As China enters the post-epidemic era, the high saving rate and the faltering consumer market are the two main obstacles to China’s current economic development. A clear trend is that, China’s consumers are growing less confident in the market as a result of the epidemic’s impacts, the country’s aging population, the real estate market’s general downturn, the stock market’s volatility, and the escalation of international trade disputes. Additionally, the country’s savings rate is still rising relative to its initial high. It is vital to comprehend the roles that savings and consumption play in China’s economy since decreasing the savings rate and increasing household consumption have become hot topics in the current economic climate. This paper mainly uses the Keynesian model and Solow model to analyze the short-term impact of reducing savings, increasing consumption, and expanding domestic demand on the economy, and the importance of reducing savings to increasing consumption in the long-term economic growth. By analyzing economic theories, this paper seeks to educate readers about the current state of savings and consumption in China as well as the function of savings and consumption in the economy.