Yay! Week 3 folks. Wishing you a very Happy Diwali.
Since its Diwali, I want to share some of my Diwali picks for you -
There is nothing called Diwali stock picks. It’s just a portfolio of stocks recommended based on what looks good today. These stock lists are not an outcome of some magical mantras which will generate exorbitant returns over the next year. You must focus on what works for you in investing. Continue investing in mutual funds, stick to your asset allocations and focus on risk management.
Buy physical gold or jewellery. I know SGBs (Sovereign Gold Bonds) are best because they are tax free if held till maturity and also pay some interest each year but paper money isn’t going to make your mother or your wife happy. Festivals are meant to be celebrated as a family. Spend some money.
Constantly focus on improving your financial position from Diwali to Diwali. My focus remains on increasing my net-worth by 10% on yearly basis. This can come through returns or through capital addition. The compounding after a few decades is going to be massive.
Prioritise risk management. It’s a one time job to put your emergency fund in place, buy your insurances and set up them on auto debit mode. Thereafter, it’s all about how you can increase your income and invest sizeable sums to get financially free as soon as possible.
Constantly focus on improving your health from Diwali to Diwali. I run faster, better, and longer than previous year. In the last one year, I have consistently hit the gym every week as well.
Do not chase returns. In the initial years, your focus must be to build a sizeable corpus. 10% returns generated on a corpus of 1 crore is better than 10% return generated on a corpus of 10 lakhs. Start working towards reaching that 1 crore mark. More often than not, it comes through your primary area of work a.k.a. your job or your business.
If your expenses are high in absolute terms, you must also consider using the right set of credit cards. They are useful tools to generate rewards to travel luxuriously.
Pay off the most expensive debt first. If you carry personal loans or credit card loans, pay them off before investing any money. Your long term equity returns are never going to be more than the cost of these loans.
You don’t have to invest in every fancy thing thats the flavour of the market. P2Ps, digital gold, crypto, private equity or fractional real estate. I have seen clients have investments in some of these or all of these. You don’t need these. Don’t create unnecessary clutter.
Learn something new every year. I am on a 200 days French streak on Duolingo.
May you and your families have a happy and safe Diwali.
My personal blog - nirajdugar.com
Get in touch for financial planning - niraj@holisticwealth.in
Work website - Holistic Wealth
Twitter - contliving
Youtube - Niraj Dugar
Thanks.
VERY good advice.
Happy दिवाळी .