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Coronavirus pandemic has disrupted the lives of billions of people around the world, shaking the global economy and job security. The virus outbreak already severely damaged many industries, leaving millions of people without jobs. Although there will be sectors and companies that may benefit from this crisis, the severe changes already seem set to leave a lasting impact on the way people plan their finances. Early data is beginning to show signs of this in China.
Almost 75% of Chinese people have plans to increase their savings in the future, according to data gathered by LearnBonds. Moreover, over half of them plan to change their investment portfolio to be more conservative.
Before the coronavirus outbreak, the Chinese considered several key motivations for regular saving. Two-thirds of them named providing a comfortable life for parents as the main reason for saving money, revealed the Fidelity International and Ant Fortune 2019 China Retirement Readiness Survey.
Another 64% of those asked wanted to secure a decent education for children. Investing in a career and starting my own business was another common reason on the list of financial priorities for savings. Over 45% of Chinese saved for their own retirements.
However, the coronavirus outbreak changed Chinese people’s investment preferences, revealed the Statista and The Economic Observer data. The statistics show during the outbreak, many of them, or around 43%, increased their investments in a diverse financial product, including insurance policies, saving accounts, 401Ks, and pensions plan.
Nearly 40% also invested in bank funds, while 30% focused on their bank savings. Stocks, government bonds, and gold and other precious metals followed with 25%, 12%, and 12%, respectively. The survey indicates few Chinese investors were interested in putting their cash into foreign exchange and the real-estate market over the last three months.
The Statista data revealed that along with increasing their savings and changing investment portfolios, most of Chinese savers plan to purchase additional insurance policies after the coronavirus outbreak. Over 75% of respondents named insurance as their top financial priority for the future.
The 2019 Statista Survey on Insurance Industry in China revealed that even before the pandemic, more than 50% of Chinese who took up insurance bought policies to secure themselves against the expensive medical costs of treating chronic diseases.
Nearly 42% of those asked plan to save more money in their bank accounts after the coronavirus outbreak, while over 32% of them will invest in bank financial products. Bank funds, investing in stocks and gold represent the other leading finance products for Chinese savers in the future, with 25%, 14%, and over 10%, respectively.
