Investing

The Ten Countries Where People Save the Most Money

5. Germany
> Pct. savings: 11.4%
> Unemployment: 7.1%
> Disposable income: $27,665
> Debt as a % of GDP: 87%
> Pct. earnings paid to taxes: 41.3%

In 2009, the average German earned $47,882 before taxes. This was more than all but a handful of wealthy central and northern European nations. However, the country also has the second-highest tax rate in the OECD, behind Belgium. Despite paying more than 40% of their income on taxes and social security payments, residents’ average disposable income is still nearly $28,000. The average resident spends more than 16 hours each week on leisure and personal care. Despite the time spent, Germans still save 11.4% of their disposable income.

4. Belgium
> Pct. savings: 12.2%
> Unemployment: 8.3%
> Disposable income: $26,008
> Debt as a % of GDP: 100.7%
> Pct. earnings paid to taxes: 41.5%

The average Belgian devotes 16.61 hours per week to leisure — quite high among OECD countries. Residents of Belgium have an above average income, although a large percentage of this goes to taxes. Belgians’ total payments to the government in the form of income tax and social security contributions is 41.5% of their total wage earnings, the highest rate among all OECD nations. Of what is left over, Belgians save 12.2%.

3. Spain
> Pct. savings: 13.1%
> Unemployment: 20.1%
> Disposable income: $22,972
> Debt as a % of GDP: 66.1%
> Pct. earnings paid to taxes: 19.7%

Unlike many of the nations on this list, Spain’s economy is in terrible shape. The unemployment rate of more than 20% is by far the highest in the OECD. In 2010, the government’s deficit was 9.2% of GDP, an improvement from 2009’s 11.1%. In that year, possibly in response to the troubled economy, the nation’s residents saved 18% of their income, the most among developed nations. As conditions worsened (unemployment hit 21% in June) the amount Spaniards have been able to save has dropped. Despite relatively low gross income and poor economic conditions, residents do benefit from a tax rate of less than 20%.

2. France
> Pct. savings: 16%
> Unemployment: 9.8%
> Disposable income: $27,508
> Debt as a % of GDP: 94.1%
> Pct. earnings paid to taxes: 27.7%

The rate of saving among the French has increased over the past five years, although it has been relatively high for quite some time. This is probably a good thing given that the country underwent a slew of negative effects following the global recession. In 2009, the country’s GDP contracted 2.5%. From 2009 to 2010, the unemployment rate increased from 7.4% to 9.5%. The government’s aggressive actions in trying to fight the effects of the recession “are contributing to a deterioration of France’s public finances,” according to the CIA World Factbook.

1. Ireland
> Pct. savings: 19.3%
> Unemployment: 13.7%
> Disposable income: $24,313
> Debt as a % of GDP: 102.4%
> Pct. earnings paid to taxes: 20.9%

Ireland was once the healthiest and fastest growing economy in Europe. That changed during the recession. In 2006, the Irish government had a budget surplus of 2.9% of GDP. In 2010, it accrued a staggering deficit of 32.4% of GDP. As the country’s debt grew and record unemployment was reached, citizens began saving a much higher portion of their disposable income. Despite having generally low household wealth, Ireland’s tax rate of just over 20% is one of the lowest in the OECD.

Michael A. Sauter, Charles B. Stockdale and Douglas A. McIntyre

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