A Study On The Saving Habits And Investment Behaviour Of Municipal Contractual Labourers At Harihara In Karnataka

Abstract

This research delves into the saving habits and investment behaviour of municipal contractual labourer’s in Harihara, Karnataka, aiming to provide a comprehensive understanding of their financial practices and the socio-economic challenges they face. Given the critical role these labourer’s play in maintaining urban infrastructure and cleanliness, their financial stability is essential not only for their well-being but also for the sustainability of municipal services. The study employs a mixed-method approach, combining quantitative surveys and qualitative interviews. A sample of 150 municipal contractual labourers was selected through purposive sampling. The survey focused on various aspects of financial behaviour, including income, expenditure, saving habits, investment preferences, and financial literacy. Key findings from the study indicate that municipal contractual labourers in Harihara exhibit low saving rates, with only 25% of respondents saving regularly. The primary motivations for saving include covering emergency expenses and securing funds for children’s education and future investments. Traditional saving instruments, such as bank saving accounts and post office savings schemes, are preferred, while a smaller portion of respondents rely on informal saving methods. When it comes to investment behaviour, a high level of risk aversion is evident. Most labourers avoid high-risk investment options like stocks and mutual funds, favouring safer alternatives such as fixed deposits, life insurance policies, and gold. Barriers to investment include low income, lack of financial knowledge, and limited access to formal financial institutions. Trust issues with financial advisors and institutions further compound these challenges. The study reveals widespread financial illiteracy among respondents, with most relying on informal sources of financial information, such as friends, family, and colleagues. This lack of formal financial education contributes to their conservative financial practices and limited engagement with modern financial instruments. The findings underscore the urgent need for targeted financial literacy programs and improved access to formal financial services for municipal contractual labourers. Recommendations include implementing comprehensive financial education programs, enhancing access to formal financial services, introducing schemes to encourage regular savings, and advocating for stronger social security measures. In conclusion, this study highlights the cautious and conservative financial approach of municipal contractual laborers in Harihara, driven by low income, employment insecurity, and limited financial literacy. Addressing these challenges through targeted interventions can significantly improve their financial stability and overall quality of life, contributing to the sustainable development of urban infrastructure and services in Harihara.