Livret A, LEP, life insurance… Which savings protects the most against inflation?

Bruno Le Maire has repeated it many times: inflation will peak, then calm down. The assertion of the Minister of Economy has been confirmed by the European Central Bank. According to a survey of forecasters and published on July 22, 2022, inflation should rise to 7.3% in 2022, 3.6% in 2023, and 2.1% in 2024. In the meantime, how can we prevent melt the woolen stocking?

Many French people still store their savings in their current account. In April 2022, these deposits represented approximately 1,317 billion euros. A considerable sum, which dwindles as prices rise. At the time of going to the checkout first: the note of fuels, oils, fruits and vegetables, makes more and more cringe. But inflation also has a more pernicious effect: accumulated money devalues ​​even if it is not spent. To protect against inflation, which savings to turn to? Several upgrades will take place. The Express takes stock.

The booklet A, doubled on August 1

First reflex, the booklet A. The preferred savings of the French will bring in 2% per year, on August 1st. The increase was announced by Bruno Le Maire in the Parisian, on July 14th. This is twice as much as the old rate, and four times as much as last January. The Minister of the Economy pushes himself for this savings, guaranteed and whose interests are tax-exempt. “In the current situation, no other product offers so much security,” he said.

Limited offer. 2 months for 1€ without commitment

But does the livret A protect against inflation? A rate of 2% is a level not reached since 2012, and sometimes higher than the remuneration of Obligations Assimilables du Trésor (OAT), the government debt securities that certain individuals buy. However, with inflation for the month of June (5.8%), the net return on the livret A is -3.8%. The booklet A, whose ceiling is set at 22,950 euros, therefore acts like a fridge: it slows down the melting of the wool stocking, without stopping it. It’s always better than leaving your money in your checking account. And this makes it possible to finance the construction of social housing.

Popular savings account, soon a rate of 4.6%

Another idea, the popular savings account (LEP). Currently, less than seven million French people have them. However, 15 million of them have the right to this savings, which is also guaranteed and tax-exempt. Still, the use of this booklet created in 1982 is not very… “popular”. A shame for Bruno Le Maire, who ensures at the Parisian : “The LEP is the most effective investment to protect against inflation.” The government will soon relaunch a communication campaign on this subject.

What if the General of Public Finances sends you an email, informing you that you have the right? The LEP interest rate will increase from 2.2% to 4.6% on August 1st. Its return net of inflation will then be approximately -1.2%. This is enough to cushion the losses linked to inflation, without, however, bringing in any money. Weak point of this savings: the ceiling, set at 7,700 euros.

Life insurance: a delay, before going up

In 2021, the remuneration of guaranteed funds in euros amounted on average to 1.30% (net of fees, gross of tax), according to France Assureurs. A level then higher than the booklet A, but which did not cover inflation. But the trend is upwards: to slow down inflation, the European Central Bank (ECB) decided to curb monetary creation and thus increased, on Thursday 21 July, its three main key rates by 0.50%.

However, life insurance funds in euros are made up of 80% bonds, which are highly correlated to key rates. New bonds issued should adjust to current rates. As these replace securities that have reached maturity, the remuneration of life insurance could increase, so as to prevent savers from turning to a livret A or to bond funds with all costs, and therefore up to date. on current yields.

The Express app

To track analysis and decryption wherever you are

Download the app

Download the app

Putting your money in a life insurance fund in euros could therefore prove to be the most protective in a few months. But again, expect a negative return. Another downside, this solution is the least “liquid” of the three. Unlike transfers from an A booklet, immediate, it is necessary to wait a few months to release this money. Up to 6 months, in the event of a financial crisis, according to the Sapin 2 law.


opinions

The chronicle of Cécile Maisonneuve

An employee of the Russian gas giant Gazprom, February 18, 2015By Cécile Maisonneuve, Senior Fellow at the Institut Montaigne, Advisor to the Energy and Climate Center of Ifri

The chronicle of Frédéric Filloux

Tech giants like Apple are massively buying back their shares.Frederic Filloux

The chronicle of Christophe Donner

A movie theater.Christopher Donner

Christian Gollier’s chronicle

French President Emmanuel Macron speaks at the opening of the Eurosatory arms fair, in Villepinte, near Paris, on June 13, 2022.By Christian Gollier, economist at the Toulouse School of Economics

Leave a Comment