Loss aversion is typically associated with poor financial decisions. In contrast, loss-aversion based precautionary saving theories suggest that loss aversion can even trigger savings when facing future income uncertainty. We empirically study this loss-aversion based precautionary savings hypothesis with over 800 participants in a lab-in-the-field setting in Bogotá complemented with a classical lab experiment, using experimentally measured loss aversion, and observed as well as exogenously induced income risk. Confirming theory, we find that precautionary savings increase with the degree of loss aversion. Thus, consistent with a loss-aversion based precautionary savings hypothesis, but in contrast to common assumptions, our findings establish that loss aversion is not necessarily an obstacle to saving, and thus identify new approaches of increasing saving and preventing the loss averse from undersaving.