Few coins in the piggy bank

Monday, 5 november 2018 | Redacción CEU

Problems when managing unforeseen events, difficulties to materialize medium or long-term plans, the impossibility of paying bills on time, trouble bringing projects to life, the inability to increase capital through smart investments, etc. Not keeping enough money in the money box entails having to face big obstacles sooner or later. This is not a minor issue and, therefore, deserves a lot of attention. However, managing to increase the savings rate in Spain is still one of the great pending issues of the country. Why is it so difficult for Spaniards to save?

The fact that Spaniards have little money saved is nothing new. As we remarked in an article last year, Spaniards save little, and there is even a downward trend. The report "Analysis of savings and investment decisions of Spanish households" that was published in October by the CNMV (National Securities Market Commission) confirms the trend. CNMV's study reveals that the Spanish savings rate represents less than half of the European average. The Spanish gross income, which is calculated from the difference between the gross disposable income minus the final consumption, is 5.1%. That figure is really small compared to the 12.13% average which is recorded in the Eurozone, 17.3% in Germany, or, 13.7% in France.

The Spanish savings rate has always been lower than the European one, and its trend has generally pointed downwards. Only when the crisis started was a strong pickup recorded. That increase came to reach a record high of 13.4% in 2009. Even at that time, the figure was not high enough to match the European average. Facing such a difficult economic scenario, Spaniards decided to resort to saving as a preventive and protection measure. However, when the hardest years of the crisis were left behind, the country's savings kept experiencing a gradual decline once again. Why are the Spanish money boxes empty again?

What do other studies say about Spanish savings?

Ofertia, an online sales platform, has recently presented the results of its survey which was carried out on the occasion of the World Savings Day. According to them, the economic problems are, along with health, the main concerns of the Spanish people. This fact has been corroborated by the high percentage of respondents who claim to be unable to save money with their current salary, specifically, 71% of them.

Another study by Rastreator, a search aggregator of insurances and mobile network operators, which was also carried out on the occasion of the celebration of this day, points out that 7.97 million Spaniards (a figure that represents 26.7% of the population) do not manage to save anything at the end of the month. In turn, this report claims that the number of savers in Spain has fallen by 13.5% over the last year. According to its analysis, the lack of income is the great obstacle to saving (48,8%). Other reasons that explain this situation are: expenses in contingencies (36%), indebtedness (14%) and economic support to third parties (13%). 19.4% of respondents admit that they spend more than what they earn and 19.8% confess that the reason why they do not save, or do not save more, is they prefer to allocate that money to whims.