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Comment by yareal | Hacker News Reader

> There is nothing about savings that implies they must be liquid.

Here are several examples that disagree. Yes, in a strict Keynesian economic sense it is saving but saving is different from savings, despite the similarity in the two words. (Yes, you are right, this is confusing.)

Examples defining "savings" in personal finance:

https://www.investopedia.com/terms/s/savings.asp

"Savings is essentially cash"

https://www.britannica.com/money/saving

"Saving may take the form of increases in bank deposits, purchases of securities, or increased cash holdings."

https://en.m.wikipedia.org/wiki/Saving

"In terms of personal finance, saving generally specifies low-risk preservation of money, as in a deposit account, versus investment, wherein risk is a lot higher."

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> Here are several examples that disagree.

Disagree with what? I fail to see the difference from definition two.

It does not match definition one, of course, but that had to exist in an effort to be fair to the original commenter. It is not like you are going to go in like a horribly confused idiot and randomly redefine tillage or something. If the OP is using savings in the sense of the positive net value of a home, rationally one will be accommodating to that.

But it doesn't really matter what definition you choose. The math doesn't add up to what was presented under any definition.

The original poster is correct, the majority of Americans live paycheck to paycheck. With no savings (in the personal finance sense).

Example: https://www.forbes.com/advisor/banking/living-paycheck-to-pa...

What's challenging for you about these numbers? Your original response included mortgages in saving, which is atypical. If you exclude mortgages, which is typical, do the numbers make more sense?

> It is not like you are going to go in like a horribly confused idiot and randomly redefine tillage or something.

Try to remain on topic and avoid ad hominem, please.

> The original poster is correct

Seemingly not, else we'd have seen the math already. Also,

1. Not having savings (in the personal finance sense) does not mean one is living paycheque to paycheque.

2. The article you link to defines living paycheck to paycheck as a scenario where the family income does not cover expenses. Principal repayment is not an expense. Outside of the 1-2% with interest-only mortgages, anyone who is paying a mortgage cannot be living paycheck to paycheck under the definition you have given. They must have surpluses over and above expenses in order to do so.

Again, the math does seem to work in that sense if you include children. But is there some reason we should be aware of newborns not making enough money to save?

> Try to remain on topic and avoid ad hominem, please.

1. It is on-topic. It explains why multiple definitions are present.

2. Ad homiem implies being directed at a person. The statement is not directed at a person.

> Principal repayment is not an expense.

In the links I posted several comments above, you'll find that it is considered an expense for the purposes of personal savings.

I don't disagree with your definition, btw, it's just not the common one.

What are you referring to specifically? I only noticed one bit that suggested that a loan payment is an expense, but:

1. It does not make clear what the payment is. If it is only to pay the interest portion of the loan, there is little question that it is an expense. That would be outside of the topic of principal repayment, though.

2. If we assume there is a principal portion included in the payment, it is said only with respect to student loans. The product of a student loan retains no value – literally worthless the moment you drive it off the lot. As such, it is not unreasonable to consider the principal an expense. There truly is nothing left. A house, not so much. Unless the house has lost value (an atypical situation), you didn't give up anything.

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