Tokyo, Nov. 9 (Jiji Press)–Japan’s government-backed shift from savings to investment is gaining steady momentum. Fueled by the expansion of the Nippon Individual Savings Account, or NISA, a tax-exemption program for small-lot investments, stocks and investment trusts make up a growing share of household financial assets. Meanwhile, the share held in cash and deposits is shrinking. Still, fewer than 40 pct of people in their 30s have opened NISA accounts, even though that age group has the highest account ownership rate. This suggests significant scope for further growth. Fund Inflows According to preliminary flow-of-funds data released by the Bank of Japan in September, household financial assets totaled 2,519 trillion yen at the end of June. Holdings of stocks and investment trusts jumped some 40 pct from a year earlier to a record 678 trillion yen, nearly tripling over the past decade. Their share in total assets has risen to about 27 pct, while the share of cash and deposits has fallen to about 45 pct. The figures clearly reflect the recent stock market rally. But Ayato Nishino, a researcher at Daiwa Institute of Research Ltd., noted that households have been increasingly channeling money into investment trusts since the revamped NISA program was launched in 2024. “The shift from savings to investment is steadily gaining traction,” Nishino said. “As NISA becomes widely embraced, the desire to follow others who have started investing, along with rising stock prices in recent years, is providing a tailwind.” Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., said growing awareness “that inflation erodes the value of cash has prompted people to start investing.” Growing Interest NISA account holders are exempt from the roughly 20 pct tax on gains from selling stocks and investment trusts. The 2024 revisions made the program easier to use by removing the limit on the tax-exempt holding period and raising the annual investment caps. According to the Financial Services Agency, 28.2 million NISA accounts had been opened by the end of 2025. Interest in the revamped program remains strong. According to the Japan Securities Dealers Association, the number of NISA accounts at securities companies rose by more than two million in the first half of 2026. The full-year increase is expected to far exceed the 2.22 million recorded in 2025, with people in their late teens and 20s driving the growth. Yusuke Maeyama, a senior researcher at NLI Research Institute, noted that the term “NISA broke” has become a topic of conversation. It refers to people who cut back on daily living expenses hard to put more money into their NISA accounts. “That suggests more young people may have become highly interested in investing,” he said. Challenges for Further Growth Still, NLI Research Institute estimates that only 38 pct of people in their 30s hold NISA accounts, even though that is the highest share of any age group. In addition, about 37 pct of NISA accounts are inactive, with no record of any purchases. “There is enormous scope for people who have not yet used NISA to start taking advantage of it,” JSDA Chairman Takashi Hibino said. Understanding how to invest remains a hurdle for many. The JSDA conducted a survey in fiscal 2024 that included people with no investment experience. Among respondents who had opened a NISA account but never invested, the most common reason given was, “I don’t really understand how to invest.” “For people thinking about investing, the steps from opening an account to making a first purchase present a high barrier,” Maeyama said. “How best to help them take that first step remains a challenge.” He suggested regional banks as one possible answer. These have more branches than brokerage houses and reach a far wider range of people through services such as payroll accounts. Maeyama said he hopes regional banks “could take the lead in further expanding the use of NISA.” END [Copyright The Jiji Press, Ltd.]
