SIMPLIFY YOUR WEALTH CREATION ACTIVITIES
1. Split your activities into 3 heads
· The 1st part includes assets that need a huge, one-time effort, like house and property, which involve tedious registration, stamp duty and title deed processes.
· The 2nd part includes assets that were accumulated on an ad-hoc basis, and pose risk of neglect if weakly implemented, like buying gold on festivals, investing in company IPOs, acting on stock tips, taking a holiday loan, or frenetic tax-saving investments at the end of the year.
· The 3rd part includes assets involving routine investment decisions, like provident/pension fund deductions, monthly mutual fund investments, recurring deposits and sweep accounts with banks, where default choices can ensure that money is deployed even if you don’t act.
2. Align your financial habits
· For the 1st part, take help of a broker to complete the paperwork.
· For the 2nd part, take help of a helpful parent or uncle to manage the records as outside help may be tough to get.
· Move into the 3rd part as much and as soon as possible, as you will then win your battle against inaction and make investment a habit.
3. Make consolidation a goal
· Consolidate all that you do with your money in fewer banks, advisers and consultants, and get your mundane financial jobs done through them.
· A long-term relationship and assets held or managed by them will help you immensely.
4. Have clarity in doing and delegating
· You need clarity on how much effort you will put in yourself and what you will outsource.
· This will help you to systematically move ad hoc transactions to habitual ones.
· Avail of the referral services of advisors and banks for a good amount of your leg work.
· Remember to pay them a fee for their services in order to get the best out of them.
5. Keep track of event-linked actions
· Find a way to deal with financial events that need action from you when they occur.
· Your money will be stuck if you did not complete their procedural requirements.
· Some of the prominent events are: change of address when you move, change of a closed bank account, alteration in name for women after marriage (if needed), change of nomination after marriage or divorce, transfer of investments after an investor’s death, change in child’s status after becoming a major, etc.
6. Find friends
· Find friends with whom you can work on your finances and their related procedures.
· It also helps when you consider investment propositions jointly.
· However, do not extend the friendliness towards placing your money at risk.
7. Devise your own rules and habits
· Try and devise your own rules and habits so you get them to work for you.
· The trick is to convert most decisions into routines, and making decision-making easier.
· If you are able to move most investments and financial actions to the auto mode, your wealth may benefit from the default action.
· The advisors will also be able to take over if they see a pattern in your investing habits.