Savings: a perspective based on three fundamental pillars

November 2024 by Mario Pires

Saving is an essential driver for financial stability and economic growth in any country, as it represents not only the accumulation of resources, but also the construction of a more resilient and prosperous future. However, the responsibility for saving should not fall solely on the individual, as it is the collaboration of all sectors that truly maximizes its potential. 
For savings to be effective and sustainable, it is essential that they are promoted and encouraged in a coordinated manner between the state, companies and citizens. Each of these three pillars plays a unique and essential role, but it is by working together that they can create a virtuous cycle of savings and sustainable growth, ensuring a positive and lasting impact on the collective well-being and economic strength of the country. When each sector contributes to a healthy savings environment, the result is a more robust economy, capable of responding to challenges and offering better living conditions to all citizens.

The State

The State is the first pillar and plays a decisive role in creating an economic environment that favors growth and savings. Its action goes beyond simply reducing expenses, focusing on managing resources efficiently and channeling them into strategic areas such as infrastructure, health, education and technology. These investments not only improve people's quality of life, but also boost business growth and increase productivity. Reducing the tax burden on companies and families, for example, is a measure that can promote investment and consumption, generating more tax revenue and encouraging long-term savings. At the same time, careful management of public resources and a fiscal policy that avoids deficits create a stable and predictable economic environment that encourages both companies and citizens to save and invest.

Companies

Companies represent the second pillar and are crucial in transforming the conditions provided by the state into real and sustainable economic growth. To do this, they must maximize productivity and efficiency, taking advantage of tax incentives to optimize processes and invest in their employees. Companies that invest in advanced technologies such as automation are able to reduce costs and increase competitiveness, which is vital for sustained growth. Furthermore, investing in the development of human capital becomes essential: by investing in ongoing employee training, companies not only increase productivity but also prepare workers to respond to the challenges of a constantly changing market. This increase in workers’ financial security boosts their savings capacity, reinforcing the economic growth cycle.

Citizens

The third pillar is citizens, whose savings are vital to the financial solidity of an economy. The success of individual savings depends, to a large extent, on financial knowledge and adequate incentives. Introducing financial education in schools is an important step towards enabling future generations to manage their resources intelligently and to understand the principles of saving and investing. In addition, incentives such as tax deductions on savings and pension plans promote conscious financial choices, encouraging consistent savings habits. This combination of financial literacy and adjusted fiscal stimuli allows citizens to contribute to economic stability in a more significant way, strengthening the financial system and mitigating the impact of economic crises.
When we look at savings through the three pillars – the state, companies and citizens – it becomes clear that this is a central pillar not only for economic growth, but also for lasting financial stability. When each of these sectors assumes its responsibility and acts in a coordinated manner, the economy becomes more resilient, capable of facing crises and promoting sustainable progress. Saving, then, transcends individual responsibility and becomes a collective mission, an essential goal for economic and social development. In a world where challenges are growing and opportunities are scarce, only a joint commitment to savings will allow us to build a more prosperous, inclusive and future-ready society.