IslamicFinance.de

Experts say that 85 percent of Saudi families do not save money and resort to diving into their savings or borrowing to meet their needs. The absence of savings is one of the biggest weaknesses of the Saudi economy. The spirit of consumption is dominant and this negatively affects economic growth and increases the rate of inflation due to the increased rate of consumption. Due to the absence of a culture of saving, Saudi families are exposed to financial woes every month, not because they earn a low income but because they never learned to save money and engage in financial planning. Most Saudi families suffer from over-spending and sometimes spend 10 percent more than they earn. This urges them to borrow money.