SIMPLIFY-6. YOUR WEALTH CREATION ACTIVITIES
1. Split your activities into 3 heads -
- 1st part includes assets that need a huge, one-time effort - like house and property - that involves tedious processes.
- 2nd part includes assets that were accumulated on an ad-hoc basis - like gold, company IPOs, stock tips, holiday loan, or frenetic tax-saving investments - that may pose risk of neglect.
- 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 these 3 heads -
- For 1st part, engage brokers to complete the paperwork.
- For 2nd part, take help of a parent or uncle to manage the records as outside help may be tough to get.
- For the 3rd part, involve yourself 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.
- Get your mundane financial jobs done through them with a long-term relationship.
4. Have clarity in doing and delegating
- Be clear 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.
5. Keep track of event-linked actions
- 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. Devise your own rules and habits
- 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.
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