Critical Analysis Of 'The Bias Against Saving' By Buttonwood

When growing up, I heard over and over from my parents to save my money. Most times this was encouraged in order to ensure that I wait to spend my money when I needed it. Although this was a main concept that I heard while growing up, it seems as though in today and age, saving is not the right way to go. There are many opinions about the idea of people saving their . The economist illustrates their opinion in the article “The Bias against saving” by Buttonwood. In this article, the main idea is the thought that individuals should be saving because those savings are needed to spread among other places in the economy. When trying to explain the idea illustrated in this article, Buttonwood starts off by stating some negative results that are

This means that in order to positively affect the economy, there must be savings because those savings are used for investment. For example, a person may put their money into savings and then that money is used for further investment like employment. Bouncing off of the idea that savings is needed for investment, the article states the idea that savings pots are needed in order for a person to see them through retirement. Buttonwood states “governments offer tax breaks to pension savings to encourage this process” (“The Bias against Saving”). Although this idea seems to be the opposite of the first idea that I stated, the article gives a great analogy that clearly explains their opinion of

This statement explains the thought that savings can positively affect the economy if it is spread around the population and is not just lumped in a few places. This article clearly states their opinions that saving is something that should be encouraged. The research shows that “households are not to blame for a saving glut; the savings rate hovered around 10% of income from the 1960s to the early 1980s and is now half that level” (“The Bias against