How Finns Save – 29% No Savings
With the help of Good Finance Finland’s Consumer Panel, we conducted a survey to find out how Finns are saving. What are the most common ways to save? Are there any age or gender differences in saving methods?
According to the survey, 6% saves on real estate investments, 6% saves on bonds and ETFs, 15% saves on equities, 22% saves on mutual funds and 38% saves on a traditional savings account.
After investing in a savings account, fund saving is clearly the most popular option. About one in three young family members investing in funds. 19% of 18-29 years olds save in funds, but the largest age group investing in funds is 30-39 years. Of these, 27% will be saved in funds.
Gender differences in saving
Men are more active in investing in stocks and funds than women. The percentage of men investing in equities (21%) is more than double that of women (10%). 19% of women save in funds and 24% of men respectively.
It is worrying that 29% of all respondents do not save in one way or another. The Buffer Fund is one of the most important signs of own financial management. Gender differences are not great as far as complete non-saving is concerned. 29% of women who responded to the survey do not save any money. The percentage of men who responded to the survey was 28 percent.
Investing is the smartest way to save money
If you have already accumulated a buffer, you may want to consider whether you would like to continue to save on a place where interest accrues. It makes sense to save on a destination where money is making the most money.
The important thing is to invest with the sums that are right for you and remember that the higher the return expectancy and the short time, the greater the risk. It is good to get to know the market and compare different savings options.
When starting an investment, it is important to consider whether you want to get there as easily as possible or invest time in investing. If you want to make investing effortless, you may want to invest in index funds, for example. If you want to invest in investing yourself, you might want to start by studying investment advice. Once you have a better understanding of how the investment market works, you can start investing in the way you see best, for example through direct equity investments.
It’s a good idea to start saving now rather than tomorrow
You should start saving as soon as possible. Interest on interest is the eighth wonder of the world, and this time is of considerable importance to the outcome.
The amounts saved may be small at first; a monthly savings contract can already be signed for tens of euros a month. For direct equity investments, it is advisable to start with a few thousand euros, due to trading expenses. The importance of costs is further emphasized, the smaller the amounts, these must be careful.
Where should I put the extra money?
Once you have the basics of saving, the next step is to think about whether you want to continue saving in a bank savings account, or whether it makes more sense to invest some of your money in an apartment or fund. The size of the capital and the need for benefit over time determine where it is profitable to invest.
Bank deposit and savings accounts are one of the riskiest ways to invest money at one time or in the long term. When investment funds are clearly labeled with their own account, which is separate from banknotes, they are more likely to remain safe and accrue interest.
In addition, banks offer mutual funds, which is a friendlier option for beginners compared to eg equity investing. The funds offer different packages depending on, among other things, the risk level. It is entirely up to your own risk tolerance whether you invest money in high-risk funds or whether you end up with lower returns with fewer risks.