In the face of uncertainty imposed by the coronavirus crisis, many across Europe have been careful with their money. ING conducted an International Survey to understand financial attitudes and behaviours of people in 13 countries across Europe, both before and after the coronavirus lockdown.

Many self-report actively changing their daily spending and saving activities. People report significant changes to day-to-day money management: more than half (55%) in Luxembourg say they are spending less, and 41% feel that they are able to save more. This is even higher than our European peers: 44% of them declare spending less and a third say that they are saving more. This may be a reflection of changing attitudes. 

Day to day spending is different during Corona

There is no question about it: the coronavirus pandemic and the accompanying lockdowns have changed people's attitudes when it comes to money, and Luxembourg is no exception. Respondents to the ING International Survey self-report spending less, saving more and using card over cash to make payments. 

Has Coronavirus changed the way you save and/or spend?

Among our survey respondents, 55% of Luxembourg residents say they spend less now than before the virus swept the world which might be partly due to lack of options: restaurants, bars, retail shops, cinemas and other spending opportunities have been closed during lockdown. But some have also suffered a sharp decrease in income and/or the threat of such a loss. Both conditions help to explain why many said they were saving a bit more - putting something aside for an uncertain future. 

Perceived “savings comfort” remains stable

The self-reported changes in saving and spending may have led some to feel more comfortable with their level of savings. Our survey, comparing attitudes before and during the coronavirus pandemic, shows a slight decrease in the percentage of Luxembourg residents who say they would need either much more or a little more in savings to feel that they are in a comfortable financial position (from 63% prior to Corona  to 49% during the Corona confinement). This shift in savings comfort may be temporary. Lockdown seems to have reduced the ability of people to spend. Those who have been able to remain employed may feel they are saving more. However, it’s worth noting that we ask about perceptions rather than actual saving values. The same trend that we see in Luxemburg is reflected at European level.

What best describes you?

Indeed, although people consider themselves to be saving more during lockdown, there is little evidence in self-reported savings figures that the share of respondents who have and those who do not have savings has changed noticeably. Prior to the coronavirus pandemic, in December 2019, 13% of residents confirmed that their household had no savings, and in May 2020 this figure dropped to 8%. Although there is some variation, our survey shows that there does not seem to be any significant difference between the pre and post-coronavirus habits of saving for Luxembourg residents. Those figures have remained steady in the past 8 years.  “We have been asking for years whether people have savings, and in Luxembourg the percentage of people who do not have any savings at all was consistently around 12%” confirms Ingrid Ballesca, Market Intelligence analyst at ING Luxembourg. The coronavirus crisis does not seem to have changed that figure significantly.

https://www.ing.lu/content/siteing/en/About_us/press/2020/ing-news-saving-and-spending-habits-of-luxembourg-residents-during-the-coronavirus-crisis.html?lang=en