Americans save less than Europeans but save more effectively, while the level of state pension determines the level of private old-age provision, new research suggests.

Despite the fact that the savings ratio there is significantly lower, private households in the US have higher net financial assets than their counterparts in the EU member states, the Allianz research contests.

While the financial assets of private households in the EU equate to 141% of GDP, in the US they are 223% of GDP. The reason for this is that people in the US invest more efficiently, favoring shares and investment funds, while Europeans prefer less risky forms of investment such as bank deposits, the study suggests.

With private old-age provision of E37,700 per capita, US citizens are better off than their European counterparts, who have saved an average of E18,100 per capita. However, once state pension entitlements are added in, the Europeans are slightly better provided for, with E220,000 per capita, than the Americans with E200,000 per capita.

It seems that there is also a correlation between the level of state pension and the amount of private old-age provision: the lower the state pension, the more citizens save for their old age.