More than half of the UAE’s residents see debt as being part of their lives for the forseeable future, the results of a survey show.
Fifty-seven per cent of the survey’s respondents said they had a long way to go before becoming free of debt, and nearly half do not have a savings plan in place.
That is according to a YouGov survey that was conducted in collaboration with UAE Saves Week, an initiative aimed at the advancement of financial literacy in the country.
The findings echo HSBC research that shows 50 per cent of UAE residents are not regular savers.
More than 60 per cent of the YouGov survey respondents said they would not be able to rely on their savings for more than six months if their sources of income dried up.
“We have been hearing about concerns regarding personal financial health in the UAE for a long time now and they are ever-increasing,” said Nima Abu-Wardeh, the founder and chief executive of cashy.me, the organiser of UAE Saves Week.
“Fast-paced lifestyles, tax-free living and high disposable incomes all contribute to this, and easy access to external sources of income aggravates the trend further.
“UAE Saves Week is dedicated to helping people in physically making small changes in their lives that will ultimately lead to better financial health and overall happiness,” said Ms Abu-Wardeh.
Indeed, data from the Central Bank show that personal loans extended to residents increased by Dh3.8 billion in June, the sixth consecutive month of increases.
It was the biggest monthly increase in the three years of Central Bank records.
Total personal lending has risen by Dh15.3bn this year. That is equivalent to the total amount of new consumer credit extended over the preceding two-and-a-half years. In all, the UAE had outstanding consumer loans of Dh276.2bn at the end of June.
Today, UAE Saves Week, which hopes to improve UAE residents’ money management ability in small incremental steps, moves into Wise Up Wednesday, culminating in Frugal Friday and Stick With It Saturday.
Wise Up Wednesday calls on residents to “wake up” and “learn where you could be saving yourself a headache” when it comes to dealing with banks, financial statements and the “misunderstandings” that could cost time and money.
“There is a lot of free literature on financial management but we know that it is easier said than done,” said Ms Abu-Wardeh, who is also a columnist for The National.
“We launched UAE Saves Week with the objective of helping people take the first steps towards saving money and, hopefully, to continue to practice these lessons for the rest of their lives.”
For more information on UAE Saves Week visit http://www.cashy.me/en/uaesw2013/uae-saves-week-2013/