Covid changed how we save, and spend
Many of us are sitting on a bigger savings nest egg than normal as we head into the Christmas shopping season, thanks to changes in lifestyle brought about by Covid-19.
National figures show households had more than $200 billion squirrelled away in their bank accounts at the end of October.
Collectively that takes our pot of savings to a larger level than it has been in over two decades.
In part that has been driven by reduced spending during the enforced lockdowns and the lingering changes those restrictions have caused in the way we live.
Many of us discovered a lot of our day to day expenses came from commuting and incidentals spent during our working day in an office or worksite, Sense Partners economist Shamubeel Eaqub says.
Not going into work therefore lead to savings.
‘‘A lot of the money that people spend while they’re working is getting to and from work.’’
While we were forced to work from home during lockdown, once restrictions lifted a good number of us decided we actually liked the flexibility and have continued to work from home – on average for two days a week says Eaqub.
So savings have continued to accumulate.
‘‘With working from home there are a bunch of people who are actually saving a bit of money because they’re not eating out at the cafes and restaurants or they’re not driving the car,’’ Eaqub says.
‘‘And that makes a huge difference in terms of the weekly budget.’’
So with our day-to-day spend on bus and train fares, parking, filling up with gas, and work lunches reduced, our ability to spend up on other things has increased.
Some of it substantially. Head of TradeMe motors Alan Clark said they had 84,000 searches over a seven-day period in October.
Searches for Toyota Land Cruisers and Ford Rangers are up over 70 percent on last year,
but the most popular vehicle to search for is the Toyota Hilux. Searches for that are up 54 percent on last year.
As ASB economist Mark Smith says, Covid has had wider impacts also with the closure of borders: ‘‘Households are not going overseas because they can’t ... they’ve been at home more, and more of the spending is focused where they are.’’
Trade Me spokesperson Millie Sylvester says: ‘‘All of the top three most popular vehicles are perfect for loading up and exploring what New Zealand has to offer – from beaches to mountains and everything in between.’’
Motorcycles have also proven popular.
In Tauranga, Bay Ride Motorcycles owner Damian
Fleming has also seen a massive spike in people buying motorcycles.
‘‘We could not have predicted customers would be so flush with money and so positive,’’ he said.
‘‘We’re seeing husbands and wives who are no longer going overseas purchasing new bikes as they’ve decided to tour New Zealand.
‘‘They’re thinking ‘why not get a new motorcycle’.’’
Fleming has also noticed the increase in family bonding.
‘‘Fathers are buying bikes and getting bikes for their children,’’ he said.