The most basic principle behind working is to garner enough income in order to pay expenses for things such as health, education, clothing, food, and shelter, with anything left over being put aside into savings. The importance of savings is manifold, of which, one of the more important reasons to save is to have money set aside to live upon when one is no longer able to work, or interested in working, or able to find work, or to serve as an augmentation to retirement income, or as a necessary emergency fund to draw upon, should an unexpected situation arrive. In addition, monies saved are often necessary in order to make a down payment on a home, or on a vehicle, as well as in recognition that money saved, makes additional money.
As shown on statista.com, in the 1960s the average personal savings rate throughout that decade was 10.4%, in the 1970s the average personal savings rate throughout that decade was 12.9%, and in the 1980s the average personal savings rate throughout that decade was 11.2%. However, beginning in the 1990s, the average personal savings rate throughout that decade dropped to 8.2%, and then with the beginning of the 21st century, from 2000-2011 there was not a single year in which the savings rate was even at 8.2%, and with the exception of a savings rate of 11% in 2012, in no other year, has this been higher than 6.4%, and the savings rate in 2017 was a very anemic 2.4%.
While there may well be a lot of plausible explanations as to why the savings rate has declined so precipitously, the most obvious explanation is that rich people are very good at saving money, and those that are struggling paycheck to paycheck are not. In addition, never have so many been indebted for so much for vehicle loans, student loans, and credit card loans; and quite obviously those that are indebted have to pay even more additional money for the privilege of having had that credit extended to them.
The decline of the savings rate clearly signifies that the American consumer, is borrowing from the future in order to obtain things of the present, of which, how that will ultimately work out for the American consumer is a tale not yet completely told; but with seventeen years already recorded in the 21st century, what has been demonstrated rather convincingly is that being indebted is truly the flip side of saving money, and those that have no savings, are in a rather poor position, of getting out from under, which apparently is an exceedingly difficult task to accomplish.
The lack of savings is creating a bifurcated America, in which, the few own the bulk of the assets and capital, while a significant amount of Americans, have little or nothing; and the little that they do earn, and the little that they do own, is exploited by those that make the rules, and by those that write the laws, and by those that charge the highest interest rates and provide the worst deals to the very people that have not the capacity to negotiate anything better, because that essentially is the only deal available for them in town.
A nation that has a population that does not save, especially in a nation that is the richest nation the world has ever known, clearly demonstrates that income inequality is at levels so high, that something tragically bad such as the Great Depression could very well be repeated in the near future, all over again.