Poll Shows Israelis Savvy About Money, Not Investments
A poll by the Central Bureau of Statistics showed that Israelis were very savvy about money matters: 84% of those polled said that they “watched their monthly expenses carefully,” while 82% said that they pay their bills on time. Eighty one percent testified about themselves that they were careful shoppers, agreeing with the sentence “I compare prices before I buy.”
The picture was far different when it came to investments. Only 27% agreed with the sentiment that “my knowledge is sufficient to enable me to choose the best investment vehicle.” A similar number agreed with the sentence “I compare between the investment vehicles and financial plants before choosing an investment plan.”
Fifty seven percent of those polled said they had an investment setup or pension plan, while 67% said they had extended health insurance or long-term nursing home care insurance. However, only 28% said they had mortgage insurance, which pays off the debt on a mortgage in the event of the death of the mortgage holder.
Israelis are not as savvy as residents of other OECD countries on matters of finance, the poll showed. While 82% of residents in 14 OECD countries could figure out the rate of return on 2% annual compounded interest on an investment of 1,000 of the unit of currency in each country, only 59% of Israelis could figure out the return on a NIS 1,000 investment. Eighty percent of foreign respondents said that they understood the sentence “the cost of living goes up more quickly when inflation is higher,” while 65% of Israelis said they understood that sentence. In addition, only 48% of Israelis said that the sentence “an investment with a high return is usually a more risky one,” as opposed to 71% of respondents in other OECD countries.
The poll also showed that Israelis perceive themselves as having a difficult time economically. Forty five percent of those polled said that they agreed with the sentiment that “most months of the year I have a difficult time making ends meet.”
The poll was taken between January and May of this year, with a scientifically representative 1,200 Israelis ages 20 and up participating.