How Covid-19 pandemic changed the life goals of individuals!

According to Wealth Expectancy Report 2021 by Standard Chartered of affluent (comprising emerging affluent, affluent and high net worth) consumers in 12 markets across Asia, Africa, the Middle East and the UK, revealed that in India, 94 per cent have reset their life goals following the pandemic.

Covid-19 has changed the way individuals set their life goals. According to Wealth Expectancy Report 2021 by Standard Chartered of affluent (comprising emerging affluent, affluent and high net worth) consumers in 12 markets across Asia, Africa, the Middle East and the UK, revealed that in India, 94 per cent have reset their life goals following the pandemic. Most importantly 48 per cent of the respondents feel that COVID-19 has diminished their confidence in their finances, preventing them from taking the actions necessary to achieve their new goals. The survey was a 20-minute online survey of 15,649 emerging affluent, affluent, and high net worth respondents across 12 markets between June 30 and July 26, 2021. The samples per market were: Hong Kong (1,076), India (1,501), Indonesia (1,523), Kenya (1,598), Mainland China (1,505), Malaysia (1,037), Pakistan (1,556), Singapore (1,056), South Korea (1,082), Taiwan (1,041), UAE (1,053), and the UK (1,621).

COVID-19 has also changed the way an individual set his/her future goals. It has prompted the affluent in India to become more future-focused when resetting their priorities: nearly a half (42 per cent) of people have set the goal ‘to improve their health’ followed by 39 per cent of people setting the goal ‘to be financially prepared for major life changes (having a child/moving abroad)’ and 37 per cent ‘to set aside more for my children’s future (education or financial support)’. 

To meet these new goals, the affluent are taking more proactive investments rather than just saving cash. “However, their current ‘confidence gap’ has made many increasingly averse to risk, potentially stopping them from putting their money to work through investing or making use of digital tools that simplify wealth management,” says the survey report. It further added that the ‘confidence gap’ is greater for the emerging affluent.

When it comes to retirement planning, a late start to retirement planning, combined with the pandemic-induced confidence gap, leaves a significant proportion of affluent consumers at risk of a shortfall for their retirement. “The survey found that 33 per cent of respondents who are not yet retired have not started saving for retirement, yet 43 per cent of the affluent in India anticipate depending on investment income in retirement. At the same time, 54 per cent plan to retire before the age of 65 and in the last 18 months, 20 per cent have set a new financial goal of retiring early.” 

Whether it is diversifying into new asset classes, new investment strategies to rebalance their portfolios, or exploring sustainable investing, the survey revealed that more hands-on investors are happier with their finances. 27 per cent of investors asked said they ‘pursued new strategies to make the most of the stock market (eg. short-term trading)’, followed by ‘invested in private markets (e.g. private equity, private debt)’ (27 per cent). In India, almost all (99 per cent) of those who have taken five or more actions related to their finances in the last year are happy with their investment portfolio.