SAVE? WHAT DOES IT MEAN?
Tomorrow starts America Saves Week. So, let’s examine America Saves Week starting with the word save or saves.
Imagine you are a young child. What would the word ‘save’ mean to you? If asked to choose one of the following answers to define the word ‘save,’ which do you predict a child would select?
b. Store up, accumulate, build wealth and save
c. Spend less and save
d. ‘B’ and ‘C’ above
e. Something else, like protect the lead in a game; keep an opponent from scoring, or retain data on a computer or mobile device
We believe there is a strong likelihood a young child would choose definition “a” – rescue. It seems reasonable there is a greater probability they would have been exposed to the word save more frequently in this context than in the other definitions. Why? Rescue themes are common and constant in children storybooks and movies. The Black Panther saves Wakanda and the world. The Avengers save New York. Wonder Woman saves Army pilot Steve Trevor.
Now, let’s try this. Define the word ‘save’ or ‘saves’ as used in the title: AMERICA SAVES WEEK. We now have more context, yet the meaning of save is still murky, isn’t it? Even if it was named America Saves Money Week there would still be ambiguity, regardless if you are a child or an adult.
Although we would now know the saving being advocated relates to money, there is still a problem. I call it – the ‘save deposit’ – ‘save spend’ conundrum.
Like many words in English, the word ‘save’ has multiple meanings. Given, this initiative pertains to the United States, the number one consumer market in the world, and is sponsored by the Consumer Federation of America, it is not unreasonable to expect the campaign to chiefly champion smarter spending and come with coupons.
If you check the home page of the website AmericaSavesWeek.org you will not find coupons, but you will find the following sentence in the section ABOUT AMERICA SAVES WEEK:
America Saves Week brings together diverse nonprofit, government, academic, and business groups to encourage and support Americans to save effectively.
By itself, this sentence is still not clear enough to accurately determine the nature of the saving campaign. Search the home page further and you find this statement in the section AMERICA SAVES WEEK:
Started in 2007, the Week is an annual opportunity for organizations to promote good savings behavior and a chance for individuals to assess their own saving status.
If you were grading a standardized test and a child had answered “a – rescue” to either of the questions above, at this point, you could not, without a doubt, mark that answer incorrect, could you?
Language is complex and can even be confusing at times. This is especially true when it comes to saving and money.
Fortunately, if you take a deeper dive into the America Saves Week website, and I encourage you to do so, you will discover the campaign’s emphasis is on building wealth and security. The main website for America Saves also confirms this interpretation.
I pledge to save money, reduce debt, and build wealth over time. I will encourage my family and friends to do the same.
DANGEROUS and DIABOLICAL
What makes the word save as it pertains to money dangerous and diabolical, is it can be correctly used to advocate for behaviors that are diametrically opposed to one’s financial well-being. Yes, it is sales genius and consumer perfection that one can spend less, save money and add absolutely nothing, zero to their savings or investment accounts. But, for kids and many adults, a lack of clarity about what form of saving money is being advocated, why saving (i.e. depositing, building wealth) should be prioritized, how it develops ones character, builds ones future and protects ones current well-being is a recipe for disaster. It can easily lead to overspending on a wide variety of goods and services, even some perceived as beneficial, like say college for example.
To develop a deeper appreciation of the ‘save deposit’ – ‘save spend’ conundrum watch this PBS News Hour segment on personal finance: All the financial advice you'll ever need fits on a single index card.
Rule 1 is to save 10 to 20 percent of your income. To do this, according to the reporter, you must “slash your spending.” This rule is not about ‘save spending.’ It is about ‘save depositing’, building wealth. To do this, you want to make saving a priority, or what some personal finance experts call pay yourself first. A great way to accomplish this is by joining an automatic saving and investment program, just like the America Saves campaign recommends.
They are not alone in this recommendation. Warren Buffett says it this way: “Do not save what is left after spending. Spend what is left after saving.”
Sammy Rabbit says: “Make saving a habit, make it automatic.”