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The importance of savings for the common people has been explained here

Published in: Economy & Finance
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  1. 1. Savingsthe stepping stone for Self-RelianceR.JayachandranSocial DevelopmentManagement Consultant,Chennai
  2. 2. Savings Setting aside a portion of current income is called as Savings Savings is a conscious decision made for the requirements of future Savings is made by individuals, corporates and Government.
  3. 3. Purposes of SavingsThe purposes of savings are different by the type of savers.Individuals save for their futureCorporate organizations save for meeting the expenses of repairsand maintenance and replacement of machineries and toolsGovernment saves for the infrastructural development.
  4. 4. Individual and Household Savings Savings is the starting point of the individual economic improvement plan Savings is an acknowledgement of an individual taking responsibility for self and dependents Habit of regular savings results in economic confidence and gradual decrease on the higher dependence on others(people, institutions and subsidy schemes)
  5. 5. Savings-a reliable Safety net It is both for Planned(education, marriage) and Unplanned (health, death) expenditures A handful save for retirement In both the cases, Savings provides a safety net and thereby the much needed economic security for the households.
  6. 6. Savings- the lever for Progress Regular Savings serves as a Wealth building tool (pooled money used for acquiring productive assets, redeeming assets) More money is needed to keep the same standard of life in view of the ever escalating inflation and its repercussion on essential commodities and services. Regular Savings , in the long run helps to increase the standard of living (increased purchasing capacity arising out of the productive use of accumulated savings) Regular Savings helps the household to get relived from the debt trap.
  7. 7. Savings-the trends The pattern of Savings is diversifying from traditional investment in to Gold to Savings in Banks, Post Offices, Insurance and Mutual Funds The regular Savings is turning out to be a gateway for institutional credit
  8. 8. Savings vis-à-vis Debt and our mindset Lack of habit of regular savings is one of the prime reasons for debt-trap of common people Waiting for ever evasive ‘’more income’’, to start saving money is the impediment
  9. 9. The positive Action for Savings Set aside at least ten percent of the current income as savings Gradually start increasing this percentage Save money to build the economic confidence, security and self-reliance.