Do not believe in Tips, they’ll tip you over
Sell High, Buy Low
Enter the market, when others are worried
Exit the market, when brokers are investing as if there is no tomorrow
—- Sounds like Robin Sharma, I know it is more of Warren Buffet…but then have pity on my poor soul.
At the end of the day it is unchecked, free of cost, on your face advice beaming across TV channels, magazines, articles and of course our dear Web. It’s similar to the tele-callers who call you for some ABC product and whom you can shut down and generally at a high pitched voice but you listen to these investment gurus with uninterrupted attention.
With so much advice floating around, especially when it comes to financial planning and investing in the market; the mind is always at cross roads and it is with great difficulty can one make a decision.
As a middle class person, the following list adds up to the confusion of making a financial decision –
1] My investment should not end up as a dead investment – every time the stock market sees a huge correction… even my aggressive risk profile corrects itself. Is it worth the risk?
2] Tax benefits – I need all of it. Not a single day goes by when I don’t think about my tax money ending up with some “Adarsh” guy involved with “CWG” (Corruption wala games) and to top it behaving like a “Raja”.
3] LIC kiya kya? – The other day I was visiting my bank for home loan installment and this was precisely the topic of discussion amongst the staffers. A huge chunk of the society, who work in banks/government bodies/semi-government institutions still hold LIC as sacrosanct to investment though at the end it offers no more than 5-7% returns with life cover. That is brand LIC for you. That is inadequate knowledge about Life Insurance for the society in general. That’s a huge customer base for all private life insurers.
4] Mutual funds – We have nothing in mutual agreement. They play around with the money of so many people and I don’t want anybody to play with my hard earned money. Every time when I see a particular MF company telling me that their XYZ fund is above average; they are not telling me that their DEF fund is giving below average returns.
At the end, to add up to all this confusion, investment gurus tell us – Investments are subject to market risks and past performance is no guarantee of future results. I find solace in buying 10 Kg Atta from Big Bazaar on any Wednesday – at least they tell me “Iss se sasta aur kahi nahin”.
So where am I heading? I have only one question to ask – where does this confusion lead us to? Yes, we get attracted towards either MF, or stocks or LIC or ULIPs or some investment scheme based on a marketing impulse rather than really understanding what we are getting into. Of course gone are the days when some distant relative’s reference used to sell us LIC policy but even in today’s information savvy world we buy financial products based on the investment agent’s convincing note – Iss se behtar aur koi nahin.
Some companies have understood these issues and besides the normal adulation they heap on their products; they have now started combining the product benefits as a solution to our issues. Is it Smart Marketing or maybe realizing our needs finally? A few examples are:
So, my mantra is to not get carried away by every advertisement/radio jingle that talks high of an investment product rather stay alert, be smart, educate yourself about the financial instruments – and then plan! See, another advice-J