Well, sure the economy would shrink, but that is the point. There would be less demand for consumer goods, because preservation implies less consumption.

Imagine a pretend happyland where everyone owned their own home and had a stockpile of 30 years of food. They change their usual work week to take Mondays off and sit comfortably at home. 20% of the economy literally disappears overnight. It isn't obvious that the anyone would be suffering.

The reason the economy shrinking is so terrible is because people generally live hand-to-mouth. If you have enough resources stockpiled to last you the rest of your lifetime, you technically no longer need an economy. It is still nice to have and some resources can't actually be stockpiled (eg, a doctor's time) so I wouldn't advise doing without it, but the economy is mostly important because people don't stockpile resources.

There seems to be a feeling that we should not stockpile resources because the economy is important. That line of thinking is very popular, but imo precisely backwards. Links the right things in the wrong order. Bit of a non-sequiter, but that thinking is why governments and central banks keep printing money.

All this is an interesting but philosophical point. People, in the main, consume everything they have available to them and then work to earn more.

EDIT It is notable that if no-one borrows then by definition no-one can make money by lending money. Again, although this is radical compared to what we do now, it isn't actually obvious what the problem would be. Again, it isn't advised because borrowing money for the purpose of investment is a source of fantastic economic efficiencies. The issue is we all know there is borrowing going on to fund consumption. That isn't a good idea, although the cost is carried by the people responsible so I have no beef with it happening.