Survey: More Savings, Less Credit for Hungarians

More and more people in Hungary have some money left over from their income at the end of the month, and fewer and fewer are forced to borrow from family, friends, relatives, financial institutions and financial service providers, according to a representative survey of 4,500 people commissioned by Provident Financial Ltd.

However, recent data show that only one third of the population is able to save regularly. When money runs out, women are more likely to borrow from family members and financial institutions, while men are more likely to borrow from friends.

While it is still not easy to make ends meet, the proportion of people who are not completely out of money by the end of the month is growing significantly. According to a recent survey by Provident Financial Services, there is still a minority of people who are able to save from their income: 23.5% of those surveyed said they have enough money left at the end of the month, higher than the 19.7% in 2023, but well below the 33.8% average for nine countries that include - apart from Hungary - the Czech Republic, Romania, Estonia, Lithuania, Latvia, Poland, Mexico and Australia.

The research shows that far more Hungarian men (33.1%) are able to save than their female counterparts (14.5%). The large gap is hardly explained by a difference in spending propensity: the more obvious correlation is that women earn unfortunately less than men. According to a report published by the European Parliament last April, the average hourly wage gap for women in Hungary in 2021 was 17.3%, significantly higher than the EU average of 12.3%. But the most recent Hungarian data from the Hungarian Central Statistical Office (KSH) show the same difference. Also according to KSH data, the vast majority of single parents are women, further limiting their ability to save.

Within the three main age groups in the survey, the highest proportion of those who can save from their income is among those aged 35-54 (26.7%). This is also due to the fact that they have the highest salaries, taking home an average of more than HUF 660,000 gross per month in the first quarter of this year, according to KSH. The 55-75 age group has a higher overall monthly income than the 18-34 age group, but the older generation has less money left to spend at the end of the month due to the cost of basic food and especially medicines: only 19.1%, compared to 24.2% for the younger generation.

Higher incomes and higher levels of financial literacy could be the reason why 32.3% of those with tertiary education said they would have money left to spend at the end of the month. Only one-fifth (around 20%) of those with primary and secondary education have a monthly savings capacity.