Households less optimistic about economy: Study

Optimism about the overall state of the economy came down in 2015, with households listing unemployment, corruption and rising inflation as major areas of concern, according to a study.

PTI| Updated: Feb 23, 2016, 20:23 PM IST

Mumbai: Optimism about the overall state of the economy came down in 2015, with households listing unemployment, corruption and rising inflation as major areas of concern, according to a study.

"The overall optimism in Indian households has decreased as compared to year 2014. Indians are concerned about building their financial future and have a lot of expectations from the government," Principal Retirement Advisors Managing Director Sudipto Roy said, quoting the study titled 'Principal Financial Well Being Index in India 2015'.

Except Chennai, the study revealed that majority of the respondents from 10 cities the survey covered were concerned about the health of the economy.

Unemployment (68 percent), corruption (68 percent) and rising inflation (67 percent) continued to be top concerns for the next one year, it added.

The study was conducted along with research firm Nielsen across 11 tier-I and II cities among 1,491 respondents.

About 36 percent of the respondents said they were extremely worried about home loan interest rates, while only 11 percent said they were not at all worried.

Further, 69 percent respondents felt prices for household items would go up in the coming year.

Household expenditure accounts for 43 percent of the total income earned, savings and investments account for 40 percent, while loans take up the remaining 17 percent, the study said.

About 43 percent households expect their spending to increase in the next one year. The study found that positive outlook about increased salary and bonus are top reasons for increased spending expectations.

It said 63 percent respondents were not planning a holiday next year, which is slightly more than 2014, and 71 percent respondents felt they will either spend the same or less on festivities.

A majority of respondents had a positive outlook towards their personal finances, with most stating that they have good insurance coverage, are in control of their financial situation and are making good progress towards long-term goals, it added.