Housing cost the biggest worry as Irish people fear they are not saving enough

Bank of Ireland Savings and Investment Index suggests that, despite dropping to 1.8%, inflation is still a key concern too

Bank of Ireland data shows that 57% of households surveyed fear they are not saving enough. The cost of housing/rent is the chief financial worry of 23% of all those surveyed, and 39% of people aged 16 to 29. 

Concerns over inflation and the cost of living are increasing among households as 57% fear they are not saving enough, the latest Savings and Investment Index from Bank of Ireland shows.

According to the latest Savings and Investment Index from Bank of Ireland, the cost of housing and rent along with inflation remains the biggest concerns for households.

Housing is chief worry of 39% of 16-29-year-olds 

When asked to say which they were most concerned about, 23% indicated the cost of housing/rent, an increase of 7% compared to the end of last year. This increases to 39% among 16 to 29 year olds.

A further 21% of people indicated that they are most concerned about inflation and the cost of living, up 3%.

The Bank of Ireland Savings and Investment Index tracks household attitudes towards savings and investment as well as monitoring their perspectives on the current and future savings and investment environment. It is based on a survey of 1,000 consumers aged 16 and above.

The survey is conducted by Ipsos B&A, an independent research agency.

The Savings Index was up by one point to 95 between January and March this year, compared to the final three months of 2024. The Investment Index was down one point to 92 during the same period.

Cost worries despite easing inflation 

Kevin Quinn, chief investment strategist at Bank of Ireland said while inflation has dropped to 1.8% in February, “both housing or rent and the cost of living remain the dominant worries faced by Irish households”.

“While the pace of inflation may no longer be as concerning and the European Central Bank has already cut interest rates six times, the cumulative impact of price rises in recent years has left many households still in catch-up mode and it will be some time before this begins to lessen as a concern.”

The index shows that savings habits are slowly returning to pre-pandemic levels with more people thinking now is a good time to save than since late 2021. This was also reflected in the incidence of people saving reaching close to the historic highs last seen just before the pandemic in February 2020.

Mr Quinn said there is “no doubt” people recognise the need to save “when combined with the impact of the cost of living crisis of recent years, the savings habit is only returning slowly”.

This is demonstrated through a higher incidence of saving this quarter but the smaller amounts people can afford to put away.

The index also showed that there is a “cautionary mood” developing among people who are investing.

There was a noticeable drop in how people viewed the stock market for the coming six months, with 44% believing the world stock market would be down in the next six months compared to 32% in the last survey.

“A lot is happening in 2025 to influence how people view the stock market and there is a much more cautious tone as a result,” Mr Quinn.

“In quarter one alone, we have seen the onslaught of change from the new US administration as well as a very changed landscape in Europe. Many of last year’s winners in the stock market are trailing behind so far this year and markets like Europe have been the winners so far.”

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With markets down to date this year, it is no surprise that investors are expressing a more cautious tone, and I’d expect to see more of this for the months ahead.”

The latest Savings and Investment Index from Bank of Ireland comes as risks to the global economy grew significantly last week after US president Donald Trump announced a raft of tariffs on imports from countries around the world including a 20% tariff on the EU.

China has already responded by implementing a tariff on US imports.

The EU is expected to outline their response to Mr Trump’s tariff policy later this month which will cause prices of US imports into the bloc to rise.

News of the tariffs, and the moves to retaliate against the US, lead to markets falling significantly leading the S&P 500 index to lose $5 trillion (€4.56tn).