How to save the savings of Italians suffering from recession in checking accounts

Italian savers love liquidity, they are always ready to deposit their money in their checking account and leave it there for times of need. The household saving rate in our country is traditionally high, among the highest in Europe, and the economic situation in the past two decades has certainly not helped to change this aspect.

Since the economic crisis in the first decade of the twenty-first century, the propensity to save has recorded a continuous growth, as today bank deposits have grown by 48% compared to the end of 2010. Then came Covid-19 and the propensity to save increased again: + 7.4 points between 2019 and 2020 Altogether, household savings increased by 130 billion in the 2020-2021 pandemic. In practice, living with Covid has convinced Italians to save more. And in the first three months of 2022, the value of bank deposits increased by 10 billion compared to 2021.

In 2021, the savings rate fell to 14.9%, maintaining a 4.9-point increase over pre-pandemic levels. It is no coincidence that in April 2022, compared to the same month the previous year, bank deposits of Italian families grew by 4.4%. Even compared to December 2021, liquidity has grown by 1.3%.

As in many other sectors, the pandemic has accelerated all the trends already underway: the growth of Italian household bank deposits increased even more despite already high, and as of July 1, 2022, average deposit account rates showed the first upward trend of About 0.15% to 0.25%, depending on the duration of the restrictions.

According to neuroscientist Lorenzo Dornetti, this is the result of an extreme form of fear: “Frightened people engage in two instinctive behavior patterns out of deep inertia: procrastination and accumulating. They postpone all unnecessary purchases and allocate resources for the future. The astonishing growth in current account holdings, even in these hyperinflated months, has a psychological, quasi-neuropsychological matrix,” he wrote in Il Sole 24 Ore at the beginning of June.

The low propensity to invest, poor financial knowledge and fear of markets drive savers to keep money in their accounts rather than invest it, even though they know that they will not get any returns in the future. But at a time like this, leaving a lot of cash in your checking account may not be a good idea.

Inflation is the main danger: it must be remembered that inflation is a general and constant increase in the prices of goods and services, and involves the loss of purchasing power of a currency. In this way, it also reduces the value of savings over time: the same amount deposited in a checking account will be worth much less after a year of high inflation.

Today, inflation has broken the barriers that have been in place for decades. For Istat, it rose in June to 8%, a level not recorded since January 1986 (when it was 8.2%); For the year 2022 acquired is +6.4%. Figures that put Italians’ savings at risk.

Precisely for this reason, the European Central Bank (ECB) announced on June 9 that it would raise interest rates for the first time in ten years, and since July it has suspended its major government bond purchase program, which has been active for more than. eight years. Specifically, the goal is to mitigate the impact of inflation, with rates first raising to 0.25% in July, then to 0.5% in September.

In an attempt to address the severity of the liquidity stagnation in checking accounts, many Italian institutions offer convenient, simple and affordable investments: with no-cost solutions, many savers can avoid seeing their savings in their accounts depleted.

Deposit account is a solution that gives its subscribers high interest based on the amount invested. It is a form of investment without risk. There are two main types of deposit accounts: the free type allows you to withdraw the invested capital at any time; The limiter allows you to withdraw the invested amount only after the agreed period, which guarantees you greater returns.

Banca Ifis offers a very diversified solution with Rendimax Conto Deposito, a savings deposit account that allows you to create different types of deposits, according to one’s needs and preferences: a free savings deposit account (Libero), with a notice (such) and restricted savings (escrow).

Using these solutions, the Institute undertakes to return the amount of money on demand at a time chosen by the client, or upon expiry of the term (binding) or notice (such), acknowledging the mutual interests. As of July 4, Banca Ifis has raised the returns on all offers: the new returns are more advantageous and reach a maximum of 2.5% per annum.

With regard to the term deposit, the customer must indicate the amount to be committed, the term of the restriction and the method of payment of interest pre-determined within the indicated options. Interest will accrue on the amounts deposited to the extent determined by the agreement between the Bank and the Customer. But the latter can take advantage of the Like service by transferring, even at different times, all or part of the amount – as long as it is liquid and available in the Rendimax Conto Deposito. In this case, the person may request re-credit, in whole or in part, of amounts from Like to Rendimax Conto Deposito at any time, provided that the 33-day notice period is respected.

Banca Ifis is not the only organization providing this type of service. The start-up Illimity Bank specializes in lending to small and medium-sized enterprises, but also caters to individuals with various banking services, including an Illimity deposit account, which allows up to 2% return on savings (at the launch stage, recognized interests were higher than they are it today). Even the Unicredit savings books and deposit account guarantee the bank’s customers the possibility of obtaining interest on the amounts deposited: the Unicredit savings deposit is a contract under which the bank purchases the amount of funds deposited by the customer, and undertakes to return it by the agreed deadline – in the case of term deposits, generally within 6 months – or at the request of the customer, in the case of free deposits. What the bank offers instead of a deposit account with a limitation of 3, 6 or 12 months, which can be controlled Home Banking And without costs or opening fees.