Average Savings and Financial Literacy in Japan

[Haystack]

Very interesting article! It's seems old established Japanese have piles of cash, but younger people have no plan and less savings.

The author seems to suggest his own precarious situation is due to unstable yearly contracts. Perhaps someone should link him to the forum?

https://www.city-cost.com/blogs/City-Co ... ey_howmuch

[Butterball]

I think this is one of those cases where averages don't tell much about the overall situation, to be honest.
Does the average "under 40" really have savings of around Y7m & outstanding debt of about Y13m? I don't think many people fall into that zone. If they've bought a house, their mortgages are almost certainly well above Y13m, and their savings are likely below average, as most of it went to downpayment & mortgage payments. If they haven't bought a house, they're likely saving up, with more savings and no debt.
Similarly, for the retirement age people at 60-69, I wouldn't really call Y25m a "pile of cash"; you're not going to live very comfortably on that unless your pension is much better than average. But I think most retirees either retire with much more than Y25m saved up (and they're probably also the same ones with the good pensions), or much less.

I thought the second chart was interesting in that everyone seems more attuned to their children's educational costs than the other categories.

[Haystack]

I think this is one of those cases where averages don't tell much about the overall situation, to be honest.
Does the average "under 40" really have savings of around Y7m & outstanding debt of about Y13m? I don't think many people fall into that zone. If they've bought a house, their mortgages are almost certainly well above Y13m, and their savings are likely below average, as most of it went to downpayment & mortgage payments. If they haven't bought a house, they're likely saving up, with more savings and no debt.
Similarly, for the retirement age people at 60-69, I wouldn't really call Y25m a "pile of cash"; you're not going to live very comfortably on that unless your pension is much better than average. But I think most retirees either retire with much more than Y25m saved up (and they're probably also the same ones with the good pensions), or much less.

I thought the second chart was interesting in that everyone seems more attuned to their children's educational costs than the other categories.

You are right that the average just give us a snapshot. This data should be split up by income level.

For retirees though it is a "pile" because the data shows most of it is not invested. Just piled up in a bank account .

As for the second chart, retirement seems to far off for many. They are focusing on the immediate, Juku and school costs. ...They are just trying to stay above water.

[Tkydon]

I think anyone who remembers it is still traumatized by the Bubble.

[Bubblegun]

I suppose if Japan has one of the highest savings rate,
And don’t rely on credit cards. I’d say there literacy has to be better than some other countries. They seem to have this in built, from birth , and I think the Otoshidam , new year money is a great way to start, save for when they get older “mentality. Save for when you Get sick, kids future, save for a home.
I also think there are several factors though.
One that certainly helps are the multi generation families/homes. Certainly helps on savings over the long term. Affordable college! Possibly no house inflation. People can’t afford service college debt, credit cards, car loans and still save up for a home in the US, UK Australia.
With the stimulus money given here, I think most decided to bank it, knowing they may need it for something important. Some other countries may see it as party time, but that new car, that massive TV , or in the UK, I can pay even more for an already inflated home.

I do like to keep in mind that the average saver, in itself is a minority, because they’re are many more people who save very little, or nothing , and at the other end of the spectrum there are the big savers.