I am planning a book on investing. This book is aimed at the beginner and will carry a series of steps that an investor can take / must take to build a nice corpus when the person is ready for retirement. Needless to say this will work better for the 23 year old than the 34 year old. However the 34 year old who has started investing also is better off compared to the 32 year old who is yet to start!

The strategy is simple. Even a 9 year old should be able to understand (I tried with a 10 year old and he did understand). It takes you about half an hour to understand, and I guarantee it will make you a millionaire pretty soon.

It is SIMPLE, but that not make it EASY to achieve. Like the morning walk – SIMPLE to understand does not mean it is EASY to do. 

What are the steps?

Start investing early – as soon as you get your first job, obviously the best time. Or TODAY. Stop regretting ‘what could have been’.

Assuming that you are the typical Indian youth, there is a safe assumption that your parents have all their money in bank Fd and post office. So the assumption is there is ENOUGH debt investments in your house.

Start doing a SIP in 3 funds in equal proportion:

  • An index fund
  • A large cap fund which has beaten the Sensex on a regular basis for a long period of time. Say 10 years.
  • A mid-cap fund.

In all the three funds sign up for a SIP TOP UP. Say you started with an initial amount of Rs. 5000 in each fund. Your TOPUP is say Rs. 500 every YEAR. So at the end of one year -i.e. in the 13th month the amount will change from 5000 to 5500 AUTOMATICALLY. So your total investments will increase from 15000 to 16500 per month. Do not worry in about 3 years time the Rs. 1500 per month increase will not be felt at all.

Of course as your resources would be limited you could start all the 3 schemes as ELSS schemes – so that you get the tax benefit under sec 80C.


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  1. It will be nice if you provide reasoning along the way for certain actions, such as…

    1. Start doing a SIP in 3 funds in equal proportion – Why? Why only 3 and not 5 or 10?

    2. Why SIP and not lump sum?

    3. Why funds and not ETF or inidividual stocks?

    Not expecting to an essay on each but a brief reasoning shall help the newcomers alot, along with pointers for them to find more information at other places.

  2. i refuse to get into detailing. Take it or leave it. This is not a treatise on investing. This is an action based book. Do your research elsewhere.

  3. Top up increases once a year but then for next year it remains the same. Same story is repeated every year.

  4. Top up increases once a year but then for next year it remains the same. Same story is repeated every year. Excellent facility.

  5. Is there any mix of ELSS and Index fund? I always find it difficult to determine the ELSS is large cap, mid cap or even balanced.

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