Stop! Your money or your time!

Last Updated on

Dear young earner, what do you wish to optimise? Your money? Or your time?

Would you rather dig deeper and deeper into money management and learn “best” ways to “optimise” money management? Or would you rather spend some mandatory time in getting your finances in order and let it run in auto-pilot with periodic maintenance and use the rest  of your spare time in doing what you love?

If money management is your passion, for eg. finding ‘good’ business to co-own as a shareholder,  then this choice obviously disappears. And perhaps there maybe some hybrid choices in between the two – I don’t care.

If you wish to optimise money management, or in other words get more returns, find ways to track the market efficiently, learn more and more aspects of personal finance then this post is not for you.

If you suffer from “fear of missing out” syndrome, this post is not for you. Rest assured that you will not miss much.

This post is only for those who wish to manage money efficiently with minimal effort so that they have enough time for their passions/hobbies.

With the objective made clear, here are some ways to choose time over money!

1. Stop tracking expenses. It is a waste of time and money. Read more: How tracking investments instead of expenses changed my life!

2. Set a small monthly investment target. If you have just started earning, and just want to ‘live life’ without worrying about financial independence, set an investment target.

For eg. tell yourself,

I will invest at least 30% of my take-home pay, as soon as I receive it, in a Nifty Next 50 index fund*. Rest is mine to enjoy as I please. Each year, when I receive a pay hike, I will increase the investment amount by 5-10%.

* something I recognised only recently. Not claiming that it will do better than active funds blah blah. Just something simple to get going.

So you will have only two investments: your salary deduction into EPF/NPS (choose EPF if you have a choice) and the above index fund.  Do not buy any other investment product for the next few years.

If you have to save tax over above the salary deduction, use VPF (if you have an EPF – thanks to Amit Gupta for pointing this out at AIFW) or a PPF.

If you don’t like equity, that is fine too (your money, not mine and I am not a mutual fund salesman). Put it in PPF.

3. Stop tracking your investments … on a daily basis. Money does not grow if ‘watched’ that frequently. Remember we are all primates and sooner or later will want to tinker with our investment just for the heck of it.

Young earners can afford to not watch their portfolios for at least 5-6 years after starting gainful employment. It would help the portfolio immensely if they simply let it be for a few years.

4. Do not go to  investment seminars arranged at work.  They are typically done by insurance and mutual fund salesmen with the help of your HR dept. Stay away.

5. Never talk to any bank employee unless absolutely necessary.

6. Politely tell your salesmen relative that you do not talk money with relatives.

7. If your parents disapprove of what you wish to do, tell them even more politely that you wish to chart your own course.

8. Don’t read finance blogs (esp. mine), business magazines/newspapers or watch business channels. Waste of time and money.

Happy noise-free investing. Your time is way more important than your money.

 

Do share if you found this useful

Create a "from start to finish" financial plan with this unique open-source robo advisory software template


 Don't like ads but want to support the site? Subscribe to the ad-free newsletter! 
You will get the full post-ad-free delivered to your inbox for Rs. 3000 a year. Follow this link to read the terms and sign up! 


About the Author M Pattabiraman author of freefincal.comM. Pattabiraman is the co-author of two books: You can be rich too with goal based investing and Gamechanger. “Pattu” as he is popularly known, publishes unbiased, promotion-free research, analysis and holistic money management advice. Freefincal serves more than one million readers a year with numbers based analysis on topical issues and has more than a 100 free calculators on different aspects of insurance and investment analysis, including a robo advisory template for use by beginners. Contact information: freefincal {at} Gmail {dot} com He conducts free money management sessions for corporates (see details below). Previous engagements include World Bank, RBI, BHEL, Asian Paints.

Content Policy

Freefincal has original unbiased, conflict-of-interest-free,  topical reports, reviews, commentary and analysis on all aspects of personal finance like mutual funds, stocks, insurance etc. All guest authors and contributors to the site also do not have any conflict of interest. If you find the content useful, please consider supporting us by (1) sharing our articles and (2) disabling ad-blockers for our site if you are using one. No promotional content We do not accept sponsored posts and link exchange requests from content writers and agencies. This is our privacy policy Our website is non-profit in nature. The revenue from the advertisement will only be used for hosting charges, domain registration charges, specific plugins necessary for traffic growth and analytics services for search engine optimisation.
Want to conduct a sales-free "basics of money management" session in your office?
I conduct free seminars to employees or societies. Only the very basics and getting-started steps are discussed (no scary math):For example: How to define financial goals, how to save tax with a clear goal in mind; How to use a credit card for maximum benefit; When to buy a house; How to start investing; where to invest; how to invest for and after retirement etc. depending on the audience. If you are interested, you can contact me: freefincal [at] Gmail [dot] com. I can do the talk via conferencing software, so there is no cost for your company. If you want me to travel, you need to cover my airfare (I live in Chennai)

Connect with us on social media


Do check out my books


You Can Be Rich Too with Goal-Based Investing

You can be rich too with goal based investingMy first book is meant to help you ask the right questions, seek the right answers and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now.  It is also available in Kindle format.
Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You WantGamechanger: Forget Start-ups, Join Corporate and Still Live the Rich Life you wantMy second book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at low cost! Get it or gift it to a young earner

The ultimate guide to travel by Pranav Surya

Travel-Training-Kit-Cover This is a deep dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, how travelling slowly is better financially and psychologically with links to the web pages and hand-holding at every step.  Get the pdf for ₹199 (instant download)

Free Apps for your Android Phone

All calculators from our book, “You can be Rich Too” are now available on Google Play!
Install Financial Freedom App! (Google Play Store)
Install Freefincal Retirement Planner App! (Google Play Store)
Find out if you have enough to say "FU" to your employer (Google Play Store)

Blog Comment Policy

Your thoughts are vital to the health of this blog and are the driving force behind the analysis and calculators that you see here. We welcome criticism and differing opinions. I will do my very best to respond to all comments asap. Please do not include hyperlinks or email ids in the comment body. Such comments will be moderated and I reserve the right to delete the entire comment or remove the links before approving them.

13 Comments

  1. Dear Pattu,

    Extremely honest and candid, both are fairly contra and unpopular attrinbutes in these times of ‘being active’ and seeking popularity at every opportune moment.

    I’ve an experienced corporate person but can completely relate to and understand where from your ‘free for all blogs and calculators’ come from – pure enjoyment at making them and then just putting them out there, without even a pretence of having shared them for others’ good!

    Keep up the good work, this article should come in very handy for anyone, especially a youngster in his / her 1st job / career.

    It takes one to be and feel tremendously secure to make oneself redundant.

    Regards,
    Bashyam

  2. “It takes one to be and feel tremendously secure to make oneself redundant.” ….. liked it so much .. .. very well said… :)..!

  3. Ha Ha… This is very valuable advice ! Where were you when I started working, Pattabi ?
    Please keep writing…
    You’ve got this Amazing Dual Talent – Finance and Writing ! 🙂
    Thank you for your time.

  4. A young earner, if he has taxable income & still has unmet Sec80C limits should invest in one good ELSS fund and be done with it, right? Better than an index fund, isnt it?

  5. very well put except the last one. Don’t read finance blogs (esp. mine), business magazines/newspapers or watch business channels. Waste of time and money.
    I started investing in MF based on your articles and some my research. Only time will tell how it will turn out. Thanks for doing wonderful thing which is free is like adding icingt to the cake.

  6. Kash….. I found u 15 yr ago i mean in 20s. 🙂 last 5 yr auto pilot mode is going on just what i learnt from dis blog. ( HT200 5 YR Going to end this Dec=16) and with 14 to 15% CAGR happy with that.
    Thanks to u and your blogs.
    Wish and pray your investment and life again come back to auto pilot mode. Njoy
    thanks
    regards

Leave a Reply

Your email address will not be published. Required fields are marked *