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Do you think Indians are good at savings ?

Discussion in 'Money Matters' started by SriVidya75, Jan 28, 2010.

  1. SriVidya75

    SriVidya75 Platinum IL'ite

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    Lately after going through some of the articles/blogs on internet, I have this question are we Indians good at savings than Americans???

    Are we taught to save right from childhood than our fellow American kids??? This is not to show some one down ...just a discussion/thought sharing thread...We see many threads or topics on frugal living on most of the money sites...but is Frugal living really necessary for Indians? What is your take on this?
     
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  2. Shanvy

    Shanvy IL Hall of Fame

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    Vidya,

    I would quote kalam on this..and then my views.

    the savings-oriented psyche of Indians and their habit of living within their means will help the country to tide over the global financial crisis - former President APJ Abdul Kalam- this was in march 2009.

    The reality is different. there has been a considerable drop in the savings of Indians due to various reasons.

    I believe sensible style of living is more important.

    Yesterday a acquaintance x - f-60 years was talking about her neighbour. both worked. the dh in a pvt concern and the dw in a school. so both have a pension. but the smartness x was talking about was recently they renovated the house, and they coughed up around 2lacs without blinking the reason, for the last 10 years they put aside 1000rs every month towards home maintenance separately. they plan for all contingencies and have amounts ready for everything. recently the wife had a cataract done, and they just took the amount from the 20k they put aside for medical expenses. they get rent from 3 homes, which they do not touch. they eat healthy, enjoy life. the kids are all settled abroad.
    what do we call this living?? frugal or sensible.

    I know another person's parents. the guy works so hard and sends money, the parents are always spending, not even thinking that they need to set aside some for emergency. the net result is that though the son works abroad both the parents/son have no savings.

    Till, the last decade, there were surveys that said indians were more prepared financially to tackle life after retirement. today with the cost of living, the inflation we see many senior citizens trying to go for jobs. i know one person who is still working at 72.

    But the conservative style of our banks, tax structure, DH says, people working in india are forced to save because of the taxes. well many start thinking of retirement and things only when are above 40/45. today life starts at 40 for many.

    There should be a balance style. not buying a car just because somebody else you know has it, but thinking whether you need it, whether you can maintain it. having credit cards is a style statement. i know people who says i buy everything by cc. ok fine, do you know how to manage your cards, if not don't is my suggestion to them.

    But, we are better at the saving aspect, though the percentages have gone down from what it was a decade ago
    Have I diggressed..will be back in the discussions...
     
  3. SriVidya75

    SriVidya75 Platinum IL'ite

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    Shanthi madam

    Excellent explanation....I totally agree with your last statement...I do think that we have slowly drifted away from those savings concept...

    however just to see the bright side...can we think that the standard of living has improved????ofcourse living on creditcard debt is not what I am talking about, but able to afford or able to secure jobs or that confidence that they can pay off the debt or they can earn is this the reason for increase in the living standards??or drifting away from the aspect of savings?

    around 10 to 15 yrs ago, except government employees , not many people were planning for their retirement or effective savings/investment options..all that people cared for was about getting proper education for their kids and hoping the son would take care of their family...few people who had PFs used to save it for the old age, ..but off late there are different investment schemes, options, facilities and lot of involvement from people too...isnt it a good sign??

    Also now even a 50 or 60 yr old can get some job where they can sit and manage some office work, so is it that because some jobs are available even during late age, so the savings thought itself is starting late..(like you said, real life is starting at 40!!!)
     
  4. Mahajanpragati

    Mahajanpragati Platinum IL'ite

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    hi,
    i feel Indians are good savers.i don't have any data to quote only what i see around me.today young people spend a lot but they also earn.i find them working in cafe's,pizza place or even standing on road holding banners for specfic product for which they get paid.yes,they spend but atleast they don't ask their parents to give them money so indirectly the parents are saving.
    then the Indians will basically eat at home,carry food to work & use less of packed tinned food.here, i was surprised to sell that we get bread crumbs at super market.i thought we made it by grinding the hard 1st & last piece from the packet.
    ladies save money & invest in gold which again is saving.

    many of the elders worked in govt.sectors & hence enjoy the benefits of pension.few continue to work inspite of having passed the retirement age.
    yes,in some ways the old concept of saving money are reducing.people take more risk now & invest in shares or mutual funds.
    frugal living is necessary for indians.ours is a poor country & i feel we should not waste resources which indirectly can help a country grow.saving electricity or water is need of a hour & now the world is walking up to these concepts in disguise of green living etc.we have been taught from childhood to put off light or use less water.only problem is that we lack same zeal in saving which we don't precieve as our own.we will leave taps open at water out lets at malls or the light /computer switched on at office.we need to be aware that ultimately we are payinfg for these facilities.why do we get taxed so much because that money is used to provide us these facilities.
    i hope i did not get carried away & dragged the topic away from the basic discussion
    pragati
     
  5. SriVidya75

    SriVidya75 Platinum IL'ite

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    Pragati

    You have covered some good points !! I guess as much as I agree that we dont save that much what we used when we compare to olden days...but again the medium of savings has changed alot and also the appreciation of the same savings...

    Totally agree on the frugal living point..
     
  6. Devinaren

    Devinaren New IL'ite

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    Hi all,

    I feel most Indians are good at saving but poor at managing their money. Most of them follow, others and invest in traditional way such as banks, gold, etc. There are various financial products which are available to retail investors which can give good returns at comparatively lower risk such stocks, options, goldbees, etc.
     
  7. Srama

    Srama Finest Post Winner

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    Srividya, I should hang around more in this forum to contribute some and mostly to learn. This is an interesting topic. I agree with Shanthi that it really is personality dependent! The means of savings are so different though - while in India if we assume buying property or buying gold or generally keeping aside some money in FDs is the best way to save, here we cannot have the same mind set. If we look at Indians in general here in the US, it is really very rare to find Indians that do not save some money at least (the conversion factor plays a big role I think). This I can say confidently about our generation. I donot feel the same about the next generation that is being brought up here though - this is purely my personal opinion no offense to anyone please. Just yesterday I was talking with a friend about the same - that we are glad we can afford most of the things that our kids want but the question is with this kind of thinkning (I can buy whatever I want), even assuming they will have a very good life financially are we doing any kind injustice by them? We start off teaching the differences between needs and wants and somewhere in the teens they tend to forget about the same. Hopefully it comes back when it comes to their own earnings.

    About Americans saving, I know of a lot of them who are really quite frugal and are on top of managing their money - I am always hearing of things like how they are cutting back, investing, some very savvy shoppers etc. Most people I know have saved well and enough for retirement if not for future generations. Like others I donot have any numbers to substantiate and say one way or the other. But there are quite a few of them who do manage their finances well and a majority who donot. If there is one thing that I really like is the idea of keeping aside a certain decent percentage of one's earning and living quality life with the rest. That is where I feel there is something to learn.

    Finally, I really don't know if I have contributed effectively to the original topic, but there.... my opinion!!
     

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