Financial Situation Tense for One Third

Almost half of Austrians feel financially not independent, with over a third even considering their own situation as financially strained. This is the result of a survey conducted by BAWAG among nearly 1,000 people. People who have invested in securities such as stocks and bonds see themselves as more "autonomous" than "savers." Nevertheless, traditional savings products remain the most popular form of investment in this country.

Minority sees themselves as financially independent

From the respondents' perspective, financial independence primarily arises from autonomy in financial decisions. In other words: having no debts, being able to provide for oneself without help - for example, from the state or relatives - and having sufficient reserves for emergencies. However, only 17 percent of respondents see themselves as completely independent, as Thomas Csipkó, head of BAWAG's branch business, noted during the presentation of the study on Wednesday. These are mainly full-time employees and retirees. In contrast, younger generations and women comparatively often see themselves as financially dependent.

If money is available for investment, the goal according to the study results is particularly to preserve value and offset inflation. For most people, a return takes a back seat. The desire for security is also reflected in the forms of investment: savings book and savings card (already used by 83 percent of respondents), online savings account (67 percent), and building savings contract (66 percent) are significantly ahead of investment funds (29 percent), stocks (23 percent), or bonds (15 percent).

"Securities polarize"

In general, skepticism regarding securities, which often have higher earning potential, is high in this country. "Securities polarize," said Marcus Kapun, Head of Global Brokerage at BAWAG. For many people, the fear of price fluctuations or losses dominates, which then becomes noticeable in the choice of investment form. In many cases, people are also unaware of potentials such as the possibility of risk diversification and the resulting security, according to Kapun.

The potential of savings plan concepts on Exchange Traded Funds (ETF) is also underestimated. For this, the bank has modeled an investment plan for a fund with a duration over the past 20 years. The result: With a monthly investment of 100 euros (a total of 23,500 euros in deposits), an end amount of a good 69,000 euros was achieved - thanks to the compound interest effect and despite disruptions such as the financial crisis of 2008/2009 or the coronavirus pandemic. Nine out of ten respondents estimated the result lower in the survey. "In the short term, we see large fluctuations in the capital markets, but in the long term, a clear upward trend is evident," summarized BAWAG's Chief Financial Officer Enver Sirucic.

(APA/Red)

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