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Friday , February 3 2023

Kuwaiti family’s average savings just 8%

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Housing expenditures constitute about 28%

KUWAIT CITY, Nov 10: The disposable income of the Kuwaiti family ranges between 38 and 66 percent of the total average income while the average actual family savings is about 8 percent, shows a government study prepared by the global consultant firm McKinsey Consulting Company, reports Al-Rai daily. The housing expenditures, according to the study, constitute about 28 percent of the total per capita income in Kuwait, partly due to the value of residential plots of land in the local market which has almost doubled in value, although prices differ from one governorate to another. The study added that the maximum limit for the installment loan, set at 70,000 dinars, covers only a limited part of the value of the housing land, other than construction costs. McKinsey noted that the average annual inflation rate for consumer goods has risen significantly, especially between 2004 and 2017. The compound infl ation rate in Kuwait for this period was about 67.1 percent, after the price of consumer goods, which was 15,000 dinars in 2004, reached 25,100 in 2017, and these rates later increased by 3 percent.

The Arab Monetary Fund expects the inflation rate in Kuwait during 2021 to reach about 8.2 percent, and 1.3 percent in 2022. In its study, McKinsey relied on the Household Income and Expenditure Survey conducted by the Central Administration of Statistics, which stated that the ratios of different types of expenses to available income are divided into 4 types of expenses as follows: Basic expenditures constitute about 34 percent of total per capita income in Kuwait, and include food, beverages, housing necessities (water, electricity, gas and fuels), health care, transportation, communications, education, furniture and clothing; Residential expenses represent about 28 percent of total income, and include monthly rents; Nonessential expenditures which constitute about 20 percent of total per capita income and include entertainment, culture, restaurants, hotels, furniture, and clothing and the miscellaneous expenses represent about 10 percent of a person’s total income, and include miscellaneous personal goods and services, social protection, and insurance.