There is one famous quote, “To become wealthy, your money must be growing even when you are asleep”. Hailing from a middle class family Amit kumar lives in Pune, with his family . Starting early in his life, saving and investing money helped to make his money work for him day and night. Many know how to earn money but very few have the knowledge to create wealth. In early 2006, he was introduced to mutual fund by his brother’s friend, a mutual fund advisor.
So his investment journey started with an SIP amount of 2000. Having a detailed round of discussions, he realised that if he give time for his investments, they would definitely give what he thought of. He understood that it’s not timing the market, but the time which you spend in the market, which helps to create wealth over a long period of time. Just after few years of his investment journey, 2008 market crash happened, but his understanding and hand holding by advisor helped him to face the downfall. He continued his SIP irrespective of the market condition and the subsequent market rise helped to come out of decreased valuation of his mutual fund investment.
After completing his engineering from prestigious college he joined an MNC. Subsequently he increased the SIP amount to 6000 and later on 15000 on his first salary increment. Saving habit was inculcated during his child hood as parents were teachers. He understood the importance of saving. But mere saving doesn’t make you rich, unless your hard earned money works for you. He used to do lump sum investment from the annual bonus money depending upon the market conditions. Time to time lump sum investment gave the required boost to his portfolio making it bigger and bigger. The value appreciation helped him to understand why Einstein used to call “compounding”, as the 8th wonder in the world. The selection of his funds depends on his risk profile, investment horizon, pedigree of the fund.
He has clear financial goals in life like retirement, child education, marriage, foreign family trip. Building retirement corpus of 4 Cr is the biggest goal in value term, out of which he already accumulated 60 Lacs. Have clearly defined SIPs for his son and daughter education as well as marriage expenses, ranging from 12 lacs to 25 lacs in today’s term. Rising inflation and increasing standard of living has been taken care of by way of Top Up SIPs. Time to time review help him to monitor his mutual funds growth. He firmly believes that mutual funds are better than investing in direct equity. Currently his current portfolio growth rate is around 14 percent and saving rate of around 25 percent of his net income. Amit kumar is systematically moving towards his financial goals and confident that he is on the right track.
He summarise his achievement by stating below important message.Everybody wants to be a Millionaire, but very few are willing to invest for long term. Staying invested with equity mutual funds for a longer time, helps to achieve your financial goals. You have to be patient with equity investments and importantly a better advice give clear understanding to achieve one’s financial goals.
Will the stamp duty on mutual fund investments affect you significantly?
Stating From 2000 SIP to creating corpus of 300 times monthly expenditure
You don’t need wealth to create wealth. Just need action in the right direction