Maybe we're not such crummy savers after all
By Laura Bruce • Bankrate.com

One of the gazillion statistics the U.S. government spews out every month is the personal savings rate (PSR). Essentially, it's what's left in our wallets after we pay taxes, mortgage, car payments, groceries, contact lenses, dinner for two, mamba lessons -- well, you get the point.

When we're done blowing our paychecks, the government figures the rest goes into savings.

For a rather depressing period from August 2000 until April 2001, the Bureau of Economic Analysis, the folks who crunch the numbers to come up with the PSR, issued monthly news releases noting that we Americans, collectively, had a negative savings rate. Not only were we not saving more, we were dipping into what we already had.

Dutiful reporters across the nation wrote copious copy about what slouches Americans are when it comes to saving.

Well, it turns out we're not such bad savers after all.

Missing persons, pensions
The BEA folks have reworked their calculations and, like magic, the negative numbers have disappeared! Here's why.

If you work for a private company and put money in your retirement plan, it's considered personal savings. Under the old accounting system, when government workers put money in their retirement plans it was considered government savings.

"Originally, we just got trapped in the accounting procedure for the government," says Larry Moran, senior economist at the BEA.

"The government had control of those pensions so it was considered government savings. It was obvious they should be considered private savings.

"It became clear when we got these negative savings numbers. People were saying, 'Hey, they're drawing down savings,' and we knew they weren't because a lot of money was going into savings. It was a major inconsistency in the way we were handling pensions.

"Why it didn't happen two years before, I don't know. It was simply an attempt to do a better job. We saw all those negative numbers and knew it was misleading, and we saw the articles and knew they weren't really accurate, but you couldn't really blame the writers."

What a difference a little accounting change makes.

The numbers have continued to improve in the months since.

The personal savings rate hasn't dipped below 3.4 percent since January 2002, and it's been as high as 4.5 percent.

While the numbers are quite a bit better, they're nothing to crow about.

From 1946-2002, the average personal savings rate was 7.8 percent. The highest annual percentage rate during that period was 10.9 percent in 1982.

So, we're way short of hoarding as much of our paychecks as we should.