Why do we fail to get Rich?
“Rich” is a fancy word, everyone passionate about it in some way or other. Who is associated with investment knows compounding and magic of it’s working on investment?
The 8th wonder of the world “compounding” works when you stay long in a journey. We believe and suggest our clients to understand, compounding works when you stay for long. Minimum 10 years is must to see the fruits of investment.
To create a Wealth — Equity investing is almost the only way for most of us. Be it for employees or owner of a business, equity is inevitable to create wealth. The path is clear. It is the journey which is difficult. Let’s discuss those.
Here we discuss the points what stops us from getting “RICH”.
1. Not having a proper mix of asset allocation & not allocating enough for investing.
2. Investing without a GOAL. Associate your investment with a goal, it solves most of the behavioral problems.
3. Irregular or discontinuing the process of investment.
4. Treating investment corpus as an emergency fund.
5. Choosing wrong products / asset classes or expecting returns in short time.
The list goes on……
We suggest you allocate only the amount which you can hold for a long-time horizon without interrupting the compounding machine.
Quick points before starting investment — One should have the following:
1. Emergency Fund — say 3–6 months of expenses, depending upon lifestyle
2. Having Health Insurance (we suggest taking personal health Insurance policy apart from Company provided) and enough Term Insurance to cover your dependents in your absence.
