What country has the most savers — and why?

July 20, 2023

Story after story talks about how X per cent of Canadians don’t have enough savings to pay an unexpected $2,000 bill — or how they live paycheque to paycheque.

So, fine. Maybe we don’t save as much as we’d like. But are there any nations that can make that boast? And if so, why — what’s making them save so well? Save with SPP had a look around to find out.

According to the Statista website, the Swiss are the world’s leading savers, socking away an impressive 23.1 per cent of household income as of 2020. They are followed closely by the Irish (21.6 per cent), the French (21 per cent) and the citizens of tiny Luxembourg (18.1 per cent).

Canada was 12th on this list.

Our grandfather was born in Basel, Switzerland and was a formidable saver.

Let’s focus, then on the top two, the Swiss and the French.

The Swiss, reports the BBC, are a bit unique in that they still like to use cash.

“In Switzerland, cash remains the dominant payment method. Here, there’s an assumption everyone carries cash, even in an increasingly digital economy. Most don’t get caught out buying a sandwich or paying for a haircut when the card payment machine is out of order,” the article notes. In fact, the broadcaster goes on, 70 per cent of Swiss financial transactions are in cash — 22 per cent are through debit cards, and just five per cent are via credit cards.

The relative lack of credit card use in Switzerland is quite instructive, particularly when contrasted with the record-high levels of credit card debt here in Canada. Less debt to pay down means more money to put in savings, perhaps?

A CNBC report found that in addition to having a cultural tradition of saving, the Swiss franc is a very valuable, stable currency. The average income in Switzerland is quite high, so people spend a smaller proportion of their overall earnings on “food and accommodation” versus folks in other countries, the article adds. Inflation, though high for Switzerland, was much lower than in other European countries, the article adds.

OK — the Swiss spend cash, even commonly using 1,000-franc banknotes, they are fairly wealthy, and so spend less of their overall income on necessities like food and shelter. That leaves more money for savings.

What about the French? In France, reports the Tilly Money blog, citizens enjoy “one of Europe’s most generous state welfare systems,” including “substantial unemployment benefits, a world-class healthcare system” and “one of the youngest retirement ages in Europe.” As we’ve read, there are still protests going on about changing the state retirement age to 64 from 62.

“The majority of the population put their savings into a financial investment ‘Livret A’ account, where the interest rate is low and fixed by the State but is also guaranteed by the State and tax free. Their second love is, of course, ‘investir dans la pierre’ – or what we would call investing in bricks and mortar,” the article continues.

According to the bank BNP Paribas, “middle-aged households (30 to 59 year olds) save more than younger and older generations.”

So for France, then, you not only have generous state benefits for retirement, unemployment and health, but a government-backed savings account and a focus on investing in real estate.

So, some interesting traits emerge her for our friends in Switzerland and France who are high savers. They like to use cash and not credit cards. They tend to have higher incomes and thus are less impacted by rising food and shelter prices. Government benefits are generous, and in France at least, you can save in a fund where your rate of return in guaranteed by the government. Both the French and Swiss seem to have a cultural tradition of saving.

It’s interesting to see how the other half lives — and saves!

Here in Canada, government retirement benefits are pretty basic. If you want a little more money to help fund your retirement lifestyle, personal savings is the way to go. A great tool to help you boost your retirement savings is the Saskatchewan Pension Plan. SPP will take your contributions and invest them in a pooled, professionally managed fund, run at a very low cost. When it’s time to start your retired life, SPP will present you with a variety of income options for your savings, including the possibility of a lifetime monthly annuity! Check out SPP today!

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Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.

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