Generally investment managers emphasise a lot on financial or money management for all the people they meet. This is of course nice, their job depends on the assets under their management, so they should do this.

Let us look at it from the ‘investor’ or ‘client’ ‘s point of view.

When you are young (say age 24 to 34) you spend a lot of time LEARNING and build a base for future EARNING. At this stage you are much better off concentrating on your career. Of course you will earn – do the simple things like doing a SIP, take a term insurance, be careful while you borrow. In short keep it simple. Learning your craft, doing the extra courses, working late hours, having a good time with friends, and once in a while checking your mutual fund statements! That is how life should be. Ignoring investments is risky, and you want the power of compounding…so do your investing, but keep it simple.

When you are 34-45 – both you and your money should be working hard. Differentiate the wheat from the chaff. Jump up your SIPs. Take some big bets on equity, if you know how. Learn the rudiments of wealth creation.  Your investments are now bigger, so you have to be more careful. If you do not wish to invest in learning, just jump up your indexing. Start your PPF. Check out your pension requirements. Decide where you want to stay once you retire.

When you are 45-55: Your money has to work real hard now! you will be withdrawing for your needs like children’s education, children’s marriage, buying a second house, leisure travel etc. You will also be earning very well…It is the time when you consider quitting your job. Ascertain to see how prepared are you to quit your job. How rich you are is a function of how many months/ years can you live WITHOUT a pay packet. Get realistic about getting a new job if you lose your current job. YOU HAVE TO know everything about your money now – and make it work real hard.

I wrote this piece because I am finding a lot of people who concentrate on mutual funds, ulips, etc. but earning much below their potential! Please remember that when the corpus is small (when you are young) and extra 1-2% MAY NOT MATTER as much as it would matter when your age is more. That extra effort in finding a better job in a different location – city or country.

I hope people do not take this to mean ‘ignore your money’. NO. Just index and concentrate on your career.

Do not think that because your dad opened a PPF ACCOUNT for you when you were 4 years old (you were lucky, sure!) you will end up RICH. YOU WILL NOT. The final figure that you have in any account is a function of:

HOW MUCH MONEY YOU PUT (make no mistake, this is VITAL),

HOW SOON YOU PUT IT (earlier the better)

HOW LONG YOU LEFT IT UNTOUCHED (the best, do not keep removing to see how it is!)

Do not buy ULIPs….all those instruction stay as it is. CONCENTRATE MORE ON YOUR CAREER that is what it means.



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  1. hi Subra,
    i found this blog some weeks back and appreciate that you’ve got great fundamentals.

    this time (in this blog) i felt unlucky that i didn’t find you earlier.

    i’m 34 now and all the years i did the same thing : learning, career etc. and also all personal/financial responsibilities of a family : marriages etc.

    but i didn’t do the SIP/MF part. i spent last ~4yrs and met many people (CAs/insurance agents now selling everything/fund managers) but couldn’t strike a chord with anybody on what you said above. since last 1 year, i’m learning the rudiments but have not jumped in the pool yet ! and i know i am in bad need.

    i guess i’m waiting for somebody to help me take off – possibly bec. i’m afraid of making costly? mistakes.

  2. Great post, Subra, and very appropriate advise. Generally, most of articles I see in various places on financial matters are usually only one dimensional. This post is quite refreshing.

  3. Hi Subra,
    The more I read your blog ,i feel luckier:) to be born in an internet savvy era..and read all these things free of cost and start at 23 with my SIPs and equity investments..taking a term insurance and medical cover e.t.c..
    The best part is i know i have time in hand and i can afford to make a few mistakes in my process of learning 🙂

  4. Subra Anna,

    I have been reading your blog very attentively since dec 2009,But never wrote a comment.I have lived in 4 developed contries and was a avid reader of personal finance blogs(I do not like movies ot TV).For the past 6 months, I have stopped reading other blogs and reading only SUBRAMONEY.The reason is You really care for the well being of the readers and this article is a strong proof.Thats why I wanted to call you as anna.Hope you did not mind.

    I have personally recommended this site(only) to many of my students to have a broad and clear view on their future.

    Keep Going.We Love you.

  5. Hi Subra,
    Have been reading your blogs from quite a long time. Thanks for your wonderful articles.
    I am a 25 year old, IT engineer and have been investing (or should i say playing) in the share market. Have made a lot of losses so far 🙁
    wished i had taken the mutual funds route.
    Anyways, i can still correct my mistakes.
    The thing i liked the most about this articel, is that it made me realize, that i rahter focus on my job which can increase my income by 8 to 15% a year, than focusing on investments at this stage (following news channel, which always give contradicting opinions on all things, n when one of them works, they say “As we had said,…”

  6. Hi Subra,

    >>When you are 45-55:…buying a second house…

    When is buying the first house 🙂 ?? In many other posts of yours, you have argued for NOT buying a house at all and stay at a rented place for your lifetime ( a PoV which I agree with ) but here you suggest to buy a second house ?!?!

  7. Well written article addressing the need of time. We would not allow one to drive a car without getting a driving license yet we allow people to enter the financial complex world without any financial education.
    Rightly pointed out, our investments should be vary with age and we should not make use of power of compounding.

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