The residual impacts of COVID-19 on saving and investing attitudes
One-in-two investors intend to save more and invest more in low-risk asset investments after the permanent lifting of lockdown, according to a global Schroders-commissioned survey of 23,000 people.
Spanning across 32 countries in Asia, Europe, the Americas and Australia, the survey consisted of those who were planning to invest at least €10,000 ($16,063) in the next 12 months. Schroders acknowledged this group was not necessarily representative of everyone’s experience during the pandemic.
About one-in-seven Australians surveyed said they spent more time thinking about their financial wellbeing and reorganising their personal finances this year, slightly lower than the global finding of 74%.
Schroders Australia chief executive, Sam Hallinan, said this was unsurprising “given the amount of time that we’ve been spending thinking about reorganising our personal finances, and maybe even that increase in priority of financial wellbeing is linked to the economic uncertainty and job stability which has been a characteristic of our landscape for the last 18 months to two years”.
According to the research, 48% of Australians said they would contribute more towards their savings generally while 44% said they would invest more towards low-risk asset investment. About one-in-three Australians said they would invest more towards high-risk investments.
“For many, the pandemic has presented an opportunity to recalibrate their personal finances and focus on financial wellbeing and, due to decreased spending on non-essentials, investors around the world have been able to save according to plan or indeed exceed their targets for savings,” Hallinan said.
“While it may be too soon to predict the longer lasting legacies of the pandemic in the round, it’s clear that increased saving is set to continue even when lockdowns lift and ‘normality’ resumes.”
Following the permanent lifting of lockdown, 40% of Australians said they would spend their money paying off debt, including a mortgage, followed by investing in, or purchase of a property at 39% and gifting to charity at 37%.
In terms of post-pandemic priorities globally, property was the frontrunner but luxury and leisure purchases were also a priority, with 35% of people looking forward to spending more money on holidays, vehicles and special occasions.
The survey found 58% of Australians were less cautious about spending their retirement savings, 11% higher than the global average.
Australian investors indicated they were saving more towards their retirement than the mandated 10%, with people saving 15% on average from their income.
AUTHOR
Liam Cormican
Recommended for you
VanEck is expanding its fixed income range with a new ETF this week to complement its existing subordinated debt strategy which has received $1 billion in inflows this year.
Specialist global equities manager Nanuk has celebrated 10 years of its flagship New World Fund and is actively considering its next possible vehicle.
Australian equities manager Datt Capital has built a retail-friendly version of its small-cap strategy for advisers, previously only available for wholesale investors.
The dominance of passive funds is having a knock-on effect on Australia’s M&A environment by creating a less responsive shareholder base, according to law firm Minter Ellison.
