Why gold as an investment is losing significance in India despite its emotional connect
For centuries, gold has held a deep emotional and cultural significance in India. Whether it’s adorning a bride on her wedding day or being passed down as a family heirloom, gold has traditionally been more than just a metal; it has symbolized wealth, security, and pride. However, in recent years, gold’s role as a preferred investment is fading, even as its emotional value persists.
Shifting investment patterns
India’s younger, more tech-savvy population is leading a shift in investment preferences. With access to financial literacy and digital platforms, millennials and Gen Z are exploring modern avenues such as mutual funds, stocks, cryptocurrencies, and real estate. These alternatives often provide higher returns and liquidity, two areas where gold falls short.
Declining practicality
The high emotional value attached to gold can limit its utility as an investment. Families are often reluctant to sell gold assets, as doing so might feel like letting go of sentimental ties or traditions. This emotional reluctance often leaves gold locked away in safes, rather than functioning as a liquid or growth-oriented asset.
Rising costs and lower returns
While gold prices have steadily risen, the return on investment often lags behind other asset classes. Additionally, the costs associated with purchasing physical gold, such as making charges and storage expenses, reduce its appeal in a competitive investment landscape.
Cultural evolution
Urbanization and modernization are gradually shifting cultural dynamics in India. While gold remains a cherished commodity, younger generations are less inclined to view it as a cornerstone of their financial planning. Instead, they prioritize assets that align with their fast-paced lifestyles and long-term financial goals.
Conclusion
Gold’s emotional significance in India remains undisputed, but its practical role as an investment is being re-evaluated. As financial markets evolve and newer generations embrace modern investment strategies, the glitter of gold is losing its shine in the portfolios of Indian investors. While tradition will always hold a place for gold, its importance as an asset may continue to decline in the years to come.
Source: https://www.udayavani.com