forced saving

Forced saving refers to saving that occurs involuntarily due to restrictions on spending, deferred income, or insurance. It can also involve the transfer of purchasing power from consumers to investors through monetary expansion and a decrease in the value of money.1

Saving, in general, is the process of setting aside income for future use. This can be done through bank deposits, securities, or cash. Factors influencing an individual's saving habits include preferences for future consumption, income expectations, and interest rates. National saving is the difference between national income and consumption and taxes, which equals national investment. Saving is crucial for economic progress as it fuels investment and increases productive capacity.2