Irish still saving for rainy day

Irish people are now saving an average of €283 per month, new figures published today reveal.

Some 26% of people reduced their debt in 2009 and over 40% of people claimed that they now have no borrowings, according to the auarterly Postbank Savings Index.

Debt levels look set to fall again in early 2010 as just 6% of people surveyed indicate that they will increase their borrowings in the next three months, with 25% planning to reduce their borrowing levels.

Savings levels remain high with 76% of adults saving on a monthly basis, a slight drop since the last quarter. The main motivation for saving remains the “rainy day fund” for emergencies, accounting for over one third of savings.

“The trends we are seeing at the moment show that people still want to have a secure nest egg, a buffer during times of uncertainty,” said John Donegan of Postbank.

“People are paying down their debt and if they are likely to make big purchases it will be based on savings and credit as opposed to the buy now pay later approach of recent years.”

The Postbank survey also suggests thsat spending looks to take a further hit in 2010, with over half of respondents indicating the intention to spend less in the coming year.

Women in particular will be cutting back, with 56% planning to trim their budgets.