“Now that you’re earning, you should do some kind of financial planning!”

“Don’t splurge your entire salary over one weekend”

“Do you really need another pair of shoes?”

If you’re a 20-something year old Indian who’s just embarked on the glorious journey of financial freedom — you’ve definitely been thrown at least one of the above lines, or something roughly the same.

Don’t worry, this isn’t another blog where we talk about how important it is to set aside savings for emergencies, or how doing a bit of financial planning for your retirement early on is a good idea.

Because that, you already know.

So we’re going for the why and how in this blog — because that’s actually the road block, isn’t it?

The Why

For most Indians, finance and financial freedom are rarely touched upon subjects. Our schoolwork does not include the concepts of expense and investments, and at home money management as a habit is inculcated far too late, or never at all.

Fortunately the past couple of years have seen a change in this, and more and more young millennials are taking an active interest in their own finances.

Yet, investment is an avenue that most of us still avoid, or delay due to certain hesitations and presumptions we hold from the lack of better financial insight.

So everything’s A-Okay in the “I know I should start investing” department — then what is it that’s holding back most young Indians from just getting started already?

If there was ever a catchphrase that could summarize the plight of all young adults, it would be this one.

And understandably so.

It’s a constant tug-of-war between making the responsible choice and living life one day at a time.

Sure there’s saving to be done and investments to be made but — there’s also rent to be paid, taxis to be taken, scooters to be refueled, subscriptions to be renewed — and then, a little bit of splurging, because you do live only once.

But the truth is that Carpe Diem applies to investment journeys as well — because every day that we’re not seizing to invest, is a little less money being generated for the long run.

Our priorities, needless to say, at 25 and at 35 are worlds apart.

At 25 we’re more concerned with finding a career we love, an education to facilitate it and making the most of the life in between.

We think that once we’ve grown past the internship stipends and first salaries, and have more money — then investments can happen.

And at 35, we realize it’s high time we started investing.

Unfortunately by then, it’s already too late.

Because that’s the thing about investment — the how long, is far more important than the how much!

Let’s put this in numbers because trust us, once you see those you’re going to go — wait, seriously?

Monthly investment vs wealth metric based on what age you start investing at

*The above calculations have been made with an assumption of an average return p.a. of 12%, based on the performance of the Indian market over the last 20 years. The numbers are subject to market change.

Okay, even to someone who doesn’t really like big numbers that has got to be a big deal. To simplify it even further — even if the amount of money you could have the bandwidth to invest at 35 is more, you will still end up doubling the amount of money you can have at 60 years of age if you start now!

Pro tip: If you’re even younger than 25, you need to jump at this!

03 Investments vs Inhibitions

But investing would mean ₹2,000 less in hand — what if I need that extra cash towards the end of the month?

Commitment has never been millennials’ strongest suit, has it?

With money and investment, this anxiety is with having to lock away a chunk of one’s monthly income and more importantly — feeling like your own money has now been made inaccessible to you.

And in all honesty, considering the limited information we are fed regarding money and investments — this inhibition is fair.

But here’s the truth:

1. Saving and investing are two different things. If you need that extra cash towards the end of the month, then that’s what your savings are for. Investing counts as a separate part of your money and the only job it has, is to grow. (And yes, we know we already tackled the part where setting aside money for 2 whole activities is difficult but the solution’s coming right up!)
   
   
2. Investing doesn’t always mean putting your money away in a scheme and then not seeing it again for ages. Yes, it’s ideal for you to continue investing that money until a certain point but it absolutely does not mean that if you need it, it’s going to be inaccessible. It’s just doing its job — growing.
   
   And number 3, which also brings us to the “how” part of this blog -
   
   
3. There is a way to invest without feeling the pressure of the monthly obligation or the anxiety of locking away a large amount of money at a time.

The How We’ve just got one thing to say — round-up investments!

Round-up investments is when you invest your digital spare change.

Here’s how it works:

You’ve had a long day at work. There’s 3 deadlines and only 8 hours in a working day so of course, it’s now become a 12 hour work day for you.

And to top it all off, you had to work through lunch.

Now all you really want to do is get back home and sleep — but there’s travel before that, and dinner to look after.

So for once, even though you know you really shouldn’t, you choose an Uber sedan, instead of your regular auto.

And for once you get back home and order from that new pizza place you’ve been meaning to try, instead of cooking your standard aloo.

But your heart doesn’t sink.
Because now you’ve got Deciml on your phone. So when you approved the ₹295 cab payment, Deciml rounded up the amount to the nearest 10 and invested your digital spare change of ₹5 in a Mutual Fund on your behalf.

When you punched in your OTP while paying ₹990 for the pizza (+ coke + garlic bread + dessert, but of course), Deciml once again came into action, rounded up the amount to the next 10 and invested your digital spare change of ₹10 in a Mutual Fund on your behalf.

Which is why when the AC blast hit you in the sedan, there was no breeze of regret.

And when you bit into the cheese-loaded pizza slice, there was no taste of remorse.

And when you spent, you could do it guilt!

Invest As You Spend

Now think of all your expenses — small and big, basic and extravagant, necessities and luxuries — from a bag of chips to your electricity bill, from refueling your scooter to your monthly grocery shopping list; every expense of yours gets rounded up and your spare change, as little as ₹1 gets invested!

These day-to-day small investments, made over a large amount of time can actually facilitate the end-goal of financial freedom.

The Road to Financial Freedom .. .. starts with a goal! This is the most important part of financial planning as well as investment planning, and unfortunately — one of the most neglected one.

Because if you’re not working towards something specific — a financial goal — then the chances of you spending more than investing are higher.

Plus, what could possibly be a better investment success yardstick than the achievement of your own personal financial goals?

Deciml’s goal creation feature lets you set a financial goal for yourself, replete with the amount and time required — whatever it may be, a laptop, a vacation or some festive shopping — so that you’re investing in your goals.

Rounding It Up

Personal finance doesn’t have to be complicated.

A great deal of the fear and hesitation regarding money, finance and investment is based on genuine reasons, and comes from never having to deal with the subject until absolutely required.

But now you have it — the breakdown of the reasons, and the build-up of the solution.

So what’s stopping you now?

Download the Deciml app here.

Know more about how round-up investment works here.