According to a survey conducted by Ipsos for Generali Investments, savings accounts are among the Czechs’ favourite tools for managing their finances, with their popularity growing since last year. Preferences for investment funds and shares have increased, while real estate investments have lost attractiveness due to high interest rates.
The survey, which involved a representative sample of 1,078 respondents aged between 18 and 65 from all regions of the Czech Republic, revealed that 37.4 % considered savings accounts to be the most suitable way to manage their finances. The percentage of those who consider them the best way to keep money increased by 2.5 points compared to last year. In addition, the percentage of people who consider investment funds the best way to keep their money increased from 10.7 % last year to 12.3 % this year. The share of those who consider stocks and bonds to be the best way to save money also increased, now standing at 9.7%. In contrast, the share of those who prefer real estate investments decreased by 2.7 percentage points to 12.7%. According to Mederly, high interest rates have contributed to the decline in the popularity of real estate investments; however, with an expected drop in rates in the future, the situation could change again.
Petr Mederly, sales director at Generali Investments, told reporters that he is not surprised that Czechs consider savings accounts to be one of the preferred tools for preserving their finances, thanks to the period of record low interest rates for conservative products such as savings accounts, certificates of deposit (CD) and government bonds. However, he warned that although people expect the current yield of savings accounts to continue in the future, this will not happen if interest rates fall.
As for the most popular investment securities among the Czech population, shares dominate the long term, with 48.7 % of investors currently investing in them. This is followed by bonds, with 25.9% of investors, and real estate, which attracts 25.6%. Cryptocurrencies, on the other hand, have seen a decline in popularity over the past three years, with 14.5% of Czech investors investing in them this year, compared to 24% in 2022.
These changes in investment preferences are also relevant for retirement savings, which occupies a specific position among investments. The survey showed that 79% of Czechs are concerned about the lack of funds for retirement, while 64% of the population is already taking steps to ensure sufficient funds. Pension saving is chosen by 76% of Czechs as the main method. In this context, the long-term investment product (DIP), made possible by law as of this year, represents an opportunity to secure sufficient funds for the retirement of Czech citizens. So far, it is used by 6% of Czechs, while another 16% are considering it, attracted by the possibility of tax savings and the ability to make independent decisions on their investments. However, compared to the euro area, Czechs tend to keep a larger share of their savings in easily accessible forms, such as bank deposits and cash. Although pension saving is the main method of choice, this does not necessarily mean that they invest more in insurance and pension funds.
In conclusion, it is essential that savers are aware of possible future changes in interest rates and consider diversifying their financial strategies. A balanced and informed approach can help protect and grow assets over the long term, regardless of market changes.
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