Hi, Brother, why did you stop buying?

In total, Finnish households have dramatically decreased spending on consumer goods.  We would like to ask why.

According to the Finnish consumer confidence indicator from January 2014, only 14 per cent of consumers fear that their own economy would worsen over the year. Also, Nordea Bank’s recent study shows that majority of Finnish households earning over 35,000 euros per year don’t feel they have less money to spend than a year before. These studies show that most consumers would have money to spend, if they wanted to.

We don’t believe that all the money goes to foreign online stores instead of Finnish retail shops as public opinion speculates. We rather believe that the general attitudes toward excessive spending have changed after the 2008 banking crisis, maybe for good.

In addition, the public sentiment in Finland is very concerned about national debt and our six-pack government is looking more distressed week after week. This affects consumers making them cautious and the shop-till-you-drop days are over.

It is true that unemployment has risen, tax burden is increasing and there is a lot to worry about. However, there are still plenty of households that are doing just fine. So where does the money go?

Empty pockets

We claim that, in the competition of consumers’ money, the winner is the financial sector. Finnish consumer confidence indicator states that 76 per cent of all consumers believed they would be able to put money aside for savings during the next 12 months. Last year, the most common investment targets were mutual funds, also the number of private stock holders has increased.

Brothers and Sisters, did you stop buying because you started saving? Maybe the new megatrend is saving for a rainy day.

M&M

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3 Responses to Hi, Brother, why did you stop buying?

  1. tertturuu says:

    I think there really is some kind of megatrend ; “buy less and have more”. It is also a question of sustainable development; for me it means that I try to buy products which don’t have harmful effects on my health nor on the environment. On the other hand it means also that I can’t buy all I want because for example organic products are much more expensive than the ordinary products. So there are two choices; I have to save some money to get these good quality products (= not harmful for environment) or I decide not to buy them at all. Of course I’m saving also for the rainy or a sunny day….>)

  2. hannakoivukoski says:

    That’s true that many people are investing in high quality, which leaves less money to use for another things. I’m trying to go for that too, but as a student it’s not always that easy. For example Michael Kors bag feels quite expensive for low budget, so it’s easier to buy cheaper one. But, that means you have to buy many of them, because they don’t last. The problem for me is that I don’t usually have big moneys at the moment to buy expensive stuff (Unless when I’m working at summertime). I have to save for bigger shopping. Moreover, I’m saving to travelling and my own apartment too. It makes such challenging combination..

  3. It is always very hard to explain people’s behaviour and the reasons for not buying can be very varied. In spite of the relative certainty in the economic stability, people learned from the governments’ mistakes and are anyway cautious about their spending. Besides, it is one of the main rules of economics that the value of the money tomorrow is greater than today. People realize that today more than ever.

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