According to Zee Business research, nearly 41% of Indians say their financial goals are the biggest reason behind their stress. The findings indicate a financial well-being score of 62 out of 100, suggesting that concerns around financial security persist among the population. The issue appears to be more pronounced among urban Indians, while younger individuals and women were identified as groups reporting lower confidence about their financial security. As per Zee Business, financial experts note that financial stress is increasingly driven by inflation, rising lifestyle expenses, inadequate financial planning and investment habits that struggle to keep pace with long-term financial needs.
The study points to several factors contributing to growing money anxiety among Indians. As reported by Zee Business, rising inflation, EMI burdens, children's education expenses and future planning concerns are identified as primary contributors. Financial experts explain that when people are unable to control their expenses or do not have sufficient money available to invest towards their financial goals, financial stress is a natural outcome. The challenge lies in balancing current lifestyle spending with future financial commitments, as noted by Hemant Rustagi, CEO of Wiseinvest. Despite improving investor maturity and more young people participating in financial markets, many continue to struggle with balancing current lifestyle spending and future financial goals.
According to Hemant Rustagi, financial stress is closely connected to a person's financial security and ability to achieve future goals. He noted that investment and spending patterns in India have changed significantly, with many investors continuing to rely heavily on traditional investment avenues that struggle to generate returns capable of consistently beating inflation. Rustagi pointed out that despite growing awareness of market-linked investments, only about 7-8% of Indians invest in equity or market-linked products, limiting the ability of many households to create long-term wealth. The experts also identified that conservative investment choices may provide safety, but they often make it difficult to build enough wealth for future goals. Many investors begin SIPs without clearly defining their goals, investment horizon or asset allocation strategy, leading to interruptions during market volatility.
Rushabh Desai, Founder of Rupee With Rushabh Investment Services, outlined three essential pillars for reducing financial stress and building security. The first pillar involves building a strong emergency fund capable of supporting household expenses for two to three years if income is disrupted. Desai emphasized that we live in uncertain times where businesses can slow down and jobs can be lost, making a sufficiently large emergency corpus essential. The second pillar emphasizes maintaining adequate health and term insurance coverage to protect against rising healthcare costs and lifestyle-related illnesses. The third pillar focuses on maintaining investment discipline through systematic investment plans, with experts recommending increasing SIP contributions by 5-10% annually to keep pace with inflation. Desai noted that a moderate level of financial stress can serve as a motivator for better financial planning, but excessive stress affects decision-making.
During portfolio reviews discussed by experts, multicap funds and international exposure were suggested for long-term wealth creation. For a long-term wealth-creation portfolio, experts recommended a combination of flexi-cap, mid-cap and small-cap funds to achieve diversification across market segments. The discussion highlighted that global diversification is an important component of long-term wealth creation. Experts emphasized that financial planning is a process, not an event, and investors should avoid treating it as a one-time exercise. They advised investors to align their spending with income levels, avoid unnecessary debt for lifestyle consumption, and focus on appropriate investments capable of generating inflation-beating returns, noting that equity remains one of the few asset classes capable of comfortably beating inflation over long periods.
