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Nearly 50% of Hungarians Unsatisfied With Financial Situation

Analysis

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Nearly half of Hungarians (46%) are not satisfied with their financial situation, and almost 60% say that their finances have worsened in recent years, according to NN's 2023 Longevity Survey.

Generally, Hungarians are pessimistic about the future, with 28% saying it is impossible to achieve what they want out of life, according to the survey. While life expectancy at birth continues to rise, only 38% of Hungarians feel ready for a longer life.

The results of the international survey show that in the area of finances, Hungary is performing moderately poorly compared to the international field. It also showed that Hungary is one of the most pessimistic countries. After Japan, Belgium, and Slovakia, the proportion of Hungarians who are optimistic about the future is the lowest, at only 16%, while 84% expressed various concerns. 

Financial Troubles

Pessimism in Hungary is fuelled above all by the challenges facing households and the country's economy: two-thirds of respondents said the cost of living and inflation were the main causes for concern, while 41% saw serious risks in the economy and employment. The survey found that almost three-quarters of Hungarians face financial challenges of varying degrees (33% more serious, 41% more moderate) and only a quarter said they had no such problems. A fifth of respondents are making efforts to secure themselves financially, while 35% are not.

It is therefore not surprising that nearly half of Hungarians (46%) are not satisfied with their financial situation. One in three say they struggle to make ends meet, 18% rely on family or friends for financial help and only 41% have at least three months' savings. This gloom is reinforced by the fact that 59% of Hungarians say their own financial situation has worsened in recent years.

Some 28% of those surveyed said they felt that their financial situation meant that they had no chance of achieving what they wanted out of life.

Trust in State Pension System Remains High

That said, the level of confidence in the state pension system is remarkable: about 79% of respondents overall have confidence that they will receive this benefit in the future. 

However, many people are already taking advantage of pension savings: for example, there are already more than 440,000 pension insurance contracts in Hungary, which has almost doubled since 2017. However, it can be seen that the phenomenon of "euroization" in pension savings is also gaining momentum, NN notes.

"We are seeing a growing interest in euro-based savings from customers. Our survey last year showed that 60% of respondents would be more comfortable holding their savings in euros. Recognizing this demand, NN Insurance will launch our new Motiva regular premium unit-linked pension insurance, now based on the euro, at the end of May", said Bence Holló, president and CEO of NN Insurance.

He stressed that in today's turbulent environment, it is understandable that customers are looking for stability and predictability, given the strong positive and negative fluctuations in the forint exchange rate. 

However, as pre-savings are increasing, active age is also being extended with longer life expectancy. According to the Longevity survey, the over-60s are increasingly seen as less likely to stop being active, with 61% of respondents planning to work beyond retirement age.

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