- Personal Finance
How does the United States Savings Rate Compare to Other Countries?
Here in the United States we here a lot about the national savings rate. For a few years it was actually negative, meaning that people were spending more than they earned and saving nothing. Once the recession hit in 2008, Americans finally began saving again and by the end of 2008, the news was reporting a national savings rate of over 3%. This is wonderful news, but it really made me curious how Americans compare to other countries. So I did some research, which turned out to be easier said than done, due to conflicting information. I will share with you what I found.
I was surprised to find out that the US was not the only country with a negative savings rate. Norway, Finland and Denmark were all spending more than they earned. Just how much more is debatable though. I searched many sources for all the information I am sharing here, however so much of it was conflicting regarding the exact rate, but everywhere I looked stated a negative savings rate in recent years. So Americans aren't the only ones that do not live within their means.
Most of the other countries I found information on had higher personal savings rates than the United States. Some countries saved much more of their incomes than we do. China seems to save the largest percentage of their take home pay; with most sites I found stating that the Chinese save almost 50% of their pay. I found that shocking and after searching more I found a couple of other sites that said a more realistic number was 24%. No matter which one is correct, the US is far behind those statistics.
France, Germany and Spain seem to be doing things exactly right, saving the recommended 10% of your income. Sweden's personal savings rate was around 8%. I found conflicting reports for Japan as well, some sites stating the Japanese save only 2.6% of their income, while others stating they save 20%. Confusing to say the least. I imagine it is somewhere in the middle, which is still better than the US. Italy seems to save around 6% of their pay, double the US. Canada, Australia and Korea all came in around 2%.
I found this information very interesting. I wonder why the Chinese can save so much more than the Americans. I also wonder how cost of living compares in these different countries. Of course I also wonder how other countries do it, because while we do save each month, we don't come close to the 10% mark. I hope that in the United States people continue to save money, hopefully getting closer to the 10% mark. I know that if more people had been saving money all these years, then the recession and resulting higher unemployment rates would have a smaller effect on us.