Research by TNS Emor into the financial behaviour of Estonian households shows that 72% of households believe they could put some money aside every month if needed. This figure reached as high as 77% of households before the financial crisis hit, but by 2012 it had fallen to 65%. In the immediate aftermath of the economic crisis it was mainly families with higher incomes that thought that their ability to save was improving, but in the past two years families with lower incomes are estimated to have improved their capacity for saving.

The improved ability to save means that there has also been an increase in the number of families that have financial savings. The research shows that 59% of Estonian households had financial savings in September 2014. Although this share has increased by six percentage points over two years, it still remains smaller than before the crisis and it is somewhat worrying that 41% of households still report having no money saved.

In September close to 245,000 families in Estonia, or 41% of all households, had loans. These numbers have been relatively stable throughout the past four years, and loans are still mostly taken for buying, building or repairing homes. However, there has been steady growth in purchases that are paid for in instalments or loans for purchasing durable goods, which indicates greater capacity for borrowing than during the crisis and increased confidence, and probably also a wider range of products that can be paid for in instalments.

In the past year, 8% of Estonian families have wanted to take a loan to buy or renovate a property, and 58% managed to borrow as much as they wanted to, while 31% of loan applications for housing loans were rejected and 8% were given less than they wanted. Consumer loans were also sought by 8% of families and 78% of applications were granted in full. The share of loans that were granted was larger for both types of loan than it was two years ago.

There were around 31,000 households who have had difficulties making repayments on loans in the past year, which is around 13% of all the households who have taken loans. Of these households, 2/3 say that they were affected by temporary financial difficulties, while 1/3 said their difficulties were permanent. The share of families facing payment difficulties is slightly smaller than two years ago.

The monthly payment of principal and interest is below 20% of income for more than half of families with loans. The families with greater difficulties are those whose monthly loan repayments exceed 40% of their income, and they make up one tenth of families with loans.

The survey by TNS Emor was conducted in August and September this year and covered 955 households, with respondents aged between 18 and 74. The survey was commissioned by Eesti Pank.
TNS Emor has been conducting the F-monitoring survey since 1998. The survey maps changes in how Estonian households use money and in the options and desires behind their financial behaviour.

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Ingrid Mitt
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