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The financial fragility of European households in the time of COVID-19
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The financial fragility of European households in the time of COVID-19

Maria Demertzis, Marta Domínguez-Jiménez and Annamaria Lusardi
Bruegel, 2020
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8

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  • Overview

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This seminal study from economists Maria Demertzis, Marta Domínguez-Jiménez and Annamaria Lusardi assesses the financial condition of households in the European Union. Their analysis finds that, even before COVID-19, one in three families was unable to meet an unforeseen jolt to normal expenses, a situation now made more perilous by the pandemic lockdowns. The authors argue for different policy responses across EU member states to strengthen people’s “financial resilience,” although educating households about financial preparedness is an across-the-board imperative.

Take-Aways

  • “Financial fragility” in the European Union was prevalent even before the coronavirus outbreak.
  • Households’ financial situations vary across EU countries.
  • Educating people about financial security is vital, and leaders should devise targeted initiatives to address long-term weaknesses across EU member states.

About the Authors

Maria Demertzis is the deputy director of Bruegel, where Marta Domínguez-Jiménez is a research assistant. Annamaria Lusardi is the academic director of the George Washington University Global Financial Literacy Excellence Center.

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