An International Comparison of Financial Satisfaction among the over-50s

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FINDINGS 4: FINANCIAL DIMENSIONS OF WELLBEING IN OLD AGE

Using a major international dataset – the World Values Survey – this blog presents preliminary findings about levels of self-reported financial satisfaction. Analysing data from 56 countries over six continents, these findings throw new light on levels of financial satisfaction within and between countries. We plan further detailed analysis that will be of use to both international practitioners and policy-makers alike.

The collaboration between ILC-UK and the Personal Finance Research Centre (funded by the ESRC) is now in full swing and has been producing results from several data sources. The project looks at financial dimensions of wellbeing and wider quality of life measures in older age. It began in earnest earlier this year and we have presented our work at several national and international conferences, as well as publishing our results widely [1]. This is the fourth in a series of blogs to highlight emerging findings from the research.

In this analysis we use data from the World Values Survey to compare levels of financial satisfaction by country [2]. The World Values Survey is a cross-national survey of more than 80 countries, recording data about people’s socio-economic, cultural and political circumstances and attitudes. Our analysis focuses on individuals aged 50 and over, and uses the latest available wave of data (2005-2008). In this wave, the dataset contains around 25,000 individuals aged 50+ in 56 countries (not all countries are surveyed at all waves), and is weighted to be nationally representative.

Across all of the countries included in our analysis, 55 per cent of those aged 50+ report being satisfied with their household’s financial situation is 55 per cent. However, this varies dramatically by country. Over 80 per cent of Britons aged 50 and above report that they are satisfied with the financial situation of their household, the seventh-highest percentage among all countries surveyed. The Swiss have the highest level of financial satisfaction among older people (88 per cent are satisfied with their household’s financial situation) followed by three Nordic countries – Norway, Sweden and Finland (85, 84, and 83 per cent respectively).

Former communist states dominate the bottom of the ranking, with Georgia displaying the lowest levels of financial satisfaction among older citizens (12 per cent), followed by Bulgaria and Moldova (15 and 23 per cent respectively). Indeed, six of the ten countries with the lowest levels of financial satisfaction among individuals aged 50+ were communist regimes until the early 1990s.

Along with Bulgaria, Romania is the other new member state of the EU included in the survey. Although the percentage of older Romanians who report being satisfied is double that of the Bulgarians (30 per cent), Romania still ranks in the bottom third of the 56 countries.

Interestingly, France, Germany and the United States trail Great Britain in terms of older people’s financial satisfaction. About two-thirds of French and German individuals aged 50+ report being satisfied with their financial situation (65 and 61 per cent), with a similar percentage of older Americans being satisfied (64 per cent).

Of the African countries included in the survey, the picture is one of dissatisfaction. Less than a quarter of Rwandans aged 50 and above report being satisfied with their household’s financial situation (24 per cent), while levels of financial satisfaction among older people are also relatively low in Burkina Faso, Ethiopia, Morocco and Egypt (27, 29, 36 and 38 per cent respectively).

Finally, to contextualise some of these results, the global average of financial satisfaction among younger individuals (aged 16-49) is 52 per cent, slightly lower than the figure for those aged 50 and above. However, in Great Britain, there is a substantial and highly significant difference. While 80 per cent of older Britons report being satisfied with their financial situation, only two-thirds (66 per cent) of those aged under 50 feel the same.

Over the coming months, we will unpick both the individual and the macro-level determinants of financial satisfaction, and provide a detailed picture of levels of financial satisfaction between groups of individuals, and within and between countries.

[2] This blog concentrates solely on data aggregated to the country-level. In the full analysis we will unpack both individual and macro-level predictors of financial satisfaction, using a multilevel methodology. The findings from this further analysis will be published over the coming months.

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