The study notes that two in five women still find taxation and investment concepts challenging while one in two men find investments difficult.
When it comes to money, men and women often take distinctly different paths. A recent report titled India’s Financial Outlook 2024 by Fin One, a digital initiative of Angel One, finds that women are 2.7 times more likely to choose insurance as an investment option compared to men. But one may wonder why this is the case, and what it says about how women approach their financial goals.
A typical discourse would often paint men as risk takers, favouring high-return options like stocks and women as a group who would traditionally lean toward financial security, focusing on investments that promise stability. This trend isn’t just anecdotal, the report puts hard numbers to this narrative.
According to this study, based on over 2,000 responses, 8 per cent of women prioritise insurance investments compared to just 3 per cent of men. While these statistics might seem small, the gap is telling.
Tier 3 cities are leading the pack with higher savings. The report highlights that 42 per cent of Tier 3 respondents save over 30 per cent of their income, outperforming Tier 1 (35 per cent) and Tier 2 (37 per cent) cities when it comes to disciplined savings.
The data challenges the traditional notion of urban areas being more financially forward.
In terms of regional savings trends, 48 per cent of respondents from South India save 20 to 30 per cent of their income, outpacing other regions in disciplined financial planning.
The younger cohort too is keen to prioritise their savings. Financial awareness is high among younger Indians, with 59 per cent of 18 to 21-year-olds saving around 20 to 30 per cent of their income, compared to only 39 per cent in the 22 to 25 age group.
This shift shows young Indians’ early focus on building savings.
The study finds that nearly 20 per cent of Tier 1 respondents prioritise saving for emergency funds, a significantly higher rate than in Tier 2 (10 per cent) and Tier 3 (10 per cent).
This points toward a greater awareness of financial preparedness among the urban populace to build on emergency funds.
Around 72 per cent of the 18 to 21 age group prefer stocks as an investment option, compared to 46 per cent in the 22-25 age group. Young adults seem to be more confident in undertaking high-risk investments despite not having financial savings early on in their lives.
The report highlights that around 1 in 2 Tier 1 respondents are aware of bonds, compared to approximately 1 in 3 respondents in Tier 2 and Tier 3 focusing on the need for financial education.
Tier 3 residents, around 62 per cent of total respondents, are also very confident about stock investments surpassing 48 per cent of Tier 2 respondents and 31 per cent in Tier 1. Awareness of stocks is also high in Tier 3 wherein 91 per cent of respondents are familiar with this investment option.
On household finance trends, the report finds that Tier 1 respondents are 3 times more likely to manage household finances jointly as compared to Tier 2 and Tier 3.
Moreover, Tier 3 respondents are nearly twice as likely to rely on their parents to manage their finances compared to those in other cities.
The study finds that financial literacy is leaning more toward the digital route. Digital platforms, especially YouTube, are becoming the centre stage for financial education among Indians. Around 74 per cent of women are turning to YouTube for financial knowledge as compared to 59 per cent of men.
This shift underscores the broader democratisation of financial literacy where financial information is now accessible at the click of a button.
However, there is still room for growth in the financial knowledge area. The study notes that two in five women still find taxation and investment concepts challenging while one in two men find investments difficult.