We’ve gone from being a nation of super-spenders, to being on of super-savers, and all in the course of a single year.

The economy may be in freefall, with record unemployment and a collapse in the tax base, but over 80 per cent of Irish adults are now regularly saving on a regular or lump sum basis, according to the latest Postbank Quarterly Savings Index survey.

The average monthly amount we are putting away has fallen from €344 to €304 in the past year, a reduction of 12 per cent but the numbers of savers has risen by seven per cent since this time last year, says Postbank’s Head of Marketing John Donegan.

Based on national averages, the savings rate has increased to 11 per cent and this is expected to rise to circa 13 per cent in 2010, according to the ESRI, the highest rates since 1978.

“We are seeing an increasing number of people saving smaller amounts,” Donegan said.

“We are also seeing that the gap between men and women saving has been reduced dramatically, with men likely to save larger amounts.

“The switch from spending to saving more is a product of the economic circumstances, as we build up a buffer during times of uncertainty.”

As if anticipating the impact that the December budget will have on the nation’s capacity to spend and save, Postbank say the figures reveal something interesting.

“For the first time since the index began in 2008, over half of savers believe that they will have to dip into their savings in the coming months.

“Looking ahead to the next three months, more and more of us will be relying on savings to help with current expenditures.” 

The gap between the higher numbers of women than men has also dramatically narrowed, say Donegan and more women now say they are likely to dip into their savings over the coming months (up nine per cent this quarter to 56 per cent).

Commentators have suggested that this may be partly due to the fact that male unemployment has been particularly high over the past year, especially in construction and manufacturing, with more women reporting that they’re now the main domestic breadwinner.

The most common reason – still – for saving, say respondents, is the need for a financial safety net or emergency fund.

Some 47 per cent of people say that security is the key factor in choosing where they save.

Only half that number said the interest rate they received or easy access to funds was more important; a quarter of those surveyed said they still “have no confidence in the security of their savings,” a reflection of the deep concern about the viability of the Irish banking system.

Finally, one result of this survey that will be deeply worrying to the nation’s retailers is the number of people who told Postbank that they will be drastically cutting their Christmas spending.

More than half of the respondents said that they would be spending under €500 this season.

Only a relatively small group (13 per cent), were planning on spending more than €1000. Other consumer surveys in 2007 and 2008 estimated that the average Christmas spending was over €1,300.

This sharp reduction in the amount people expect to spend on their Christmas celebration reflects how much we are paying down our debts.

The September credit and debt figures from the Central Bank showed that private sector credit declined by €4.4 billion overall.

And while credit card spending went up fractionally in September (the ‘back to school’ effect), overall credit card spending is down 14.8 per cent on September 2008.

This debt repayment phenomenon isn’t just happening here: in the United States, for example, where unemployment is now officially 10.2 per cent, Americans wrote down a whopping $14.8 billion of personal debt in September.

For the year to date, personal debt across the Atlantic totals $156 billion – all money that is not finding its way into the consumer economy.

For Irish savers, the creation of NAMA is supposed to mean that the Irish banks will have money again to lend to business and personal borrowers.

Bank commentators however believe that this might also mean that as demand picks up, it will mean higher commercial and personal loan rates.

This could spell the end of very low variable rate mortgage deals and three per cent plus premium interest rates.

Anyone who is currently on a variable rate mortgage under three to three and a half per cent might want to consider a similar fixed rate from the likes of AIB and Bank of Ireland for at least the next two years.

But bear in mind, of course, that you might be penalised if you break this contract over that period.

Savers, meanwhile, who have more money on deposit that they need for income purposes or for another use in the immediate future, might want to lock in now at the higher fixed rates.

You won’t suffer any capital penalty if you change your mind and want to close the account earlier.

Because the Government’s 100 per cent deposit guarantee in the Irish institutions ends next September 2010 you might also want to choose an institution that you have confidence in by then, even without the blanket guarantee.