Young Indians are risk-averse; Swiss Re survey

Indian youth have the lowest risk appetite in Asia-Pacific, according to a survey done by Swiss Re, a global reinsurer. The survey that interviewed people between 20 to 40 years of age said Indians prefer a secure job instead of turning entrepreneur.

Indians rank last in Asia-Pacific risk-taking index much behind Australia and China. According to Swiss Re, this ranking is attributable mainly to the respondents’ low appetite for career and finance risks. Capital preservation tops Indians’ investment priorities with only 29 per cent willing to take risks as against 36.8 per cent in China and 45.9 per cent in Japan.

So much so that 80 per cent of the 20 to 40 year-old Indians surveyed said that they are willing to sacrifice a high return in exchange for this security.

Clarence Wong, head- economic research and consulting, Asia at Swiss Re said, “the fact that only around 10 per cent of Indians are covered by any form of pension scheme helps us understand the low financial risk tolerance of Indian respondents.
But Indians are not alone – most young adults in Asia-Pacific care about their future financial security, though some are a little more daring in their investment goals.”

To a certain extent, the reluctance of Indian consumers to use professional advisory services shows that the concept of financial planning itself, in contrast to mere savings or investments, is a notion that has only just begun to take root in that country, said the survey.

Indians are also Asia’s least willing to take career risks, with stability a key factor for employers or job seekers. About 75 per cent of Indian respondents, the highest percentage in Asia, said they prefer to work for a large and established company rather than move to a smaller company even if it offers them a higher salary or better growth prospects. This contrasts with China, where only 35 per cent opted for the security of working for a large company.

Similarly, almost 75 per cent of Indians chose a stable job over the challenge and opportunity of running their own business, whereas only 51 per cent of Chinese chose this option. The survey found that Indians, Chinese and Malaysians were most careful about health risks whereas the Koreans and Japanese were least careful.