With Covid-19 setting a compulsive limit to almost all the economic activities, a study was undertaken to know how drastically it had impacted the household expenses of a common man. The study showed that over 50% of the households had changed their budget priorities drastically.
Household expenses: Are the well-off any different?
It is expected that the mid and the mass-market consumer households are not going to be of any means of sustenance to the producers. Their motive is straightforward – economize and spend only when it is necessary.
Even though the well-off are no exception to this motive, they are still going to be of some respite to the market. It is now their responsibility to keep the market from stagnation.
The study also emphasized on what areas the well-off were likely to concentrate their household expenses for the next two quarters of the financial year. It showed that even though the virus had made it impossible for everyone to go back to their normal, there were still some exceptions:
Travel – Almost 35% were unlikely to undertake air travel as a part of their plan for the next year, this 35% were still willing to spend their money on short trips and agreed to check in to motels/hotels/resorts.
Food Market – The fear factor plays an important role here as people are unwilling to move out of their houses physically to eat at restaurants. However, the virus hasn’t been able to put a stop to the activity of ordering in. Thus, it is safe to say that the food market is out of danger.
Education – The dynamics of education, again, have drastically been changed. While people are still unsure about offline education, online education is being undertaken in full mode. This was confirmed through a survey from about 1000 households with an income ranging from 12 lakhs to 70 lakhs per annum.
Medicine – This is the one area that has seen a boost during the post COVID – 19 era, as people are willing to spend a part of their household expenses on health, medicine as well as insurance. Here, again, the fear factor is responsible.
Loans – While the people are unwilling to go for loan moratoriums, fearing instability in repayment, the demand for personal loans, auto loans, as well as gold loans has increased. Click here to check HDFC Gold loan. Most of the households plan to invest a part of their household expenses in the immediate future, in MFs, stocks and gold, as these bring promising returns that everyone needs during these trying times.