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My interactions with a cross section of investors has thrown up weird reasons for not investing and equally strange reasons for investing one’s money. Why I term them as weird is because there is no reasonable logic for the same.
REASONS FOR NOT INVESTING
Lack of time!
Many people have all their savings lying in the bank account earning a meagre 3.5% only because they do not have the time to look at their Financial matters.
Lack of Understanding!
There are others who decide not to invest because they do not understand the various investment products. For them Investments mean Fixed Deposit. Major chunk of the individuals fall under this category.
Too many Investment Options!
Some are too perplexed with the various investments options available that they decide not to go through the Investment process at all. Thanks to inflation, the money keeps diminishing in the Savings bank account.
Why not take the Helping hand of an Advisor…
Don’t want to pay Financial Advice Fees!
Many investors do a hit and trial, ask friends, search around for information and gather some details. This category makes an effort to invest, which is insufficient. But they are not ready to hire a Financial Advisor. Reason being, we in India are never used to paying fees for Financial Advice and want status quo to remain.
Investments is a specialised field and over a period of time you will realise that the growth in your investments far exceed the fees you pay to your Financial Advisor.
REASONS FOR INVESTING
The Agent was a Friend or a Relative!
I rank this THE MOST WEIRD REASON for investing. Whether the agent is a relative or a friend, Do you earn money for yourself or so that the agent can fill his pockets at your cost? Many people invest without looking at the the suitablility of the investment, just to please the relative/friend agent.
While this is the least controversial reason for investing, in India it has become the most important one. Most people invest money only so that they can save taxes. Instead of tax saving being taken into account in the whole investments process, the entire investment process happens to save tax. That way the individual saves tax, but loses out on appropriate returns on his investments.
You have worked hard to earn your money; it’s time to make your money work hard for you.