Nature v Nurture – Why are Some People Good at Saving?


The concept of saving money has become increasingly fanciful in recent times, particularly with inflation remaining at a far higher rate than earnings in the UK.

The Bank of England (BoE) has sought to rectify this by increasing the base interest rate from 0.25% to 0.75% during the last eight months, but this is yet to have the desired impact on society.

In fact, Nationwide and other banks have confirmed that they will not pass the recent 0.25% rate rise in full to savers.

With this in mind, it’s clear that citizens will need to rely on their own earning and budgeting skills if they’re to save effectively in the current climate. The issue here is that not everyone has the necessary attributes or mindset to save money, and in the article below we’ll ask whether this is a question of nature or nurture?

Nature v Nurture – Why are Some Individuals Naturally Inclined to Save?

Financial education in schools has only recently been made mandatory, while there is also a significant failure to deliver this in UK classrooms.

As a result, basic financial and budgeting skills are certainly not being taught in schools, and this is partially responsible for the gaps of knowledge that currently exist.

Saving money is clearly a learned behavior, however, and one that is based on a fundamental understanding of financial concepts such as budgeting, inflation and interest rate fluctuation. These factors comprise the subject of macroeconomics, which educates students on how they interact as part of the aggregate economy.

With these points in mind, it’s clear that children are most likely to learn positive financial behaviors such as saving from their parents. So, children who grow up in a financially secure household in which parents budget and manage their money efficiently are more likely to save in later life, whereas those who do not will typically display reckless behavior as they grow older.

Similarly, parents that encourage their children to earn money through a paper round rather than collecting pocket money are also more likely to save in the future, primarily because this teaches them the value of money and importance of earned income.

This also creates a more considered approach to spending and borrowing, enabling individuals to make more informed decisions concerning unsecured personal loans and similar products.

The Last Word

While there’s little doubt that nurture prevails over nature when it comes to saving (which explains the importance of mandatory financial education in schools), psychology can also play a role in determining the motivation to save.

After all, saving money is a deceptively simple psychological process, and so-called ‘left-brained’ individuals who are driven by logical thought processes are far more likely to prioritize longer-term gains over short-term pleasure.

This underpins successful saving, and create an extremely effective outlook when combined with positive, learned behaviors.