23.05.2025
As many as 59% of Estonians will have to cut their spending significantly this summer, according to a recent Norstat survey commissioned by LHV. People aged 30-39 feel the greatest pressure on their wallets.
According to Nelli Janson, Head of the LHV Investment Community, the results of the survey clearly reflect the different responsibilities in a person's life cycle. "It is obvious that the 30-39 age group is going through an active period of raising a family, a home loan is in need of payment and a number of other household-related financial liabilities are to be borne. This means more spending and a more frugal approach to finances," said Janson. She added that while normally a significant amount is spent on travel and entertainment in the summer, especially for families with children, these are very costly activities that will certainly be taken under scrutiny in today's economic situation.
While the biggest pressure on the wallet is felt by people between the ages of 30 and 39 (of which 69% of respondents have to significantly limit their spending this summer), the proportion of those cutting back is the lowest among the youngest and elderly, or in the age groups 18-29 (51%) and 60-74 (54%). "Young people who live with parents and are just beginning to take the first steps towards independent living generally have lower financial responsibilities. The elderly, in turn, often have low debt burdens. They also have children who have left home, fairly well-established consumption habits, and an inherent tendency to plan spending from an early age," Janson explained.
She pointed out that in the light of cutting back spending, it is also worth thinking about building a savings habit. Notably, knowledge of the existence of a financial backup offers peace of mind and supports flexibility, because, alas, not all expenses are predictable in life. According to Janson, it's worth starting by setting up an emergency fund that can cover at least three months of expenses. To do this, it's a good idea to use a savings account, which also earns a small amount of interest. "Once this buffer is set up, it's worth thinking about the next steps on how to save the money from rupturing inflation's sharp teeth. Investing is the only way to grow your money in the long run, and today there are many opportunities with different levels of risk to grow your own future certainty. One of the most popular options, for example, is putting money into index funds," Janson said.
She stressed that investing is worth starting with just small amounts to gain experience. "It's important to develop a saving habit, as it keeps you motivated through market ups and downs. It is the consistency that leads to the goal," Janson noted. It is also smart to automate saving as much as possible, a good example of which is Pillar III, which supports cultivating an economic sense of security for a dignified old age, with the state refunding income tax to investors on contributions.
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