings Rate

The amount a person or organization places in a savings account or similar vehicle as a percentage of total disposable income. Savings are important for long term financial stability as it gives a person or organization a cushion for bad times. The savings rate may be calculated at microeconomic level for personal finances or may be aggregated at the national level to gauge financial health. A low or negative savings rate usually indicates excessive borrowing, spending, or both. On the other hand, a high savings rate may result in slower economic growth as persons and companies are saving instead of purchasing goods and services. See also: Rainy day fund.
References in periodicals archive ?
If the relationship observed between the personal savings rate and the business startup rate from 1977 to 2011 has continued in recent years, what can the available data tell us about the potential rate of business startups in current and future years?
In every year of the 2007-12 period measured (as well as the overall 1980-2012 IMF dataset), nations with high savings rates had significantly higher economic growth.
The idea is to auto enroll employees in the plan at a 10% savings rate for six months to determine if they can handle this financially," she says.
Many other developing countries with spindly social safety nets have low savings rates, while Japan in the 1980s had strong supports and very high savings rates at the same time.
savings rate is negative, meaning that Americans spend more than they earn.
Commerce Department calculates the savings rate as the ratio of personal savings to after-tax disposable income.
While this article focuses on household savings, it is useful to look at how the overall national savings rate has trended.
The latter level was 1% higher than the average savings rate among all United States households in 2001.
Barro and Sala-i-Martin [Economic Growth, 1995] respecify this definition in terms of savings such that the actual savings rate in the economy is greater than the golden rule savings rate.
99 of every $10 they earn, which has plunged the nation's savings rate to one of its lowest levels since the Depression.
America's personal savings rate plummets to record lows," scream the headlines.
The theoretical effects of a change in risk on the savings rate are also ambiguous and depend critically on assumptions regarding preferences.

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