FILIPINO households are saving less despite higher incomes, a worrisome trend considering that those who are not setting money aside are also cutting back on important items such as education.
Citing data from the triennial Family Income and Expenditure Survey (FIES), the National Statistical Coordination Board (NSCB) said real per capita annual savings had fallen: P5,261 in 2003, P4,667 in 2006 and P4,957 in 2009. The share of savings to family income also shrunk over the years: 16.4% in 2003, 14.8% in 2006, and 14.9% in 2009.
This meant that for every P100 in income, P15-16 went to savings, NSCB Secretary-General Romulo L. Virola said in a report posted on the agency’s Web site. “[I]ncome is not evenly or equitably distributed across all families in the country. Therefore, many of us either do not have savings or have been able to save less than 15% of our income,” he said.
Two out of three Filipino families were able to save and out of every P100 earned, they kept P23-25. Non-savers, meanwhile, spent 14-15% more than what they earned between 2003 and 2009, allotting more for food. “This is similar to past findings from poverty analysis that the poor spend proportionately more on food than the non-poor,” Mr. Virola said.
Non-savers also spent more on alcohol and tobacco while sacrificing education as it seems they “could no longer afford to send their children to school” or “that higher education is no longer the priority that it used to be. Among non-savers, the share of education spending declined to 2.62% in 2009 from 2.67% in 2006.
Sought for comment, University of Asia and the Pacific economist Peter Lee U said the data was a cause for worry, adding that the finding on non-savers sacrificing education needs further investigation.
On a lighter note, Mr. Virola said Ilocanos, who have a cultural reputation for thrift, were not the biggest savers. In terms of saving households’ ratio of savings to income, the Cordillera Administrative Region (CAR) topped the list with 23%, followed by Cagayan Valley or Region II (21%) and Central Visayas or Region VII (20%).
Among non-saving families, the biggest ratios of deficit to income were in the CAR (21%), Soccsksargen or Region XII (18%) and Region II (17%).
Mr. Virola noted that the CAR and regions II and VII were not among the poorest. “[However,] CAR and Region II appear to exhibit extreme behavior… they are home to families who are the highest savers as well as the most lavish spenders,” he added.
Data also showed that households headed by females saved consistently higher versus male-dominated households, with the former spending less on food, non-durable furnishing, clothing and footwear and the latter spending less on recreation, special family occasions, gifts and contributions.
For non-savers, households headed by females spent more on personal care and contributions while male-headed households spent more on alcohol, tobacco and durable furnishing.
Households headed by singles had similar saving patterns with households headed by married people, but the former spent less on food, fuel, light, water, education, non-durable furnishing, house maintenance and repair. Households of married couples spent less on recreation, alcohol, gifts, and contributions.
Non-saving households headed by singles had a narrower deficit than those headed by married people — 15% versus 16% — which could explain why fewer people are tying the knot, Mr. Virola said.
“Clearly, the challenge for those of us not on the Forbes List is how to spend our money more wisely — less on non-basic expenditures so that we will have more for essentials…,” he said.
Invoke Article 33 of the ILO constitution
against the military junta in Myanmar
to carry out the 2021 ILO Commission of Inquiry recommendations
against serious violations of Forced Labour and Freedom of Association protocols.
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