Is it money that makes Saudis happy?

Are you happy? Are the people around you and the rest of the country happy? Are you looking forward to the future? You may not have the answer to all these questions but media agency OMD Arabia does. They’ve recently unveiled their “Future of Saudi Arabia” survey and among its many results, it appears that we are particularly happy. In fact, 80% of us claim to be happy and content with our lives. This is higher than what a similar survey found in the UAE a couple of years ago. Only 7% describe themselves as unhappy and 6% claim to be stressed with their lives in the Kingdom.

If just under half of respondents feel that their lives today are better than 10 years ago, thanks to technology, access to the internet and social media, this optimism applies to the future too. More than half (55%) of Saudis expect their children’s lives to be better than their own in the next 10 years. Those who have a more negative view of the quality of their life complain about the cost of living, the state of the economy or the ever-growing presence of technology.

While there is no denying that the Saudi economy faces significant headwinds with lower oil revenues and a bulging budget deficit, the impact hasn’t been felt too much by consumers, at least yet, it would seem. The survey was conducted at the end of last year. Austerity measures had only just been introduced and have been limited in scope. Nonetheless, the cuts were expected to translate into a reduction of 20% to 30% in a family’s budget.

Living without financial worries is a major contributor to happiness levels and this probably explains why almost ¾ of respondents describe their family as financially prudent rather than extravagant. This is corroborated by the fact 54% of Saudis either live within their means or are able to save some of their income, whereas 46% are in debt. Still, earning more is always a good thing and 58% of respondents say they’re not happy with their salary.

According to the survey, spending habits have been increasing over the past 10 years and Saudis anticipate they will be spending more in the future, as only 17% say they will reduce their outgoings. A modern lifestyle has certainly taken its toll on Saudis’ wallets. According to a Euromonitor report, despite decreasing disposable incomes towards the end of last year, Saudi consumers still spent a relatively high proportion of their incomes on apparel and footwear, beauty and personal care and consumer electronics. Luxury goods, such as jewellery, watches and bags, also featured prominently. This list matches the findings of OMD’s survey. “This is due to the social stigma surrounding poverty and the desire among consumers to appear to have remained unaffected by the economic slowdown and recent austerity measures”, the Euromonitor report explained. As it is the case in the UAE as well, eating out is certainly on the increase, as are the amount spent on call/data plans. Asked what they struggle to pay for, some of these items again appear, such as meals out, fashion items or groceries, the price of which has been rising lately, but also housing.

Home ownership is a huge aspiration in the Kingdom. Along with buying more smart devices, a key priority for 62% of respondents, fashion items and a car, buying a house is a major planned purchase for 13% of Saudis in the coming year. Slightly over half of the respondents currently rent their home, usually an independent villa or an apartment, but 62% hope to own their home, preferably independent villa, in the future.

Buying a home is a major financial commitment and with 92% of respondents stating they feel secure in their jobs for the next 10 years, it’s easy to see how such a commitment is deemed possible. Asked about their financial plans for the next two years, Saudis still show their prudence though. The highest score, 16%, is for reducing or settling debts, followed by using more cash and less cards. There are still 12% of Saudis who expect to take more bank loans or upgrade their credit card.

The prevalent happiness doesn’t blind people to the challenges the country or their community is or will be facing in the future. There is, however, a great deal on confidence in the country’s vision of its future and its ability to achieve its ambitions. The success of the National Transformation Plan and the broader Vision 2030 also rests on that confidence turning into individual actions and steps by residents in the Kingdom.

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About Author

Hani Dajani

Having been born and raised in Saudi Arabia, Hani's acute understanding of local consumer psyche and behaviors has served OMD's clients well. Combined with his vast experience, today he brings global best practice and local relevance to every single brief, providing cutting-edge solutions that unlock the Saudi market for brands.

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