Financial Cocktail Samosas: Bitesized Money Morsels For You, 31/05/2023

Good Money Habits To Teach Your Child

Teaching good money habits to children can be vital for their financial future. If they grow up without these habits, they may end up mismanaging their money because of inadequate inputs on ‘money behaviour’.

Here are some ways to impart money lessons to your children that will help them to live financially fit lives:

✅ Set savings goals: Encourage your child to save money regularly, even if it’s just a small amount each week or month. Help your child set savings goals, such as saving for a new toy or a special outing, to teach them the importance of saving for the future.

✅ Play money games: Make money learning interesting – play money games with your child to help them learn about money management.

✅ Let your child earn their own money: Let your child earn their own money by doing extra chores at home. When the children earn money to buy stuff they want, they also learn the value of money and hard work.

✅ Involve them in budgeting: Teach your child how to budget by helping them create a budget for their pocket money and follow it strictly.

✅ Realize that kids learn what they live: Be aware of your own attitudes towards money and how they may be influencing your child. Set a good example for your child by modeling good money habits yourself.

✅ Discuss Wants Vs Needs: Discuss the difference between wants and needs with your child to help them make better spending decisions. For example, point out items in their bedroom or the kitchen and ask them whether the object is a need or a want.

Since children learn so much about life by modeling their parent’s behaviour, it is valuable to develop healthy money habits in them at an early age and to normalize money discussions around them.

(Contributed by Yogesh Gola, Relationship Manager, Advisory Desk, Hum Fauji Initiatives)

Your Wrong Assumptions Can Be Your Enemy in Investing!

Have you started investing recently and are worried about where you should invest for the next 10 years? Are you concerned whether all your investment decisions are right or not and will they make your money grow with perfection?

Well, the answer should be based on an evaluation of periods, growth, volatility risk, and so on. The equity market is unpredictable and expecting your money to grow only without any downfall in the investment journey is impractical.

Some wrong assumptions investors have while starting their investment journey:

1️⃣ High Returns: The equity market is volatile and the impact of volatility would be seen in your portfolio too. Having a long-term vision while ignoring upheavals is the only key to success. A decent return with fair safety should be the priority instead of taking excessive risk and a strong desire for quick and substantial profits.

2️⃣ Don’t Diversify: Investing in mutual funds if it is equity backed, should follow two rules; one is taking the benefit of diversification, and another is SIPs. Not diversifying can create a lot of risk to your hard-earned money though you may realise it very late.

3️⃣ Delay your investments: Some investors don’t start investing early and keep waiting for the perfect time. Nobody can ever time the markets. You may eventually find that you have less corpus in hand for your future goals since you invested very late and may even have lost the opportunity when the market revived from the dip.

4️⃣ Wrong Trends: Following wrong advice dished out through social media and YouTube and trying to have a so-called perfect portfolio can lead to long-term pains. This approach can also lead to poor investment decisions based on temporary market sentiments.

As they say, “Perfect is the enemy of good”. So, stop chasing perfection and start investing with discipline. Taking help from an investment advisor can smoothen your journey of investment and makes you a smart investor.

(Contributed by Sweta Kumari, Financial Planner, Team Arjun, Hum Fauji Initiatives)












Cooking and investing share similarities in terms of persistence, practice, and adapting to changing circumstances. By drawing lessons from cooking experiences, we can approach investing with more confidence and make better financial decisions.

1️⃣ Cook As Per Your Appetite: Measure Your Investment & Risk Appetite: Just as we measure ingredients while cooking as per our hunger, so should we measure our investment and risk appetite before investing. Choosing how much and where to invest needs knowing our financial objectives and risk tolerance, much like deciding how hungry we are and how much food to prepare.

2️⃣ Balance Your Dish Well: Balance Your Portfolio: Similar to a chef balancing flavours and elements in a dish, we need to balance our investment portfolio. Rebalancing among asset classes diversifies risk and generates returns throughout the market cycles. An unbalanced portfolio, like an overly sweet or spicy dish, increases the likelihood of losses.

3️⃣ Keep Calm and Cook: Be Patient with Your Investments: Having patience with investments is essential just as we need patience when cooking. Rushing or being impatient during cooking might result in unappealing, undercooked or overdone dishes. Similarly, when it comes to investing, being hasty and making snap judgments based on momentary market swings can result in losses and have a detrimental influence on long-term financial objectives.

4️⃣ Keep Learning from the Experiments: Continual learning and experimentation are valuable, similar to how chefs explore new recipes and techniques to advance their craft. As investors, we should constantly seek new investment methods and strategies to improve ourselves and achieve our financial objectives.

By applying these cooking principles, we can approach investing with greater assurance, adapt to changing circumstances, and make better financial judgments.

(Contributed by Ujjwal Dubey, Associate Financial Planner, Team Prithvi, Hum Fauji Initiatives)

What Did Our Clients Ask Us in the Past 7 Days?

Question: Why do we need to invest in liquid funds first and then transfer that amount to the targeted equity and hybrid funds through STP (Systematic Transfer Plan)? It leads to unnecessary tax when we have the option to invest directly in the targeted fund.

Equity markets are always volatile. Therefore, it is preferable to invest in small bits, rather than put all our funds there in one go – it is only much later that would we know whether we invested in overall high rates or low or medium rates. Hence, investing initially in liquid or ultra-short funds (UST) and gradually shifting the amount in small bits to target funds is considered a good industry and investment practice. It also has the benefit of rupee cost averaging like in SIPs. Returns from liquid or UST funds are greater than those from bank savings accounts and hence you do not lose anything.

Additionally, if the market presents a sudden opportunity with a dip, a ‘bullet’ shift from the Liquid or UST can also be done while the STP keeps going on.

Question: Is the stock market still attractive for investments at its all-time high (ATH)?

An ATH does not mean that markets cannot go higher. When the market moves beyond the past highs, it could simply mean that more investors in the market are positive about the country’s future economic outlook than the number of investors who are negative about it. The market’s move up is to be considered ‘risky’ only when either the market has run ahead of its valuations (measured through the general PE ratio of the market) or there is an unnecessary and unjustified exuberance due to excessive speculation.

We all know that India is currently in the spotlight due to its exceptional potential for future growth relative to its peer markets and economies. As per us, the Indian market is looking very attractive for long-term investment. It does not mean that there will be no dips, no downs on the way to that long term – that is part and parcel of the investment journey. But if you invest for the long term and insulate yourself from the ‘market noise’, you are likely to have a good investing experience.

(Contributed by Team Prithvi, Hum Fauji Initiatives)

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