ing of which many
persons that are really spending all their incomes are very proud.
Such forms are: planning to buy a particular thing and then deciding
not to do so, but buying something else; finding the price less than
was expected, and thereupon using this so-called saving for another
purpose; spending less than some one else for a particular purpose,
such as food, but off-setting this by larger outlay for another
purpose, such as clothing; spending all one's own income but less
than some one else with a larger income. We may define saving as the
conversion, into expenditure for consumptive use, of less than one's
net income within a given income period.

Saving goes on in a natural economy both by accumulation of indirect
agents and by elaboration so as to improve their quality.[1] It goes
on to-day by the replacement of perishable by durative agents, as in
replacing a wooden house by one of stone or concrete, and by producing
wealth without consuming it, as in increasing the number of cattle on
one's farm. But saving has come to be increasingly made in the form
of money (or of monetary funds), and in this chapter we shall consider
some of the ways in which this can now be done.

Sec. 2. #Economic limit of saving#. There is an economic limit to saving,
as judged from the standpoint of each individual.[2] The ultimate
purpose of every act of saving is the provision of future incomes,
either as total sums to be used later or as new (net) incomes to be
received at successive periods. The economic limit of saving in each
case is dependent upon the person's present needs in relation to
present income and conditions, as compared with the prospect of his
future needs in relation to his future income and conditions. Each
free economic subject must form a judgment and make his choice as
best he can and in the light of experience. There is no absolute and
infallible standard of judgment that can be applied by outsiders to
each case. Yet there is occasion to deplore the improvidence that is
fostered and that prevails, especially among those receiving their
incomes in the form of wage or salary. Considered with reference to
the possible maximum of welfare of the individuals themselves, the
apportionment of their incomes in time is frequently woful. It is
uneconomic for families of small income to save through buying
less food than is needed to keep them in health; but it is likewise
uneconomic to spend the income, when work