Analysing Determinants of Household Savings: A Case Study of Lusaka, Chilenje Sub-District

Savings at the household level are one of the most vital needs for financial security and economic development. This paper identifies the determinants of household savings, focusing on sociodemographic and socioeconomic factors, income, consumption patterns, and savings practices that provide insight into challenges and opportunities related to fostering a culture of saving sustainably. A descriptive research design was adopted, in which primary data from household heads was collected through structured interviews and questionnaires. Stratified and simple random sampling methods ensured representativeness, while quantitative analysis techniques identified key determinants of savings behaviour. The results indicate that saving practices are influenced by factors such as education, family size, and housing status. High income and diversification of income boost savings, while high dependence due to a large family and high consumption restrain it. The study also revealed that 66% of the households have planned savings, although the majority depend on informal forms of savings because formal financial facilities are lacking in most rural areas. It also estimated the marginal propensity to consume (MPC) to be approximately 87.8% of the income. The findings call for selective interventions in income diversification policy, financial literacy programs with a strong emphasis on budgeting and prudent spending, and access to formal financial services. It is also recommended that community-based saving initiatives be promoted and longitudinal research on savings behaviour be conducted. These measures have the potential to empower households in Chilenje sub-district toward better absorption of financial shocks and, subsequently, broader economic stability.