Are Indian Youth Focusing on Savings with the New Tax Regime?
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Synopsis
A groundbreaking report reveals a significant shift in the financial priorities of young Indian professionals, who are now focusing on savings and investments instead of immediate consumption. This trend showcases a growing sense of financial prudence that may reshape the future of personal finance in India.
Key Takeaways
- 60% of young professionals prioritize savings and investments.
- 30% focus on debt repayment.
- 76% of tech professionals are saving their surplus.
- Delhi and Gurgaon are leaders in savings.
- Awareness of the new tax regime varies significantly.
New Delhi, Sep 9 (NationPress) A recent report indicates that young professionals in India are now placing a higher emphasis on savings, investments, and debt repayment rather than discretionary spending. This analysis, conducted by the job portal Naukri, surveyed over 20,000 job aspirants earning up to Rs 12.75 LPA, categorizing them within the zero-tax bracket as per the new FY’26 tax regulations.
The findings reveal that nearly 60% of the participants are directing their surplus income towards savings and investments, while 30% are utilizing it for debt repayment. In contrast, only a minor segment is allocating these additional funds towards immediate consumption, with just 9% opting to enhance their lifestyle and a mere 4% spending on travel and leisure activities.
Particularly noteworthy is the trend among professionals in emerging technologies, where 76% are saving their excess income. This is followed by individuals in the auto sector at 63% and the pharmaceutical industry at 57%. Furthermore, employees in the FMCG sector (64%) and hospitality sector (over 60%) are among the most dedicated to long-term retirement planning and investment strategies.
“These insights signify a generational shift in financial habits: young Indian professionals are constructing a robust foundation for long-term financial security rather than indulging in immediate consumption. Additionally, regional and industry-specific variations enrich this evolving trend,” the report states.
In contrast, fresh graduates embarking on their first jobs demonstrated a tendency to spend their tax surplus on lifestyle upgrades (31%) and travel (14%). However, interestingly, with just one year of professional experience, 69% prioritize savings, which is more than double the rate seen among fresh graduates at 34%.
Geographically, Delhi and Gurgaon lead in savings, with 63% and 64% of professionals, respectively, setting aside surplus income. Chennai stands out with 44% of respondents focusing on debt repayment, while Mumbai is recognized for its retirement-oriented savings, with 51% allocating extra income to retirement funds.
Moreover, the report indicates that awareness regarding the new tax regime is inconsistent. While fresh graduates are the most informed (64% reporting complete awareness), 57% of professionals with over five years of experience also show full awareness. Overall, 43% of respondents expressed a lack of clarity or complete unawareness regarding these changes.
Point of View
It’s vital to recognize the emerging trend of financial prudence among young Indian professionals. Their shift towards savings and investments speaks volumes about the evolving economic landscape and the changing mindset towards financial security. This trend not only reflects the current economic climate but also sets the stage for future financial behaviors.
NationPress
09/09/2025
Frequently Asked Questions
What are young Indian professionals prioritizing according to the report?
According to the report, young Indian professionals are prioritizing savings, investments, and debt repayment over discretionary spending.
How many respondents are channeling their surplus income into savings?
Nearly 60% of respondents are channeling their surplus income into savings and investments.
Which sectors have the highest savings rates?
Professionals in emerging technologies, auto, and pharma sectors are leading in savings, with rates of 76%, 63%, and 57% respectively.
What is the awareness level of the new tax regime among professionals?
The awareness of the new tax regime is uneven, with 64% of freshers being fully aware, compared to 57% of those with over five years of experience.
Which cities are leading in savings among young professionals?
Delhi and Gurgaon top the charts in savings, with 63% and 64% of professionals setting aside their surplus income.
