More households report savings

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Thursday, April 3, 2014


MORE middle and low income earners had savings in the first quarter of the year, the latest Consumer Expectations Survey of the Bangko Sentral ng Pilipinas found.

According to the survey, 17.8 percent of low-income households that participated in the survey had savings, up from the 15 percent that said they had savings in the previous quarter. For middle income households, the figure rose to 38.2 percent from the 36.9 percent in the previous quarter. High income households, however, declined from 67.3 percent to 60.8 percent.

The BSP’s quarterly survey was conducted between Jan. 21 and Feb. 3. Respondents composed of 5,870 households taken from a master sample list of the National Statistics Office.

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Of the 5,870 households, 46 percent were low-income earners earning less than P10,000 a month while 38.4 percent were middle income earners earning P10,000 to P29,999 a month. Those earning P30,000 and over comprised 15.6 percent.

The survey further found that 65.3 percent had bank deposit accounts while 22.9 percent still kept their savings at home. About eleven percent kept their savings with cooperatives and credit loan associations.

Those who set aside savings claimed they were saving for emergencies, health and hospitalization, retirement, education, business capital and investment.

The overall confidence index of the country was in negative territory at -18.8 percent, but it improved from the -21.3 percent in the previous quarter. Reasons given for the more favorable outlook include the availability of more jobs, an increase in the number of employed family members, more investment prospects, higher incomes, stronger business activity and good harvests of copra, sugarcane and fish.

For the coming months, respondents have a more positive outlook, with a confidence index of 5.4 percent for the second quarter of 2014 and 19.3 for the rest of the year.

Consumers expect more job opportunities and better weather conditions for this spike in confidence.

The survey is measured by three indicators – economic conditions of the Philippines, family financial situation and family income.

More households expect to spend more on basic goods and services, especially electricity and gasoline. Many also find the first quarter of the year to be favorable to buy big-ticket items. Many feel real estate is a good investment.

As for the economic conditions of the country, most consumers expect inflation and interest rates to rise this quarter. They also believe the peso will depreciate against the dollar. Researchers believe this perception was influenced by the weakening of the peso during the survey period. Consumers are more upbeat with the employment situation, expecting a lessening of unemployment.

Among the households surveyed, 560 reported receiving remittances from overseas Filipinos. Ninety-seven percent said they used it to buy food while 68.9 percent allocated an amount for education. Some 62 percent also allocated amounts for medical payments while 45.9 percent said they used to money to pay debts.

More households receiving remittances reported setting aside an amount for savings, up 45.4 percent from the previous quarter’s 41.6 percent. Thirteen percent reported using remittance money to purchase property while a decline in investments, consumer durables and motor vehicles was observed.

In areas outside of the National Capital Region, there was a higher number using the money to pay debts, consumer durables and motor vehicles.

The survey had a response rate of 98.2 percent, with 49.6 percent of the households coming from the National Capital region and 50.4 percent from around the country.

Published in the Sun.Star Cebu newspaper on April 04, 2014.

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