The Covid-19 pandemic has been a wake up call for many Indians, shaping their behaviour towards personal finance, according to the findings of a survey by Scripbox.
As per the survey report, over 80 per cent of the respondents said that the pandemic has been a wake-up call for them, to get their personal finances in order and to course correct for better financial health. One in three (32 per cent) respondents said that financial health and well-being has been the biggest stressor for them during the pandemic, ahead of physical health and relationships.
Both men and women acknowledged the role of the pandemic in it having changed their behaviour vis-à-vis saving and investing. 28 per cent of women respondents said that they are smarter investors today than before the pandemic, compared to 26 per cent of male respondents, who assessed themselves similarly.
Positive change
“The positive behavioural change with personal finance is evident in the actions that survey respondents are taking,” the report said.
51 per cent of respondents said that they have started to save more than before, while 36 per cent of respondents are investing more in wealth creation to improve their financial health.
Women are complementing their increased savings with reduced discretionary spending, an action backed by 29 per cent of women respondents, the report said. 20 per cent of respondents have a financial plan in place to meet their personal goals, while 15 per cent of respondents said they are seeking professional help with investment decisions.
“Given the uncertainty, Indians are preferring to keep excess money in their savings accounts or in Fixed Deposits, followed by investing in Mutual Funds,” the report said.
53 per cent of survey respondents put their excess money in a savings account while 41 per cent said that they put it in a fixed deposit or a recurring deposit. 37 per cent respondents prefer mutual funds as their number one investment choice, followed by stocks (24 per cent), Gold (24 per cent), Crypto currency (14 per cent) and buying property (14 per cent).
Emergency fund
Creating an emergency fund emerged as the top financial goal in the current environment across genders. While 34 per cent of men picked healthcare as their next important financial goal, 38 per cent of women would prefer to set aside money for children’s education. Buying a home was among the top financial goals of 29 per cent of respondents.
Furthermore, 56 per cent of respondents said that they would like to advise their younger selves to start investing as early as possible in life.
“The findings of this survey are profound and encouraging. Just like the use of digital is a new habit acquired by many during the pandemic, financial behaviour has also undergone a transformation with a preference for digital interactions and this uptick in the use of digital services is here to stay,” said Atul Shinghal, Founder and CEO at Scripbox.
“Our survey respondents confirm that alongside saving more and investing for wealth creation, reducing discretionary spending and creating an emergency fund are what they are paying more attention to, to be better prepared in the new normal. It’s about being in control and that confidence of being in charge, helps to create a greater sense of well-being,” said Shinghal.
“As the ongoing crisis makes people more aware of the importance of active financial management, a personalised financial planning approach that delivers on long-term goals, rather than on selling specific products will be the opportunity to connect with a highly engaged audience,” Shinghal said.
The report is based on an online survey where Scripbox polled nearly 650 respondents with equal representation from women and men.