A 6.9% Savings rate in the US?

It's July 1st, therefore, happy Canada day. It's also the first of the month, were I tally up all my living expenditures for the previous month.

It was previously posted in the National Post that the average savings rate in the US has risen to a 15-year high of 6.9%... 6.9% !? This value is also defined as the amount of disposable income saved, which I take to mean: Total income - taxes - fixed living costs = disposable income, and then divide the amount of money saved by that number, giving you a measly 6.9%. The graph posted at the National Post illustrates at positive savings rate for all but 1 year in the past 20 years, but yet it seems that the US is piled high in debt.

Seriously, how is it possible that the average savings rate be always be positive and yet you have an entire country ridden in debt? It perplexes my mind.

I've just calculated my savings rate from January to the end of June. I've decided against doing any fancy math and decided to calculate how much of every dollar I've saved that came in. My raw savings rate is 51.25%. Meaning that I've saved more than 1/2 of all the money I've had coming in. If I were to convert this number to something relative to my disposable income, it would be ridiculously high and no, I am not some crazy high roller that brings in a fat pay cheque in every month.

I'd have to lose at least 40% of my income to have a raw savings rate of around 10%. I'd be making ridiculously little money but I'd still be saving more than the average American easily that I'd have to call bullshit on those numbers. Sure the stock market crashed and the housing market crashed, but if everyone was able to save money before, then they shouldn't be in the rut that they are in right now.