FI Analysis 28: Liquid assets of Swedish households

Aggregate statistics indicate that Swedish households are holding significant assets in the form of cash, bank savings, fund shares and securities. The overall value corresponds today to an average of SEK 1 million per household. However, because these economic buffers are unevenly distributed between households, the average is a poor measure for assessing the risk of a significant drop in consumption following an economic shock.

We therefore document the cross-sectional distribution of households' liquid assets for 2012.

We find that a large percentage of households have small liquid assets: approximately 45 per cent of households have less than SEK 100,000, and the median households have around SEK 130,000. Even though we are using data that is eight years old, there are circumstances indicating that the distribution should be the similar today. For example, the percentage that cannot pay an unexpected expense of SEK 12,000 within one month has largely remained the same since 2008.

For many households, their liquid financial assets are also small in relation to their disposable income. Approximately one out of ten households has liquid assets corresponding to at the most two months' disposable income. One out of three households have liquid assets corresponding to at the most four months' income. These results are in line with similar studies for other countries and with Swedish surveys.

We find that the liquid assets are just as unevenly distributed among the households with the largest interest expenses. Overall, this means that the liquid assets of a large percentage of households are so small that these households may be forced to reduce their consumption expenses immediately following an economic shock.

Laddar sidan