Fewer people are aware of the bulge in those aged between 30 and 60 the peak

Fewer people are aware of the bulge in those aged between 30 and 60, the peak earning period for most people. These rise from under 38 per cent of the population in 1991 to nearly 42 per cent in 2001 People save most in their middle years. As these baby-boomers reach their peak earnings, they will push up total national savings.They will have to do so partly because of the low level of state pensions - the second reason for expecting saving to come back into fashion State pensions are pegged to prices, not earnings. A basic standard of living may thus be guaranteed, but as earnings rise, the gap between the final wage of someone just before retirement and the state pension will grow.Of course, it is possible that a future government will lift the state pension sharply: older voters would delight in that.

But anyone in their 30s or 40s relying on a state pension is betting on the political colour of the government a generation from now. That is a hairy gamble, given rising pressures on public finan- ces. Prudence sug- gests that people should, if possible, build a private pension provision.Third, there is what Merrill Lynch calls "income uncertainty" The more the uncertainty, the greater the need to save. That does not necessarily need any overall rise in unemployment: more fluid employment patterns, with less steady jobs interspersed with periods of retrain- ing and self- employment, are sufficient argument for having as large a nest-egg as possible.

Income risks have risen sharply since the 1960s, and it is hard to see that trend reversing, at least in the near future.There are two further factors: taxation and the availability of credit. At the moment, we give enormous tax advantages to contractual savings, most obviously through a pension plan, and only limited tax advantages for voluntary, personal savings. It is tough to see the overall tax incentives being cut back, rather the reverse, and some rebalancing may start to favour individual saving.As for credit, one of the main reasons for the decline in net savings during the late 1980s was the rise in borrowing. The issue is whether that was a one-off reaction to easier credit, whether people able to borrow through credit cards rather than the time-honoured visit to a bank manager, went a bit mad. Or whether there has been an underlying rise in the willingness to borrow. Anecdotally, it seems to be more the former, for while consumer borrowing has continued to grow, there is certainly greater resistance to taking on "big ticket" debt, particularly for home purchase.Put all these together and it is certainly reasonable to expect a rise in saving, with huge knock-on effects on banks, building societies, life assurance companies and the like.

They will have to create more products for savers, not for borrowers, reversing much of the post-war trend. More interesting, however, are the implications for society and politics.For example, we are moving into a world where willingness to save while young has become an enormous determinant of prosperity in later life. This is very much the opposite of the situation 10 or more years ago when willingness to borrow, particularly for house purchase, was the determining factor.I suspect the willingness to save will become as important as choosing a high-earning career, given that high earnings often go with high insecurity of employment.If that is right, there is a new and potentially troubling social division, between people who, by their background and environment, are conditioned to save and those who are not. Maybe on a long historical view that is not so new - we are back to Mr Micawber - but it is certainly different from the 1960s, 1970s and even the early 1980s.Another social consequence will to be reinforce savers' political clout.