A majority of Finns lack any reserves for financial troubles at all. We have little savings, apart from our overpriced apartments, which we are always eager to own. We expect government to come to our aid when things get tough, although we do not entirely trust this to happen either.
Our personal unpreparedness is a result of heavy taxation on one hand, as well as generally high cost levels, and on the other hand the result of the common Finnish opinion that heavy taxation entitles us to help should we need it. We are not interested in the kind of thriftiness required to boost personal preparedness and tend to outsource responsibility to society at large. This works as long as any unforeseen economic troubles pertain to individuals and households or at most smaller groups of people at a time.
It is however most likely that we hit financial troubles in a time where the entire economy is simultaneously weakened on a national level and its effects reach a large number of people. In this instance governmental ability to handle things is also rapidly diminished, and the so-called welfare promise cannot be fulfilled. When households lack a buffer of liquid assets in times of crisis, the worst-case scenario is a serious disturbance of societal peace and a large amount of human suffering.
In order to avoid this, the authors suggest a number of actions, the aim of which is to strengthen individual ability to safeguard oneself against financial trouble. Two such measures are the dismantling of current tax benefits on owning (as opposed to renting) one’s house of apartment, as well as controlling cost development through deregulation and lighter taxation.
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