We're a nation of mediocre savers finds RAMS
Four in five Australians are concerned they’re not saving enough, while a third feel that they’re not saving sufficiently to meet their goals, according to the RAMS Savings Satisfaction Report 2013.
The survey concluded that most people are saving for a holiday, yet a large portion of respondents felt they would not have enough in their accounts in the event of an emergency.
RAMs Chief Executive, Melos Sulicich, said that the finds of the survey shows that Australian is a nation of ‘precautionary savers’, which may reflect continued perceptions of an uncertain market environment.
“Despite Australians working hard for their money and seeking to be rewarded with the best possible rate of return, it’s concerning our results found the majority are taking a ‘set and forget’ approach to managing their savings - potentially missing out on more than $4 billion** in lost interest per year. This equates to an extra $1100 for every Australian school age child^ that could be put back into the pockets of parents to help with living expenses,” Mr Sulicich said.
86 per cent of respondents said that they worry about their savings, while 7 in 10 report that savings is a daily topic of conversation in their household.
“One third of respondents find it difficult to save money and when they do save, the amount is not as much as they wanted. For half of them, the lack of sufficient income is seen as a barrier to saving followed by maintaining a good quality of life,” he said.
There are many different savings accounts on the market including term deposits, transaction accounts and online high interest savings accounts offering an introductory interest rate or a high ongoing bonus rate.
Mr Sulicich said: “Our results indicate that people tend to have an everyday transaction account allowing at-call access to their money but earning little or no interest. Term deposits tend to be popular with retirees and those who don’t need immediate access to their money.
Other findings from the RAMS Satisfaction Report 2013 include:
- The greatest motivation for saving is preparing for the future (i.e. precautionary savings)
- Most respondents say they try to save in some way. Half don’t usually have a set amount to save. They simply save what they can.
- 1 in 2 respondents save for holidays but 1 in 3 save for rainy days, 1 in 3 save for retirement, 1 in 4 seek to pay off debt faster and 1 in 4 save for life’s necessities.
- A third of respondents admit they are struggling to save for their goals and 4 in 5 are worried about their savings.
- 4 in 5 respondents are making lifestyle sacrifices to save money including eating out less or avoiding takeaway food, taking their lunch to work or cutting down on entertainment.
- 45% use a high interest savings account to save.
- Women are savvier savers than men with 49% of women having a high interest savings account compared to 42% of men.
- The results indicate that on average Australians save $540.20 per month. Women tend to save an average of $428 per month while men save an average of $616 per month.