Saving

Definition

Saving is the act of setting aside income for future use instead of spending it immediately. It involves not consuming all disposable income at once but keeping a portion for later use.

Related terms

Consumption: Consumption refers to spending by individuals or households on final goods and services. It includes purchases such as food, clothing, housing, entertainment activities.

Disposable Income: Disposable income is the amount of money an individual has after taxes have been deducted from their total income. It represents the portion of income available for consumption or saving.

Interest Rates: Interest rates are the cost of borrowing or lending money. They determine how much individuals or businesses are willing to save or borrow. Higher interest rates may incentivize saving, while lower interest rates may encourage borrowing and spending.