Booklet A: the French dug into their woolen stockings at the end of the year

Posted Jan 21, 2022, 5:36 PMUpdated on Jan 21, 2022 at 5:43 PM

Another record annual collection for the Livret A and the Livret de développement durable et solidaire (LDDS). But the parenthesis of oversaving is well and truly over. According to figures from Caisse des Dépôts published this Friday, the cumulative flows on these two very popular French savings accounts reached 19.21 billion euros in 2021.

This is well below the collection for 2020, which stood at 35.21 billion euros. But this remains the second highest amount of the last ten years if we exclude 2012 (49.16 billion), marked by the increase in the deposit ceiling on the Livret A and the LDDS. In total, the cumulative outstandings of these two passbooks reached 469.8 billion euros. A new historical record.

However, this strong annual inflow hides a reversal in savings behavior in the latter part of 2021. In December, the French withdrew 1.06 billion euros from their savings accounts. “The Livret A ended the year in the red by signing a significant outflow testifying to the return of life before, at least in savings behavior”, underlines Philippe Crevel, the president of the Cercle de l’Epargne.

“Back to life before”

In fact, it is even the fourth consecutive month of outflows. Since September, households have drawn nearly 5 billion euros from these two savings accounts (net of contributions). By comparison, they had placed about 3.8 billion there over the same period a year earlier. Neither the appearance of the Omicron variant, nor even the prospect of rising interest rates for Livret A and LDDS, have reversed the trend.

“After nearly two years of the epidemic, households have, with the holidays, made pleasure purchases, helped in this by the savings they have accumulated, the strength of consumption being the translation”, resumes Philippe Crevel .

In addition, since the summer, the French have had to deal with a return of inflation which intensified at the end of the year, notably driven by the sharp rise in energy prices, “which may having led them to dip into their precautionary savings”, underlines the specialist. The support measures put in place by the government – which has made protecting purchasing power against inflation “an absolute priority” during this election period – have however mitigated this phenomenon.

Another sign testifying to the willingness of households to take advantage of the savings accumulated since the start of the pandemic: the strong dynamism of the real estate market. To meet rising prices and greater personal down payment requirements, households have dipped into their woolen stockings. As a result, loan production and a record number of transactions were recorded in 2021.

The start of 2022 could however be marked by a rebound in inflows. The government has indeed announced a doubling of the rate of remuneration for the Livret A and the LDDS from 0.5% to 1% from 1er February. “Rate increases temporarily boost payments but have little effect over time”, nuance Philippe Crevel.

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