THE ULTIMATE WEALTH CREATION TIP

Greetings,

Let’s say that you are fasting just like that… you say “Not feeling like eating... I will not eat today” and there is no specific motive for avoiding food.

And wow… in front of you, your best friend opens his Lunch Box and there you see your favorite Pizza… 99 out of 100 times, you will lose your resolve, succumb to the tempting yummy Pizza and go ahead to munch on the cheesy delight breaking your fast!

 

 Do you know why this happened?

There was no clarity on the PURPOSE behind the fast and thus getting lured and swayed by the yummy food is natural.

But if you were fasting due to a religious belief…say Ekadashi, Dasara festival, or a Ramzan, you wouldn’t get tempted come whatsoever as there is a CAUSE behind your action.

The strength behind you maintaining your fast in this case remains resilient and you wouldn’t budge no matter how tempting the Panner Butter Masala may be as now you have a PURPOSE and a REASON behind the fasting.

Without a clear purpose behind your fast, you are more vulnerable to being influenced by enticing options that appear in front of you.
Likewise, having no specific financial goal for your savings can lead to reckless spending or diverging from your investment plan when attractive but unplanned expenditures arise.

=======================================

We keep meeting all varieties of Investors. Some are truly well-intentioned but still not able to create Wealth.

Let me give you an example.

Last week, I had a new investor through a reference. He said “Sir, me and my wife do save religiously. We save for months but suddenly something comes up and we end up using not only our savings but even our Credit Card. We assure you, Sir, we both are SAVERS and not at all spendthrifts”

They literally begged, “Please help us ACTUALLY SAVE”!!

 

This was not peculiar to me at all.

This happened to them as they did not have a FINANCIAL GOAL in Mind.

While every one of us is driven by Financial Aspirations and a promise of a better tomorrow, somehow the bag of money saved vanishes when an Amazon Prime Day Sale comes up or one of our cousins puts up a photo on Instagram enjoying a Scuba Diving in the Maldives and lo! We too must do the Scuba Diving or similar and end up spending ……totally unplanned!

The Key to Successful Saving (and investing) lies in linking these to Well-defined Goals.

You first need to understand “WHY YOU NEED MONEY”
Just saying “I need lots of money” is not enough.
Answer the WHY… Know the purpose and the reason for needing the money.

 

 

WHY DO WE NEED MONEY?

The need for money could be varied and needs to have a target. It could be anything like a wish fulfillment, making your life better, lifestyle expenses, or reducing loans! It could be anything.

To make it easier for you, I have listed some here.

To get rid of a Loan (Home loan, Education Loan, Personal Loan)

To start a new business, a new factory, a new branch

To travel, to explore new places.

To plan for kids’ future (education, wedding)

To plan for my own RETIREMENT!!

When you know why you need the money (purpose), you will be in a better position to make the BEST USE OF RESOURCES you have to achieve Financial Freedom

The goals can be anything. It could be your Annual Vacation, your new car, or your down payment for that dream home. Now that the goals are linked, you will find a purpose, motivation, discipline, and direction for your savings.
Visualizing you achieving your goal will keep you motivated enough and ensure you don’t redeem that FD / Mutual Fund which is growing quite well.

This linking of goals will also make you more motivated to find ways to increase your percentage of savings and maybe even your ways of increasing your income!

And once you achieve a Goal, it will give you that confidence that yes… you can do it. It will give you a sense of fulfillment and reaffirms your own ability to take control of your financial life.

 

THE MORE SPECIFIC YOU ARE, THE BETTER

In fact, having a SPECIFIC goal will help you not only visualize better but be motivated much more in saving and achieving that goal.

For example, I want to buy a car is a goal but “I want to buy a 6-seater Toyota SUV is very specific”.

This will give you an idea of “How much” is needed for that goal and “When” you can reach that goal.

Begin with Short Term Goals and then gradually go for Medium Term Goals and finally the big ones. And that’s your Long-Term Goals

Setting short-term goals is the perfect way to build confidence and establish a foundation for greater success.  Small wins lead to big accomplishments!

Now that we know the goal…it’s easy to PLAN.

Suppose you say I need Rs.2 lakhs for my Singapore Trip 2 years from now. Good. Now that we know you need Rs.2 lakhs and we have 2 years’ time.
It becomes now easy to calculate how much you should keep aside every month for that Singapore Trip and you can achieve the same.

 

FOR THE LONG TERM TOO:

This can and must be applied for the long term too.

Instead of saying “I want to retire rich”, you can have a specific number in mind and say, “I want to retire with Rs.5 crores of Net worth”.

Now that you know you need Rs.5 crores when you are 60 and suppose you are 35 now., you have a good 25 years to plan.

Let’s look at an example.

Suppose you start with zero (0) and start saving at age 35.

All you need is less than Rs.30,000 per month! And now you know that 30k is enough for your 5cr retirement target corpus, you can plan easily and direct savings to that goal.

Having a financial goal will help you stay focused and be disciplined with your money.

It gives you a reason to save, and invest rather than splurge on impulsive purchases.

With a goal in mind, you will also be able to track your progress and celebrate the reaching of goals.

 

DON’T SAVE… INVEST!!!

I have seen many who save religiously but do not invest wisely. Saving is only the 1^st step but the 2^nd and most crucial step is INVESTING.
  

Saving is like putting your money in a Piggy Bank. It will keep your money safe but will not grow due to the effects of inflation and taxes.

Investing is like planting a variety of seeds in a garden. The seeds may and will take time to grow into plants and then trees but the effort is worth it as you can reap the rewards regularly.

Investing is the right way to grow your wealth and reach all your financial goals on time.
Yes… Investing is a difficult process especially when it comes to not only identifying the right asset class but also the right instruments and the percentage of amount that needs to divide among these many varieties

That’s where the requirement of an Experience Investment Expert will come in handy. She will help you navigate the market fluctuations, maximise returns without compromising on risk by understanding your risk profile, asset allocation, and guide accordingly.

 

THE BIGGEST ADVANTAGE:
Once the Goal/Purpose/Target is identified, automatically the WANTS will get reduced and may even be eliminated as now the inner mindset will be focused on reaching the goals.

 

Making sure you INVEST the saved amount in Equities is what will ensure that you just DONT RETIRE RICH but retire WEALTHY!!

So don’t just save, invest. Saving is good, but investing is better.  Saving is necessary, but investing is smart.

Saving keeps you safe in a cage.

Investing will elevate your financial status and help you soar to new heights.

 

                                                                                Invest…don’t just save.

 

 

THE ULTIMATE WEALTH CREATION TIP IS

a.  HAVE A GOAL FOR YOUR SAVINGS

b.  DON’T SAVE BUT INVEST FOR THAT GOAL

All the very best to your Financial Freedom Journey

Srikanth Matrubai

Author — Don’t Retire Rich

All the best,
Regards,
Srikanth Matrubai

MUTUAL FUND DISTRIBUTOR

REBALANCE VOLATILITY CERTIFIED COACH

Srikanth Matrubai, Author of the Amazon Best Seller DON'T RETIRE RICH

You are strongly encouraged to consult your financial planner before making any decision regarding this investment. The views expressed here are the author's personal views and should not be interpreted as a recommendation to invest/avoid.

 

Srikanth Matrubai Author of the Amazon Best Seller DON'T RETIRE RICH

Do read the book and give your valuable feedback and request you to post positive comments on Amazon. https://amzn.to/3cHUM6M/ 

You can purchase the book on Amazon and Flipkart 

For the best of ideas on where to invest to create Mountains of Wealth 

join my TELEGRAM channel

WEALTH ARCHITECT
    https://t.me/joinchat/AAAAAELl4KUnaJzi-JJlDg/

Financial Freedom Is Not Just for the Rich: A Guide

FINANCIAL FREEDOM IS NOT JUST FOR THE RICH
Follow these steps for you to achieve the same.

 

 

 Financial freedom is often perceived as a privilege reserved for the wealthy. However, as an experienced financial advisor, I firmly believe that financial independence is attainable for everyone, regardless of their current financial circumstances.

Just like a seasoned traveler relies on a map and navigational tools, you can follow the steps given in this article to achieve your financial freedom.

Reflecting on those experiences, it is clear that financial freedom, a state of being financially self-sufficient and stress-free, is a goal you must choose.

Achieving this freedom is not an overnight process; it requires a systematic and disciplined approach. It is important to avoid making uninformed decisions that can hinder progress.

 

EMERGENCY FUND IS THE PILLAR OF A STRONG FINANCIAL PLAN 

We live in an era where joint family is an endangered species and thus you are left to fend for yourself even in an emergency financial situation.

In a Contingency Situation, the options for you could vary from selling your prized processions to selling your blue chip shares/Mutual funds to taking a Credit Card loan or even borrowing from your friend or the next-door moneylender.

All these could lead to potentially rock your Financial Plan. This is where an EMERGENCY FUND comes into the picture.  One of the biggest lessons that COVID has given all of us is the importance of having an EMERGENCY FUND

Emergency Fund acts as a Shock Absorber of a Financial Plan. The absence of it can make a Financial Plan turbulent. Once you have this covered…. then the mental peace you have is unparalleled.

If you don’t have an Emergency Fund, SET IT UP NOW!!!

 

 

 

GET INSURANCE:

The most vital aspect of Financial Planning is Risk Management. We never know when life will throw a Googly at us (covid, etc). Thus, it’s absolutely crucial that we are adequately covered for such emergencies by way of Health Insurance, Vehicle Insurance, Property Insurance, accident insurance, etc.

 

Insurance can be expensive, but it can save you a lot of money in the long run. If you are unable to work due to an illness or injury, health insurance can help pay for your medical expenses. If you are in an accident, auto insurance can help pay for the cost of repairs or replacement. And if your home or belongings are damaged in a disaster, Property insurance can help pay for the cost of repairs or replacement.

Insurance is thus, not an expense, but a smart way to ensure your financial stability and peace of mind.

 

 

CREATE A BUDGET

Create a plan for your money to flow properly. It’s a blueprint that guides your financial decisions.

This plan called a Budget in other words, helps you effectively manage your income and expenses.

List out all your income from various sources like Salary, investments, rent, government benefits, etc.

Likewise list out all your expenses like Food, Transportation, Rent, Utility bills, insurance, and EMIs.

 Be sure to include even your irregular and make provision for unexpected expenses as this will make your budget plan realistic.

Once you know where exactly your money is going and coming from, you can then decide how much you can save and invest.

Note that the budget plan should be flexible. Our life is constantly changing. Income may vary, expenses may vary and thus your budget plan should be flexible enough to have all these adjustments to navigate our financial journey.

The plan for the money flow will help establish a strong financial foundation so that you can easily achieve your financial goals.

 

SAVING AND INVESTING:

Saving and investing are the pillars of building a solid financial foundation. Saving helps you build up a cushion of money in case of unexpected expenses like a job loss or a medical emergency, while investing helps you create wealth over time and achieve all your financial goals like Buying a home, etc

Set aside a portion of your income and build an emergency fund to deal with unexpected expenses. Find investment opportunities that suit your goals.

Don’t just save… INVEST!
SAVING IS MONEY KEPT ASIDE FOR AN FORESEEABLE EXPENSE (NEED)

 

INVESTING IS MONEY KEPT ASIDE FOR A FUTURE EXPENSE (WANT/COMFORT)

SAVING is a process of accumulating money. With Saving, you are safeguarding your money and is risk-free. 

INVESTING is the process of CREATING WEALTH and could involve some form of Risk.

SAVINGS doesn't need much expertise. 

INVESTING is complex and expert hand-holding is a MUST at least in the initial stages and in some products, inevitable. 

 

 If you are not sure how to save or invest, consider talking to a financial advisor. A financial advisor can help you create a financial plan that meets your specific needs.

 

 

GOAL

 

It’s proven that we humans work better and are more successful when we have a specific goal to focus on, as a goal will give us direction and keep us motivated.

Divide your financial goals into specific short terms like Visiting Char Dham, medium-term goals like buying a Car, and long-term goals like Child Marriage or Buying a Dream House.

By writing these goals, you will get a purpose and motivation to make your money directed towards achieving those goals.

Having clear financial goals will propel you faster toward the goal of Financial Freedom.

 

 

AVOID DEBT LIKE A PLAGUE:

Debt will take you down the hold and digging will only get deeper and deeper with every passing day of your debt life.

If you already do have a debt, work vigorously towards reducing and clearing off the same. Please note that having debt will also affect your cibil score and thus you will have to pay higher interest if you need further debt.  Be mindful of your spending habits and resist the temptation to rely on credit cards or loans for unnecessary purchases. Focus on living within your means and utilizing cash or debit for your day-to-day expenses.

 Imagine that you're trying to run a race, but you're carrying a heavy backpack. The backpack is full of debt, and it's slowing you down. No matter how hard you try, you can't seem to catch up to the other runners.  That's what debt can do to you. It can weigh you down and make it difficult to achieve your financial goals.

 

One of the easiest ways to avoid getting into a debt trap is by

a) Having an Emergency Fund

b) Having a pre-planned expenses list and sticking to it

c) Pay all your bills ON TIME

 

Remember, avoiding debt is an essential component of achieving financial freedom. By adopting a prudent approach to spending, building an emergency fund, and repaying existing debts strategically, you can pave the way for a more secure and prosperous financial future. Stay committed to your goals, practice financial discipline, and celebrate the milestones as you move closer to a debt-free life.

 

 

DIVERSIFY YOUR INCOME SOURCES:

A strong sturdy building stands for 100s of years only due to its PILLARS.

A farmer relying only on 1 crop is vulnerable to unpredictable crop failures but if he has multiple fields and multiple crops, the chance of a bountiful harvest is sure to happen.

Likewise, try to have multiple income sources so that you have a safety net that gives you a cushion against unexpected financial setbacks in any one of the income sources.

Do explore and pursue various income avenues, leveraging the power of diversification to secure your financial future.

By spearing your investments across various asset classes and sectors, you reduce the risk associated with a single investment.

Having multiple sources of income (however small) gives you a sense of security, and more freedom and reduces your risk thus increasing your chances of achieving Financial Freedom sooner.

 

REACHING GOAL QUICKER BY TOPPING UP

To reach your destination efficiently, you need to fuel your journey with consistent efforts. Just as a car requires fuel, your financial journey demands regular savings and investments.

 

Just as a smart shopper seizes discounts during a sale, adding funds to your investments during market downturns can enable you to buy assets at lower prices, potentially increasing your returns when the market rebounds.

 

 

 

REVIEW & RE-ROUTE IF NECESSARY

On a long journey, it's natural to encounter detours and obstacles. The same applies to your financial journey. Unexpected expenses, market fluctuations, and life events can throw you off course. That's why it's crucial to review and adjust your financial plan regularly, like recalibrating your GPS.

 

Even the best of plans can go awry due to unforeseen and unavoidable changes in life and circumstances

A review and a route change are a must in such a case.

Say a change of job, childbirth, a death in the family, tax law change, or even a change of place of work could lead significant impact on the financial priorities.

 

Just as a ship adjusts its course to reach its destination, we may need to keep making necessary adjustments in our financial plan to stay on track to achieving Financial Freedom

A review will help in accessing your progress and identify areas where improvements are needed.

 

 

Remember, with each adjustment you make, you are optimizing your plan and inching closer to achieving your dreams. The review helps in making informed and proactive steps to reach our goal of Financial Freedom more quicker. An experienced Financial Advisor by your side can provide valuable guidance and give insights into investment opportunities and make sure your strategy aligns with your goals helping you reach your goal on time with the least stress.

 

Achieving Financial Freedom is not a pipedream.

 It is a realistic and achievable goal that anyone can pursue with the right habits and strategies. By following the steps outlined in this article, you can set yourself on the path to financial freedom and enjoy life to the fullest.

.

Conclusion:
Financial freedom is not an exclusive privilege of the wealthy; it is a goal that can be pursued by anyone committed to taking the necessary steps. Remember, it starts with cultivating healthy financial habits, building a strong foundation, embracing incremental progress, leveraging the power of compounding, seeking knowledge, and surrounding yourself with a supportive network. Embrace the journey towards financial freedom, knowing that you have the potential to unlock a future of independence and security, regardless of your current financial circumstances.

 All The Very Best,

Srikanth Matrubai

Author – Don’t Retire Rich

 This article of mine is also published in MEDIUM 

https://medium.com/@matrubai.srikanth/financial-freedom-is-not-just-for-the-rich-a-guide-d1f2c7f04d29

All the best,
Regards,
Srikanth Matrubai

MUTUAL FUND DISTRIBUTOR

REBALANCE VOLATILITY CERTIFIED COACH

Srikanth Matrubai, Author of the Amazon Best Seller DON'T RETIRE RICH

You are strongly encouraged to consult your financial planner before making any decision regarding this investment. The views expressed here are the author's personal views and should not be interpreted as a recommendation to invest/avoid.

 

Srikanth Matrubai Author of the Amazon Best Seller DON'T RETIRE RICH

Do read the book and give your valuable feedback and request you to post positive comments on Amazon. https://amzn.to/3cHUM6M/ 

You can purchase the book on Amazon and Flipkart 

For the best of ideas on where to invest to create Mountains of Wealth 

join my TELEGRAM channel

WEALTH ARCHITECT
    https://t.me/joinchat/AAAAAELl4KUnaJzi-JJlDg/

SHOULD YOU GO FOR HIGHER CONTRIBUTION TO EPS ?

 

 

 

The EPFO (Employees Provident Fund Organisation) has now allowed contributions towards Employees’ Pension Scheme (EPS) at 8.33% instead of the earlier 15,000 ceiling.

 

The higher Pension (that too for life) looks very tempting but as we all know FREE FOOD IS AVAILABLE ONLY IN MOUSE TRAPS and hence this needs to be dug deeper before committing your hard-earned money.

 

I WILL NOT GO INTO NITTY GRITTY OF ENTIRE EPS EPF working.

Let’s focus here only on WHETHER HIGHER AMOUNT SHOULD BE CONTRIBUTED TO EPS OR NOT...

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Contributing a higher amount to EPS will result in a LOWER corpus of your EPF.

The NO.1 Priority in Financial Planning must invariably go to RETIREMENT PLANNING Nobody gets a Retirement Loan.

When you build a bridge, you insist that it can carry 50000 kgs weight, but you only drive 15000 kgs weight truck across it. That is the way you want your bridges to be.

 And that same principle works with your retirement planning. You must make sure that your fund lasts as many years as it can. It's better to have MORE rather than less, especially when it comes to RETIREMENT CORPUS & RETIREMENT INCOME.

India doesn’t have too many ASSURED return products stretching for longer duration and hence EPFO presents a useful, suitable, stable solution for those planning for retirement.

Peace of mind is of primary importance and a stable pension post-retirement definitely fits the bill for post-retirement financial security.

 

But...

Should you go for a HIGHER contribution?

Does it make sense?

 

 

LET’S DEEP DIVE

 

If you are a person who is not well versed in equities or does not foresee a REGULAR income in the form of either an Annuity, Rent, or Pension then a HIGHER EPS contribution is a MUST for you.

In an increasingly uncertain and unstable world, a stable pension in the form of EPS would give you PEACEFUL Sleep even before you retire as the feeling of SAFETY is paramount for any human being.

EPS is a defined benefit plan meaning that the amount you receive post-retirement is GUARANTEED and Pre-determined and thus NOT DEPENDENT ON THE STOCK MARKETS

 

 

PLEASE NOTE:

 

1. Post Retirement, you will NOT get any LUMPSUM but only a monthly pension through EPS

 

2. Contributing a higher outgo could result in a liquidity squeeze for the present. Are you okay with that?

if you have other financial priorities, such as paying off high-interest debt, building an emergency fund, or saving for short-term goals, you may want to prioritize these before increasing your contribution to EPS.

 

3. If you require funds before retirement for whatever purposes (kids’ marriage, starting own venture), this EPS will be of no use to you as it is illiquid

 

4. The more service period you have, the better will be your gains when going for Higher EPS

 

5. With Interest rates going down over the last 2 decades and also in the foreseeable decades, the high returns that are now visible MAY NOT BE SEEN GOING AHEAD

This could lead to RE-INVESTMENT risk for the LUMPSUM amount that you receive on retirement.

In this scenario, a higher monthly pension will help you LOCK-IN rates for life long.

 

 

6. The corpus in the EPS pension will not be given to you.

And on your death, the monthly payout to your spouse goes down by a massive 50%

 

 7. 
The amount of pension you get will be FLAT throughout the retirement period

The amount will not increase as per INFLATION
and we all know how Inflation keeps eroding the value of our rupee

Rs.50,000 monthly pensions at the age of 60 will make more sense

but if you continue to get the SAME amount of Rs.50,000 even after 15 years (at age 75), you will actually have a LESSER amount in hand due to INFLATION 

 

MOST IMPORTANT,

The Monthly pension that you get will be TAXED

whereas the LUMPSUM you get is TAX-FREE!!

&

THE HIGHER THE SERVICE PERIOD YOU HAVE, THE HIGHER WILL BE YOUR GAIN

In simple terms, you have a shorter period to retire.... don’t go for higher EPS (of course, you should take a VRS or something!)

 

 

 

 

IN CONCLUSION

If your present liquidity needs are taken care and you can afford a higher outgo

AND AT THE SAME TIME

if you are okay with a HIGHER Monthly Pension but less LUMPSUM post-retirement. only then GO FOR HIGHER EPS

FINALLY,
While planning for retirement, remember you are not 'saving for retirement”.

in fact, you are actually investing for *SPENDING AFTER RETIREMENT*

And of course, with a prudent investment approach, you can create your own pension by investing in Equity Mutual funds suiting your Risk Profile.

Post Retirement, start an SWP and get regular income at a frequency of your choice and create your own pension!

 

All the Best for a Wealthy Life 

Regards, 

Srikanth Matrubai

Qualified Personal Finance Professional (QPFP)

AMFI Registered Mutual Fund Distributor

 

Author of the Amazon Best Seller books  
DON'T RETIRE RICH
&
WEALTH OF WISDOM

All the best,
Regards,
Srikanth Matrubai

MUTUAL FUND DISTRIBUTOR

REBALANCE VOLATILITY CERTIFIED COACH

Srikanth Matrubai, Author of the Amazon Best Seller DON'T RETIRE RICH

You are strongly encouraged to consult your financial planner before making any decision regarding this investment. The views expressed here are the author's personal views and should not be interpreted as a recommendation to invest/avoid.

 

Srikanth Matrubai Author of the Amazon Best Seller DON'T RETIRE RICH

Do read the book and give your valuable feedback and request you to post positive comments on Amazon. https://amzn.to/3cHUM6M/ 

You can purchase the book on Amazon and Flipkart 

For the best of ideas on where to invest to create Mountains of Wealth 

join my TELEGRAM channel

WEALTH ARCHITECT
    https://t.me/joinchat/AAAAAELl4KUnaJzi-JJlDg/