Study: Estonians Hoard Savings, Fear Investment
A whopping 82 percent of Estonians are not ready to invest their savings, a study by the Saar Poll research company has shown.
The nation's households have a total of 5 billion euros in savings, of which half is sitting in regular cash accounts and only a fifth in long-term deposits, reported Eesti Päevaleht.
The Bank of Estonia said that people are cautious in their spending but because interest rates for long-term deposits are very low, Estonians prefer to keep their money in cash accounts. “The [savings] figures also reflect a fear of risk taking. Because of the uncertainty of the financial environment, it is harder to assess risks for alternative usage of people's finances,” said Ingrid Mitt, a spokeswoman for the bank.
Savings grew by a billion euros over the last year while interest rates continue to drop. Currently, the average interest rates in Estonia for household deposits are the lowest in the Eurozone.
The study shows that 55 percent of Estonians say they have savings. A third said they would not, in their own opinion, financially survive even a month if they were to lose their jobs, while only a third would have enough to last over three months.
The study, conducted last October, polled 1,513 people between the ages of 18 and 80. It was commissioned by the Government Office in cooperation with the Financial Supervision Authority as well as the ministries of finance and education.