Page 2 - Savings

Household savings rate plummeted to five-decade low in 2022-23: RBI

The household savings rate plummeted to a five-decade low in 2022-23 as people started spending after the restrictions on movement ended after the pandemic, the Reserve Bank of India said on Friday. Deputy Governor Michael Patra said the dip in net financial savings of households to 5.1 per cent of the Gross Domestic Product (GDP) in FY23 also includes an increase in liabilities, much of which are home loans that will show as investments in the next year. When asked if the decline in savings to a 47-year-low is indicative of over-leverage among the households, Patra reminded that historically, the average household savings rate was about 7.5 per cent but during the pandemic, it had gone up due to a variety of factors, including inability to spend due to the restrictions and also because of precaution savings. "as these movement restrictions were removed, people went out to spend and started to draw down those precaution savings. That is some of the phenomenon that we're seeing now,"

Household savings report: There is no distress, says finance ministry

The clarification comes in the backdrop of Reserve Bank of India data showing that household net financial savings rate is at its lowest in decades

Strategies for saving more, buying insurance: Top personal finance stories

Our pick of best stories this week explains how get more from your salary and what your life insurance plan should do

'No distress', people investing in other fin products, says FinMin

The finance ministry on Thursday dismissed the criticism over the impact of declining household savings on the economy, saying people are investing in different financial products and "there is no distress". The statement posted on X by the ministry brushed aside critical voices raised with regard to the decadal fall in household savings and its overall effect on the economy. "Lately, critical voices have been raised w.r.t. to household savings and its overall effect on the economy. However, data indicates that changing consumer preference for different financial products is the real reason for the household savings and there is no distress as is being circulated in some circles," it said. Net household savings declined to a 47-year low of 5.1 per cent of gross domestic product in FY23 as compared to 7.2 per cent recorded in the previous year, as per the data released by the Reserve Bank in its latest monthly bulletin. At the same time, annual financial liabilities of households ro

Savings for growth

Low household savings can create risks

India may cut market borrowing if small savings shoot up: Ajay Seth

India has projected gross market borrowing at 15.43 trn Indian rupees ($185.88 bn) for the fiscal year ending on March 31, of which it plans to borrow 8.88 trn rupees between April and Sept

Centre approves 8.15% interest for 60 million EPFO subscribers in FY23

FY23 interest rate is marginally higher than 8.1% for FY22. After the 8.15% payout, EPFO will be left with a surplus of Rs 663.91 cr

Learn About the Different Types of Fixed Deposits in Detail

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Most ethnic minority groups in UK save less into pensions, shows study

The percentage of people from these groups expecting a "comfortable" retirement is also greater

From insurance policies to MFs, here are the new tax rules from April 1

What changes: Tax on proceeds from high-value insurance policies, higher tax on debt MFs and more

Safety in the storm

As the requirement for capital import into India at present is low, the global tornado has modest implications for us

'Higher pension under amended EPS scheme comes with caveats'

The Employee’s Provident Fund Organisation issued a circular on February 20. According to it, employees who wish to opt for a higher pension from the amended Employees’ Pension Scheme-1995 must do so by March 3. To know whether salaried employees should opt for the higher pension or stick to the current scheme, Sanjay Kumar Singh, Associate Editor, Business Standard spoke to Deepesh Raghaw, a Sebi-registered investment advisor and founder, PersonalFinancePlan

Can you outlive your life savings?

A good financial plan must identify the reasons why a person may run out of money in his lifetime and find a workable solution to it

Saving for retirement? You need at least $3 million, says study

Most respondents are optimistic they'll move closer to their retirement goal by ending 2023 with a balance of retirement savings higher than it was at the end of 2022

Explainer: New EPS rules and why higher pension will come at a cost

Employees need to weigh the pros and cons before opting for a higher pension; EPFO also needs to clarify how the higher contribution to EPS will be funded

New tax regime won't endanger country's savings rate: Revenue secretary

Household savings through tax saving instruments is just Rs 4 lakh crore, which is 16 per cent of total savings, and shifting to new tax regime won't endanger the country's savings rate, Revenue Secretary Sanjay Malhotra said on Friday. He said the total household savings today are 27-30 per cent of India's GDP and the schemes announced in budget, especially for senior citizens and women, will help the country in improving the savings rate. "I would also like to point out that the savings through tax exemptions is actually a very small portion of the total savings of our country, which are about Rs 25 lakh crore for households. Savings through tax (saving) instruments are only Rs 4 lakh crore. You know people are now investing otherwise," Malhotra said at a CII post-budget event. To encourage taxpayers to shift to exemption-less tax regime, the Budget 2023-24 has proposed changes to the new optional tax regime which provides that no tax would be levied on annual income of up to Rs 7

Asia the saver

The global savings glut may persist as, despite ageing rapidly, Asia can continue to be a net saver

Financial resolutions for 2023: 6 ways to get your finances in shape

These tips can help you make and stick to your financial resolutions in 2023

Savings deposit growth in Q2 slumps to 9.4% YoY while FDs gain traction

Growth of money kept in current accounts moderated to 8.8% this September, from 17.5% a year ago

Companies mostly beat large banks on FD returns, face competition from SFBs

However, corporate deposits are generally riskier than those offered by large bans; debt funds offer attractive returns in above 3-year tenure