Six out of ten Dutch households have trouble making ends meet

A new study of Dutch households showed that roughly 60 percent were either financially unhealthy or financially vulnerable. That figure has grown from about 50 percent in 2021, according to a joint study by Deloitte, Nibud, and Leiden University. Where two-thirds of households were confident they would be able to repay their mortgage on schedule in 2021, only 44 percent still believe that to be the case.

In 2022, about 21 percent were considered to be financially healthy, down from 27 percent. Another 19 percent were considered financially adequate, down from 24 percent. Those considered to be unhealthy or vulnerable reached 30 percent each, with both groups increasing their share from about one-fourth of households in 2021. "Unhealthy" was defined as those who cannot make ends meet, while "vulnerable" indicates those who can make ends meet but cannot use savings to cover unexpected incidents. "Adequate" are those who have a little bit of cash leftover for savings every month with stable and predictable income flows, though occasionally have to make the tough choice to skip boosting savings to stay current with another payment.

The researchers said, "2022 was a turbulent year with far-reaching economic and social events that had an impact on the financial health of Dutch households. We see the consequences of these developments reflected in the results of the study." The dominant economic issues that affected people at home were the war in Ukraine, the energy crisis, high inflation, and diminished purchasing power.

Among the most hard-hit are those aged 18 to 25. About 30 percent of them were financially unhealthy in 2021, and that figure swelled to 45 percent in 2022. Younger people are more likely to be focused on the short term, which puts them in a more vulnerable position, the researchers noted.

They also noted a sharp divide between men and women on the list, with women under more financial threat in general. "No less than 65% of women fall into the health level Vulnerable or Unhealthy, versus 55% of men. In both cases this is an increase of more than 10% compared to the previous edition of the survey."

The study also found that about 25 percent are either uncertain or very uncertain about their ability to make larger expenditures, compared to about 16 percent the previous year.

The researchers said that employers also have a responsibility to address financial problems and debt at the workplace. They also promote better education about financial health in primary school, secondary school, higher education, and also with adult education platforms. "In the long term, prevention should be put at the forefront of improving financial health," the researchers said.