Growth rate g = APS ÷ v at your capital–output ratio. The marked row is your saving rate.
Saving rate
APS
Growth rate g
5%
0.050
1.25%
10%
0.100
2.50%
15%
0.150
3.75%
16.0%
0.160
4.00%
◀ yours
20%
0.200
5.00%
25%
0.250
6.25%
30%
0.300
7.50%
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What it calculates: Average propensity to save (APS), Saving rate, Average propensity to consume (APC), Saving.
Updated 22 September 2026 · Transparent assumptions
Saving $8,000 of a $50,000 income is an APS of 0.16 — a 16% saving rate
The average propensity to save is saving divided by income over the same period. A household that takes home $50,000 and saves $8,000 has an APS of 8,000 ÷ 50,000 = 0.16, which is the same thing as a saving rate of 16%. Because every dollar of income is either spent or saved, the APS is also 1 − APC: the same household spends $42,000, an APC of 0.84.
APS = S ÷ Y = 1 − APC
Saving here means income not spent, whatever happens to it afterwards — paying down a loan counts, and so does money left in a current account. It is a flow over the period, not the balance of a savings account.
Worked example
S = $8,000 and Y = $50,000
APS = 8,000 ÷ 50,000
APS = 0.16
(a saving rate of 16%)
The US personal saving rate was 3.0% in July 2026: an APS of 0.030
The Bureau of Economic Analysis measures the economy-wide APS every month as the personal saving rate: personal saving divided by disposable personal income. It read 3.0% in July 2026, 4.3% in December 2024 and 6.2% in December 2019. The pandemic pushed it to a record 31.8% in April 2020, when spending collapsed while incomes were propped up by transfers; its lowest reading was 1.4% in July 2005.
BEA computes personal saving as disposable income minus all personal outlays — consumption spending plus interest payments plus transfer payments — so the published rate is slightly smaller than one minus consumption over income. The calculator’s APS uses the saving figure you give it, so it matches the official definition if you enter saving as income minus all outlays.
Higher incomes save a larger share, because the fixed part of spending shrinks against them
In cross-section data the APS rises with income. The linear saving function S = −a + (1 − b)Y shows why: the intercept −a is spending that happens even at zero income, and as income grows it matters less, so the APS climbs toward the marginal propensity to save. With a = $8,000 and an MPS of 0.32, the APS is −0.08 on $20,000, 0.16 on $50,000 and 0.24 on $100,000.
APS = (1 − b) − a ÷ Y
The long-run national saving rate does not rise with average income in the same way, which was the puzzle Simon Kuznets documented and Milton Friedman and Franco Modigliani set out to explain. Households save against their expected lifetime income, not only against this year’s, so a temporary rise in income is mostly saved and a permanent one is mostly spent.
At an APS of 0.16 and a capital–output ratio of 4, Harrod–Domar growth is 4% a year
The Harrod–Domar growth model gives the average saving ratio a role no other page on this site does. If every dollar saved is invested, and each unit of yearly output needs v units of capital, output grows at g = s ÷ v. A saving ratio of 0.16 with v = 4 gives 4% a year; raise saving to 0.24 and growth rises to 6%.
g = s ÷ v
The model was built for post-war development planning and its limits are well known — it ignores technical progress, depreciation and population growth, and treats the capital–output ratio as fixed — but it states cleanly why the saving rate appears in growth arguments at all. The calculator’s growth output is that one division, labelled as an illustration.
Growth from saving
s = 0.16 and v = 4
g = 0.16 ÷ 4
g = 0.04 = 4% a year
When everyone tries to save more at once, total saving need not rise
One household can raise its APS by spending less. An economy cannot always do the same, because one household’s spending is another’s income. If every household tries to save more while businesses keep investment unchanged, spending falls, incomes fall, and at the new equilibrium total saving is back where it started — equal to investment — at a lower income. Keynes called this the paradox of thrift.
The paradox needs idle capacity and fixed investment to hold. When extra saving lowers interest rates and raises investment, or when the economy is at full employment, higher saving can raise the capital stock instead. The savings function calculator works the paradox through with numbers.
Three mix-ups between the APS, the MPS and savings balances
The same word, saving, names several different quantities.
Using a savings-account balance as saving. The APS uses saving over a period — the flow — not the stock accumulated from earlier years.
Using the APS in a multiplier. The multiplier depends on the share of extra income saved, the MPS, not the average share.
Ignoring dissaving. A negative APS is a real result: the household spent more than its income and ran down wealth or borrowed.
Frequently Asked Questions
Is the average propensity to save the same as the saving rate?
Yes, up to units: the APS is a fraction and the saving rate is the same number as a percentage. An APS of 0.16 is a saving rate of 16%.
Can the APS be negative?
Yes. When consumption exceeds disposable income, saving is negative and so is the APS. The household is financing spending from past savings, borrowing or asset sales.
How do APS and MPS differ?
The APS is total saving divided by total income. The MPS is the change in saving divided by the change in income — the share of an extra dollar saved. With a linear saving function the APS rises toward the MPS as income grows.
Why is the APS 1 − APC?
Because disposable income is either spent or saved: Y = C + S. Dividing by Y gives 1 = APC + APS.
Sources & References
Figures on this page are checked against primary, authoritative sources. Links open in a new tab.
Results are estimates for planning and analysis based on the figures you enter. They are not accounting, tax, or financial advice — verify with your own records and a qualified professional before making decisions.
Sudha, J. (2026, September 22). Average Propensity to Save Calculator. Calculator Matters. https://calculatormatters.com/economics/average-propensity-to-save-calculator/
MLA
Sudha, Jay. "Average Propensity to Save Calculator." Calculator Matters, 22 Sept. 2026, https://calculatormatters.com/economics/average-propensity-to-save-calculator/.