EMEA Chief Market Strategist
Global Market Analyst
It is well known that European savers do not access capital markets to the same extent as US households. The reluctance of Europeans to invest is having a tremendous cost, not just on individuals, but also on Europe’s economy and on political stability across the continent. We are pleased to see that tackling this issue is becoming a top priority for European policymakers1.
This research, based on an independent survey of 17,000 households across nine European countries, aims to shed light on the reasons behind the choices that European households are making. Only when armed with this knowledge can we hope to find a solution. Our key findings are as follows:
- Lacking a plan: Less than a quarter of Europeans have a clear savings plan that they are following to fund their retirement.
- Overreliance on government: Around 30% of respondents across Europe said they were relying mostly on a government pension for their retirement funding. Concerningly, this is most apparent in the highly indebted countries.
- Dependence on cash: 27% of individuals have the majority of their non-emergency savings in cash.
- Fear: The most commonly cited reason for not owning stocks was the risk of losing money.
- Lack of financial knowledge: 18% of respondents believe that cash will provide the best long-term returns, vs. 15% who believe stocks and shares will provide the best long-term returns.
A survey of European household attitudes to saving and investing
This report draws on data from a survey commissioned by J.P. Morgan Asset Management and conducted in partnership with Opinium to understand the savings behaviour of European households.
The research surveyed a representative sample of 17,000 adults aged 18 to 65 across nine European countries: Germany, France, Italy, Spain, Poland, Netherlands, Belgium, Sweden and Finland. Samples comprised 2,000 respondents per country, except for Finland, where 1,000 adults were surveyed. Fieldwork was carried out in the second half of July 2026.
Where results are presented at the European level, figures are weighted by population using United Nations data for 2025.
Europe’s tendency to sit in cash bears a great opportunity cost. Had the EUR 2.8 trillion that EU households have saved in cash or cash-like instruments since the start of the pandemic been invested in global stocks it would now be worth EUR 5.4 trillion. Having sat in cash it is worth just EUR 3.0 trillion. The combination of fear and lack of knowledge has cost European households EUR 2.4 trillion in the last six years alone2. Putting this right must be treated as a matter of urgency. These results present a great opportunity for policymakers, and all those in the financial industry across Europe, to work together to generate change. The time to act is now.
From lose-lose-lose to win-win-win
Europeans have always been bigger savers than their US counterparts. Since the start of the pandemic, however, European households have been saving even more than usual, with a sizeable share of this parked in cash. In fact, since the start of 2020, EU households have added an additional EUR 2.8 trillion to savings held in cash or cash-like instruments, taking the total cash pot to EUR 12.4 trillion.
This reliance on cash is resulting in a significant loss for individuals and is putting the financial outcomes that they deserve at risk. Although cash interest rates are higher than the dismal rates on offer for much of the last decade, real cash rates remain low to negative across most EU member states, accounting for the fact that inflation is higher. Equity markets, by contrast, have provided much greater recent returns, buoyed by strong corporate earnings as new technologies permeate the globe. By remaining in cash, individuals risk missing out on the long-term growth potential of equity investing, and the opportunity to secure a more comfortable financial future.
High cash savings rates are also having a significant negative impact on the health of the European economy. The flipside of high household savings is, of course, lower consumption, which is harmful to economic activity unless these savings are channelled to businesses via investment. Savings held in cash are not obviously serving this purpose. Both consumption and investment have grown by substantially less in the eurozone than the US since the pandemic.
While these two issues are increasingly being discussed, what has not been acknowledged is the impact on the political cohesion that underpins the European Union. The fact that not enough European households are benefiting from buoyant stock markets is helping to fuel wealth inequality and political discontent, providing fertile ground for populists to claim that the European Union isn’t working for nation states.
We therefore need to turn the situation from lose-lose-lose to win-win-win. Supporting households to make their precious savings work harder will not only give them a better chance of reaching their financial goals, including a comfortable retirement, but also help fuel business investment, revive growth and remove the foundations of populist appeal.
While the need to fix the savings problem is clear, the difficulty is how. To help answer this question, our independently commissioned survey has been specifically designed to provide a better understanding of household attitudes and behaviours towards saving and investing across Europe.
What did we discover?
Europeans are confident about their retirement outcomes…
One of the first questions we asked our respondents was whether they felt good about their financial future and, in particular, the standard of living they would have in retirement. The response showed that Europeans are generally confident about their financial outcomes. More than 50% of respondents said that they are at least somewhat confident that they will be able to afford their desired standard of living in retirement.
…but lack a plan
So far, so good. Until we dig into how well-founded this confidence is.
We asked households how far along they are in planning to meet their retirement objectives. Less than a quarter said they have a clear plan that they are actively saving towards. Almost 22% of respondents haven’t started thinking about a savings plan at all. If these respondents were all young individuals, this lack of a plan might be excusable. However, 20% of Generation X respondents, who are aged 46 to 61 and should therefore be in their peak ‘saving’ years, have not started thinking about a savings plan yet.
Government to the rescue?
This lack of personal planning, combined with optimism about retirement outcomes, may be explained by a strong belief across Europe that the state will provide a comfortable retirement. Around 30% of respondents across Europe said they were relying mostly on a government pension for their retirement funding.
The concern we have is that across many European countries, government debt is relatively high, the population is ageing rapidly, and there are other spending pressures facing governments, such as a commitment to greater defence spending and upgrading ageing infrastructure. In many countries, maintaining even the current level of public pension provision looks challenging. Most concerning is that the countries where our respondents rely most on government support are also the most heavily indebted, and therefore look least able to meet these expectations.
The problem is that there is no incentive for today’s political parties to warn future generations that they may not get the state support that the current generation enjoys. The end result is that future generations are not being given the information, support, and time they need to provide for themselves.
With the political system unable to provide the information individuals need, the onus falls on those of us in the financial industry to support savers. We need to encourage individuals to think about their personal savings and retirement plans, and to reduce their reliance on the state.
Confidence about investing sits at odds with the decisions being made
Having established how investors feel on the whole about their savings and retirement plans, we then focused on the nature and reasoning behind the decisions being made.
Most Europeans say they are confident in their own ability to make investment decisions. Almost two-thirds of the individuals sampled stated that they are at least somewhat confident in making decisions about how to invest their money.
Again, this confidence in making decisions is hard to square with the next set of questions, which examine the choices that individuals are actually making when it comes to their savings.
We asked individuals where they were deploying their ‘non-emergency’ savings3. By focusing on non-emergency savings, we were seeking to understand what vehicles people were using for their medium- to long-term savings, rather than savings vehicles that can provide easy access to cover emergency events. The most common response – 27% of the population surveyed – said that the majority of their non-emergency savings are in cash. Just 21% of the population stated that the majority of their savings are in stocks and shares.
Something else that was noteworthy in the sample was the prevalence of cryptocurrencies as the main savings vehicle, particularly among respondents from the youngest generation.
The lure of cash is partially fear…
We then drilled deeper into the reasoning behind this decision, asking why stocks and shares don’t play a larger role in savings portfolios. More than a third of respondents said the main reason for not owning stocks was the risk of losing money. Just as concerning was the 43% that said they hadn’t even considered stocks and shares, or didn’t know how to invest in them.
…and partially a lack of financial knowledge
This lack of general knowledge about asset markets and savings options also comes through in the next question: ‘Thinking about saving for your retirement over the long term, which of the following do you believe has the potential to provide the best return on your money?’. More respondents (18%) said that they felt cash was likely to provide the best return than those who said that they thought stocks and shares would provide the best return (15%).
Had we just experienced a number of years of stock market stagnation or correction, this result might have been understandable. But the fact is that this answer bears no resemblance to lived experience.
It is possible that households believe cash offers the best return because, after almost a decade of zero interest rates, cash rates have risen to roughly 2.5% in the eurozone4. Households, however, might be suffering from what economists call money illusion, which is the inability to account for the impact of inflation. So, for example, if the nominal interest rate is 3%, a household might enjoy the EUR 3 interest hitting their bank account dependably for each EUR 100 that they save. However, if prices of the goods and services the individual buys have also risen 3%, they are no better off. Individuals may not have realised that nominal interest rates are only higher because inflation is also proving to be structurally higher.
This lack of knowledge about savings choices and the consequent return is damaging for individuals’ financial health. EUR 100 saved at the start of 2020 in a cash deposit account is worth EUR 109 in nominal terms but just EUR 89 after we account for inflation. Had this European saver invested their EUR 100 in global equities it would be worth EUR 194 in nominal terms and EUR 158 in real terms5.
Finally, we asked households where they were obtaining their financial advice from. The vast majority of respondents rely primarily on their bank for their financial information. Friends and family were the second biggest source of information. The problems we see in earlier questions – lack of knowing how to invest, or uncertainty over the returns on offer – may relate to the limited set of financial products on offer. As a result, there is a tremendous opportunity for the banks to play a significant role in moving individuals to a more optimal savings solution. This is particularly relevant when we consider that 86% of our sample said that human connection was ‘important’ when it came to receiving financial advice.
Retail banks, through their personal connections with clients, have a tremendous opportunity to play an important role in reaching a better outcome.
Had the EUR 2.8 trillion that EU households have saved in cash or cash-like instruments since the start of the pandemic been invested in global stocks it would now be worth EUR 5.4 trillion. Having sat in cash it is worth just EUR 3.0 trillion. The combination of fear and lack of knowledge has cost European households EUR 2.4 trillion in the last six years alone.
‘Best in class’ or ‘must try harder’?
The results do vary significantly by country. Sweden, Finland and the Netherlands sit in our ‘best in class’ bucket. It is interesting to note that these countries don’t necessarily score significantly higher in terms of financial knowledge, or when it comes to confidence making investment decisions. Instead, individual savers in these countries have more exposure to capital markets thanks to well-structured policies to either direct savings via pension schemes or through the use of tax levers (see the country analysis for full details).
Italy is interesting, because improved outcomes are not necessarily the result of government policy; rather, a more supportive financial sector and better access to professional advisers have resulted in a more optimal allocation of savings. But clearly not all Italians are accessing this support, so there is still considerable work to do.
The countries that cause us most concern are France, Spain and Poland. In all these countries there is an expectation that it’s the government’s job to provide in retirement and households are leaving a large majority of their savings in cash. Governments look set to encounter either a clash with their bond market or a clash with their electorate in the coming years.
The time to act is now
European households are saving a lot. But too much of these savings are held in cash. As a result, the financial prospects of savers are being damaged, economies are being starved of the capital they need to thrive, and inequality is increasing, with dire political consequences.
Action needs to be taken urgently. But what?
Self-led (slow train)
Perhaps the ideal route would be to dramatically improve financial literacy so that individuals can plan appropriately using the right investment vehicles for their stage of life.
The Swedish financial information portals are a fantastic example of government and industry collaboration to improve transparency and guidance in a manner that is suitable for the average individual.
Our concern is that focusing solely on education will not turn the dial quickly enough. Current financial literacy in many countries in Europe is so low that it would take time that, quite honestly, we do not have.
Regulators should perhaps think about the degree of risk aversion that our survey has revealed. The ‘capital at risk’ message has clearly been absorbed by European households but perhaps now needs to be balanced against ‘return at risk’.
System-led (fast train)
At the other end of the spectrum, governments could absolve individuals of the responsibility of understanding financial markets with systems and policies designed to ensure households are, by default, accumulating savings in capital markets. A prime example would be auto-enrolment pension schemes, whereby a state body or pension fund is responsible for investing in products suitable for the age and financial characteristics of the household.
System-led policies remove the onus on the individual to understand the myriad financial options available to them and are the most timely way of making sure long-term savings are appropriately invested.
The Netherlands provides probably the best example of this system-led approach. Our survey shows that Dutch households are not particularly financially savvy or engaged with where their savings are going, but they know that their pension funds are delivering good replacement rates of income in retirement and so feel confident about their retirement prospects.
Sweden provides an excellent example in terms of transparency and ease of managing pension contributions. Households are able to see what the state will provide both in terms of the basic pension and the premium pension, and also their private provision. They can then see how adjusting specific factors, such as contribution rates and retirement age, affects the outlook.
Government child investment ‘gifts’ that are by default invested in stocks are another great idea in promoting a healthier risk-culture.
System-led policies require no up-front individual financial knowledge and will, over time, help to adapt risk culture as savers are able to see the benefits that stocks bring. The ‘Trump Accounts’ recently announced in the US are a good example. Children born today will receive a USD 1,000 contribution, which defaults to an S&P 500 tracker. Family members are able to add up to USD 5,000 per year. The account is locked until the child turns 18 and is exempt from capital gains tax. This is also a good way of making sure all income cohorts feel some long-term benefit of having access to the stock market and this isn’t seen as policy that simply supports middle to upper income households. A US teen turning 18 today would find themselves in receipt of USD 5992 had the policy existed at their birth6.
Tax levers and subsidies can help provide incentives to investors to direct their savings more optimally but in some jurisdictions there is a chance that risk aversion is so entrenched that it does not sufficiently alter behaviour.
Governments may be reluctant to implement these policies today. They may fear the fiscal cost, or the pressure that mandated personal savings contributions will place on households struggling with the cost of living. While a balance needs to be struck, beginning even a phased process of delivery is essential.
Sweden is the exemplary country in our sample. A multi-pronged approach (detailed in brief below and in detail in the country article) has set Sweden up for success. Such admirable policy measures are already bearing fruit in terms of households’ financial outcomes, the success of Sweden’s capital markets and economy, and the improved fiscal outlook.
Pension auto-enrolment – PremiePension (PPM)
Sweden went through a major pension reform all the way back in the 1990s. This legislation led to 2.5% of pensionable salary being removed at income source and invested in financial markets. Individuals can choose from a large number of approved mutual funds or, if they do not make a choice, their contributions will go into a default fund. Each individual has a PPM account and is able to see the return that is being achieved by their savings.
Tax incentives – Investeringssparkonto (ISK)
Whereas the PPM is mandatory, the ISK is a voluntary investment account that exempts stock investments from capital gains tax. Almost 40% of Swedes have an ISK. These ISK accounts follow the ‘Everyman Funds’ (Allemansfonder), which were introduced back in 1984 to stimulate broad participation in the Swedish stock market.
Knowledge portals
Sweden provides two well-used web-based platforms, one that provides financial education (Like Your Finances) and one that provides tools for retirement planning (MinPension). By allowing people to collate their savings and pension information, and to consider the impact of the choices they make on potential returns (asset choice, annual contributions, retirement age), these portals can help individuals to make better decisions.
Guidance Portal - Gilla Din Ekonomi (Like Your Finances)
Begun in 2010 as a collaboration between the Swedish authorities and financial organisations, this portal was designed to improve people’s ability to understand and make decisions about their finances. It was specifically created to be independent and free, without commercial advertising.
We have to get on a train
We don’t have time to continue to discuss this topic for years to come. We are drifting towards an unnecessarily disappointing future, both for Europe’s citizens and for the economy. Governments, regulators and those in the financial industry need to work together to change outcomes.
The time to act is now.