Majority in UAE feel more financial pressure than their parents

Over half of UAE residents believe they have to take more risks with their money now in comparison with the older generation.

Residents in the UAE feel they are under greater financial pressure and have to take more risks with their money, research by HSBC has found.

This is despite the fact that many residents believe there are more choices in their life today. HSBC's latest 'The Power of Protection: Life changers' report finds that many individuals in the country see the future for themselves and their families as increasingly complex. Volatility in the global economic landscape, a challenging environment for finding jobs and rising costs are fuelling a high degree of uncertainty in life.

The report examines the responses of more than 12,000 people in 12 countries, including over 1,300 in the UAE, asking them to compare their lives to those of the previous and the next generations. In addition to the financial pressure they face today, only 39 per cent of respondents believe the next generation will be better off in this regard, highlighting that people expect their financial lives to become more complex in the future.

Interestingly, HSBC's research revealed that people in the UAE, and across the world, tend to have a more positive view on the lives of their parents when compared to their own. Over half believe that the previous generation had a better quality of life, while 19 per cent feel it is the same now as it was then. This appears to primarily be linked to financial reasons rather than qualitative ones, as 57 per cent believe they have more choices in life than their parents. However, only a quarter think the past generation were under more financial pressure.

"There appears to be a link between people having more choices in life today and feeling greater financial pressure than their parents' generation," said Gifford Nakajima, head of wealth development in the UAE and Mena region at HSBC Bank Middle East. "More choices mean a higher number of life-changing events, whether it is more opportunities to start a business or move abroad, instances which although positive, can also bring a greater degree of financial pressure."

When asked to predict life for the next generation, people in the UAE cited a more positive outlook as 57 per cent said they would have more choices in life and 53 per cent said they would have a better quality of life, compared to 29 per cent that believed future generations would be worse off in both those areas. Around 51 per cent said their children would have a more fulfilling life, while only 33 per cent felt the opposite would be the case. People in the UAE are also more optimistic about the future than countries like the US and UK, where only about a quarter of respondents said they did not believe future generations would have a better quality of life.

Despite these sentiments, when it came to financial issues, 43 per cent in the UAE felt the next generation would be under more pressure and, at 48 per cent, nearly half thought they would have to take more risks, compared to 39 per cent and 36 per cent respectively who thought they would be worse off. Nonetheless, in terms of uncertainty about the future, only 38 per cent think their children's generation will face a tougher time compared to the present.

- rohma@khaleejtimes.com