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financial planning - PEACEFUL INVESTOR

When we start investing, we are full with curiosity and excitement!

Many starts investing on their own, as they are called as ‘DIY Investors’ whereas some take the assistance from ‘a financial planner’.

There is no any ‘Best way’ to investing & managing personal finance!

But with all ups & downs of the market, changes in micro & macro-economic conditions, changes in geo-political scenario, investor not only faces changes in own portfolio but also goes through whirlwind of emotions!

It doesn’t matter whether you are new or old investor, whether you are investing in big or small amounts, you as an investor want ‘peace of mind’ along with returns on your investments.

Peace of mind always weighs more than high returns!

In the process to become a ‘peaceful investor’, one can simply follow below Five things:-

Be informed:

Knowledge is the key to open right doors of investing!

An investor must first need to read and understand ‘basics about investment options’ available in the market. Today, through the medium of internet, newspapers, blogs providing suitable & right information about investing, books with tremendous knowledge on investing, personal finance and behavioral finance can help a lot.

When you are armed with basic knowledge about the products & options available to invest, you can better choose the suitable product for your own investment.

You can simply follow any news & updates about the product & your investment in it.

Many investors blindly follow the news or advice given by others before investing. When faced with any negativity in the portfolio, they lose their peace of mind & become clueless with actions to take on.

As an investor you must know-

  • Features of the product like origin or provider entity of the investment product
  • Entry & exit conditions from the investments
  • Minimum amount to invest
  • Tax implications
  • Nomination facility
  • Risk level involved

When an investor knows the above, he is in better position to choose a suitable investment option.

Decide on your basics:

Before investing, an investor must first decide on ‘Basics’.

These basics are –

  • Goals
  • Investment Tenure
  • Own Risk appetite


We all are have different aspirations, desires & wishes to fulfill. When a few of these, come with certain date to achieve, it is called as goal.

Goal can ever be vague.

E.g. “I wish to go on Europe tour” is a wish. But, ‘I wish to go on a Europe tour after 5 years, for 15 days with family’ is the Goal.

Goals, when set, make us dedicated, focused & determined to achieve it.

Goals are thus important base to invest the money.

Investment Tenure:

Its important to decide on the time period for which an investor wants to be invested.  A set goal gives the idea about the time period of investment.

In the above example, 5 years is the investment tenure.

When you decide your investment tenure, you are sure about the time in hand & thus can select investment option which is matching in tenure.

If your investment option exceeds the investment tenure for the goal, then this mismatch will be painful for you as it will not help you to achieve the goal at required stipulated time period.

Always select the option whose tenure matches with that of your goal’s tenure.

Understand your risk appetite:

Risk appetite means understanding our capacity ‘to bear the risk of losing your money invested’ due to changes in market performance, or changes in external economic factors.

When you judge & understand it, you can better select a product whose risk level matches with that of your risk appetite.

This will help you to stay away from all the negative emotions, panic & fear state of mind to a great extent.

Risk appetite plays important role in our ‘behavioral finance’.

Be with right people:

A man is known by the company he keeps’!

Its an old proverb & it’s true!

Not only in general life lessons but for learning right lessons about investing, you must select right people who are-

  • Well informed about investing
  • Stay away from spreading any rumor or negative feedback about any news in the industry
  • Have unbiased view about investing & money
  • Never ask you to follow anyone blindly
  • Do their own research but never claim to be an expert from the field
  • Share their own experiences about investing in right context

When your colleagues, friends & family are like the above, you get right guidance when you face any changes in the portfolio due to external factors.

Even when you hire a ‘financial planner’ you should hire a person, who has right knowledge & experience, works in unbiased way & in a fiduciary capacity while guiding you on your personal finance.

Be disciplined:

‘Discipline’ has no alternative! It says a lot about person’s character when he/she is disciplined in own life. That reflects in his/her investments journey too.

When you start investing on a regular basis say, via ‘systematic investment plan’ or a recurring deposit on a monthly basis, no matter what, you should continue with it.

Economic or market scenario may change, keep a tap on it, review & judge but don’t stop. You can find the suitable alternative to your fund or a bank but, the process of ‘regular investing’ must not stop.

This discipline is important to enjoy the benefits later.

Disciplined investing cuts down on unwanted expenses on lifestyle & luxury. So, in a way it helps to save on your money & give it a meaning.

Never take hasty decisions:

When you start investing, many a times, you may panic or have a fear of missing out, looking at certain situations in market or economy.

Some People fear when market goes up & also when goes down!

Everyone has own way of seeing & reacting at the things around money & investments.

But, never take hasty decisions!

Market performance, economic changes are dynamic & never the same. When faced with big changes, patiently review your portfolio. Understand, assess & re-assess the changes to be made & then rebalance it where required.

Hasty decisions may not prove right always!

Suitable Asset Allocation & rebalancing:

Asset allocation & diversification are important in investing!

Asset allocation allows us to invest your money in suitable asset classes in right proportion as per your goals, risk appetite & tenure.

When you have a plate full of different investment options, it becomes important to choose your investment option wisely.

Asset allocation helps you to decide where to invest & how much. Everyone’ asset allocation should be different because everyone is different in terms of age, income, risk appetite, goals, investment tenure.

Never copy other’s asset allocation if they are earning good returns, it may not work for you.

Happiness & peace of mind come from within!

Investing journey is a roller coaster ride full with volatile returns, risk level of the investment options, changes in government policies, market performance, economic & geo-political conditions, but at then end when you are ‘peaceful’ with what & how have you invested, it’s a cherry on the cake!!

Happy Investing!

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