There has been a lot of conversation about the excess savings that consumers built up during the pandemic, but not a ton about the savings "burn rate" by income level. From what I've read, it seems pretty clear that most of these savings were accumulated by higher income households, and that lower income households have already spent mos…
There has been a lot of conversation about the excess savings that consumers built up during the pandemic, but not a ton about the savings "burn rate" by income level. From what I've read, it seems pretty clear that most of these savings were accumulated by higher income households, and that lower income households have already spent most of this excess (which makes sense given their MPC is higher).
How does this play out across higher income households (ie, if/when do their excess savings dry up)?
At what point do people stop thinking about the excess savings as "excess"?
Do recession expectations push consumers to hold more savings across all brackets?
There has been a lot of conversation about the excess savings that consumers built up during the pandemic, but not a ton about the savings "burn rate" by income level. From what I've read, it seems pretty clear that most of these savings were accumulated by higher income households, and that lower income households have already spent most of this excess (which makes sense given their MPC is higher).
How does this play out across higher income households (ie, if/when do their excess savings dry up)?
At what point do people stop thinking about the excess savings as "excess"?
Do recession expectations push consumers to hold more savings across all brackets?