Savings the stepping stone for Self-Reliance

R.Jayachandran

Social Development

Management Consultant,

Chennai

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.

Purposes of Savings

The purposes of savings are different by the type of savers.

Individuals save for their future

Corporate organizations save for meeting the expenses of repairs and maintenance and replacement of machineries and tools

Government saves for the infrastructural development.

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)

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.

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.

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

Savings vis-à-vis Debt and our mind set

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

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.