What motivates the Czech Republic to invest? They don’t trust the state to have money in their old age

In the Czech Republic, there is still a preponderance of people who have never invested and have no plans to do so. Only four people out of a hundred are considered experienced investors, and roughly every third Czech invests regularly or once. This follows from a survey conducted by the Perfect Crowd agency for the Capital Market Association (AKAT).

“If we look at foreign statistics, we still have a lot to catch up on. However, another 23 percent of respondents are considering investing, which already sounds significantly more promising. The current enormously high inflation is probably also driving them to this, which forces them to think about how not to let their savings depreciate on the current account,” added Jana Brodani, executive director of AKAT ČR.

Czechs most often consider real estate to be their best investment in life (29 percent), but more than two-fifths of respondents could not identify the worst investment, and one-tenth agreed on a used car.

For almost two-fifths of people, the main motivator for investing is the need to create a sufficient financial reserve for old age, because they do not believe that the state would take care of them. In addition, less than a third want to ensure an active lifestyle even in old age.

Another important motivator is, for example, the fact that money does not just sit in an account (34 percent) or its protection against inflation (27 percent), as well as preparation for unexpected situations (25 percent) or securing the future of children, or to save for them to have an easier start in life (26 percent).

On the contrary, for two fifths of the respondents, the biggest barrier to investing is the fear of losing their money. A third also worry that a “good” investment will eventually turn out to be a scam. But investing is also hindered by ignorance and a lack of information and the necessary finances.

For obtaining information about investing, financial portals are most often used, from which a third of people draw, and for roughly one in seven to eight Czechs, this is also the most important source of information. A quarter of people get advice from friends, roughly the same number read websites of investment companies.

For half of the people, the past return of an investment already made is the main factor for choosing an investment. Less than half will also give to the person who offers the investment, two fifths are also guided by the potential excess income compared to inflation.

Czechs most often keep their money in savings and current accounts (65 percent of finances). The vast majority of Czechs’ savings are therefore very liquid. People want to have money available in the event of unexpected events that could, even in the short term, affect their economic situation.

Two-fifths of respondents save in pension savings accounts, and less than a third in building savings. One in six invests in mutual funds, one in eight invests in cryptocurrencies and also in investment life insurance, and roughly the same number invests in gold.

Despite the unfavorable times, more than two-fifths of Czechs plan to save money in at least a savings account in 2023, a quarter of the adult population wants to put money into pension savings, and less than a fifth into building savings.

But all of these products, along with investment life insurance and cryptocurrencies, are mentioned less often compared to the products people own now. Gold and other precious metals were the only ones to see a slight increase in this regard.