In the UAE, a severe absence of a savings culture, that’s been said and proven time and time again. The image of a tax-free salary and comfortable lifestyle continues to attract thousands of expatriates from all over the world to leave their homes, jobs and even families, to come to UAE for a better life.
But are we saving this ‘extra’ money we’re supposedly earning here? The results of yet another survey say otherwise.
Souqalmal.com, a leading price comparison site in the Middle East, says that 65 percent of their 900 respondents admit they want to be saving more than they actually are. So, on the bright side, at least there’s a desire to save, but half of them claim they save absolutely nothing at all, while 44 percent complain that they’re saving less than they did three years ago.
“The combination of high living costs, the perception of “being rich” due to no taxes and a lack of education on how to manage income and debt could explain the results of our survey,’ says Ambareen Musa, Souqalmal’s founder.
“While enjoying a good quality of life now is important, saving adequate amounts for the future is even more so, especially as people typically do not accrue social benefits while working in the UAE,” says Musa.
The next bit of the study groups the best savers in the country according to their nationality – and if you’d allow Kipp to slightly digress – we must say we aren’t completely fond of segregation by nationality. But here are the facts if you’re interested.
Apparently, western expats are the best savers; being able to put 10 to 30 percent of their monthly income away, followed by Asian expats, with one third of them saving within that same range. Thirty percent of nationals in the UAE do not save any money at all and, lastly, the study suggests that ‘Arab expats seem to find it harder to save’ with 12 percent admitting they don’t even know how to save and 32 percent claiming they save nothing at all.
Why people fail to save ? It is the Plastic money culture which is on boom again. Banks have smartly trapped people by allowing a limit of 1.5 times the actual pay cheque. means if a person is making AED 5000 the credit card limit is AED 7000. Such entrapment is the root cause of Zero-Savings culture across local & expatriates equally. While the locals manage to get a waiver for fees & markups, and can pay off in easy installments after settlement, while the expats end up in jails. Thats called Discriminated Economic Lynching ! :)