Well aware of the new financial environment, French savers are prepared to boost their investments while accepting a reasonable degree of risk

French savers have become aware of the very low interest rate environment and its possible impact on their savings in terms of performance.

Almost 80% of individual investors noted the decrease in returns on regulated savings products and in interest rates, 64% noticed the lower return on euro-denominated life insurance products. Many expect the rate of interest on Livret A passbook savings accounts to continue dropping (40%), as well as the return on euro-denominated life insurance products (42%). On the other hand, 64% observed the rise in stock market prices in recent years.

Furthermore, savers are more realistic and pragmatic regarding the return that can currently be expected on an investment. When asked from what level they consider an investment to be profitable, the majority (52%) replied between 3% and 5%. For them, very realistically, topping 3% per year is a threshold.

“2015 marks a real break for French savers. They have become aware of the new environment of very low interest rates which now applies to them and of its impact in terms of expected return on traditional savings products,” comments Christine Lacoste, Head of network development at Natixis Asset Management.

This new deal means new dynamics: savers are prepared to boost their investments to get a better performance in the long term.

Reflecting savers’ greater maturity, the environment in 2015 is widely seen as being conducive to changing investment objectives (71%), to diversify into new financial investments adapted to the changing environment (71%) or even to invest in stock market-related investments (60%). In actual fact, over the same period, a significant proportion of savers has even taken action: 41% have reviewed their goals, 38% have diversified their savings, 30% have invested in the financial markets.

“The results of our 2015 survey confirm our observations on the ground: investors are gradually moving back into potentially more efficient investments, notably mutual funds (UCI³) and diversified unit-linked accounts, for which they accept a reasonable degree of risk,” explains Christine Lacoste.

French savers focus more on immediate budget savings than on reviewing their savings strategy regularly and astutely. And yet, savings strategies can generate greater potential gains over the long term. Financial advisors play a key role in making them aware of this.

Almost 6 out of 10 savers (58%) say they have already renegotiated a telecom package, more than 55% have renegotiated their car insurance and almost 50% their mortgage, when only just over 40% reviewed their savings strategy in the first half of 2015.

At the same time, like in 2014, banks’ financial advisors remain the no.1 source of information and advice for savers (cited by 69%). Financial advisors still have a key role of education and support for individual investors, particularly in understanding the market environment and identifying investment opportunities to be seized.

It should also be noted that the Internet comes top of the media consulted (17% for specialised savings and investment websites), and that its place in the sources of information consulted by savers is constantly growing.

“Financial advisors remain the major players in making savers aware of the benefits of challenging and regularly revisiting their savings strategies – and this, in the same way and with the same agility that savers bring to their credits and existing contracts,” explains Christine Lacoste.

Retirement remains a major concern, leading to a surge of interest in more dynamic investments, notably in the financial markets.

Like in 2014, preparing for retirement remains a priority goal for savers. The proportion of savers putting money aside for their retirement remains high in 2015, more than 66% (64% in 2014).

For this purpose, individual investors continue to use savings accounts or passbooks (34%), as well as life insurance (26%). Individual retirement plans have lost some ground (from 16% in 2014 to 12% in 2015). On the other hand, financial and stock market investments have picked up (from 9% to 14%), showing they are becoming more open to more dynamic strategies.

Specifically, individual investors show keen appetite for thematic equity funds, which give more context and purpose to long-term savings. When asked about their interest in equity funds in the themes of agriculture, job creation and the environment, savers express keen interest in all these themes: 42%, 43% and 55%, respectively.

1 - Assets held at household level.

2 - Click here to consult the 2014 survey (press release and presentation of the results) “Retirement – The French paradox: savers choose very safe investments while harboring grand hopes as regards revenue and capital appreciation”: Natixis Asset Management/Communiques-de-presse/Archive/2014-08

3 – UCI: Undertakings for Collective Investment.