1/n

A short thread on Indian Household Finance

Percentage of Households having exposure to equity

USA
Direct stock
60s 40%
80s 25%
90s 17%

MFs
80s 70%
90s 43%
(Lynch)

India
One of the lowest in the world at ~14% as per MOSL vs 45% of US.

Whereas RBI quotes <10% in Jun 20.

2/n

We are close to 80% invested in Real Estate and drowning in unsecured debt.

3/n

Only 13% save for retirement

And over 50% think their children will help in retirement

4/n

96% of people seek Financial advice amongst family & friends.

5/n

Median household wealth is 5.6 lakhs.

Income Tax return analysis of a few years ago concludes that if you earned over 16 lakhs you are in 99th percentile of tax filers.

6/n

Financial assets is negligible as we progress with age.

7/n

But we invest on and on in real estate as we age.

8/n

We fund our real estate my mortgages even as we grow old and not much from our other investements.

We love real estate!

9/n

We anyways have one of the highest unsecured debt. But we reduce that as we age.

10/n

Insurance?

What's the heck is that?
Who needs it?
Who cares?

Our attitude summarized above.

11/n

We lack basic financial numeracy compared to developed countries.

Sources: RBI, MOSL, Peter Lynch, DBIE