Financially Independent Millennial Report 2022: Highlights

With increasing awareness about tax saving modes & avenues, millennials are joining the clique of savvy investors, who look at both future returns and present tax savings.

CASHe, India’s leading AI-driven financial wellness platform with a mission to make financial inclusion possible for all today released the ‘Financially Independent Millennial’ Report 2022. 

According to the survey, more than 43 per cent of the respondents across the country stated that they started making financial decisions independently between the age of 21 and 25 years. The pan-India survey was conducted among 20,000 customers on CASHe platform as well as on its newly-acquired wealth management platform - Sqrrl. The survey witnessed the participation of millennials from more than 80 cities that captured their preferences and attitudes towards finance as well as investment matters.  

As millennials are evolving and growing to take on additional financial commitments, there is a growing realisation among the cohort for responsible investing. As part of their preference for ongoing investment & growth, millennials are eyeing to ace financial discipline and regularity with over 47 per cent of respondents expressing their penchant for SIP/recurring deposits as their preferred investment pattern, followed by 31 per cent of respondents who favoured goal-based savings. Although young millennials may not have much to put aside, the study indicates that they are aiming to adopt smart savings habits. Also, the cohort’s inclination towards SIP and goal-based investment plans implies their commitment to regular savings.  

With millennials growing increasingly wary about money matters post-pandemic, the study indicated that a vast majority of the respondents (41 per cent) set aside a budget of anywhere between 10-20 per cent of their annual income as savings. The data showcased the growing trend of millennials adopting responsible financial behaviour at an early age. However, in contrast, it also stated that a considerable chunk of millennials (around 30 per cent) set aside less than 10 per cent of their annual income as savings, which raises concern in regard to the cohort committing to regular savings.  

The report also highlighted that millennials are rapidly evolving as ‘forward thinkers’. While boomers are either into retirement or nearing it, millennials have plenty of time to plan and save; however, there is a growing consciousness among them to start saving early for their post-retirement life. More than 34 per cent of the respondents stated that they were highly conscious of the matter and have started saving already. On the other hand, close to 48 per cent of the respondents said that they have not yet factored in retirement planning but a considerable chunk (23 per cent) aim to kick-start retirement planning soon.  

Millennials are increasingly turning to digital alternatives and prefer to do their investments themselves. In terms of preference for new-age alternative asset classes, digital gold topped the charts with more than 33 per cent of the respondents voting for it. It clearly showcased millennial inclination towards gold as a stable asset class and a profitable instrument, offering long-term gains. Digital gold offers the digital native cohort the best of both worlds - owning physical gold with the benefits of new-age technology that eliminates the hassles of physical inspection and onus. This was followed by cryptocurrency (29 per cent), fractional ownership (17 per cent), P2P lending (12 per cent), and US equity investment (9 per cent).  

With increasing awareness about tax saving modes & avenues, millennials are joining the clique of savvy investors, who look at both future returns and present tax savings. According to the survey, more than 56 per cent invested in tax saving plans while the rest were found supposedly unaware.  

Millennials have faced the most uncertain economic future of the generation since the onset of the pandemic. The majority of millennials have grown to become more cautious about finances amid the pandemic. According to the report, medical emergency, accounting for 36 per cent, was the top reason for millennials availing of loans in 2022. This was followed by unplanned expenditure and education accounting for 19 per cent & 14 per cent, respectively.   

The report also highlighted that banks continue to lead the stride as the most preferred go-to lending avenue among millennials. The survey highlighted that 41 per cent of millennials secured loans from a bank whereas 35 per cent of the borrowers opted for a digital lending platform. Owing to the relaxed eligibility criteria, bias-free processes, and attractive interest rates, lending platforms are rapidly gaining popularity among millennials.