Saving is the difference between current income and current expenses. If the difference is positive, the economic unit in question can accumulate resources that will allow it to finance the cost of the investments in capital goods or real estate it needs to make, or to acquire financial assets with which to get a return.
From another point of view, saving is the difference between disposable income, that is, the set of resources available to an economic unit to spend, and final consumption expenditure.
To get an idea of what is called saving, it is suitable to focus on a financial year, usually coinciding with a calendar year. An economic unit has, throughout the year, a series of current income, that is, those that have an ordinary and recurring nature, as well as a set of current expenses, which are limited to the year and have a recurring nature.
When judging the sustainability of the economic situation of a family, a company or a government, it is of enormous importance that it has the capacity to save; if current income is not enough to cover current expenses, it is very likely that you will get into a delicate situation.
