Some of the world's biggest billionaires and icons say the same thing — savings lead to freedom

There's a worrying trend in India. Household savings, as a percent of GDP, have plummeted to the lowest in 47 years, according to recent data released by the Reserve Bank of India (RBI).

With that in mind, let's understand how saving money, a concept that even the world's wealthiest individuals value, can be a pathway to financial freedom.

Nilesh Shah, the CEO of Kotak Mutual Fund, who is responsible for the management of over ₹3.3 lakh crore ($40 billion) echoed that sentiment from Buffett.  "Income minus expenses is not savings, income minus saving is equal to expenses," he said in an interview in 2019.

Essentially, people should decide how much they want to save, and then, spend what's left. Over a period of time, these savings will allow you to explore new avenues, quit a bad job, or just take a break to focus on your mental health or to take a risk as an entrepreneur.  So, how much should you save to be able to risks?

Warren Buffett, CEO and Chairman of Berkshire Hathaway in an interview with Yahoo Finance said that the principle is to prioritize saving; once you've set aside your savings target, then you can consider spending. Essentially Buffet advices that rather than spending money first, and then saving whatever is leftover people should save a portion of their income first and then spend the remainder.

Buffet for instance, is a staunch advocate of spending in cash. He mentioned to Yahoo Finance, "I've had an American Express card since 1964, but I use cash for 98% of my transactions.

There cannot one number for everyone. How much each individual saves will depend on their priorities and responsibilities, existing ones as well as the ones that they can expect, reasonably, in the future.

Microsoft Founder Bill Gates, according to a report by CNBC MakeIt, kept a year’s worth of cash on hand when he started Microsoft to keep the business afloat when revenues were light.

But if you have credit card debt or expensive cars or sneakers, anything that's beyond your means, and you're saddled with EMIs (easy monthly instalments), it will only add to the anxiety and limit the flexibility in your life's decisions. As Mark Cuban, the venture capitalist popular for his appearance on the TV show Shark Tank, put it, your biggest enemies are your bills.

"The more you owe, the more you stress. The more you stress over bills, the more difficult it is to focus on your goals. The cheaper you can live, the greater your options," Cuban said in a 2009 blog post.

In an era, where burn-outs (triggered by work) are not rare, and the GenZers crave for a better work-life balance than what the millennials settled for, this conversation about savings becomes more indispensable.

"What you want is a balance. Young people

Financial security is imperative to be able to be able to claim those things, beyond work, which we would treasure.