Kippreport investigates if oil prices aren’t the only cause for the market slumpAugust 27, 2015 12:00
Super-sized spending in Saudi
Most families in Saudi are spending much more than they earn, accumulating huge debts as a result.
March 10, 2010 4:31 by Aarti Nagraj
Families in Saudi Arabia spend almost twice what they earn, according to research conducted by Kuwaiti economist Jassem al-Mutwwa, reports Arab News. “Education, amusement and eating out account for more than 181 percent of a family’s income in Saudi Arabia,” al-Mutwwa said at during a lecture on personal finance in Jeddah. They overspend on personal articles and services by an average of 8 percent, he said, adding that the expenditure on hotels, cafes, beverages and other leisure-related activities is rising every month.
Meanwhile, spending on housing and health care was lesser in Saudi as compared to other parts of the world. “While only 44 percent of the family budget is spent on housing, health care represents 39 percent,” he said.
Al-Mutwwa urged Saudis to “rationalize their spending habits” and spend within their means so that they could avoid falling into debt traps.
Judging by recent reports, many young people in the Kingdom are already deeply entrenched in debt. The Arab Youth Survey, conducted by public relations company Asda’a Burson-Marsteller, found that 52 percent of people aged 18-24 in Saudi are in debt. The survey ranked the Kingdom highest for youth debt, based on interviews with 2,000 nationals and Arab expatriates in nine countries across the region.