Shocking figures: Western Europeans have ten times more savings than Hungarians
Even though the Hungarian population has increased its savings in recent years, we are still far below the European average. Let’s look at the numbers, the details!
Which brings together the most advanced industrialized nations, regularly publishes data on household savings. Comparison of the data reveals where Hungary stands in the region, in Europe, in the world. One study compares the average savings of the population with the annual salary.
On the basis of this, stagnation was rather observable
Hungary’s relative position has not changed much compared to recent years. At present, Hungarian households save on average 2.8 times their annual salary. This is a double of what is common in Western European countries. But there is nothing to be surprised about, because the standard of living is actually much higher in a country west of us than in our region or Hungary. At the same time, at least for our mills, Hungarian households have more savings than the regional average.
It is also advisable to look at the per capita saving amount as this will further illustrate the gap between the various European regions. While in Western Europe the average wealth per capita is close to 27 million HUF, in Hungary it is only 2.6 million HUF. And this is just an average value, there is a significant part of the population that has no savings, while a narrow layer has a much higher amount than the average.
At first, it may seem strange that
When measured by annual salary savings, Hungary is ahead of the CEE region, but is lagging behind in terms of per capita value. The reason for this is that when calculating the indicator, savings were calculated for the whole population and not for the employees.
All this does not change the fact that the average saving of a Hungarian is one tenth of that of a Western European. In addition, the Mediterranean countries are ahead of our country, where there is an average triple difference in the value of savings. Reviewing the composition of savings, you will find several specialties that are specific to the Hungarian population. Here are the following:
– the Hungarian people have traditionally high cash holdings (15%), but this is true for our region as a whole,
– due to very low deposit rates, deposits have been completely turned away from deposits, even in Western Europe the share of deposits is not so low (34%), – equities do not stir Hungarians, but Western Europeans,
– a very high proportion (16%) of the population holds investment funds,
– life insurance plays a much smaller role in savings (7%) than in Western countries,
– the other category has an extremely high ratio (25%), which can be attributed to the high popularity of retail government securities.
Deposits account for almost one third of the savings
It is also important that deposits placed with savings banks and state subsidies are also shown here. According to the available data, the deposit portfolio grew by an average of 16% per annum between 2003 and 2016 and was likely to double-digit in 2017 as well.
At the end of 2016, housing savings totaled HUF 724 billion, while deposits according to the OECD were more than HUF 8000 billion. In other words, about every 10 forints between deposits is at home savings. And given the popularity of the sector, there is every reason to increase their share. With a 30 percent state subsidy, you can realize up to two-digit returns.