Photo: Evija Trifanova/LETA
69% of Latvian residents have financial savings, but 15% would not be able to survive on them for more than one month, and one in five, or 22%, have no savings at all, according to SEB banka’s “Financial Security Index” survey data.*
According to the surveyed Latvian residents, 35% would be able to survive on their savings for at least three months, 19% – for more than half a year, however most of them do not have such a “safety cushion” that would allow them to cover daily expenses in the long term.
The situation in Lithuania is better – 76% of society has savings there, and 43% of the population, suddenly losing their source of income, could live with their existing savings for three or more months. For every fifth, the existing “safety cushion” would be enough for a period of one to three months, while 13% could cover the costs for no longer than a month. 17% of the population in Lithuania have no savings.
The situation is very similar in Estonia – 43% of the population have savings to cover expenses for three or more months. 21% of the population’s savings would be enough for a period of up to three months, and 14% – for no more than one month. There are 18% of the population in Estonia without a “safety cushion”.
“In the last two years, we experienced situations in reality that proved the importance of savings. A significant part of the population was able to cover the rapidly growing costs for everyday goods, home maintenance, and liabilities only thanks to existing savings. Spending savings is normal, however, when the situation improves, it is important to start replenishing the “safety cushion” so that its amount is enough to cover at least three to six months of expenses. Often, at the beginning of the year, people tend to receive a salary supplement or a financial assessment for the previous working year – it would be wise to direct at least part of the additional income to a savings account, for example, in order to receive interest on the savings as well,” he points out. SEB banks Elza Rudzīte, head of private persons segment.
The results of the survey also show that the “safety cushion” is most often used to cover unexpected expenses. If unplanned expenses appear, 43% of residents in Latvia use savings to cover them, while 45% try to save money by reducing other costs. 19% of respondents turn to relatives and acquaintances for help in such cases, while another 16% use loans. Only one in five is looking for additional income opportunities to cover unexpected expenses, and this is mainly done by young respondents up to the age of 39.
*The population survey in the Baltics was conducted by the company Norstat in November 2023 on the order of SEB banka. 3004 respondents aged between 18 and 74 took part in it.
2024-01-17 07:38:10
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