Excuses we tell ourselves to delay investing
Investment Advice

Excuses we tell ourselves to delay investing

Investing is tough but vital in growing our wealth and securing our financial future. We may not be taught about this adequately in our school or college, but ignorance does not forgive us from the need to start investing at some point. Like any other thing in life, excuses can get in the way of accomplishing what we need to. Imagine settling for a smaller house, buying a cheaper car or not being able to provide for your children’s education just because of lack of funds.

Let’s take a look at some of the common excuses to see if you’re guilty of them and what you can do to overcome them.

1) I don’t have enough money
The cost of living is unquestionably high in Indian cities. Most often we feel, we have just enough money to pay our bills before the next salary. If you look at your budget and realize there’s no money to spare, look for something you can drop; even small cuts can create some room in your budget for investing. Can you cut any of the following?

  • Eating out
  • Conveyance
  • Shopping

This might not seem significant, but you can take that money and start investing. Don’t let any funds remain idle in low-return accounts and setup a habit to invest regularly e.g. start with Systematic Investment Plans (SIPs). Even Rs.1000 per month is good enough to begin with.

2) I don’t have time now, I’ll do it later
“Having time” is a relative term and this excuse can cost you a lot. The longer you wait before you start investing, the less time you’ll have to grow your money. Also, less likely you’ll achieve your goals, such as a comfortable retirement lifestyle. You’ll have to settle for less if you will not be in a position to contribute more in the future.

3) Its too complicated
The two key reasons a lot of people get turned off by investments:

  • Unfamiliar and often confusing investment jargon. The good news is that besides excess information available on the internet, there are several campaigns helping simple financial concepts to untrained investors including the Mutual Funds Sahi Hai campaign led by Association of Mutual Funds in India (AMFI). You can dig into these resources and get clarity to make wise investment decisions. If you still find it difficult, consider talking to a Financial Advisor to learn more.
  • Long on-boarding process and KYC procedure, Typically to invest in mutual funds, you need to fill the KYC (Know Your Customer) requirement form and submit relevant documents. This was a long-drawn process earlier. But lately, with the advent of Aadhar based KYC (e-KYC) and online investment platforms, KYC formalities have become hassle-free as they can be completed within minutes.

4) I don’t trust the stock market
It’s human nature to be emotionally attached to past bets, even the losing ones. It’s important to make the distinction between a bet/punt and a sensible long-term investment strategy with an assorted mix of different types of investment avenues varied in proportions and based on the their goals. Historically, equity stocks and mutual funds have beaten inflation by a wide margin and has created more wealth than fixed deposits and recurring deposits. Stock market is volatile in nature: they are not unidirectional. You should make use of the market ups and downs to invest more and create a long-term portfolio. If it is difficult to do, take help of an expert or use one of the online goal-based- investing platforms for insights and recommendations.

Investing can be overwhelming but it doesn’t have to be. Don’t let excuses get in the way of developing good investment habits. With time, determination and effort, you can overcome many of the obstacles you thought prevented you from becoming a full-fledged investor.

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