Mary: I’m Mary Walden with economist MW, welcoming you to the economic perspective. Today’s program looks at the comeback of saving. Mike, for many decades Americans had a reputation for not saving. Indeed, there were some years not that long ago where the personal savings rate was zero. Have we changed our ways when it comes to saving?
Mike: Summary Answer
- Indeed we have
- The personal savings rate has steadily risen since the Great Recession and now stands at 8%, the highest level in over 30 years
- Several reasons for this
- Great Recession scared people – still reacting
- Housing crash in Great Recession – broke long held belief that housing values always increase – many counted on house value for savings
- Age – evidence shows saving rates rise with age until reach around 60 – and we are an aging society
- Most economists consider more savings to be a good thing – will it last?
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.