- 27% of those surveyed have no savings; 25% of people have average savings of 1,000 EUR or less in cash on their current account
- More than 60% of respondents have around 20% of their monthly income left after expenses
- If financially possible, a safety cushion can be accumulated within 18 months
Although around 60% of paid employees have more than 20% of their income left after expenses, around half have no safety cushion amounting to three months of expenses, according to a survey by Finoterapija, a free online automated consultation service, which analysed answers from 2,300 respondents.
According to figures by Finoterapija, of those salaried employees who are financially able to save an emergency fund worth three months of expenses, but who have yet to do so, half would take up to six months if all available money was put towards it. Meanwhile, by allocating 100 Euro every month, a paid employee could save a safety cushion within 18 months.
“When we began the survey, we expected data showing that those with no money left after covering their expenses are not saving money. We were surprised that it was those who could afford to save for the future or for unexpected expenses who were choosing not to do so. In general, only one third of salaried employees who used Finoterapija have saved up a safety cushion worth at least three months of expenses,” explains Citadele economist Simona Striževska.
“We are not talking about those who are not saving because they have no additional funds left after paying bills, but rather the unbalanced income and expenses of the earning public. Although their incomes are relatively large, they spend the remaining amount, and some even live beyond their means. In this case, loss of income will be particularly tragic, as debt may also have accumulated alongside their monthly expenses,” adds Striževska.
It is not just Latvia that has problems with saving. A survey of saving habits in the U.S. (GoBankingRates) shows that 45% of US respondents have no savings, and a further 24% have no savings above 1,000 USD. In comparison, of all Finoterapija users, 27% have no savings at all and 25% more have average savings of 1,000 EUR or less in cash or their current account.
By accessing the interactive www.finoterapija.lv platform and answering specific questions, Finoterapija users can determine their current financial situation, as well as receive suggestions on how to save.
About the Finoterapija survey
Using modern technology and algorithms developed by the bank combined with many years of professional financial expertise, Citadele has created Finoterapija, a free automatic online consultation. For the survey, data from 2,300 anonymous respondents was analysed.
About Citadele Bank
Citadele’s mission is to modernise the banking sector and offer more opportunities to clients and businesses throughout the Baltics. Our aim is to become the Baltic banking champion.
Alongside classic banking services, Citadele offers its clients a range of services based on next-generation financial technology, including its modern app, contactless payments and instant payments, and finally being the first in the Baltics to introduce opening an account with a selfie and payments to mobile numbers.
Citadele is the third largest bank in Latvia by number of clients. The Citadele group is managed from Latvia. Its subsidiaries and branches operate in Latvia, Lithuania and Estonia.