Gary Clement for The National
Gary Clement for The National

Saving must be important, because it's so hard to do



It's official. We are saving less. But is it surprising considering the global economic climate of the past three or so years?

According to the 2011 National Bonds Savings Index, released this week, the level of our savings has dropped over the past year. Of more concern, however, is that 86 per cent of people in the Emirates feel that they've not saved enough for their futures, 46 per cent say they saved much less than they planned and a whopping 71 per cent of us don't save regularly.

Any wealth planner or financial adviser worth their salt will tell you that planning for the future is vital. After all, not all of us are lucky enough to have kind, charitable children who will volunteer to shelter and feed us if we can't support ourselves financially in our old age.

And the thought of that happening is pretty depressing. Not just for me, but also for my daughter, who, at just eight, will be depending on me for quite some time.

Considering the trillions that have been wiped off global pension funds since the financial crisis hit in the latter half of 2008, not to mention the fact that some governments around the world can't afford to provide state pensions for their citizens (one of the main reasons the age of retirement has been upped, or is in the process of being increased, in a range of countries, including Australia, France and the UK), there's never been a worse time to not save.

But, in some ways, the reasons are understandable.

Some respondents to the survey, which was conducted in conjunction with YouGov, blamed the increased cost of living in the UAE on their inability to sock away a little money every month.

Others said they couldn't save because they had too many liabilities and loans to pay off every month, which left the cupboard bare and them living a shaky hand-to-mouth existence.

But the biggest complaint that emerged from the survey was that residents of the UAE were paying more for the necessities of everyday living, including groceries, transportation, household items and utilities.

"Different emirates show different patterns, though," says National Bonds, the Dubai-based Sharia-compliant savings scheme. "Sharjah and Abu Dhabi provide the biggest contrast. While Sharjah residents claim that they are spending more money on necessities such as groceries, household items and children's education, Abu Dhabi residents' increasing expenditures are down to transportation, rents, eating out and buying luxury items."

I've done the cost of children's education to death recently, so you all know my thoughts on that. I'm surprised, however, it wasn't an issue for residents of Abu Dhabi considering the squeeze on school places here and the resulting high fees. Transportation I can understand. The cost of petrol has risen twice over the past year.

But what about the incentives to save? At the height of the financial crisis, UAE banks, low on liquidity and desperate for our cash, were offering high interest rates on our savings. At one stage, my bank quoted me about 6 per cent for a six-month fixed-deposit account.

Today, that same bank is offering just 1.05 per cent for the same account. Regular savings accounts offer even less, with some banks paying out as little as 0.10 per cent. I guess that's what happens when they don't need our money as much.

There is one other issue contributing to our inability to save: the financial awareness of many in the UAE is sadly lacking. In fact, there are many people here who don't even have a bank account, who rely on cash and the help of a money exchange outlet to move their money about.

Last October, Personal Finance launched a Financial Literacy campaign, kicking it off with a special issue dedicated to improving financial awareness in the UAE.

A few banks have followed in our footsteps, notably Abu Dhabi Islamic Bank, which started its financial awareness campaign in April.

National Bonds has also promised to do its part in raising financial awareness in the UAE, saying it it is planning a roadshow to help the "community manage their spending and plan their savings".

"We have seen that while there is a willingness to save, there is a lack of understanding how to save," says Mohammed Qasim Al Ali, the chief executive of National Bonds.

"As a result of this ... we will be launching a financial education roadshow later this year, which will aim to educate different segments of the community such as housewives on the tools they need to use to develop healthy savings habits."

And, as any wealth adviser or financial planner worth their salt will tell you, it's never too late to start.

Fines for littering

In Dubai:

Dh200 for littering or spitting in the Dubai Metro

Dh500 for throwing cigarette butts or chewing gum on the floor, or littering from a vehicle. 
Dh1,000 for littering on a beach, spitting in public places, throwing a cigarette butt from a vehicle

In Sharjah and other emirates
Dh500 for littering - including cigarette butts and chewing gum - in public places and beaches in Sharjah
Dh2,000 for littering in Sharjah deserts
Dh500 for littering from a vehicle in Ras Al Khaimah
Dh1,000 for littering from a car in Abu Dhabi
Dh1,000 to Dh100,000 for dumping waste in residential or public areas in Al Ain
Dh10,000 for littering at Ajman's beaches 

The Buckingham Murders

Starring: Kareena Kapoor Khan, Ash Tandon, Prabhleen Sandhu

Director: Hansal Mehta

Rating: 4 / 5

THE LIGHT

Director: Tom Tykwer

Starring: Tala Al Deen, Nicolette Krebitz, Lars Eidinger

Rating: 3/5

Results

5.30pm: Maiden (TB) Dh82,500 (Dirt) 1,600m, Winner: Panadol, Mickael Barzalona (jockey), Salem bin Ghadayer (trainer)

6.05pm: Maiden (TB) Dh82,500 (Turf) 1,400m, Winner: Mayehaab, Adrie de Vries, Fawzi Nass

6.40pm: Handicap (TB) Dh85,000 (D) 1,600m, Winner: Monoski, Mickael Barzalona, Salem bin Ghadayer

7.15pm: Handicap (TB) Dh102,500 (T) 1,800m, Winner: Eastern World, Royston Ffrench, Charlie Appleby

7.50pm: Handicap (TB) Dh92,500 (D) 1,200m, Winner: Madkal, Adrie de Vries, Fawzi Nass

8.25pm: Handicap (TB) Dh92,500 (T) 1,200m, Winner: Taneen, Dane O’Neill, Musabah Al Muhairi

WHAT IS A BLACK HOLE?

1. Black holes are objects whose gravity is so strong not even light can escape their pull

2. They can be created when massive stars collapse under their own weight

3. Large black holes can also be formed when smaller ones collide and merge

4. The biggest black holes lurk at the centre of many galaxies, including our own

5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed

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Transmission: Single-speed automatic

Price: From Dh359,900 ($98,000)

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Name: Almnssa
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