Thursday, October 22, 2015


Declining Savings rate is a big problem for the world economy since economic growth slows down due to lack of consumption which results low production which further spills over to unemployment. At the end of the road we meet income and wealth inequalities.   This has been the vicious cycle through which we have been going through over the last 7 years from 2008 onwards. Imbalances of savings rate create a vicious cycle over the family and its next generation. . A June survey of 1,015 adults from America Saves, a Consumer Federation of America campaign to promote savings, also affirms that Americans are falling behind with their savings rate. The largest decline was among respondents with household incomes under $25,000.US economy has been highly expressive in its practical application of the theory of Borrow and Spend. We know the dire consequences of the same. Now we need to get into the practice of savings since we have passed a wrong message to the youth as well as to the young generation.  High levels of savings save not only a family but the global economy too.We need to teach the young generation about savings. We need classes in schools for teaching the same.
We have taught them the luxury of life through borrowed living and now we are teaching them pains of the same.  We need child education on savings rates across the globe so that a child in his 5th or 6th standard could get an clear idea about savings rate and also the nightmares of borrowed living. I often find that school children’s are being involved into education of investment planning etc but more than investments I find teaching them about savings is more important. We need to pass the knowledge and experience of bail outs and its dire consequences. We need to train them just like military soldiers so that they are capable enough to face and avoid the hardships of the borrowing game theory. We need to teach these students in class 5 and 6 onwards that life is not a bed of roses. We need to keep in mind that this young generation is tomorrow’s future for the economy of an country or of the globe. Hence we need them to be well trained in these areas where savings and crisis practical details are made public to them. We need a strong young generation and not a weak back bone less society. We need strong mentality based economy which can only take birth when we don’t hide the real life stories from our children’s and teach them form early age about the mistakes we have done or seen over the last decade.

Investment education is being given so that financial product penetration happens more and families become more cautious towards investments and its growth opportunities. But do we ever think that teaching them about savings habit and creating a culture of no borrowed living is the urgent requirement of the time. Child education of savings and living within the means and more on birth of financial crisis should be part of the curriculum.  We need these types of classes so that we can breed a new generation of entrepreneurs or employees who can manage and run the business more firmly taking calculative risk. In order to prevent any global economic crisis and social imbalances we need the young generation well acquainted about the benefits of savings and having high levels of savings. We need classes for teaching the benefits of savings.


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