For the past few weeks, I've been spending more time with my grandparents. They came to visit our extended family for Chinese New Year and are enjoying the warm weather and nice accommodations here in Shenzhen. I try to see them at least 3-4x a week and I usually take them out to eat western food - something they enjoy but don't frequently do.
Even though each of my grandparents still receive more than 3000 per month in retirement from the government as well as consistent money from my mom and uncles, they always stash it away. (My grandparents also have all of their medical bills taken care of by the gov't.) I have been trying for some time now to convince them to spend more money to enjoy their golden years. What’s wrong with more traveling, taking taxis and eating well? They won’t do it, but are always saving. Although they like eating McDonald's and Pizza Hut, they don't like to pay for it.
While the western media argues that due to the lack of a social safety net and social security system, Chinese people absolutely need to save - because the gov't won’t take care of them. I disagree with this notion.
Saving money is a religion in China, especially for older generations. While some people have plenty of money saved away already, they still do it. Their daily lives have been routine for so long that there’s hardly any time or anywhere to spend the money. Buying groceries in the morning, cooking at home and playing cards and mahjong can only cost so much.
Migrant workers are another example of savers. They typically make about 2000RMB or less every month and save the majority of it - sending some home. However, if you look at them, they all wear some decent clothes, laptops and all have better cell phones than I do. They just typically save on everyday expenses and sometimes make that big purchase, buying something more than one month's salary.
I've recently thought that with improving living standards - esp. in the cities, Chinese middle class and white collar young people will evolve to a western-style lifestyle of using credit and spending lavishly without regard for price and cost.
Some of my friends are like this. They spend most of their relatively high salary 10,000 RMB/month on iphones, designer clothing and taxis. They travel all over China and SE Asia. They're living the good life. I worry that if these people are the next generation, China will save less.
One recent CNN report made me feel optimistic about these Chinese middle class. It is reported that there is an online group who tries to spend 100RMB/week. That's incredible! These people want to be more consceince of day-to-day spending and to be more mature of managing their own finances. Maybe there is hope yet for China and its future...
Check out the report: