The Impact of Economic Crisis on Forms of Saving and Borrowing by Individuals

In the summer of 2007, American, European and Asian stock indices began to lose value. This was a phenomenon that many call the 'bursting of the bubble'. The following chapters were dedicated to the research work, and on the basis of a survey questionnaire confirmed the hypotheses of the diploma thesis. The economic crisis conditions smaller savings of the population, which individuals invest primarily in financial institutions on the basis of trust and lower risk.

Problem

In the summer of 2007, American, European and Asian stock indices began to lose value. This was a phenomenon that many call the 'bursting of the bubble'. A crisis erupted in the subprime mortgage market in the USA, which, due to the high interconnectedness of financial markets, spread into a global financial and economic crisis.

Numerous sectors were affected, so there is no major economic system in the world that has not been forced to reduce growth expectations due to the crisis. The consequences of the economic crisis affected the economy, the real sector and consequently also the population. The purpose of the diploma thesis is to present the impacts of the current economic crisis on the saving and borrowing of the population, with all the pitfalls in both areas.

Every individual wishes to ensure greater financial security for an uncertain future, but is faced primarily with excessive indebtedness, with poorer liquidity, and with risks in managing personal assets. In the first chapters, the economic crisis and its impacts on the economy and the individual were presented, as well as the offers and forms of possible saving and borrowing by individuals.

Results

The following chapters were dedicated to the research work, and on the basis of a survey questionnaire confirmed the hypotheses of the diploma thesis. The economic crisis conditions smaller savings of the population, which individuals invest primarily in financial institutions on the basis of trust and lower risk. Due to lower incomes, individuals are forced to borrow to a greater extent, so despite stricter lending conditions, growth in borrowing is evident.

Individuals are faced with excessive indebtedness and with difficulties in managing the debt incurred.