Saving – additional information
The saving rate is defined as the ratio of money saved by individuals or families to their disposable income (income after taxes). The value of money put aside depends on a number of factors such as employment conditions, inflation, interest rates and the general state of the economy.
In 2007, the personal saving rate in the United States amounted to three percent and increased to 6.4 percent in 2008, following the outbreak of the global financial crisis. The value of personal savings in the United States increased from 296.5 billion U.S. dollars in 2007, before the crisis, to 662.7 billion U.S. dollars in 2008. In 2015, it amounted to 739.3 billion U.S. dollars.
There are various reasons behind saving. In the short term, money is usually put aside for current expenses or purchases. In the long term, the main reason behind saving might be buying a house, saving for college or saving for retirement. In 2013, 53 percent of U.S. families stated that they were saving money.
Some households decide to invest saved money in various financial instruments such as mutual funds, savings bonds or equities. In 2013, 81 percent of American households invested in mutual funds through inside employer-sponsored retirement plans.