Tunya Celasin, Sr. Communications Officer in the World Bank office in Ankara, offers this story.
In a sunny park next to the Aegean Sea in Izmir, people are complaining about how hard it is to save money.
"Forget about savings! I barely make ends meet. I have to take care of my family. Whatever comes in goes out!" says Ihsan Coskuner, sitting with his grandson. Not far away, Ahmet Baykal agrees. "I earn a minimum wage, I can barely make it! When I get paid, my money goes for food and for rent."
According to the World Bank, household saving in Turkey fell significantly in the last decade. Economists say that rising prosperity and cheap, easy credit sent Turks out shopping, spending instead of saving.
Spend Now, Save When?
Of course, Turkish families do have a strong incentive to save. Unemployment or a health crisis could wipe out small savings. Heads of households who are employers or self-employed tend to save more; wage earners less. The relatively low number of Turkish women in the workforce also inhibits saving, and families with young children put away the least.
For the economy as a whole, overconsumption holds long term threats, says Erhan Usta, a deputy undersecretary at the Ministry of Development. "Overall, for the economy and for society, if everybody consumes, there's no money for investments, and as a society you get poorer if there's no money for investments."
Keeping Money "Under the Mattress"
Many Turks stash their savings in gold, jewelry and foreign currency. But that money doesn't spur growth, because it stays "under the mattress" and out of the country's banking system.
The many stores selling chunky gold jewelry in every Turkish town provide a kind of investment service. Behiye Tulun is the general manager of Altinbas, a jewelry store in the town of Manisa. There are already two Altinbas stores here, not far from each other, and the company is opening an third.
The demand, Tulun says, is investment driven. "I'd say 70 percent of the people who buy gold jewelry at this shop buy it for savings."
Banks, Not Bracelets
To encourage saving, and get money out from "under the mattress," the Turkish government, with support from the World Bank, is considering a wide array of programs. One is tightening criteria for credit cards and consumption loans, another is promoting financial literacy, and, even more important, making private pension plans more attractive for investors.
"I've been trying to save for the past five and half years, through a private pension fund. I don't do enough, but I try," says Namik Ugur, an Ankara resident.
That's a sentiment the government of Turkey would like to support.