Since the Covid-19 pandemic began, health, in all its aspects, has become at the center of the population’s concerns. In the first place, of course, the main concern has had to do with the possible damage to one’s own health and that of loved ones that the coronavirus supposes.

On the other hand, the months of confinement, the severe restrictions on mobility and socialization – which in many cases have sadly been accompanied by the loss of family and friends – have also taken a toll on the mental health of many people. Finally, financial healtha very important part of the population – affected by the ertes, the restrictions on various sectors and the practical disappearance of the underground economy for months – has not emerged, far from it, unscathed.

This last ‘type’ of health is perhaps the least known, but it directly affects the personal development of individuals. “Good financial health is one that allows people to have sufficient resources during the different stages of their lives,” summarized Alberto Guillén, head of digital products at BBVA in Spain , during the virtual round table on The financial health of citizens in the post-covid era, organized by BBVA and El PERIÓDICO and moderated by journalist Eduard Palomares .

According to the experts who participated in the event, in a time of intense uncertainty such as the one we are experiencing, taking care of one’s finances takes on special importance.

“It is very difficult to make forecasts of what is going to happen because we do not have close historical antecedents with which to compare ourselves ,” said Ramón Xifré doctor in Economics, ESCI-UPF professor and former advisor to the Economic Office of the President of the Spanish Government .

“What does seem clear – Xifré continued – is that the recovery will not be as fast as was initially thought and, in the case of Spain, the restoration of employment at pre-pandemic rates will not arrive until 2023” .

The poor situation in the labor market is obviously a serious threat to the unemployed, Erte and those with precarious jobs. However, and although it may seem paradoxical, the extraordinary savings that many families have made during the last year can also be a risk for households . “Households have accumulated a large amount of capital.

The problem is that this saving has not been the product of a habit, but has been forced, and this may cause that, as the restrictions disappear, there is a temptation to squander these resources ”, Alberto Guillén warned.

The data shows how the current accounts of Spaniards have been filled during the pandemic. According to data from the INE, families saved 108,844 million euros in 2020, which was 126.6% more compared to the previous year . This meant reaching a savings rate of 14.8%, 8.5 points higher than in 2019 , in what was the highest record in the historical series that began in 1999.

In this context, Alberto Guillén advises not to get carried away by the “euphoria” that seeing a large number in the bank statement can entail, while also highlighting the importance of having a cushion for unforeseen events that may come.

Joan Tarradellas, doctor in ADE and professor of finance and management control at EADA , expressed himself in the same vein: “With structurally high youth unemployment -which can force parents to support their children for longer than expected- and doubts about the future of pensions, saving is more important than ever ”.

Recipes for Financial Health

\All the panelists who took the floor agreed that there is no magic formula to achieve good financial health, but that the actions carried out by each individual or family must be based on their own idiosyncrasies and their tolerance for risk , among others. factors. However, some references such as 50-30-20 were put on the table.

An ‘app’ to improve financial health
As with physical health, when it comes to financial health, each person is responsible for ensuring their own well-being. However, beyond the actions that you carry out yourself, there are tools that help you manage personal finances more efficiently.

This is the case of the BBVA mobile application, which has recently been comprehensively renovated and has expanded its services to help the bank’s clients with regard to managing their finances. “The application includes notices to alert that relevant expenses are coming, such as the IBI receipt, as well as personalized advice to optimize savings and improve investments,” explains Jaume Guillén, head of digital products at BBVA in Spain.

One of the main novelties introduced in the app is to offer a global vision of your net worth, that is, the difference between your capital in products -accounts, savings and investment, housing- and debt -loans, mortgages, credit cards. credit-. All this data provides relevant information that allows users to make better informed financial decisions.

This numerical series refers to a spending pattern whereby 50% of income should be used to cover basic needs, 30% for useful but not essential expenses and the rest should be saved. “Another ‘norm’ is that savings should be at least the equivalent of between 3 and 6 months of fixed expenses ,” said Guillén, while insisting that these figures “are mere guides, not fixed rules.”

“The need to reserve more or less money depends on factors such as age, if you have dependent children who will have to pay for their studies and / or parents who will need care soon and, of course, also on the relationship between our assets and our debt ”, listed the academic Joan Tarradellas.

Be that as it may, good financial health usually starts from a day-to-day control and a balance between expenses and income. “And once this has been achieved, it is when they can begin to consider future objectives that involve an important investment such as the purchase of a car, a property or a retirement plan,” said Alberto Guillén.

The return on savings
Another leg of financial health, beyond accumulating resources to face possible unforeseen events, is the one that refers to getting a return on savings . In a context in which current accounts generate practically no interest, users must seek other solutions to, at a minimum, protect their savings.

“The average of the inflation oscillates between 1% and 2%. This, from one year to the next, does not make a big difference, but if we broaden the focus to 2 or 3 decades, the loss of purchasing power can be very important ”, recalled Alberto Guillén.

“By accumulating the money in a savings account or investing it in solvent state bonds, we will obtain very little return or even negative returns. In this sense, investment funds can be a product that makes sense , although it should always be analyzed on a case-by-case basis ”, Joan Tarradellas added. “On the other hand,” continued the EADA professor, “the real estate sector continues to be an option that many families are betting on.”

Alberto Guillén, as a representative of a financial institution, stressed that the objective of banks is “to help customers plan their savings in the medium and long term” beyond the debate on which products are the most advantageous. And to achieve this goal, technology plays an increasingly important role.

“Technological advances help us to highly sophisticated user profiles to make increasingly personalized, useful and safe recommendations,” said the BBVA executive. In this sense, and without neglecting the importance of financial education, Joan Tarradellas pointed out that “technology in the banking sector is increasingly mature” and this allows, for example, “to use artificial intelligence to advise users”.

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