Financial literacy: 10 tips to keep in mind with the new legislature

10 financial tips to ensure you have "access to fair and transparent information"

With the start of a new legislative term, DECO PROteste has provided some advice that consumers should pay attention to in the financial area.

The statement was released by Notícias ao Minuto, where it can be read that the organization intends to promote "healthy competition in the market, without subterfuge or hidden issues in clauses that are difficult for most people to understand".

The top 10 concerns of DECO in the financial field range from the end of fees in PPR to the regulation of digital influencers.

"The 10 topics are part of a broader commitment by DECO PROteste to Portuguese consumers, ensuring that their rights are respected and they have access to fair and transparent information," the organization's statement reads, as reported in the news.

Now, these are the measures that DECO defends, according to the news shared by the news website:

Mandatory financial literacy in education and businesses - "DECO PROteste advocates for mandatory inclusion of financial literacy in education and promotion in companies and public organizations";  

Decrease in the tax rate of savings products - "It is considered urgent to reduce the tax on savings products in Portugal, especially considering the low national savings rate. This rate has suffered successive increases: it went from 20% to 21.5% and, at the beginning of 2012, it rose to 25%; still in November of that year it rose to 26.5%; and in 2013 it skyrocketed to the current 28%, one of the highest rates in Europe. For example, in Spain, the income from deposits is taxed at 19% for interest up to 6000 euros. If the amount of interest is between 6000 and 50,000 euros then the rate applied is 21% and for amounts higher the rate is 23%";

Creation of a savings account to serve as an emergency fund - "It is essential to encourage Portuguese families to save. For this, DECO PROteste proposes the creation of a savings account exempt from tax up to a certain amount, which can serve as an emergency fund. For example, in Belgium, savings accounts are a specific product regulated by the Government and the interest on savings accounts is exempt from taxes up to 1020 euros per person (value of 2024, can change every year). If the savings account is in the name of a married couple or in a civil union, the exemption doubles to 2040 euros annually. To obtain 1020 euros in interest, for example, you would have to invest 51,000 euros at 2% per year"; 

Reordering of State savings products income - "It is proposed a reordering of the income from State savings products, in order to make them more attractive and aligned with the risk and liquidity that each one offers. They should provide an income according to the risk and liquidity of each one, which is not happening and even causes some confusion to the saver. For example, the Savings Certificates are, within the group of three, the ones that offer greater liquidity and the capital is always guaranteed. But the income is higher than the Savings Treasury Certificates, which guarantee the capital, but have less liquidity";  

Increase in tax advantages and benefits of PPR, to encourage long-term savings - "More than 1.2 billion euros were withdrawn from retirement savings plans (PPR) by families in Portugal throughout 2023, the year in which it was possible to channel these savings into housing credit without penalties (either repayment or payment of installments). These same exceptions remain in 2024, so it should be two years in which the savings that were intended to create a supplement for retirement will be emptied. ADECO PROteste calls for an increase in tax advantages and benefits of Retirement Savings Plans (PPR), with the aim of encouraging long-term savings";  

Elimination of the transfer fee in Guaranteed Capital Pension Funds and Pension Savings Plans - "It is urgent to eliminate the transfer fee in Pension Savings Plans (PPR) and guaranteed capital pension funds. DECO PROteste considers it unsustainable to impose a cost on long-term products with low returns, a cost that harms consumers and the proper functioning of the market. DECO PROteste provides the Ganhe Mais no PPR simulator, so that consumers can discover which is the best PPR and whether it is worth transferring their pension savings plan to another product";  

Creation of a simple technical form in capitalization insurance - "DECO PROteste proposes the creation of a simple technical form in capitalization insurance, including PPR insurance, to provide consumers with a clear summary of key information in accessible language, allowing comparisons with other financial products";

Extension of capital gains exemption to other products - "Considering the speculative risks and lack of regulation of crypto assets, it is justified to extend the tax exemption to other financial assets, such as investment funds, stocks and ETFs, held for 365 days or more, to promote tax fairness".

48% reduction in taxation on stocks, funds, bonds and ETFs - "The 48% taxation on capital gains from the sale of securities such as stocks, ETFs, bonds, among others, applied only above a certain amount of taxable income (78,834 euros) and when the assets are held for less than 365 days, is considered excessive and also criticized by the president of Euronext. Instead of the autonomous rate of 28%, a tax rate of 48% is applied, which discourages investment in the stock market, especially the national one, and promotes tax evasion, which does not positively contribute to investors' savings decisions"; 

Regulation of advertising for financial products with risks and sponsored digital influencers - "Aggressive advertising on social media, promising quick and high profits in complex financial products, and sponsored digital influencers, often without the necessary accreditation required by the CMVM, are influencing thousands of followers. Therefore, it is essential to establish stricter rules for influencers, who often act as experts in investment areas, ensuring adequate protection for investors and consumers". 

Do you want to have frequent access to fair and transparent information about financial topics? Poupança no Minuto offers a weekly newsletter with informative and up-to-date articles, published daily, as well as financial solution simulators (mortgage credit and credit transfer). We are a credit intermediary that will be by your side to support you in any credit process you want to move forward with, at no cost! Get in touch with us if your goal is to SAVE!