2026: Spending Surges, Savings Dip for Families

Spain’s Savings Shift: Why Households Are About to Spend Again – And What It Means for the Economy

For years, Spanish families have been quietly building up their savings, a trend fueled by economic uncertainty and surprisingly good returns. In fact, the savings rate hit 12.8% of gross disposable income in the second quarter of 2025 – significantly higher than the 7.2% average between 2015 and 2019. But this era of cautious accumulation is nearing its end. A confluence of factors suggests a coming shift, one that could reshape Spain’s economic landscape and offer a much-needed boost to growth.

The Peak Savings Era: What Drove the Trend?

The recent surge in household savings wasn’t a sign of economic distress, but rather a rational response to specific conditions. Rising household incomes, coupled with anxieties surrounding inflation and global instability, encouraged a more conservative approach to finances. Crucially, interest rates also played a role, providing attractive returns on savings accounts. This created a unique environment where families could both earn a decent return *and* feel financially secure. This period of CaixaBank Research highlights the unusual nature of this savings behavior within an expanding economic cycle.

Inflation and Interest Rates: The Twin Engines of Savings

The moderation of inflation and the subsequent increase in interest rates were key drivers of the savings rebound since 2023. As inflation eased, the perceived need to hoard cash diminished. Simultaneously, higher interest rates made saving more appealing, incentivizing families to deposit funds rather than spend them. This dynamic created a positive feedback loop, further bolstering the savings rate.

The Tide Turns: Why Spending Will Rise From 2026

However, the conditions that fueled this savings boom are beginning to reverse. From 2026, several key changes are expected to shift the balance towards increased consumption. Firstly, income growth is projected to slow. Pension revaluations will be less generous (2.7% in January compared to 3.8% previously), and wage growth is already decelerating alongside falling inflation. Secondly, and perhaps more importantly, economic stability and job security are improving, fostering a greater willingness to spend. The increasing contribution of rental costs to overall consumption – counted as a service – will also play a role.

Income Slowdown and the Impact on Savings

The projected moderation in disposable income growth, estimated to fall between 4% and 4.5%, will inevitably put pressure on savings rates. As incomes rise more slowly, families will have less surplus income to save, potentially leading to a drawdown of existing savings to maintain current consumption levels. This doesn’t necessarily indicate financial hardship, but rather a normalization of spending patterns.

GDP Growth and the Consumption Engine

The anticipated decline in the savings rate isn’t just a household finance story; it has significant implications for the broader economy. Economists estimate that each percentage point decrease in the savings rate can boost GDP by approximately 0.45 percentage points. The projected cumulative drop of three percentage points between 2026 and 2030 could therefore contribute around 0.3 percentage points to annual GDP growth. Private consumption is already the primary driver of economic growth in Spain, and this trend is expected to continue.

Beyond Precautionary Savings: Structural Factors at Play

While economic conditions are shifting, it’s important to recognize that the current savings rate is still relatively high. This suggests that factors beyond simple precautionary savings – saving for a rainy day – are at play. One hypothesis is that a portion of the increased savings is earmarked for home purchases, given the increasing affordability challenges – currently requiring an average of 7.7 years of full gross annual income. However, there’s limited evidence of a massive release of these funds into the housing market just yet.

Demographic Shifts and Remittances

Demographic changes are also contributing to the higher savings rate. Spain’s growing foreign-born population tends to save more, often sending remittances back to their home countries. Similarly, an aging population generally has a lower propensity to consume and invest. These structural factors suggest that even after the current cycle shifts, Spain’s savings rate may remain higher than historical averages.

The coming years will see a recalibration of Spanish household finances. While the era of rapid savings accumulation is drawing to a close, the underlying economic fundamentals suggest a healthy transition towards increased consumption and sustained growth. Understanding these dynamics is crucial for businesses and policymakers alike. What are your predictions for the future of savings and spending in Spain? Share your thoughts in the comments below!