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Not yet thought about building wealth? Start your SIP now at as low as Rs.500. Yes. Rs.500.

Who doesn’t want to build a tidy sum of wealth over the years? But you probably are unsure where and when to start.

The simplest product gives the highest return
It’s easy to get confused in the din out there – ULIPs, ‘child plans’, ‘pension plans’, chit funds and even the neighbourhood ‘aunt’ peddling an LIC policy. These complex products are poor investments.

There is no better wealth creation engine than the equity market. Equity markets give 15%-18% annual returns over the long term. And a mutual fund is the best vehicle to invest, for those who don’t understand the markets.

A monthly automatic investment in a mutual fund (called SIP) ensures you put away money regularly for the future. You can start as low as Rs 500 per month. Technology allows you to provide a bank mandate and automatically transfer money on a fixed date every month. The money, should you need it, can be withdrawn online at a day’s notice.

The time to start is now!
If you had invested Rs 5K every month starting 2001 right through 2015, you would have invested Rs 9L in all. Can you guess what this would be worth today – Rs 75L – that’s over 8X growth!

If you had delayed starting by just a couple of years (2003 instead of 2001), your wealth would be less than Rs 35L. In other words, the punishment for starting late is severe.


Make your bonus and increment work for you

This article has been published in “The Tribune” on 8th August, 2016

It’s that time of the year you look forward to – appraisals, followed by a bonus and / or an increment. You feel entitled, and rightly so, to splurge some of the hard-earned money. Kids’ summer holidays are around the corner, and you have probably already made plans for a vacation. Now is also time to think smartly about how to make that extra money really count.


After you have done your party and vacation, it’s time to put the rest of the bonus to good use. The worst thing you can do is leave it idle in your bank account. Rs. 1 lakh left in the savings account costs you Rs. 500 in lost interest every month. That’s a family dining-out opportunity lost, every month!

If you think you need the bonus money within the next 3-5 years – say you are planning down-payment for a house – then you can put the money away in income funds. These are debt funds and carry no stock market risk. At the present time, they earn ~8% a year.

If you don’t have any immediate plans for the money, it’s even better. You can invest the money in equity mutual funds. Over the long term, these are by far the best products. Historically, equity markets have returned above 15% year-on-year. The risk is minimal if you stay invested longer than 7 years.


The best part of an increment is that you haven’t yet got used to spending the extra money! A great way is to use this to start a systematic investment (SIP) in a tax saving scheme. You hit several birds with one stone:

  • Your tax saving is taken care of, without the panic that usually happens in Jan-Feb
  • The money works for you in the best possible way – tax savings schemes are among the best performers
  • Since you aren’t used to the extra money yet, you don’t even notice reduction in cash available here and now. And yet, you are moving money towards long term wealth building


Wondering how to go about all this? The Fisdom app allows you to do all the above in a completely electronic, paperless way. You can also get specific recommendations for the funds to invest in, for each case – bonus or increment.

Does fixed deposit give you the best returns?

Does fixed deposit give you the best returns?

Usually, no! FDs are the best only if you fall in the lowest tax bracket or are a retiree.

While bank fixed deposits are undoubtedly safe, their returns are poor. In fact, over a long period of time, they tend to return lower than inflation – so your purchasing power actually reduces if your money is stored in fixed deposits over long periods of time. Fixed deposits are useful only if you need the money within the next three years.

Over the long term, there is no alternative to equity if you want to stay ahead of inflation. You can either directly invest in stocks, or, if you lack the time & expertise, take the mutual fund route.


Fixed deposits give assured returns. So, traditional investors have parked their savings in FDs. However, three things which need to be considered:

  • Fixed deposit returns are lower than inflation. Your money loses value over time.
  • Breaking fixed deposit or premature withdrawals always comes with a cost. It will be an inconvenience when money is required during an emergency.

At present, interest rates on fixed deposits are between 6% to 8%,depending on the time period of investment.Retirees, persons in the lower tax bracket or those needing money within 3 years can opt for fixed deposits.

Goal-Based Investing – How Does It Work?

Investing with a goal is very important. Read to know why.

Your goal / objective form the starting point for all our research and algorithms to rally behind.

Through a couple of simple questions, we learn from you the timing and amount of the goal. This allows us to compute what investments would make most sense, to minimize your monthly investment towards the goal.

Having said that, it is perfectly legitimate for you to not know the exact timing of a goal – for e.g. overall ‘wealth building’ is a goal. We use heuristics to determine the best allocations in such situations.

A couple of guiding principles enable us to determine the best products:

  1. The farther away the goal, the more risk you can take to try and earn a higher return. Conversely, a goal that is near requires investing in safe instruments
  2. Goals that are far away are affected by inflation – for e.g. it would be difficult for you to estimate what your toddler’s higher education would cost 15 years from today. We again use heuristics to estimate what the goal could look like in today’s terms (i.e. after adjusting for inflation)

We then help you invest one-time or monthly amounts towards this goal in the best instruments chosen. Our reporting then helps you monitor progress towards achieving the goal.



Click Here to invest to build wealth and achieve your goals.

Marriage – About The Couple, Family and Finance

While a marriage is said to bring two individuals and their family closer, there’s much more to it. Marriage also calls for tying the financial know as well.

When planning your wedding, you may think of the flowers, the invitations, and finding the perfect outfits for your big day. However, some couples make the mistake of thinking more about the wedding than they do about the marriage. A wedding lasts one day and a marriage is supposed to last a lifetime. Marriage introduces changes in a new couple’s financial situation that will affect all aspects of their life together. Everything from personal financial goals to credit card debt could bring challenges to the relationship. Finance is one of the most critical key components of a marriage.

Tying the Financial Knot

For your marriage to succeed, you have to agree about the role money will play in your marriage. Open communication about money is the key. Once you’ve decided to tie the knot, discussions about money shouldn’t be far behind.  Finance questions before marriage may help you and your future spouse understand where you both stand financially in the relationship.  It can be hard, but it is important to discuss marriage and money before you decide that you want to spend your lives together. It may seem like a silly reason to not get married, but if you start out on the wrong foot, things are going to be so much harder than they have to be.  When you get married, you take on not only your loved one’s emotional baggage, but all his or her financial baggage as well. You need to know just how heavy that baggage is.

Talking about Money

Once you’re married, your partner’s finances will be your finances, for better or for worse. After you’ve had a few initial discussions about money in general, initiate a discussion about your respective financial situations. Figure out whether either of you have any of the following:

  • Large debts
  • Student loans
  • Credit card debt
  • Investments
  • An inheritance

Maintaining separate and common accounts

The first rule of personal finance is to avoid ceding total control of your finances. They are your responsibility and if you let go off the reins you may find yourself with a number of extra problems. The best and wisest thing that a married couple can do is to have three different types of finances; two for each individual person and one as a unit. As two unique individuals you have needs; and by maintaining your own personal finance, you take responsibility for your needs.

Combining marriage and money cannot be avoided either. Although you may keep separate accounts and may both have jobs of your own, you are always going to have to work together on money issues.  You may share responsibilities of paying for bills, utilities and other necessities.

Spender v/s  Saver

Tension can develop to the breaking point in a marriage when one person wants to spend and the other wants to save. Spenders often marry savers, so this is a common issue. If you’re a saver and you open the credit card statement to find that your spouse has bought several thousand rupees worth of home accessories when you were planning to use that money for some much needed auto repairs, an argument is almost inevitable. When there’s a saver and a spender in a relationship, you have to come to a compromise you can both live with if you want to avoid constant arguments or unspoken resentments over money.

Plan an Affordable Wedding

How can you keep your wedding costs under control? First of all, do a budget. Make a list of everything you can think of that you’ll need for the engagement ceremony, wedding ceremony and reception and your estimate of what each item will cost. Refine your budget as you get price quotes, and identify the things that are most important to you. Small compromises can often add up to big savings.

The biggest factor influencing your costs is the number of guests that attend. Calculate average cost for food, drink, transport and other things you have to rent. Inviting just the people who really matter can save you ten thousands of rupees but for many people weddings are the occasion to flaunt wealth.

As a young and single man/woman you have a unique chance to bless your future spouse by setting aside just a little money every month to enable you to provide some much-needed security at the outset of your marriage.

Click Here to plan your post-marriage finance better.