Saving money saves the world
You might wonder whether such discipline and financial prudence is a selfish pursuit, especially considering the current state of our planet: a rapidly changing climate, dwindling water supply, and an influx of refugees at our borders. Perhaps it would be better to use our resources to aid those in need rather than only focus on our financial security.
In fact, the truth is quite the opposite. Savers, far from being perceived as frugal and unsociable penny-pinchers, are actually the key to driving economic growth and improving living standards.
This concept is demonstrated in the modified Harrod-Domar model of economic growth, a virtuous cycle that emphasizes the interdependence of saving, investment, and consumption.
The Harrod-Domar model of economic growth
Simply put, saving leads to investment, which in turn increases productivity and output capacity. As productivity and output capacity increase, workers become more valuable, which leads to higher wages and more consumption. This ultimately results in higher economic growth, as seen by the sustained economic improvement since the post-WWII economic boom of the 1950s.
As such, savers are not just securing their own financial future, but also contributing to the prosperity of society at large. By investing their money, they are fueling economic growth and promoting the well-being of future generations.
Share of the world population living in poverty
Source: Our World in Data