As we move through different stages of life, our financial responsibilities also change. In the early stage, we do not worry about money because our parents or guardians take care of our needs. But as we grow older and become independent, we start earning and managing money on our own. With this change comes greater responsibility. We need to manage daily expenses, plan for future goals like education, marriage, and buying a house, and also be prepared for unexpected situations such as medical emergencies or job loss. Without proper planning, it is easy to lose control over money and face financial stress. This is why personal financial planning is important. It helps us to use our money wisely, save for the future, and make better decisions, so that we can achieve our goals and live a financially secure life.

How Financial Planning helps individuals?

Many people think that financial planning is only for those who earn a lot of money, but this is not true. Financial planning is important for everyone, no matter how much they earn. It is not about becoming very rich, but about managing money properly and feeling secure about the future. Financial planning helps individuals understand where their money is coming from and where it is being spent. It encourages better control over expenses, regular saving, and smarter use of money. It also helps in setting clear goals, such as buying a house, supporting family needs, or planning for retirement.

It includes important components such as budgeting, cash flow management, savings, Investment planning, asset allocation, insurance planning, tax planning, and retirement planning. These components help individuals manage their income, prepare for future needs, and build financial security over time.

In addition, financial planning helps people to handle emergencies, avoid living paycheck to paycheck, and build saving. It reduces financial stress and supports a stable, confident, and independent life.

The Earn and spend Trap: A Growing Concern

One of the concerning trends among today’s generation is the rising “earn and spend” culture. While people now have more ways to earn money, such as freelancing, part-time jobs, online businesses, and multiple income streams, there is an increasing tendency to prioritize spending over saving. Easy access to credit facilities, including EMIs, personal loans, and “buy now, pay later” options, has further encouraged individuals to spend beyond their actual earnings. The desire for instant gratification, frequent lifestyle upgrades, and choices influenced by social media have all contributed to a habit of spending more and saving less. While spending is necessary and supports economic activity, a lack of saving and investing can lead to financial instability, increased debt burden, and limited preparedness for future uncertainties.

Early retirement: A shift in today’s mindset

In recent years, early retirement has become an important financial goal for many individuals. Unlike earlier generations that focused on long-term job stability, people now place greater value on flexibility, personal time, and the freedom to make life choices without financial pressure. This shift reflects a changing mindset where financial success is not just about earning more, but about having control over one’s time and future.

However, this aspiration also increases the need for careful financial planning. Early retirement cannot be achieved through higher income alone, it requires disciplined saving, controlled spending, and consistent investment over time. Without a clear and structured financial plan, achieving and sustaining such a goal can be challenging.

Changing financial behaviour and the need for personal financial planning

Reserve Bank of India (RBI Bulletin, August 2025) data shows, there is a clear shift in the financial behaviour of Indian households away from traditional saving patterns. While financial assets have grown, liabilities have increased at a faster pace, reflecting a rising dependence on credit. In 2023–24, household financial liabilities reached about 6.2% of GDP, exceeding net financial savings at 5.3%, indicating a growing inclination toward spending over saving.

This trend highlights the increasing importance of personal financial planning. When individuals do not actively plan their finances, they are more likely to rely on borrowing and struggle with long-term financial stability. Effective financial planning encourages disciplined saving, controlled spending, and informed investment decisions. At a broader level, financially responsible individuals contribute to a stronger economy by improving savings rates, supporting investments, and enhancing resilience during economic uncertainties.

Start Early, Plan Smart

Financial planning is important for everyone, whether one is young or nearing retirement, single or married, employed or self-employed. It is never too early or too late to begin. Even small amounts saved regularly can grow over time with the power of compounding and create a strong financial base for the future.

Making the right investment choices, such as mutual funds, retirement plans, or other suitable options, can help build financial security and meet future needs. However, the real strength of financial planning lies in being aware, staying disciplined, and remaining consistent. By understanding one’s needs, setting clear goals, and seeking guidance when required, one can create a stable and secure financial future.

Conclusion:

Financial planning plays an important role in our lives. It helps us to understand our income and expenses, make better financial decisions, and stay prepared for both expected and unexpected needs. With proper planning, we can avoid unnecessary debt, build savings, and work steadily towards our life goals.

There is no perfect time to start. The best time is now. Begin with small steps, save regularly, invest wisely, and plan carefully, because the future we build depends on the decisions we make today.

Reference:

Reserve Bank of India. (2025). RBI Bulletin – August 2025: Flow of Financial Assets and Liabilities of Households. Mumbai: RBI.

Author: Neelam Mor, Assistant Manager, Centre for Content Creation – NISM

Many readers of this blog already have a professional relationship with markets. You have cleared NISM certifications, completed structured courses, attended management development programmes, or are currently enrolled in one of NISM’s academic programmes. You have made a deliberate investment in professional competence — and that investment brings with it a question worth asking seriously: do you have the right framework to read what markets are actually telling you, in real time, under pressure?

This article makes the case that one discipline, Technical Analysis (TA) answers that question more directly than most. It is not a niche tool for chart enthusiasts. It is a core professional competency for anyone who interacts with capital, risk, or the investors who trust you with both.

Why this moment demands it

We are living through what might fairly be called a war-narrative market. Geopolitical conflicts, sanctions regimes, energy supply disruptions, and sovereign debt anxieties have become permanent fixtures of the investment landscape. They arrive without warning. They move prices before any fundamental model can incorporate them.

Price, by contrast, absorbs everything.

This is what makes TA uniquely suited to the current environment. Price is the ultimate aggregator of information. Every data point available to the market — earnings, central bank guidance, geopolitical fear, and shifting sentiment — eventually expresses itself in price and volume. A practitioner who can read price is, in effect, reading the collective judgment of every participant simultaneously. In a war-narrative market, that is not just useful. It is necessary.

Not mysticism — mathematics

There is a persistent misconception that technical analysis is opposed to rigour. In fact, the opposite is true.

The disciplines that underpin TA — pattern recognition, statistical inference, probability theory, signal processing, and trend identification — are among the most mathematically demanding in the financial sciences. Moving averages are weighted statistical smoothing functions. Relative Strength Index (RSI) is a momentum oscillator built on comparative price velocity. Intermarket analysis applies correlation and relative performance metrics across asset classes to map capital rotation and regime change. These are not guesses dressed up with chart lines. They are quantitative tools built on centuries of mathematical reasoning, applied to the richest real-time dataset on earth: the price record.

The discipline organises into six main conceptual families, each requiring its own foundation of study and practice.

The six conceptual families of technical analysis. Each is a discipline in its own right — and together they form a coherent framework for reading markets.

The psychology in the price

Technical analysis is, at its deepest level, a study of human psychology in action. Every chart is a real-time record of collective fear, greed, hope, regret, and conviction, expressed through the only language that does not lie: price.

Behavioural economics has given markets a rich vocabulary for the cognitive biases that systematically distort financial decision-making: anchoring, loss aversion, herd behaviour, recency bias, and overconfidence. These are not abstract academic constructs. They are the forces that create identifiable, repeatable patterns in price behaviour, cycle after cycle, across asset classes and geographies.

When a support level holds for the third time, it is not a coincidence of mathematics. It is the simultaneous action of thousands of investors anchored to the same price point. When markets overshoot in either direction, it is not an anomaly. It is the entirely predictable consequence of fear and greed operating in sequence, at scale. Technical analysis gives practitioners the framework to recognise these psychological fingerprints in real time, before the narrative catches up with the price.

Understanding the market’s collective psychology is one challenge. Ensuring your own psychology does not undermine your response to that information is another — and arguably the harder one.

This connection between market analysis and psychology is not peripheral to the discipline — it is structural. Trading psychology, the applied practice of managing one’s own cognitive and emotional responses while engaged in markets, sits alongside market analysis as an equally critical professional capability. Understanding the market’s collective psychology is one challenge. Ensuring your own psychology does not undermine your response to that information is another — and arguably the harder one. Deliberate study, structured practice, and honest reflection on one’s own decision patterns are the only path to building that second capability.

NISM has been at the forefront of recognising this connection, embedding trading psychology in its curriculum across multiple programme batches. The understanding that technical competence and behavioural intelligence must develop together is not a new idea — but it is one that formal financial education is only now systematically addressing.

The mathematical foundation that future-proofs the skill

There is a reason the foundations of technical analysis — statistics, probability, and signal processing — are the same foundations on which machine learning and artificial intelligence are built.

An analyst who genuinely understands what a moving average is computing, why RSI reverts to extremes, or how relative strength rotation maps to capital flows across asset classes, already possesses the conceptual vocabulary to build, evaluate, and challenge the AI-powered tools that increasingly shape market infrastructure. The practitioner who cannot distinguish a meaningful signal from a noisy one — statistically, not just visually — will be outpaced by those who can, whether they are competing with other humans or with algorithms.

This is precisely the convergence that CMT Association, the global credentialing body for the Chartered Market Technician (CMT) designation, has long recognised. NISM’s participation in CMT Association’s Academic Partner Program reflects a shared conviction: rigorous, structured education in market analysis is the foundation on which the next generation of practitioners must be built, and that foundation carries further in the age of AI, not less far.

A cross-cutting career skill

One of the most underappreciated dimensions of technical analysis is how broadly it applies across financial services. The intuition that TA is relevant only to traders or equity analysts is simply wrong.

Every financial services firm — banks, asset managers, broking houses, corporate treasuries, fintech companies, and regulatory institutions — has roles that either face the markets directly (making investment, trading, or risk decisions based on market signals) or face clients (explaining market behaviour, investment rationale, and portfolio risk). Technical Analysis sharpens both.

Technical Analysis supports both market-facing and client-facing roles across every sector in financial services, from entry level to the C-suite.

A research analyst with genuine TA fluency produces better work. A wealth adviser who can read a chart alongside a client builds a qualitatively different kind of trust. A fintech product designer who understands how market signals are generated builds better tools. And a C-suite leader who can interpret market structure when making capital allocation decisions is simply better equipped than one who cannot.

The skill scales with seniority. At entry level, it is the language of market analysis. At senior levels, it is the framework for making consequential decisions under uncertainty. That breadth is rare in any professional discipline.

The professional imperative and investor protection

Managing or advising on someone else’s capital is a serious obligation. SEBI has been clear and consistent: professionals interacting with investor capital must be rigorously qualified and continuously developing. The certification architecture that NISM maintains on SEBI’s behalf exists precisely to enforce that standard.

Social media has also generated a new and serious risk for retail investors. Millions of first-generation market participants are making consequential financial decisions based on the guidance of unqualified voices — many of whom have never managed meaningful risk. Confident chart annotations and viral trade calls are not a substitute for understanding. SEBI has taken regulatory steps to address this growing menace. But regulation alone cannot close a knowledge deficit. The most durable protection any investor can build is a genuine understanding of market mechanics — one that allows them to evaluate what they are being told against what price is actually communicating.

Accessibility is not mastery

One final word of caution — and it is an important one.

Access to TA tools has never been easier. Charting platforms, data feeds, AI-powered screeners, and freely available tutorials are available to anyone with a smartphone. This democratisation of access is, broadly, a positive development. But ease of access is not mastery. A stethoscope does not make a cardiologist.

Technical analysis, properly understood, demands intellectual rigour, pattern recognition built through sustained observation, the statistical literacy to separate signal from noise, and the psychological discipline to act on evidence rather than instinct. Understanding not just what a signal looks like, but what it means, when it is valid, and when it is most likely to fail — these things cannot be shortcut. They must be earned through consistent study, deliberate practice, and honest reflection on error.

The frameworks that underpin TA mirror this hierarchy. You cannot shortcut your way to application without the discipline of working through the foundations first.

Mastery is built bottom-up. The pyramid cannot be inverted — and the markets will quickly expose anyone who tries.

A closing thought

Whether you are protecting your own savings, advising on the wealth of hundreds of clients, building the analytical tools that others rely on, or setting strategy at the institutional level — technical analysis offers something no algorithm or screener can replace: a framework for thinking clearly about risk, probability, and market behaviour in real time.

In a world of accelerating volatility, geopolitical disruption, and information overload, that clarity is not a competitive advantage.

It is essential equipment.

NISM recently launched an elearning course on Technical Analysis. Click here

Authored by:

Joel Pannikot

Joel Pannikot is Managing Director of CMT Association and a doctoral candidate at Golden Gate University, where his research applies generative AI to technical analysis — aiming to take the discipline from the dealing room to the boardroom. His career spans over two decades in financial markets and education, including roles as a fixed income derivatives trader on European and US exchanges, Head of Education Strategy for Bloomberg across Asia Pacific, and CEO of an ed-tech venture. He periodically teaches Investment Psychology to students across NISM’s postgraduate programmes.

Acknowledging that financial awareness is only a first step could herald multi-dimensional policy-regulatory initiatives

The Investor Survey 2025, released by the Securities and Exchange Board of India (SEBI) in mid-January 2026, offers crucial insights into the investment behaviour of Indian households. Following a similar 2015 Survey by SEBI, it analyses the transformational changes that happened in Indian securities markets in a decade in terms of market size, product diversification, tech innovations and investor participation.  Thereafter, it raises a core question why despite growing financial strengths and rising awareness investor participation is lagging behind? Such acknowledgement and introspection are refreshing as they could help anchor fresh/modified policy –regulatory initiatives.

The Survey, with information from over 90,000 households across diverse Indian geographies, is rich in data and analytical results. It reveals the stark contrast between awareness and active participation in the securities market. While approximately 63% of households recognise at least one securities market product, only 9.5%, engage in actual investments.

It’s reassuring that SEBI is committed to bridging the gap between awareness and participation, as noted by the Chairman in his Survey foreword. However, the investment ecosystem is shaped by forces that fall outside any single regulator’s mandate.

Complex milieu facing investors

The dominant sentiment among Indian households revolves around the preference for capital preservation over high returns. With nearly 80% of households categorised as low-risk, the overall penetration of the securities market remains low. Traditionally, Indian investors have relied heavily on fixed deposits, life insurance, real estate, and gold. This conservative financial posture is often attributed to a lack of product understanding, prompting calls for improved investor education to bolster confidence. However, as revealed by the Survey, the reality is far more intricate and multifaceted; the mere presence of knowledge does not guarantee active participation.

Securities markets do not operate in isolation. Investment decisions are influenced by numerous factors beyond financial literacy and capability. The holistic financial system, its relationship with the securities market, the philosophical orientation of competing financial products, surrounding ecosystems like tax policies, fraud prevention mechanisms, and grievance redressal processes etc. play crucial roles. The existence and functionality of all financial markets are intertwined in operation as well as with various laws and regulations that govern them. A robust framework of all the other institutions and infrastructure is necessary to foster trust.

Behavioural barriers

While knowledge and financial literacy are important, behavioural finance suggests that investors often make decisions influenced by psychological barriers. The overwhelming nature of complex investment choices can deter even informed investors from participating in the market. Consumer Finance Risk Monitor (02 March, 2026) by the OECD, underlines such behavioural aspects and consequent distrust with ever-changing technology and fear of scams and frauds as major barriers on financial participation and investment decisions by people in multiple jurisdictions, including India.

Digitalization in finance brings both opportunities and challenges. While technology has improved ease of access to investment products, it also seem to have complicated decision-making processes. Increasing reliance on digital offerings can further entrench financial exclusion for individuals lacking digital skills. Low digital capability ranks as one of the most significant risks among those surveyed by financial jurisdictions, indicating a substantial gap in the ability of potential investors to engage meaningfully with modern financial systems. Recent trends also indicate that as technology shapes investment avenues, it also brings fears concerning digital safety. High risk of data breaches and complex digital products reinforce preference for traditional investments perceived as more secure.

Digital scams, frauds

The growth of digital financial services introduces new risks. Opaque algorithms and manipulative nudges intensify the vulnerability among potential investors Scams, such as phishing, vishing, smishing, and impersonation schemes, are becoming increasingly sophisticated, threatening consumer trust in digital financial systems. One scam can scar many and deter many more from joining the investing mainstream.

SEBI has launched a nationwide campaign “Jagruk Niveshak Surakshit Niveshak” (Aware Investor, Secure Investor) to educate investors against rising digital and social media investment frauds. It promotes awareness focusing on safe investing and verifying  SEBI-registered intermediaries. Very recently SEBI Chairman has launched a Verified App Label initiative on Google Play to help investors distinguish genuine platforms from fraudulent mobile app. While SEBI’s efforts in investor education, and its application of tech tools like Validated UPI Handles, “SEBI Check” for secured payments by investors to enhance investor protection and combat fraud, and the Saa₹thi app etc. are reassuring steps in mitigating these problems, they must be complemented by broader initiatives that involve other institutions and investor friendly operational and digital frameworks.

Addressing the root causes

Underwhelming investor participation in India’s securities markets is not only due to lack of awareness. Instead, it is mainly the result of complex interrelationship between financial markets, regulators and other institutions, behavioural barriers, traditional and emergent risks in a rapidly digitizing financial landscape. A multi-pronged approach is necessary to effectively tackle the challenges of raising investor participation on a sustainable basis. All stakeholders need to invest in comprehensive, regularly updated financial and tech literacy programs that reach various demographics, particularly focusing on those in rural/underserved areas. Digital skills training can empower individuals fostering confidence that can translate into active market participation. Collaboration between regulatory authorities, cybersecurity agencies, and financial bodies is crucial to building a safer digital environment. Investor protection frameworks needs to be updated continuously to reflect the risks associated with emerging challenges and practices. Addressing these challenges will require strategic, coordinated efforts from multiple stakeholders. Only then can we hope to see a significant uptick in investor participation, supporting the overall growth of India’s financial markets.

Author: Dr. Rachana Baid, Dean Academics – NISM | Dr. CKG Nair, Former Director – NISM

Net Zero Goal Meaning

In the Paris Agreement at the Conference of Parties (COP-21), the world discussed the worsening effects of climate change, global warming and green-house gas (GHG) emissions on our planet and ways to limit these ill effects. Further, during COP-26 and COP-27, nations worldwide, including India, concurred to the idea that conscious efforts are required to curb these ill effects of global warming to sustain a better future. India, therefore, has committed to achieve the Net Zero goal by 2070.

Net Zero refers to the state where the effects of GHG emissions will be nil on the environment and society. In simpler terms, the amount of GHG produced should be equal to the amount of GHG removed from environment to reach to a net zero emission state. Currently, India is on track to becoming the 3rd largest economy in the world by 2030 with a projected GDP of USD7.3 trillion. ^[1] This growth story inevitably requires capacity expansion in all possible sectors viz. manufacturing, services, agriculture etc. It is pertinent to understand that capacity expansion involves setting up of manufacturing units, usage of natural resources to produce energy, involvement of technological automations etc. – all bearing a cost on the environment, whereas, achieving reduction goal of GHG emissions contrasts with these growth inducing activities. Thus, to have a conducive situation in both these areas, collaborative efforts from Government, Corporates and Investors are required.

Net Zero Meaning in Policy: Indian Regulatory Push

The Government of India has taken efforts to introduce policies, based on best practices around the globe, that facilitates in reduction of effects of global warming thereby timely achieving the net zero goal. Several green projects are introduced by government and corporates alike, such as migrating towards cleaner energy, focusing on sustainable agriculture, adopting to the concept of circular economy etc., providing an impetus towards a sustainable earth.^[2] The regulators of India deserve a special mention in innovating and regulating various products and markets that cater to this objective by providing clear investment guidelines, transparent disclosures and efficient reporting requirements.

Securities and Exchange Board of India (SEBI), the securities markets regulator, regulates various financial products that aid in financing/ re-financing of green projects/ assets. SEBI has also put in greater emphasis on disclosure and reporting by corporates involved in such sustainable activities. The robust Business Responsibility and Sustainability Reporting (BRSR) framework requires detailed disclosure of Environment, Social and Governance (ESG) performances of listed entities. Likewise, RBI, IRDAI, PFRDA and IFSCA has also issued circulars and guidelines to regulate their respective registered entities.

Financial Product Bouquet: ESG Mutual Funds & ESG Debt Securities Explained

Investors, both individuals and institutions, have greater responsibility in channeling funds towards green projects enabling achievement of ESG objectives. In such a well-regulated environment, Indian investors have a plethora of financial products available to them that facilitate in achieving such sustainable environmental goals. Some of them are enumerated below, which are accessible to all investors, including retail investors, to direct their money to fund various ESG causes, more specifically climate-based causes:

● ESG Themed Mutual Funds:

Some of the thematic mutual funds are based on ESG objectives. These mutual funds invest their pooled money in equity shares of companies that aim to achieve a positive impact on the environment/ society/ corporate governance reducing long-term risks. These follow strategies such as Exclusionary i.e. avoiding harmful industries, Impact investing, Best-in class etc. to promote ethical investing thereby combating greenwashing.

● ESG Debt Securities:

Both Government and Corporates issue debt securities to raise capital to address ESG related concerns. It includes green debt securities, social bonds, sustainability bonds and sustainability-linked bonds that are issued in accordance with international frameworks to achieve positive sustainable outcomes and develop green infrastructures.^[3]

○  Green Debt Securities

help in financing the green projects. Green projects refer to the projects that aim to utilise the issue proceeds in producing sustainable outputs thereby reducing costs. Green projects include themes such as renewable and sustainable energy, climate change adaptation, sustainable waste management, pollution control etc. It also includes:

• Blue Bonds that utilise the issue proceeds in sustainable water management, water re-cycling and developing a sustainable maritime sector.

• Yellow Bonds that help financing solar energy generation and development of allied sectors.

• Transition Bonds include transition loans that help hard-to-abate industries to achieve long-term decarbonization of their system (brown to green shift).^[4] Hard-to-abate industries such as steel, aviation, heavy-duty transportation, cement and shipping produce higher GHG emissions and require focused approach to achieve pollution reduction. Transition bonds aid in funding for cleaner technologies for these industries thereby reducing GHG emissions and ultimately achieving the net zero objective.

• Sustainability Bonds help in financing both green projects and social projects in combination. It may be noted that both green projects and social projects have their spill-over effects in terms of achieving positive impact

The participation by the issuers and investors on year-on-year basis is evidenced from the below statistics:

• 9 mutual fund houses are managing ESG-focussed schemes with AUM of INR 103.3 billion (~USD 1.14 billion) as on February 2026.^[5]

• Corporates and Municipalities have raised money worth INR 112.3 billion (~USD 1.24 billion) through issuance of ESG Debt Securities between June 2017 and January 2026 (with majority amount raised in 2025).^[6]

Given the fund requirement to achieve the net zero goal, India requires a cumulative investment of USD 22.7 trillion by 2070.^[7] As per the Niti Aayog Report titled “Scenarios toward Viksit Bharat and Net Zero Financing Needs (Vol 9)” issued in 2026, Indian Capital Markets has an important role to play in mobilising around USD 16.2 trillion for the net zero transition.

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Want to understand how ESG mutual funds work in practice?

Build a strong foundation in mutual fund investing with the NISM Mutual Fund Foundation Certification Course and gain industry-recognized knowledge to navigate sustainable investment products confidently.

Enroll Now →

 

What Is Net Zero in India? Understanding the Indian Carbon Market^[8]

In addition to these financial products, India has established the Indian Carbon Market Framework to reduce GHG emissions from the environment. The GHG emissions are priced through the trading of carbon credit certificates, issued by the Indian Government or any approved authority. The Carbon Credit Trading Scheme (CCTS) provides a detailed roadmap for the high GHG emitting industries (obligated and non-obligated entities), where the carbon credit certificates can be traded among registered entities to achieve decarbonization.^[9] Thus, a dynamic CCTS market, regulated by Central Electricity Regulatory Commission, helps in managing the GHG emissions and also incentivises organisations to become energy efficient. With the detailed framework in place, the domestic CCTS market started its operations in four sectors.

Net Zero Meaning in Action: Practical Steps Toward a Low-Carbon Future

These regulatory impetus, economic incentives, product innovations should couple with behavioural shift in Investors to achieve net zero objectives. As per the concept introduced by India at COP-26, Lifestyle for the Environment (LiFE), each individual/ organisation, globally, should engage in environment-friendly actions.^[10] Small but consistent efforts such as usage of energy-efficient appliances, conservation of natural resources, banning the use of plastics, waste disposal management, planting of trees (afforestation), efficient usage of technologies etc. will result in reaching to an ideal low-carbon world.

 

References:

 

• ^[1]https://www.pib.gov.in/PressNoteDetails.aspx?NoteId=155121&ModuleId=3&reg=3&lang=2

• ^[2] Circular economy refers to use, re-use and recycle of resources to reduce negative impact on environment.

• ^[3] https://www.sebi.gov.in/legal/regulations/jan-2026/securities-and-exchange-board-of-india-issue-andlisting-of-non-convertible-securities-regulations-2021-amended-as-on-january-21-2026-_99288.html

• ^[4]https://ifsca.gov.in/CommonDirect/ViewFile?id=21626bde60601ef44a0ed022015b43b6&fileName=Circula r_on_Framework_for_Transition_Bonds_290725__1__20250729_0655.pdf

• ^[5] https://www.moneycontrol.com/mutual-funds/performancetracker/returns/sectoralthematic.html?utm_source=chatgpt.com

• ^[6] https://www.sebi.gov.in/statistics/greenbonds.html

• ^[7]https://niti.gov.in/sites/default/files/2026-02/Scenarios-Towards-Viksit-Bharat-and-Net-ZeroFinancing-Needs-Vol9_0.pdf

• ^[8] https://www.pib.gov.in/PressReleasePage.aspx?PRID=2223703&reg=3&lang=1

• ^[9] https://beeindia.gov.in/sites/default/files/CCTS.pdf

• ^[10] https://missionlife-moefcc.nic.in/index.php

 

Author: Shatabdi Mukherjee (AGM – CCC, NISM)

Financial Literacy – Your Most Powerful (and Missing) Life Skill

​By 2035, Gen Z will have a 50% share in total consumption spending in India, amounting to nearly $2 trillion USD, according to a study by Snap Inc. and the Boston Consulting Group (BCG). This is both thrilling and terrifying. Thrilling because, as the report puts it, they will become a formidable economic power, the most dominant among all others, such as Gen X, Millennials, and Gen Alpha. And terrifying, because only about 30% of Indians in the 18 to 29 age group are financially literate, according to a 2019 study by NCFE. Without proper financial literacy skills, this power can easily shape a future of stress, anxiety, and a debt trap. This is not a hypothetical fear. A study conducted by Arta Finance confirms this, which states that around 30% of Gen Z report that financial issues are their primary source of stress.

​The dark side of social media, EMI schemes, and BNPL transactions

The BCG study (as referenced above) reports that, for Gen Z, change is an opportunity for growth. Over 70% of Gen Z look forward to ‘NEW.’ From new styles to new looks, and from new tech to new experiences. They see change as an opportunity to celebrate. While embracing change can’t be a reason to blame Gen Z, how they handle their money in effecting this change is indeed worrisome.

​Whether to buy Coldplay concert tickets or iPhones, Gen Z wants to have it all. Social media has greatly influenced this behavior. A Gen Zer feels constant pressure to keep up with online trends, also known as ‘flexing’. And the urge to flex is so strong that, when they don’t have the means, they borrow. Take a look at this news article, which states that 70% of iPhones in India are purchased through loans. Or this article, which mentions how a small BNPL transaction of rupees 5000 spiraled into a rupees 4.2 lakh debt.

​This is not a blog about blaming Gen Z for being reckless with their money. After all, they grew up in an era of the internet, cheap data, easy credit, and on-demand entertainment. So, I can understand that, in a way, they have been pushed into it. However, the core issue here is the lack of basic financial literacy skills.

​We often misunderstand financial literacy as complex knowledge of the stock market. In reality, it’s about the basics – of saving, budgeting, understanding credit, investing, etc. These basic skills will help you understand that the average annual interest rate on a credit card debt is around 45%. Basic financial literacy will also help you realise that if you continue making minimum payments, this may temporarily prevent you from being marked as a defaulter. Still, as interest continues to compound, the financial burden will push you into a downward spiral.

​Financial Literacy Course for Bharat

The first and best step you can take is to educate yourself to become financially literate. There is plenty of content available on this topic. But I strongly recommend starting with the “Financial Literacy Course for Bharat” offered by the  NISM eLearning.

​Here is the direct link to enroll: Financial Literacy Course for Bharat

​It’s a comprehensive 22-hour online course that lets you learn anytime, from anywhere. It covers everything from money management and budgeting to debt, investing, and long-term planning. And the best part? It’s free and includes a certificate.

​Apart from this course, the SEBI (Securities and Exchange Board of India) and NISM (National Institute of Securities Markets) conduct the National Financial Literacy Quiz (NFLQ), a premier nationwide competition designed for undergraduate and postgraduate students to showcase their knowledge of financial literacy and securities markets. NFLQ 2026 is currently underway.

Take this course. Participate in NFLQ. Talk to your friends about it.

Author: Sandeep K. Biswal, Deputy General Manager-CCC, NISM