Ninety-two per cent of UAE residents are planning to start their savings journey in 2019, up from 73.5 per cent last year, said leading investment company National Bonds Corporation in its 2018 Savings Index.
Additionally, 43 per cent of savers plan to increase their savings in this year, of this, up to 39 per cent plan to start their savings in the first six months of the year, while 19 per cent of residents plan to stash away cash within six to 12 months, added the annual survey, conducted by market research firm Sondos on the savings environment in UAE and wider GCC region.
The importance of regular savings cannot be stressed enough, allowing one to remain financially secure and providing a safety net in case of emergencies. In the UAE, more residents have resolved to start saving money this year, according to the latest Savings Index from National Bonds.
The index, which first launched in 2011, is central to National Bonds' efforts to instil a culture of savings in the UAE.
Despite this, the largest proportion of UAE residents is positive about the country’s savings environment with 52 per cent stating it is a good time to save. Besides, a significant drop in rents across the UAE means that there is more disposable income to save. With 49 per cent of poll respondents using rising cost of living as an excuse for being unable to save.
Mohammed Qasim Al-Ali, CEO, National Bonds, said: “The 2018 Savings Index highlights that the UAE offers an atmosphere that is conducive to creating a culture of savings. Having said that, the need to educate people on the importance of savings is still critical."
As part of a drive to raise awareness on savings, more than 130 companies in the UAE participated in 400 financial workshops as part of the Employee Savings Programme (ESP), with more than 179,000 transaction made since the launching the program.
“The UAE continues to enjoy the largest proportion of regular savers in the GCC and I am confident that we will continue to lead the way in this area if we strive to raise awareness levels on the importance of saving. With up to 92 per cent of respondents planning to save this year, the urge to save exists, we just need to foster and build this appetite," said Al-Ali.
While a culture of savings exists, only a small percentage of the UAE’s expansive expat community seems to have saved as much as they had hoped. While 51 per cent of the total respondents claimed to save regularly and 77 per cent stated personal savings to be very important to them, only 23 per cent of expats who moved to the UAE for savings purposes were positive about saving as much as they hoped, while 42 per cent were somewhat convinced that they had saved enough.
In fact, up to 68 per cent of total respondents including UAE nations and expats believed that it was becoming harder to save and 43 per cent hoping that they could save more.
“Perceived barriers to saving including expenses, loans and a poor knowledge about savings instruments are drawbacks,” said Al-Ali. “However, a positive view about the economic environment being conducive to saving balances this out and will help financial institutions to approach residents with suitable instruments that promote a culture of savings.”
“We are long-time supporters of the Government’s ambition to increase financial literacy and remain committed to growing the number of savers in the UAE, helping achieve a healthy and secure financial future for individuals and their families. Studying the 2018 Index, the opportunity for us at National Bonds to educate residents and nationals alike on how to save is huge,” Al-Ali concluded. – TradeArabia News Service