Are you making your money work for you?

It’s not how much money you make, but how much money you keep, how hard it works for you. ~Robert Kiyosaki

Just as you work hard to make money, you must ensure that your money also works for you. Merely saving money is not enough, it should be invested properly so that it grows in value and helps you to realise your financial goals.

 

Why do you need to grow your money?

Nobody needs to be told how unpleasant inflation is! It erodes the value of your money. As prices go up due to inflation, the same money will fetch you lesser goods. You cannot control inflation but you can beat the inflation by protecting yourself against it. That is possible when your money also grows in value at least equal to or more than the increase in the cost of living.

Your investment should help you at least to preserve the purchasing power of your money.

 

Lifestyle Inflation

Money growsBut then, inflation is not the only devil.  When you make more money, you tend to spend more. Your and your family’s standard of living goes up and you incur more expenses to maintain that standard. The increase in your cost of living due to changes in your consumption patterns is called ‘Lifestyle Inflation’.  To maintain the desired standard of living and meet the long-term financial goals for your family, it is essential to invest in instruments that offer higher returns and help you with future wealth gain.

 

This means your investment should not only help to preserve but also to grow your money.

 

What about the Risk of Capital Loss?

Traditionally, stock markets are considered volatile and risky investment avenue.  Nonetheless, all investments involve taking on some risk, though the extent of the risk varies. Besides, not all investors have a similar risk appetite. Many investors are totally averse to the idea of losing their capital in a stock market. They fear that during a downturn, their hard earned money may get wiped out.

Safeguarding their capital is a prime concern for such investors. So they typically keep their money in savings account or in fixed deposits. But, when you invest in a saving account or a fixed deposit, the increase in the amount of money may not help you to beat the inflation. So, even though your money may be safe, you could be losing the value of your money.

For investors with a conservative outlook, products that aim to protect the principal amount against downside risk, while taking benefit of market upsides appear to be better suited. Since the downside risk is limited, investors can stay invested for a long period, even during periods of uncertainty and ultimately ensure that all the financial goals for their family are achieved.

 

Bajaj Allianz Life Insurance is coming up with a product on the 22nd June 2017 that will help investors to realise their long-term financial goals and provide the dual benefits of protection and growth.  

 

By charting out your financial plans, you can make your money work for you without having to worry too much about the downturns. Over the years, you can gain financial security for yourself and for your family.  #InvestBefikar  –>  #JiyoBefikar

 

More details can be found on the Bajaj Alliance website

Stay tuned for more updates about the Launch on the Facebook page and on Twitter

 

Hey! Say what you want to. Please Like, Share and/or drop in a Comment below!   🙂 

If you enjoyed this post, subscribe to get new posts by email.
  • author's avatar

    By: Somali K Chakrabarti

    Hi there ! I am a management and leadership coach and a ‘çlinical blogger’. Well, that’s what my family & friends call me now ! Here, I tell stories of different brands, how people relate to the brands and the values, beliefs and emotions that they associate with the brands. Hope you enjoy reading my posts.

  • author's avatar

Steer towards a positive, smart and balanced lifestyle

Signup now to receive ideas for smart living in your mailbox

I will never give away, trade or sell your email address. You can unsubscribe at any time.

13 thoughts on “Are you making your money work for you?

  • June 21, 2017 at 9:31 am
    Permalink

    Such an important topic, Somali. It’s one thing to earn money and another to grow it and make the most of it. Agree with you it’s limiting keeping money in a bank and earning interest on it. As I’m thinking more foreward looking these days, here in Australia I’m seeing you don’t get that much return on parking money in the bank. Investing is one way to make your money work better – though there may be risk, if you invest wisely with a backup plan to break even, then it shouldn’t be too bad an outcome. I’ve been budgeting my money for the last two years now, keeping track on what I spend and it has saved me quite a bit of money 🙂

    Reply
    • June 21, 2017 at 2:42 pm
      Permalink

      Thank you, Mabel for sharing your views.

      Except for a few countries like Ukraine, Mongolia, Argentina, the interest rates on savings accounts are low in most of the countries. But if you look at the whole picture, earning a 10% interest when inflation is 9% is almost about the same as earning 2% interest when inflation is 1%.

      Which means that investment makes better sense for growing money in the long run.
      It is good that you are saving since the last two years , Maybe you can start thinking about investment and look at the available options as per your investment horizon, your level of risk tolerance, for the returns that you would expect. .

      Reply
  • June 21, 2017 at 10:19 am
    Permalink

    A useful and informative post.

    Reply
  • June 21, 2017 at 12:35 pm
    Permalink

    I am quite bad at savings and this year I started an insurance scheme but at the same time trying to save in an alternate bank account. Managing money has never been my forte though Mom makes me save a good 24 k in a chit fund. It worked for me last year:)

    Reply
    • June 21, 2017 at 2:50 pm
      Permalink

      Hi Vishal,

      That is exactly the problem with most youngsters – when its gets to things like saving or investing – procrastination picks up. I used to be the same. but now I strongly feel that youngsters in their late 20s or early 30s should be more proactive about saving and investing. Good to know that your mom makes you save . Maybe you can think further about investing and growing the money.

      Thank you for honestly sharing how you think about managing money. 🙂

      Reply
  • Pingback: It’s not how much money you make, but how much money… – theakdwivedi

  • June 22, 2017 at 6:24 pm
    Permalink

    Investments are not what they used to be Somali.. as our savings now no longer at least here in the UK gain any sort of interest.. Our saving days I am afraid are over…. But I personally do not worry about that, so long as we have enough to get by.. I am happy enough, We are luckier than most, so I count myself very fortunate I do not have to worry..
    Now if I won the Lottery?? lol.. Well then I may have to consider where its best kept. 🙂

    Sending LOVE your way my friend.. and loved reading your perspectives.. <3 xx <3

    Reply
    • June 23, 2017 at 7:13 am
      Permalink

      Hi Sue, Thank you very much for sharing your views. Savings do not earn much interest in most of the countries and in the UK rates are rather low. That’s why there is the need to know about other investment options available in a country. I understand when you say saving days are over. Happy that you have enough to get on.
      At this stage, I realise how important it is to invest early in life so that later in life one is comfortable. But the awareness about the need to invest is still very low in our country. We tend to procrastinate when it comes to investing, maybe because the results are seen after a long time. Some youngsters that I speak with say they want to spend their money as soon as they get it. 🙂 Nonetheless, we need to drill the idea ( particularly in the mind of youngsters ) that it is important to save & invest early in life.
      Thank you so much once again for your patience in reading and sharing your thoughts. Love & Regards, Somali

      Reply
      • June 23, 2017 at 2:34 pm
        Permalink

        I agree with you Somali about the younger generation.. So many today spend what they do not have and get so easily into debt.. I was brought up in an age where if you could not afford it, you went without until you had saved for it..
        We struggled a lot while our children were young and we both worked .. But we invested into my husbands pension which helps provide for us today.. Without that forethought of planning, and buying our own home.. We would be a lot worse off today.. So I so agree it is important for the younger generation to think ahead to their later years.. <3
        Love and Blessings and thank you again for that lovely answer Somali. xxx

        Reply
  • June 26, 2017 at 4:10 pm
    Permalink

    Bajaj Allianz has some great products that cater the needs of the investors from all financial strata. Saving money and investing are completely different things and we need to understand that our money should grow along with our lifestyle needs. An informative and useful post, Somali.

    Reply

Say what you want to!

%d bloggers like this: