All is Not Well In India! As per the latest Credit Suisse Global Wealth Report of 2017, approx 92.3% of adult population of India have wealth less than USD 10,000 or Rs. 650,000/-
Its a simple statement but very impactful and though provoking. It means the following:
- Medical – 92.3% of Indian adult population is not ready to handle any form of medical emergency. The cost of healthcare has spiraled very high and if a person suffers from any critical illness then Rs. 6.5 lacs won’t be enough for medical treatment.
- Education of Children – Among this population of 92.3%, lots of people have children who needs good education. With inflation in education being high, majority of people in India wont be able to give good education to their children.
- Retirement – Among this population of 92.3%, lots of people have retired or will retire soon in years to come. They don’t have sufficient capital to retire peaceful and happily
- Housing – 92.3% population doesn’t have a decent purchased house to stay. Its very difficult to get a good house in Rs. 6.5 Lacs.
There are many other expenses or aspirations which are essential for an Individual which requires good money. Unfortunately, 92.3% of Indian population are struggling financially in their life.
The biggest reason for this grave situation is low level of financial awareness in India. Even educated people are not aware about importance of investment and right products for investment. Most of the people end up saving less, making wrong investments and do poor financial planning. Its important that we all become financially literate so that Indian population can become richer.
Some of the recommended actions for everyone is as under:
- Control your expenses. Differentiate between desire and need. At least 25% of Income should be saved.
- Start channelizing this savings in right investments. Stay away from Ponzi schemes and overnight rich schemes.
- Start investing in financial assets like mutual funds, PPF etc. which are transparent, low cost and deliver good return.
- Start investing early so that advantage of power of compounding can be used effectively.
- Cover the individual risks by taking Term Life Insurance and Health Insurance.
- Have 6 months salary in contingency corpus.
- Don’t be underexposed in Equity. Invest in Equity mutual funds if the time horizon is 7 years plus. Equity Funds are biggest wealth creating asset which is liquid and tax efficient.
Its our duty as citizen of India to become financial literate and also help people around us by telling them about right financial planning and investment.
Its time to wake up and grow rich!