To use a twist of words: “there is a lot of room for improvement”. What emerges from the picture is bleak as well as worrying Report 2022 Consob in portraying the behavior of Italian families towards the management of their savings: ranging from the lack of basic knowledge of finance, therefore to the fear of investing, but also to the desire to have high returns, ending up throwing risky investments looking for easy earnings.
In a country where there has been talk of the “choosing not to choose” when it comes to looking at liquidity left in their checking accounts, even at the risk of doing it erode by inflation, Consob in fact offers one explanation to such behavior on the basis of the investigation turn on a representative sample (1.436 individuals) of Italian investors.
Consob report: investments are complex for Italians
We start from the observation that the vast majority of Italians, i.e. as many as 80%, believe "complex” the management of personal finances, “primarily because of the context uncertainty and the growth of prices”. And in this we must agree with the Italians if we look at the macroeconomic data: inflation erodes the purchase power of disposable income, the economic hardship of families starts to increase again, the financial wealth in relation to disposable income is reduced, while remaining superior to that of the major euro area countries.
Basic financial knowledge is lacking: from instruments to the extent of the risk
But if you go into the details of the behavior of savers, the picture grays.
The Report shows that the financial knowledge are not yet sufficiently widespread nor with respect to the concepts of basis (for example, the notion of investment diversification is understood by only 50% of respondents), nor compared to financial instruments (the share of correct answers to questions about checking accounts, stocks, bonds and mutual funds remains below 60%), nor with respect to the size of the financial risk (in particular, the percentage of respondents who are familiar with the concepts of credit, market and liquidity risk varies between 20% and 49%).
Tax inflation obscure and unknown. Yet so sneaky
Just the theme of effects of inflationwhich is talked about extensively for over a year, since before the beginning of the Russo-Ukrainian conflict, it has been captured only on one side of the population equal to 65%, moreover with significant gaps between age groups, areas of residence and income groups. Yet, “inflation operates as one hidden and unfair tax violating the democratic foundation of No taxation without representation”, he observes Paolo Savona in his severe intervention at the presentation of the report.
More than a third of savers do not appreciate the impact of rising prices
The data show that that more than a third do not catch fully theimpact of price growth on your own purchase power and 12% of respondents would prefer to keep their own savings in the current account o 'under the mattress' (9%).
It is precisely on the subject of inflation and the critical issues of economic policy that all in the province of Savona
emphasizes: it has come to "accept that the increase in prices weighed more heavily on savings, with the exception of its modest remuneration following the discussed increase in nominal interest rates and the recognition of tax offsets estimated in the order of 2%” said the Consob president and added: “On this solution there was no explicit political debate, if only to detect the effects on thedistributive equity of the costs of adjusting inflationary imbalances”.
In the absence of a plan, savings are occasional and in any case reduced to a minimum
12 only% of the interviewees plan and define the family budget, a share that further decreased from 16% in the previous year, while investors who save occasionally increased: 44% compared to 37% in 2021.
In addition, 63% of investors find difficult save for goals too distant in time it's about half have no financial plan which could help reduce exposure to financial shocks.
Financial anxiety grows with the feeling of helplessness
The Consob Report identifies nine possible manifestations offinancial anxiety. The most common (62%) is the feeling of helplessness, with investors who think they can lose your savings even without having it responsibility. The need for delegate to trusted people the management of one's finances (49%), but also the discomfort that the latter can generate (48%). Financial anxiety is more common among women and low-income families, says Consob.
Yet about 60% of respondents would like to achieve financial goals, but over 50% find it difficult to comply with them when they come up unexpected expenses, while 40% are concerned about the resources available after retirement.
The saver looking for both easy and risky earnings
In this situation of anxiety to get one anyway performance a growing part of investors are looking for easy earnings, accompanied by an insidious woman propensity to overestimate one's knowledge. Every era of financial history has offered very generous and very risky assets. Today is the turn of cryptocurrencies. The share of respondents who access the network to exchange is growing crypto-currencies e trade onlinerespectively to 8% in 2022 from 2% in 2021 and 11% from 8%.
Looking for a professional, but better if free
In theory there seems to be a growing desire to know. The report shows that investors are increasingly aware of the need to improve their skills: in 66% of cases (+10 percentage points compared to 2021) they declare themselves willing to explore useful topics for the most important financial decisions. To this end, the reference most frequently indicated are the intermediaries (34% of cases, down by 8 percentage points compared to 2021). Investors who take advantage of the advice from a professional they don't always show full awareness of the characteristics of the Advisory Service. Only 39% of those interviewed know, for example, that their service is reserved for subjects enrolled in the Register one of the financial advisors. Only 15% identify in the payment method one of the typical characteristics of independent consultancy. Only 34% of the sample knows that counseling is a paid service while about 60% say they are not willing to pay. Yet it is found that individuals assisted by a professional hold a more diversified portfolio and are more frequently oriented towardssustainable investment.
Towards sustainable investment growth
Only 11% of respondents own sustainable investments (17% in the sub-sample of professionally assisted investors). There lack of knowledge in this regard, it is the major deterrent to choosing sustainable investments. The potential interest, however, says Consob, in the future could translate into a significant increase in demand of these investments: within two years, in fact, 57% of the interviewees declare their inclination to invest more in sustainable products (74% of those interested and 93% of those who already own them).
Savona's recipe: a balanced portfolio, supported by government provisions
To try to cope with the difficulties of the moment, the Consob president, as he had already indicated in his market speech of last June suggests a solution. Given the insufficiency of "traditional" tools to combat the price increase, the effects could be mitigated "building on an individual level a wallet where the component movable and real estate, as well as that currency (euro and dollar) were in balance” says Savona who adds: “I also provided indicators that confirmed the ability of such a portfolio to compensate for the loss of purchasing power of savings due to inflation, condition that Government and Parliament they guaranteed equal legal treatment, not just taxation, among all the assets owned”.
