Even earlier than the onset of the COVID-19 pandemic, Hong Kongers had been already juggling a number of monetary challenges, and plenty of felt nervous about their monetary scenario. The pandemic has impacted shoppers’ funds additional, with many missing monetary resilience and confidence of their monetary future.
Monetary well-being isn’t nearly having a sure checking account steadiness or quantity of investments. It’s about whether or not folks really feel assured they will each handle their day-to-day funds and plan for the long run. For some folks, monetary safety is about whether or not they pays their payments on time or put cash apart for an sudden medical invoice. For others, monetary peace of thoughts is realizing they may have the funds for to reside comfortably till the tip of their life.
As monetary companies corporations enhance their concentrate on bettering clients’ financial well-being, they want to higher perceive their clients’ monetary wants and develop services and products that may have a constructive affect on their monetary well being and assist them obtain their monetary objectives. Forrester’s Financial Well-Being Segmentation helps corporations higher assess their clients’ degree of monetary resilience and perspective towards their monetary scenario.
Forrester’s Monetary Effectively-Being Segmentation
Hong Kongers Fall Into 4 Distinct Monetary Effectively-Being Segments
To assist monetary companies corporations perceive the place Hong Kong shoppers stand on the monetary well-being spectrum, we surveyed 1,105 Hong Kong on-line adults in 2021 and located that:
- 31% of Hong Kong shoppers are Safety Seekers. Safety Seekers don’t reside paycheck to paycheck, but they do really feel anxious about their monetary scenario. They cite realizing easy methods to make investments, planning for retirement, and realizing how to save cash as their high monetary challenges. When requested about how they really feel about their funds, 38% say they really feel steady whereas 29% say they really feel harassed.
- 24% of Hong Kong shoppers are Cushioned Savers. Cushioned Savers don’t reside paycheck to paycheck and don’t really feel anxious about their monetary scenario. This section faces few monetary hardships. Even so, they nonetheless have monetary challenges equivalent to realizing easy methods to make investments and planning for retirement. A majority of Cushioned Savers understand their present monetary scenario as steady (69%) or describe themselves as optimistic (37%) with regards to their funds.
- 23% of Hong Kong shoppers are Carefree Spenders. Carefree Spenders reside paycheck to paycheck but don’t really feel anxious about their monetary scenario. The three high monetary challenges holding them again are realizing easy methods to make investments, realizing how to save cash, and affording a big life-event expense. Nonetheless, over a 3rd of these carefree spenders say they understand their present monetary scenario as steady.
- 22% of Hong Kong shoppers are Stretched Spenders. Stretched Spenders reside paycheck to paycheck and really feel anxious about their monetary scenario. Their high monetary challenges are realizing how to save cash, realizing easy methods to make investments, and paying for primary every day bills. Seventy-three % of them say they really feel overwhelmed by debt, and 78% say that debt negatively impacts their means to pay payments. Even so, when requested how they really feel about their monetary scenario, they most frequently say they really feel steady and cozy.
The upper proportion of Safety Seekers is comprehensible within the present context of uncertainty. Within the face of the pandemic and a recession, Hong Kongers have gotten extra prudent and saving extra usually, with many placing apart emergency funds. COVID-19 has derailed even the best-laid retirement plans. Even for individuals who will not be dwelling hand to mouth and have managed to construct financial savings over time, planning for the long run or realizing easy methods to make investments is especially tough given the financial backdrop.
Corporations can map their very own clients to those 4 segments and achieve perception into their monetary attitudes, behaviors, and curiosity in or use of particular private monetary administration instruments, companies, or recommendation. By understanding which segments their clients fall into, monetary companies corporations are higher outfitted to tailor their monetary experiences.
In our upcoming APAC Financial Services Webcast Series 2021, I’ll share how one can construct a extra related segmentation mannequin to enhance the monetary well-being of your clients. I look ahead to having you be part of my session on 28 July! Register right here: https://go.forrester.com/apac/financial-services/
Hope to see you there (nearly)!