Kruk investigated how residents of western Poland deal with expenditure

Kruk investigated how residents of western Poland deal with expenditure

krukOnly one in 10 inhabitants of the provinces of Lower Silesia and Lubuskie puts aside money for the future on a regular basis – this is a conclusion of a study commissioned by the KRUK Group in Wroclaw. It also turned out that almost every fourth inhabitant of western Poland had a delay in repayment of their debts.

As shown by the study conducted by the Institute of Millward Brown on behalf of the KRUK Group, a leader in the receivables management market in Central Europe and Polish Champion program participant, only 1 in 10 residents of the western region (the provinces of Lower Silesia and Lubuskie) assess their financial situation as positive.

This means that they do not experience delays in payment and manage to accumulate money for the future on a regular basis. This result is significantly lower than the average for the whole country, which is 17 percent. In contrast, 69 percent of respondents from the western provinces declare that they spend as much money as they earn.

Another 17 percent claim that their expenses exceed earnings. This means that almost nine out of ten residents of Lower Silesia and Lubuskie does not collect any savings.

“Analyzing the results of the survey, you can make the diagnosis that if the household monthly balance of the vast majority of residents of Lubuskie and Lower Silesia provinces is zero, each new expenditure that appears can have serious consequences on a household budget. Such a situation is dangerous because it can lead to a backlog of timely repayment obligations and in the long term to falling into serious debt” says Iwona Słomska of the KRUK Group.

What are we happy to spend money on?

Millward Brown also confirmed what most residents of the western region spend money on. These are relatively small expenses generating immediate gratification, such as clothing, shoes, gifts for loved ones or food. This is no different than the average for the whole Polish.

However, according to the answers of respondents, residents of the Lubuskie and Lower Silesia region are more likely to spend their earnings on holidays and short breaks than the rest of the country.

What about loans?

Only 13 percent of Poles declared their willingness to take a loan any time soon. The most common needs of the borrowers are expenses that they have planned earlier, but still have not gathered the necessary savings for.

With borrowed money they want to fund a house renovation, a new car or home electronics. Other objectives indicated by respondents included health treatment, car repair, holidays or weekend trips.

Residents of the western region are much more likely to decide to take a loan – every third of them plans to have one. But this is only the declarative sphere – 35 percent of Poles admitted that in the past they took out a loan, for, among others, the purchase of household appliances. In this category the residents of Lower Silesia and Lubuskie also surpassed the average – 43 percent of them helped themselves with a loan.

Delays and backlogs

Respondents also answered questions related to delays in repayment of obligations. While every sixth/seventh Pole has confirmed they have sometimes not paid bills or for other services on time, among residents of the western region this answer was much more common, as many as one-quarter of cases.

“In the first quarter of 2015, the debt of inhabitants of the province of Lower Silesia operated by the Group Kruk was more than 1.6 billion zloty, and the province of Lubuskie – 537 million zloty. The total number of people in debt is over 200 thousand for Lower Silesia and nearly 70 thousand for Lubuskie. Their average debt exceeds 6 thousand zloty. In both regions men are more likely to get into debt – they constitute, respectively, 58 and 59 percent of the indebted and are on average 45 and 46 years old. Interestingly, the record debt in Lubuskie province is 2.3 million zloty, while the most indebted resident of Lower Silesia slightly exceeded 1 million zloty debt,” says Iwona Słomska.

The study was conducted by Millward Brown Institute at the request of the KRUK Group in March 2015 on a group of 1012 Poles aged 18 and older.