Latvian residents’ finances diverted for their children are no longer the lowest in Baltics

The average amount Latvian residents divert for the future of their children by picking accumulative life insurance had grown 30% last year, reaching EUR 36.5. In Lithuania, parents divert an average amount of EUR 33.5 every month. Estonian parents diver the largest amount among Baltic States – EUR 39 every month on average, according to SEB Bank Life Insurance data.

Compared with 2015, the amount diverted by Latvian residents for their children’s future is no longer the lowest among Baltic States. Nevertheless, the total capital saved for children in Latvia is below amounts noted in Estonia and Lithuania. Last year, the average term for savings was 12.7 years in Latvia and 14 years in Lithuania and Estonia.

«Parents in Latvia most often start considering making savings when their children start going to school. Because of that, Latvian parents have less time to make savings than parents in Lithuania or Estonia. There is, however, a positive side – parents in Latvia gradually increase the average amount they divert and start making savings earlier than before. On top of that, the number of newly-signed contracts in Latvia was the largest among Baltic States last year,» BNN was told by SEB Life Insurance manager Kristine Lomanovska.

She also mentions that it is important that investing money in accumulative life insurance allows residents to take care of savings and insurance at the same time, as well as use state-provided benefits equal to 23% of the amount diverted from savings.

According to data from SEB Life Insurance, mothers in Latvia are the ones who make savings for their children more often. The average savings capital in 2016 was EUR 5,000.

«Parents also usually state the purpose of making savings – child’s education, purchase of a car or some other goal. But goals tend to change as life goes on. Because of that, it is good that the contract term is long – it offers parents a certain degree of freedom on how to best use savings. In addition, as a family’s financial situation changes, so does the monthly amount diverted for savings,» comments Lomanovska.

BNN 

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