Introduction

Indian families are changing their approach to the financial future. They are moving their savings to other asset classes, where they were just putting them in banks in the past. More people are now looking at stock markets and other options.

This shift shows that people are learning more about money and trying out new ways to save. Let’s look at the numbers that show this change and see how it’s affecting India’s economy.

How are Indians Shaping their Financial Future?

Indian households are changing how they plan their finances by learning more about saving and investing. They’re not just putting money in regular savings accounts anymore. Instead, they’re looking at other areas like the stock market, mutual funds, real estate, gold, and insurance.

This shows that people understand the need to plan for the future and see the advantages of investing in different ways. By spreading out their investments and looking for new chances to grow their money, Indians are building a stronger and more successful financial future for themselves.

Also read: Golden rules of trading in Stock Market

Moving from banks to investments

• In 2001, only 4% of Indian savings went to investments like stocks. By 2023, this had gone up to 7%, showing more interest in capital markets.
• At the same time, savings in banks went down a bit, from 39% in 2001 to 37% in 2023.

More Savings in Insurance and Funds

• People are now putting more money into life insurance, provident funds, and pension funds. These now make up 40% of all savings, up from 34% in 2001.

Changes in How People Save for a Brighter Financial Future

• The Reserve Bank of India’s data for FY23 shows that people are keeping less money as cash, from 12% in FY22 to 7% in FY23. More money is going into banks, from 22% to 35%.
• Savings in financial assets have doubled from FY12 to FY22, reaching Rs 28 trillion.

Where People Put Their Money

• On average, Indian families put 77% of their money in real estate, 7% in things that last a long time, and 11% in gold, showing a love for physical things.

Impact on India’s Economy

• Indian families’ savings make up 70% of all the money saved in the country. This is a significant contribution to the whole economy of the nation.
• Real estate makes up 77% of what people save physically, while gold makes up 11%. This shows that people still like these ways of saving.

Also read: Forex Trading: The Number 1 alluring business

10 Reasons Why Indians Embrace a Fresh Financial Future

1. Learning About Money: More people are learning about how to manage their money wisely. They are looking at different ways to invest their money instead of just keeping it in a savings account.
2. Wanting to Earn More: Savings accounts don’t offer much interest, so people are looking for other ways to make their money grow. They are considering investments like stocks and mutual funds, which can offer higher returns, though they also come with some risks.
3. Protecting Against Rising Prices: When prices go up over time (inflation), the value of money goes down. By investing in things like stocks and real estate that can grow faster than inflation, people can protect the value of their savings.
4. Spreading Out Investments: Investing in different asset classes, like stocks, gold, and real estate, can reduce the risk of losing money. This way, if one investment doesn’t do well, the others might still make money.
5. Taking Advantage of a Growing Economy: India’s economy is growing faster, which means there are more opportunities to invest in different areas like technology, infrastructure, and consumer goods.
6. Getting Information Easily: Digital India makes it easy for people to find out about different investment options. They can do research and choose where to invest their money based on what they learn.
7. Chasing Dreams: As people’s dreams and lifestyles change, so do their financial goals. They are looking for ways to save and invest to achieve these dreams, like buying a home or saving for retirement.
8. Saving on Taxes: Some investments offer tax benefits, meaning people can save on taxes while growing their money. For example, certain types of investments can reduce the amount of tax they have to pay.
9. More Investment Choices: The financial services industry in India has grown tremendously in this decade. They are offering more investment options and services. This gives people more choices to customize their investments based on what they need and want.
10. Influenced by Others: Inspiration for investment journeys can come from friends, family, or colleagues. This influence motivates them to embark on their investment journey and strive towards building a brighter financial future.

Also read: Home Loan Calculator: A Comprehensive Guide

Conclusion

As Indian families try out new ways to save and invest, India’s economy is also changing. More people are looking at options beyond banks, which could lead to a stronger and more varied way of saving money. This way, the majority of Indian households can reshape their financial future in a smarter way than before. Thanks to the fastest-growing Indian economy, which will unlock every opportunity to achieve financial freedom.

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