site.btaAsset Management Company CEO: Bulgarian Savers Stick to Tradition

Bulgarian savers are generally conservative, preferring to save through deposits and real estate. Only a small part of their investments goes into alternatives like mutual funds, Concord Asset Management CEO Natalia Petrova told BTA’s Kamelia Tsvetanova on Friday.

Petrova participated in the personal finance forum "EXPO MOITEPARI." Besides her role as CEO, she also serves as the Chair of the Bulgarian Association of Asset Management Companies (BAAMC) and is a member of the European Fund and Asset Management Association (EFAMA).

Petrova said that, based on EFAMA data, an investor who put EUR 10,000 into investment funds in 2013, splitting it equally between conservative bonds and aggressive stocks, would see a 61% return after 10 years.

Only 3% of Bulgarians' savings are in investment funds, a stark contrast to the 20% average in other European countries. "We need to focus on raising this figure in Bulgaria by improving financial literacy and awareness among the population," she added.

This cautious approach aligns with a poll by Trend, which shows that 22% of Bulgarians save money, with 84% using bank deposits. Younger people tend to save less, while those with higher education save more, likely due to higher income and better financial literacy. Most savers set aside up to 20% of their income, with 68% prioritizing emergency funds, underscoring the conservative nature of Bulgarian savings behaviour.

Petrova said BAAMC is running a comprehensive awareness and training campaign to cover the key concepts of investing and basic terminology, enabling investors to make informed decisions.

"Every investment offers potential benefits but also involves risks. Investors should understand these risks to decide on their budget, how much available capital they can allocate, and for how long," Petrova explained.

Despite stable financial conditions, low financial literacy is a key factor keeping many Bulgarians from exploring riskier but potentially more rewarding investments like mutual funds.