Not just you, even HNIs are struggling to save and invest

Time of India

2 days ago

Aspirations are high, planning is low
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The portfolio puzzle: heavy on real estate, light on diversification
A broken advisory model
A moment of inflection in India's wealth journey
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Mr. Kumar, a 44-year-old banking professional living in Mumbai's Kandivali suburb, earns Rs 50 lakh annually and holds assets worth Rs 3.5 crore. He dreams of buying a new car, funding his daughter's international education, walking her down the aisle, and retiring at 60 with a steady income. Yet, he saves just Rs 5 lakh a year. With a ballooning home loan EMI, school fees, and other lifestyle expenses, Kumar's financial plan, if one can call it that, secures only 62% of his long-term goals.Kumar's story is not unique. In fact, it's alarmingly typical.According to the India Wealth Survey 2025 , jointly conducted by Marcellus Investment Managers and Dun & Bradstreet, India's high-net-worth individuals (HNIs) are increasingly aspirational but financially underprepared. Despite a decade-long bull market and swelling disposable incomes, nearly 43% of Indian HNIs save less than 20% of their post-tax income. For individuals earning more than Rs 20 lakh a year, like Kumar, this mismatch between ambition and financial action is a sobering reality check.The survey, conducted between February and March 2025, captured responses from 465 households across 28 Indian cities, including metros, Tier 1, and Tier 2 towns. These households span different age brackets, professions, and family setups, but a common thread emerged: while wealth may be growing, financial discipline is not keeping pace.India's affluent class is maturing in mindset. The survey found that 75% of HNIs prioritise funding their children's education and marriage, while 40% aim to buy homes, start businesses, or retire early. These aren't far-fetched goals for individuals with annual incomes exceeding Rs 20 lakh. However, many lack the financial clarity to achieve them.More than one-third of respondents aged 30–45, those typically in their prime earning years, reported having at least one active loan. Among these younger HNIs, half are servicing debt, and only 25% manage to save more than 30% of their income. As the survey puts it bluntly, 'Indian HNIs: So Near, Yet So Far.'Their challenges stem not just from consumption but from structural issues in how they plan, or fail to plan, their financial futures. A staggering 14% of HNIs surveyed do not maintain an emergency fund at all, leaving them vulnerable to even minor financial shocks.Real estate continues to dominate the Indian HNI's investment palette, despite its illiquidity and cyclical risks. The survey found that more than 50% of HNIs allocate over 20% of their wealth to real estate, excluding their primary residences. By contrast, only one in three HNIs allocates more than 20% to equities, a disparity that persists even among those who claim to be comfortable with market-linked investments.In fact, even ultra-HNIs, defined in the study as households with net worths exceeding Rs 10 crore, struggle with effective diversification. 63% of them save more than 30% of their income, yet only 17% allocate more than 30% to equities. Meanwhile, 65% of them continue to invest 10–20% in gold and silver, underscoring a lingering preference for traditional stores of value over globally diversified, higher-yielding options.'HNIs face challenges in achieving their goals,' the survey noted, citing low investment returns (40%), lack of savings discipline (29%), poor understanding of investment options (21%), and high debt burdens (9%) as the most common roadblocks.While nearly 87% of HNIs rely on external advisors, including wealth managers, bank RMs, chartered accountants, friends, or stock brokers, many feel let down. Two-thirds reported dissatisfaction with the quality of advice they receive.The complaints are telling: 'The advisor doesn't fully understand my needs, and their recommendations are not tailored to my unique situation,' one respondent said. Another added, 'My advisor recommends products to meet their commission targets, rather than advising products which are right for me.'The survey found 31% of respondents citing lack of personalisation, 17% citing conflict of interest, and 14% highlighting lack of transparency as key reasons for their dissatisfaction.Yet, demand for quality advice has never been stronger. A resounding 82% of respondents believe professional financial planning improves their odds of meeting long-term goals. Additionally, 51% want help with diversification, 38% want customised asset allocation, and 32% seek assistance in goal planning, clear signs that Indian HNIs are hungry for more than just investment products; they want frameworks, relationships, and long-term vision.The Marcellus–D&B Wealth Survey 2025 paints a nuanced portrait of India's affluent class: ambitious, aware, but adrift. The traditional model of passive investing, real estate accumulation, and informal advice is showing its age. What HNIs now demand is a more deliberate path, one that aligns their wealth with their purpose.From goal-linked planning and global diversification to conflict-free advisory relationships, the contours of this new roadmap are beginning to take shape. Yet, as the case of Mr. Kumar shows, the gap between intention and execution remains wide.Marcellus proposes a three-pronged solution: no-cost personalised financial planning, access to diversified portfolios including global equities, and ongoing support and counselling. For those willing to trade DIY bravado for expert help, the promise is simple: security, clarity, and peace of mind.But until the broader shift occurs, until more Indian HNIs reframe money not just as an asset to accumulate, but as a means to achieve carefully mapped life goals, stories like Kumar's will continue to be the rule, not the exception.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)