One in five ‘could not handle suprise costs’

One in five Swedish households does not have enough savings to cope with unexpected costs of more than 20,000 kronor, according to a new survey.

The responses came in a survey by the Swedish Financial Supervisory Authority (Finansinspektionen – FI).

Two thirds of those surveyed said they had no plan for what to do if their incomes fell significantly for a long period. Almost ten percent said that they already find it hard to make ends meet. These households turn to credit cards (39 percent) or borrow from friends (28 percent) when they run into financial problems.

A majority of households, 70 percent, said that they had not financial problems.

When it comes to choosing a bank, respondents said that previous contact was more important than factors such as the mortgage rates on offer. Nearly half of households say they shop around before borrowing money for a property purchase.

One in two have never used a bank’s financial advisor when making decisions about their finances. Of those who have, half say they would have done just as well without the advice. Some 29 percent said they did not trust advice from the banks.

FI used a combination of telephone interviews and detailed questionnaires to carry out the survey. Of 2,354 people contacted by phone, 1,253 people agreed to complete a questionnaire. Of these, 1,019 returned completed questionnaires.