In India’s financial heartlands, high income no longer guarantees high savings. Dual-income families in metros earning ₹50 lakh post-tax often save only ₹5 lakh annually-despite holding assets worth ₹3.5 crore.
Marcellus Investment Managers’ recent survey suggests this isn’t anecdotal; it’s a systemic issue tied to inflated aspirations, poor liquidity, and lack of disciplined planning.
Saurabh Mukherjea, founder and CIO of Marcellus, in a You Tube interaction with Mint, profiled a representative case: “the Kumars from Kandivali.”
Mr. Kumar works at a bank, Mrs. Kumar in insurance, and their IB-school-going daughter stacks up ₹50 lakh post-tax income. Yet after ₹12 lakh in home EMIs, ₹4 lakh on car loans, and ₹8 lakh in school fees, they’re left with just ₹5 lakh to save-about 10% of income. Mukherjea notes these families “appear affluent but save very little,” squeezed by ongoing liabilities and lifestyle costs.
Their balance sheet shows ₹3.5 crore in assets-but ₹2 crore is locked in real estate (often across two properties with EMIs), while ₹70 lakh lies in equities skewed toward small-cap stocks and ESOPs. Liquid, quality investments are just a fraction of the total. Even worse, 14% have no emergency fund, putting them at risk in arrears or urgent expense scenarios.
The Marcellus study shows 50% of HNIs aged 30-45 save less than 20% of income post-tax, with 43% overall falling below this mark. This deficiency undercuts major life goals: a new car by 2027, international education by 2032, marriage expenses, and retiring at 60 with a ₹20 lakh annual income by 2042. Many aspirations remain glaringly unfunded.
Despite a five-year bull market, 40% of respondents reported being unhappy with investment returns. About 30% admit they lack savings discipline, while 10% cite high debt as a barrier. This reflects more a mismatch of expectation and financial strategy than market performance. “Without excess allocation to liquid assets and a structured plan, aggressive returns won’t materialize,” says Mukherjea.
He also warns of a false sense of security: real estate may inflate net worth figures, but it lacks mobility. With much of one’s wealth tied up in bricks-and-mortar, tapping into funds becomes difficult-and costly-in emergencies. The heavy reliance on EMIs further erodes monthly income, leaving little wiggle room even with respectable pay.
The survey also hints at another contradiction: 14% of these supposedly wealthy households have no emergency cushion. It’s a risky stance given their debt levels and minimal liquid reserves.
Marcellus’s findings align with RBI’s recent Financial Stability Review, which flagged increased household debt stress. That half of India’s HNIs are saving under 20% barely supports these alarming trends.