savings-rate

Vocabulary Word

Definition

Savings rate is the portion of income that is not spent, but saved for future use. You could see it as the portion of your paycheck you don't spend each month, but put into a savings account instead.

Examples in Different Contexts

For personal savings, the 'savings rate' is the portion of personal income that is saved rather than spent on consumption. A personal finance expert might recommend, 'Increasing your personal savings rate is one of the most effective ways to build wealth and ensure financial resilience.'

Practice Scenarios

Creative

Scenario:

Lucas, it looks like your design agency has had a profitable year. It must offer you the opportunity to set some considerable profits aside for reinvestment, doesn't it?

Response:

Yes, we have been conscious about maintaining a high savings-rate. This will allow us to reinvest in new tools and fostering creative collaborations.

Impact

Scenario:

The government is preparing to announce the new annual budget soon. The focus seems to be on boosting national savings and investments.

Response:

That's a positive move, a better national savings-rate will encourage more private investment and foster economic growth.