The Life Freedom Index will serve as the primary benchmark for indicating how financial free an Indian urban consumer is in terms of her financial awareness and planning
Urban Indians are not very aware about insurance products and their investment planning is not aligned with their current needs, says a survey by private insurer HDFC Life.
"Indian urban consumers' current sense of financial freedom is low," the survey said.
HDFC Life in association with ValueNotes, a market intelligence and research firm, today launched its inaugural Life Freedom Index report where over 1,600 respondents were interviewed across 11 Indian cities.
"The Life Freedom Index will serve as the primary benchmark for indicating how financial free an Indian urban consumer is in terms of her financial awareness, planning, sufficiency and adequacy of planning," HDFC Life Executive Vice President and Head, Marketing and Direct Channel, Sanjay Tripathy said.
The Macroeconomic scenario is yet to be positive as household savings seem to have gone down because families had less money to put away in a year of high inflation, he said.
"The survey reaffirms that Indian urban consumers have realised the necessity of financial planning. They are already chalking out financial plans and are generally disciplined in adhering to them. However, on the flip side, these plans lack comprehensiveness and need to be realigned with their desired financial goals," ValueNotes Managing Director Arun Jethmalani said.
The survey indicates that while 35 per cent of urban consumers rely on their social network of friends and relatives for financial planning advice, only 27 per cent seek professional help, he said.
Given the gaps in financial plans and low awareness levels, it appears that there exists a need for proper professional advice, which will help consumers in ironing out inconsistencies in financial planning and management, he added.
The urban consumers have a long way to go before achieving a complete state of financial freedom. Child education is their primary concern, the sense of financial liberty appears inflated given the inadequacy in their financial planning and awareness levels. But they have realised the necessity of financial planning, according to the survey.