The Bank of Ireland/ESRI Savings and Investment Index, October 2017

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  • Saving sentiment on the up, driven by an improving environment for savers
  • Half of Irish people are saving regularly compared to one-third that invest on a regular
    basis
  • Consumers most likely to invest in pension funds above all other vehicles

The Bank of Ireland/ESRI Savings and Investments Index measures the overall sentiment of
Irish households towards savings and investments. The monthly Savings Index increased to 100
points in October from 98 in September. The monthly Savings Index comprises two aspects; a
Savings Attitude Index and a Savings Environment Index.

Savings Index
The monthly Savings Attitudes Index asks people about their saving behaviour and how they
feel about the amount they save. 49% of people now say they save regularly, compared to 44% a
year ago and the proportion of people who do not save remained unchanged at one in three.
The Savings Environment Index, which explores households’ views on the environment for
savings, increased by 7 points to 100 in October 2017. The underlying upward trend in the
index was maintained last month with 40% of respondents feeling it was a good time to save.
This compares to 38% last month and 32% per cent a year ago. An improving environment for
savings has been a key factor behind the gradual improvement in the overall Savings Index in
recent years. Consumers appear to be taking a precautionary approach to their savings in order
to manage their upcoming Christmas spending.

Investments
On the investment front, almost one-third (32%) of Irish households indicate they invest on a
regular basis, which is lower than the proportion of households saving regularly at 49%. The
most common investment made by households was in pension schemes at 29% with investment
in shares and funds at 3%.
Investment activity was more prevalent amongst the younger demographic (those aged under
50) and amongst those in managerial/professional occupations. Despite the lower incidence of
regular investment, more Irish people still felt it was a good time (32%) than a bad time (20%)
to invest.

Commenting on the Bank of Ireland Savings and Investments Index, Tom McCabe, Global
Investment Strategist, Bank of Ireland Investment Markets said: “A key feature of October’s
Savings and Investment Index was the rise in sentiment toward saving among Irish households.
This was a direct result of more Irish people thinking that now is a good time to save, a trend that
has become more visible over the last number of years.”
“The initial data on investing clearly show that we are more a nation of savers than investors. This
would suggest a preference for capital security on savings compared to potentially higher returns
from investments. The low interest rate environment remains a big challenge for Irish savers.
Against this backdrop, it will be interesting to see if sentiment towards investing improves over the
medium term. The data from the Savings and Investment Index should help us tackle questions like
this.”

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