Household net worth rose by 3.3%, or €28.5bn, to a series high of €883bn in quarter one this year, new Central Bank figures show.
The rise in household net worth was driven by an increase in financial assets of €18.9bn, primarily due to increasing investment in currency and deposits and a rise in the value of insurance and pension schemes.
Household deposits held with credit institutions have risen over Q1, as shown in the Money and Banking Statistics.
Housing assets also increased by €8.2 billion during the quarter, while household liabilities fell by €1.5 billion.
This equates to €177,493 per capita but this measure does not capture the wealth distribution effects, and the underlying experiences of individual households may vary.
Compared to Q1 2020, household net worth increased by €89 billion, due to increases in both housing and financial assets.
Household net worth has grown annually since 2012, the Central Bank says.
The rise in wealth is in contrast to the impact of the pandemic on many households.
On aggregate, households experienced a fall in pay (€2.5 billion) compared to Q1 2020.
Households have also seen a €3.9 billion rise in social transfers (PUP) and subsidies (EWSS) alongside a fall in consumption of €2.9 billion. These counteracting movements lessened the impact of unemployment and the fall in pay experienced by household net worth in aggregate.
Household debt fell by €1.5 billion over the quarter, continuing the downward trend, to stand at €128 billion in Q1 2021.
Total debt now equates to €25,717 per capita. Household debt has decreased by 36% since Q1 2009.
Household debt as a proportion of disposable income fell by 1.9 percentage points, to stand at 102%. The decline was driven by an increase in household disposable income over the quarter, in addition to the decrease in debt.
Gross household savings increased by €1.5 billion in Q1 2021, to stand at €7.4 billion for the quarter.
Precautionary savings
This rise in savings is likely due to restricted spending opportunities and increased precautionary saving as a result of the COVID-19 pandemic and restrictions.
The rise in savings correlates to an increase in financial assets, totalling €6.1 billion in Q1 2021. This was primarily driven by investment in currency and deposits, while investment in housing and other valuables has remained steady, at €5.3 billion and €1.4 billion respectively.