The attention of many people around the globe, every four years, centers around the World Cup. Yes, it gets people in a frenzy. Everyone has their own way of showing, it: traveling across borders to follow their team, wearing the jersey of their home country, being glued to the television, even causing pain to eardums everywhere while using a vuvuzela (these things intrigue me for some reason).
So, in honor of the globe coming together for the great soccer tournament that is the World Cup, how about a little analysis on savings rates by country that we can call the World Cup of Frugality!
In this case, lets take a look at a sample of 14 countries, and their rates of savings over the previous 20 years. The rate of savings is reflected as a percentage of disposable household income.
This list is heavily skewed to Western nations, based on the data I could find. The two Eastern nations are Japan and Korea. That said, it shows some interesting trends over the last 20 years, as can be seen in this table (Source: OECD Economic Outlook Database):
As can be seen, there are trends that we can clearly see, over the last 20 years. There are many ways to analyze this, particularly when adding additional context, but purely by these numbers, I see the following:
- North American savings headed south. North American neighbors, U.S. and Canada, are clearly trending downward in savings – particularly Canada, where the magnitude of the drop has been greater
- Maybe it’s the English language.If you broaden #1 above by adding Australia, and recategorize it as the primarily English-speaking group, you’ll see all 3 have declined since 1990 (Australia appears to have stabilized a bit)
- European neighbors are saving well.Take a look at France, Germany, Austria, and Switzerland: a core group of European countries that are close georgraphically and have shown high rates of savings.
- Scandanavia has been a mixed bag. Sweden’s rate of savings is increasing, while Norway and Finland have been floundering in terms of squirreling away disposable income.
- Italy, Netherlands, and the Pacific Rim: look out below! These two European countries, along with Japan and Korea, were saving quite a bit 20 years ago, but aren’t faring nearly as well now, showing precipitous drops in savings rates.
For me, it’s interesting to see how the rest of the world is doing, outside of my own home country (U.S.). Clearly, there are issues elsewhere too, though not everywhere when it comes to savings habits. What I did see, overall, were more sharp declines by individual nations than stability or strong increases in savings rates.
Ok, since this isn’t really a competition like the World Cup, let’s close by learning how to communicate in “frugalese” with our global friends. To that end, here is the approximate translation for frugal in each of these countries, in the language most commonly spoken in each: