In terms of money, what does 'savings' generally refer to?

'Savings' generally refers to deposits that are not immediately accessible. This concept is rooted in the traditional understanding of savings accounts, where individuals set aside a portion of their income for future use rather than spending it immediately. These funds are often kept in a bank or financial institution, where they may earn interest over time.

In defining savings, it is important to recognize that the primary purpose is to store money safely while allowing it to grow gradually through interest. While savings can sometimes involve accounts that have restrictions on withdrawals or require prior notice for access, the fundamental characteristic is that the funds are intended for longer-term holding rather than immediate usage.

While liquidity and physical currency are important concepts in finance, they do not fully capture the essence of what constitutes savings. For instance, instant currency liquidity refers to the availability of cash, and money used for investments emphasizes the active deployment of funds rather than storing them. Meanwhile, all physical currency does not specifically define savings, as it encompasses money not necessarily set aside for future needs. Thus, focusing on the nature of savings as deposits that may not be readily accessible emphasizes its role in financial planning and security.