# Travel >> Destinations >> United States

Understanding US National Savings: Definition and Significance

National Saving is a fundamental macroeconomic measure representing the portion of a nation's output not consumed by households or government. For the United States, it is calculated as:

The Core Identity

National Saving (S) = Gross National Product (GNP) – Gross National Consumption (GNC)

GNP: Total income earned by US residents (individuals & corporations) from domestic production plus net income from abroad (investments, wages, profits).
GNC: Total spending on final goods/services by US households and government, regardless of where produced (includes imports).

Interpretation

S > 0 (Positive): The nation is a net saver/investor. Resources are available for domestic capital formation (factories, R&D, infrastructure) or net lending to foreigners (current account surplus).
S < 0 (Negative): The nation is a net borrower (dissaving). Domestic consumption + government spending exceed national income. Financed by foreign capital inflows (current account deficit). The US has run negative national saving for most years since the early 2000s.

Components (Flow of Funds)

National Saving = Private Saving (Household + Corporate) + Government Saving (Tax Revenue – Spending – Transfers).
US dynamics: High household dissaving (low personal saving rate) + large federal deficits = negative total national saving, offset by corporate retained earnings (often held offshore).