I'm Barbara Klein with the VOA Special English Economics Report.

Saving money is a first step toward wealth. Putting money away for the future also supports the banking system. Banks need a supply of savings to provide money for loans.

In the United States, people who want to start a savings have many choices. Banks, savings-and-loans and credit unions are traditional places to open an account.

Credit unions are cooperatives for people who are linked in some way. For example, the members may work for a university or a government agency. Most credit unions are non-profit organizations.

Savings are protected up to a limit if a federally guaranteed bank, savings association or credit union ever fails. Savers have their money guaranteed up to one hundred thousand dollars.

Banks and other financial organizations pay interest on savings accounts. But the interest rates are low. Certificates of deposit are another way to save. They pay higher interest rates.

With a certificate of deposit, a person agrees not to withdraw an amount of money for a period of time. The term could be three months, or it could be several years. Longer terms, and larger amounts, pay higher interest. People can withdraw their money early but at a cost.

Another way to save is through a money market fund. This is a kind of mutual fund. Mutual funds invest money from many people. Money market funds pay higher interest than savings accounts. The money is usually placed in short-term government securities. Money market funds, however, may not be federally guaranteed like other kinds of savings.

In a number of countries, including the United States, people have been saving less and less. The Organization for Economic Cooperation and Development is a group of thirty industrial countries. A report from the O.E.C.D. shows that in nineteen ninety Americans had a household savings rate of seven percent.

This year, it is expected to be one-half of one percent. That is below the other members except Australia, Denmark and New Zealand. Next year, though, Americans are expected to save more than one percent of unspent earnings.

In Japan, the second largest economy, the savings rate in nineteen ninety was fourteen percent. The estimate for this year and next is five percent.