Select a date Select month July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 October 2016 September 2016 August 2016 July 2016 June 2016 May 2016 April 2016 March 2016 February 2016 January 2016 December 2015 November 2015 October 2015 September 2015 August 2015 July 2015 June 2015 May 2015 April 2015 March 2015 February 2015 January 2015 December 2014 November 2014 October 2014 September 2014 August 2014 July 2014 June 2014 May 2014 April 2014 March 2014 February 2014 January 2014 December 2013 November 2013 October 2013 September 2013 August 2013 July 2013 June 2013 May 2013 April 2013 March 2013 February 2013 January 2013 December 2012 November 2012 October 2012 September 2012 August 2012 July 2012 June 2012 May 2012 April 2012 March 2012 February 2012 January 2012 December 2011 November 2011 October 2011 September 2011 August 2011 July 2011 June 2011 Select a category Agriculture Bihar Votes For Its (and India’s) Future BUDGET 2014 Budget 2015: Modi’s Moment of Reckoning Budget 2016: The stories behind the numbers Chart of the Day Climate Change Cover Story Currency Chaos Development Education Elections 2014 Employment Fact Check Governance Newsletter Health homepage video Hunger India’s Great Challenge: Health & Sanitation IndiaSpend In The News IndiaSpend Interviews Industry Investigations Central State Latest Headlines Latest Reports Making Sense of Breaking News Modi’s Message: India’s States Reply Modi’s Report Card Mumbai Special Mumbai Special: The Revival Agenda Opinion – Videos Opinions Pollution Poverty Prime Time: India’s Grand Challenges Resources Central State Sectors Agriculture Defence Economy & Policy Education Health Infrastructure Snapshots States Central India Chattisgarh Madhya Pradesh EAST Bihar Jharkhand Orissa West Bengal NORTH Haryana Himachal Pradesh Jammu & Kashmir New Delhi Punjab Rajasthan Uttar Pradesh Uttarakhand NORTH EAST Arunachal Pradesh Assam Manipur Meghalaya Mizoram Nagaland Sikkim Tripura SOUTH Andhra Pradesh Karnataka Kerala Tamil Nadu WEST Goa Gujarat Maharashtra Story In A Minute The Air We #Breathe The Road To Delhi: Elections 2015 The Transition: 2015-2016 Uncategorized Viznomics: A Quick Glance At Big Issues Welfare Women Women@Work Women@Work Search with Google

By 2031, the population of people more than 65 years old is expected to grow the fastest (75%) among all age groups, yet only 23% were saving or planning to save for retirement in 2016, according to an August 2017 report of a committee on household finance set up by the Reserve Bank of India (RBI), India’s central bank.

Only 60% insurance policies received premium for the second year in 2016, the RBI report data show. In five years to 2016, the average number of policies that got second-year premium dropped to 58%. Only 29% policies received payment for the fifth year in 2016.

The committee was set up by RBI in April 2016 under the chairmanship of Tarun Ramadorai, professor of financial economics at London’s Imperial College, and had representation from all financial sector regulators.

As they grow old, Indians are not insuring themselves against rising health expenditures. The monthly per capita health spending of elderly households (with all members at least 60 years old) in India is 3.8 times higher than that of non-elderly households (no member above 60 years), according to this 2013 report research by Sanjay K. Mohanty (International Institute for Population Sciences, Mumbai), Rajesh K. Chauhan (University of Lucknow), Sumit Mazumdar (Institute for Human Development, New Delhi) and Akanksha Srivastava (International Institute for Population Sciences, Mumbai).

While health spending accounts for 13% of total consumption expenditure for elderly households, it was 7% among households with elderly and non-elderly members and 5% among non-elderly households.

India had 77 people over age 60 per 1,000 population in rural areas and 81 in urban areas, according to the 71st round of the National Sample Survey (NSSO), India’s official socio-economic survey, between January and June 2014.

Source: National Sample Survey 71st Round 2014

In rural areas, 82% people above 60 were dependent on children for economic support while 80% were supported by children in urban areas, according to the NSSO report.

Even in 2031, over 50% Indians above age 65 are seen depending on children instead of their own wealth–which is likely to increase in real estate, the RBI report forecasts.

Source: National Sample Survey 71st round 2014

High premium was the biggest reason why people avoided buying insurance with 51% households saying they did not have insurance as they couldn’t afford it in 2015, according to the RBI report.

Source: Report of the Household Finance Committee 2017

Nearly 50% customers of the National Pension Scheme–launched for workers in the unorganised sector in September 2010 — failed to contribute the required Rs 1,000 over a year to obtain incentives in the scheme, although they continue to make smaller contributions, according to a study by economists at Delhi’s Indian Statistical Institute and Mumbai’s Indira Gandhi Institute Of Development Research, cited in the RBI report.

Only 65% Indian households headed by person younger than 35 years hold any financial assets, the RBI report data show. This increases to 77% households headed by person younger than 54 years.

Only 5% Indians Invest Over 10% In Financial Assets

Indians across income classes still prefer land and gold for parking their savings with only Daman & Diu, Sikkim and Dadra & Nagar Haveli–covering 5% of India’s population–saving more than a tenth of their wealth in financial assets, the RBI report data show.

How Indians Save Wealth Across States, 2012 Wealth Share Across Assets Debt Share Across Products Real Estate Gold Financial Assets Retirement Accounts Mortgage Debt Gold Loans Unsecured Debt Non-Insti Debt Daman & Diu 48.00% 24.40% 11.80% 10.80% 5.00% 0.00% 69.10% 66.90% Sikkim 55.60% 14.60% 11.60% 10.30% 27.00% 0.00% 48.20% 17.80% D & Nagar Haveli 62.80% 6.50% 10.50% 12.40% 52.70% 2.40% 34.60% 31.30% Delhi 54.90% 17.40% 9.80% 6.20% 15.60% 0.40% 63.90% 46.60% Arunachal Pradesh 63.30% 5.10% 8.30% 5.00% 18.10% 1.30% 33.30% 45.70% Chandigarh 57.00% 10.20% 8.30% 14.10% 47.10% 0.00% 23.00% 9.50% Puducherry 56.90% 25.70% 7.20% 4.50% 3.40% 50.10% 33.30% 40.20% Himachal Pradesh 71.80% 13.60% 6.80% 3.50% 35.60% 0.00% 42.40% 35.10% Andaman & Nicobar Islands 42.50% 23.50% 6.30% 18.10% 6.40% 13.10% 66.40% 36.20% Assam 76.10% 6.60% 5.30% 2.60% 15.80% 1.20% 62.90% 48.00% Karnataka 67.10% 16.10% 5.00% 4.40% 24.80% 3.40% 53.80% 49.20% Mizoram 79.60% 1.20% 5.00% 5.70% 40.70% 0.00% 34.00% 17.20% Meghalaya 80.70% 3.00% 4.30% 3.50% 2.30% 0.20% 74.00% 24.70% West Bengal 81.20% 6.70% 4.00% 3.30% 16.70% 2.80% 69.50% 47.40% Andhra Pradesh 62.80% 21.60% 3.80% 3.10% 9.50% 9.50% 55.30% 48.90% Goa 60.00% 20.20% 3.70% 6.00% 18.10% 3.50% 19.00% 8.00% Haryana 81.10% 5.90% 3.40% 3.00% 27.80% 0.00% 53.20% 48.10% Maharashtra 76.60% 10.40% 3.10% 3.60% 47.00% 1.40% 36.00% 27.90% Punjab 81.60% 4.90% 3.10% 4.50% 25.70% 2.10% 57.40% 57.70% Tamil Nadu 59.40% 28.30% 3.10% 3.20% 11.30% 41.30% 37.90% 42.10% Tripura 76.50% 10.00% 3.00% 3.80% 3.80% 0.20% 72.70% 44.70% Jammu & Kashmir 84.20% 4.70% 2.90% 3.10% 10.10% 0.00% 62.20% 56.30% Kerala 78.90% 13.10% 2.80% 1.80% 38.30% 17.20% 31.60% 20.00% Chhattisgarh 81.70% 6.80% 2.70% 1.10% 14.70% 0.20% 65.20% 54.30% Jharkhand 85.60% 4.40% 2.50% 1.90% 12.90% 0.20% 79.70% 62.80% Lakshadweep 80.40% 11.20% 2.50% 3.10% 9.70% 9.30% 66.70% 24.20% Uttarakhand 78.70% 10.00% 2.20% 2.20% 18.80% 0.00% 67.60% 45.40% Gujarat 72.50% 13.70% 2.10% 3.50% 38.00% 2.80% 38.20% 39.90% Odisha 78.90% 10.00% 2.10% 2.00% 26.90% 2.30% 59.10% 47.10% Telengana 70.50% 17.50% 2.00% 2.40% 11.30% 2.90% 73.00% 55.80% Madhya Pradesh 82.20% 7.40% 1.90% 1.70% 30.40% 1.00% 60.00% 53.60% Uttar Pradesh 85.40% 5.60% 1.80% 1.50% 27.30% 1.30% 63.00% 59.20% Manipur 84.00% 5.10% 1.60% 2.80% 3.10% 14.20% 30.40% 77.70% Nagaland 82.60% 1.60% 1.50% 7.30% 8.00% 0.00% 30.80% 40.30% Rajasthan 79.40% 9.50% 1.40% 1.70% 21.30% 1.00% 70.20% 68.70% Bihar 90.50% 2.70% 1.00% 0.50% 8.20% 0.30% 81.90% 82.20%

Source: Report of the Household Finance Committee 2017

An average Indian household holds 77% wealth in real estate, 7% in durable goods like vehicles, livestock and poultry and non-farm business equipment, 11% in gold and 5% in financial instruments like deposits and savings accounts, publicly traded shares, mutual funds, life insurance and retirement accounts.

The debt of most Indian household is unsecured (56%)–that is, without a collateral–reflecting an unusually high reliance on non-institutional sources like moneylenders, according to the RBI report. Unsecured loans account for 23% of total debt in China and 39% in India.

With 95% wealth in non-financial assets, the share of Indian household is identical to the average Thai household and slightly higher than the 91% for Chinese households. The average Chinese household invests 62% wealth in real estate, 28% in durable assets and only 0.4% in gold.

In American households, real estate accounts for 44% wealth, while it is 37% in German households.

(Vivek is an analyst with IndiaSpend.)

We welcome feedback. Please write to respond@indiaspend.org. We reserve the right to edit responses for language and grammar.



__________________________________________________________________



“Liked this story? Indiaspend.org is a non-profit, and we depend on readers like you to drive our public-interest journalism efforts. Donate Rs 500; Rs 1,000, Rs 2,000.”