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Is Rs 3.6 crore enough for your retirement? Here's what a StanChart survey reveals

The report examined the saving and investment habits of 10,000 emerging affluent, affluent and high-net-worth individuals (HNIs) across 10 fast-growing economies.

December 18, 2019 / 02:52 PM IST

Three in five individuals in India have a financial strategy for the future and close to four in five see money as essential to happiness, according to Standard Chartered's new Wealth Expectancy Report 2019.

The report examined the saving and investment habits of 10,000 emerging affluent, affluent and high-net-worth individuals (HNIs) across 10 fast-growing economies: China, Hong Kong, India, Kenya, Malaysia, Pakistan, Singapore, South Korea, Taiwan and the UAE. The key finding across countries was that people’s aspirations outstrip their ‘wealth expectancy’, or their total net wealth at age 60.

In India, the report found that almost one-third participants (32 percent) are on track to achieving more than half of their wealth goal at age 60. But all is not lost for the remaining. StanChart feels it is still possible to narrow the gap with well-defined goals and a considered wealth management approach.

According to the report, the average wealth expectancy in India for those in India with enough disposable income to save and invest is Rs 3.6 crore: Rs 1.3 crore for the emerging affluent, Rs 2.6 crore for the affluent and Rs 6.9 crore for HNIs.

This translates into an average Rs 93,000 per month to live by on during retirement, which is less than both their current income and wealth aspiration.

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What's disturbing is that if Indians were to spend at the average monthly rate at which they aspire, their wealth expectancy would last the emerging affluent six years of retirement. These figures should be seen in relation to average life expectancy of 23 years post-retirement.

Indians are majorly saving for their children's education, funding their own business, investing in property and supporting parents or relatives financially.

On wealth planning, three in five Indians (60 percent) have a financial strategy which includes investment products. The financial products that Indians prefer are: savings accounts, mutual funds, and property, the report stated.

Despite this, nearly half (49 percent) see themselves far away from their top financial goals. As per the survey, around 64 percent of the affluent group said "they worry so much about money that it affects their health, and 62 percent of the emerging affluent feel so overwhelmed by financial planning they fail to put a plan in place at all".

Another point of concern raised by Indian savers (62 percent) was how will the next generation manage and preserve the wealth they pass on, despite 80 percent having a comprehensive wealth transfer strategies in place.

In a leg-up to the government's digital finance initiative, the survey found that nearly four in five of the emerging affluent and affluent feel more in control of their finances by managing their money digitally. Of this subset, 81 percent feel digital banking has helped them achieve a better quality of life.
Moneycontrol News
first published: Dec 18, 2019 02:51 pm

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