Indian employees investing actively but lack financial preparedness and knowledge, study shows

Indian corporate employees are investing more actively in mutual funds and equities, but many lack adequate financial knowledge and emergency preparedness, shows a Finsafe India study.

Top financial challenges*:

The workforce is anxious about the future, juggling ambitions for long-term stability with immediate career uncertainty, with their top concerns being:

Monthly savings

Debt burden is undermining respondents’ ability to save, trapping many in a cycle of borrowing.

Preparedness paradox:

Respondents relying solely on employer-provided insurance may be overestimating the coverage, leaving families vulnerable if a layoff occurs. When including with those who are not prepared at all, roughly three in four respondents would be vulnerable in a crisis.

Closing the risk-and-readiness gap:

There is a concerning mismatch between risk-taking and preparedness: only a quarter of respondents are fully protected with adequate insurance and emergency savings, yet 42% are drawn to “new and trendy” high-risk investments like crypto or peer-to-peer (P2P) lending. Some ways in which employers can help are:

Emergency fund initiatives: Payroll-linked emergency savings, auto-enrolment, gamified challenges and milestones rewards.

Insurance assessment and education: Embedding insurance literacy into wellness by covering topics such as evaluating health, life, home and pet coverage

Link risk to reward in communications: Making readiness “cool” and using measurable risk protection, investment readiness, or retirement preparedness

Holistic programmes: Making employees recognise that financial well-being is the foundation on which other aspects of wellbeing, physical, or mental stand

Investing high, learning low*

Over half the respondents now invest in mutual funds or equities, but an overwhelming majority of these investors are jumping into markets without adequate know-how, suggesting an ‘invest now, learn later’ phenomenon.

Source: ‘Workplace Financial Wellbeing Report FY 2024-25’ by financial education platform Finsafe India, conducted among 4,335 participants, with 68% respondents being male and the rest female. Based on age, 32% respondents were in the 20-30 years group, 45% in 30-40 years, 19% in 40-50, and 4% in the over 50 years group. *Percentages not adding to 100 as multiple responses given by respondents.