Belgians this year have already saved €5 billion more than before, driven first by the pandemic and then by the automatic wage indexation as a result of rising living costs.
For years, the savings rate in Belgium, or the percentage of income that is saved, declined: at the turn of the century, 18% of income was being saved, but then it dropped steadily to 12% in 2016, where it hovered for years. This was until 2020 and 2021, when households saved more than 20% and 17% of their income, respectively, due to lockdowns which resulted in people spending less money.
After that, household savings fell back to pre-pandemic levels: by 2022, the savings rate was down to 12% again. However, in the first half of this year, the disposable income that is not being spent on daily consumption has once again recovered to 14%, VRT reported based on data from the National Bank of Belgium (NBB).
The fact that Belgians were once again sitting on more savings was demonstrated in recent weeks with the success of the state bonds, which brought in almost €22 billion. This accounts for less than 7% of the €300 billion in savings in the country.
Extra disposable income
This rise was mainly due to automatic wage indexation: at the beginning of this year, some one million employed people saw their wages increase by about 10%, resulting in disposable income rising, which households largely decided to save rather than spend.
Of every €100 of extra disposable income, €75 was saved, the figures showed. The rise in interest rates and fear of more taxes were also possible reasons for families to save more.
Throughout 2023, the National Bank is counting on a savings rate of 13.5% – 1.5 percentage points higher than the years before the pandemic. This means that households will save almost €5 billion more this year than before. For 2024 and 2025, a savings rate of 13% is assumed, so about €3.2 billion extra will be saved each time during these years.
