BigDecisions, a free online platform that helps retail users make smarter and more informed financial decisions, released its research report based on 15,000 users across India. The data was recorded through three tools Life Insurance, Retirement & Real Estate each providing a comprehensive understanding of respective aspects of financial decision making. The data records were classified into categories along demographics, finances, aspirations and expectations of users.
- Contrary to popular perception, it is not that the relatively lower and middle-income groups have a greater problem of under-insurance. The current insurance cover does not increase in the same proportion as the increase in income. With higher expense levels the higher income group is at a higher risk.
- Protection continues to remain a lower focus area and a larger portion of the premiums seem to be going into savings products.
- The effective inflation, while different for different age groups was found to be in the range of 3%4% making a big difference in the required savings versus the conventional financial planning method of using CPI (which would require using 7% or more) to arrive at post retirement expense levels.
- There is a sharp drop in the percentage of double income families after the main wage earner (male in case of our visitors) turns 35, indicating thereby that large number of women stop working post 35. While this number stood at close to 50% in the first age group of 25-30, it dropped precipitously post 35 and does not go much higher than 25% at any point.
- Most people expect single digit appreciation in property prices over the next decade. At these levels, the time frame required for buying to be a better decision than renting stretches out to 9 12 years.
- People in smaller markets are more hopeful of the future with respect to real estate. Our findings suggest that people will benefit by taking a house on rent in the city theywork (say Mumbai) while buying in their hometown like (Nasik, Trivandrum) and can expect to maximise their benefits by doing so.
BigDecisions used algorithmic filters to eliminate any invalid and test data from the total 60,000 users that it used for the report and identified 15,000 valid records out of the total.
Speaking on the release of the report, Manish Shah, co-founder & CEO said, Our key learning has been that a one size fits all approach was never more out of place. Outsourcing ones financial decisions entirely to others needs to be replaced by consumers taking greater ownership. A larger trend thats been seen here is that users across the country see the benefit of being much more in control of making their financial decisions. Theyre willing to understand for themselves how things work as long as its made easy for them to go about the process.
Gaurav Roy, co-founder & COO, Bigdecisions said, We hope this is the start of a larger movement where markets for financial products expand because consumers understand and appreciate the need by themselves leaving product manufacturers like banks, insurers and asset managers to focus more on possible solutions for these needs.
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