Attitudes, behaviours and social representations around saving money in the Maltese context

Abstract

Having an emergency fund one can access in case of need (precautionary savings) has been found to protect against material hardship in times of economic instability. Where individuals do not have savings and are living in or at risk of poverty, a buffer of emergency savings should be promoted over other saving goals such as property or private pensions. Maltese data suggests that 15.1% of individuals are unable to meet an unexpected expense of €725, suggesting a lack of emergency savings. This dissertation explores saving within the Maltese context using a two-stage process, first assessing local thinking around saving in the form of social representations, followed by an analysis of attitudes and behaviours. This was required in order to ensure that any policy recommendations made were appropriate for the local context, given the strong influence of socio-cultural context on one’s attitudes and behaviour. Results suggest that the universal representation of saving held is strongly positive, seeing saving as a source of security, primarily in liquid form, kept primarily for “a rainy day,” or for retirement and property purchases. Attitudes towards saving were also positive, but data suggested all demographic differences identified were a function of age, with attitudes towards money and saving changing as one takes on greater responsibility in life. Saving was acknowledged as important, with respondents indicating that they did not expect (or anticipate) that the welfare state would step in to provide for them. Both quantitative and qualitative data indicated that the primary reason for not saving is insufficient income, with a regression model identifying personal income as the strongest significant predictor of possession of savings, with individuals’ financial circumstances, ability to afford unexpected expenses and likelihood of possessing savings increasing incrementally in line with increases in personal income. Rather than policy action to increase awareness and acceptance of savings, it is suggested that action be focused on assisting low-income groups in building a buffer of savings.