The Investment Process

Welcome to the fifth edition of?The Multigenerational Wealth! In this issue, we explore?The Investment Process, breaking down the essential steps to manage your investments effectively while adapting them to different life stages.?Like life,?Family needs assessment and achievement?is not one-size-fits-all—it evolves with your goals, risk appetite, and priorities.

The Foundation of the Investment Process

Certain?investing principles?remain fundamental, but how we prioritize them changes with circumstances. The investment process is all about balancing?individual goals?with available?financial strategies. Whether you're focused on safety, like a fixed deposit holder, or growth, like a cryptocurrency investor, your approach should align with your goals and values.

?Steps of the Investment Process:

1.?Define financial?needs

2.?Set time horizons.

3.?Calculate the amount needed for each goal.

4.?Choose asset classes.

5.?Establish savings targets (monthly, quarterly, annually).

6.?Create a financial?roadmap.

7.?Execute the plan.

8.?Monitor and review progress.

9.?Rebalance portfolios as needed.

Age-Based Investment Strategies

Let’s explore how the investment process changes with different life stages, whether you prefer a?DIY approach?or work with a financial advisor.

20-40 Years (Early Career)

DIY Approach:

??Prioritize an emergency fund (3-6 months’ expenses).

??Diversify equity, debt, and gold investments based on your goals.

??Regularly review and rebalance your portfolio.

With a Financial Advisor:

??Receive a customized portfolio based on your risk tolerance and goals.

??Optimize tax planning for maximum efficiency.

40-60 Years (Mid-Career)

DIY Approach:

??Balance equity and debt investments, favouring stability with index funds.

??Consider real estate for rental income and capital appreciation.

??Maintain an emergency fund and allocate 5% for new opportunities.

With a Financial Advisor:

??Develop a comprehensive retirement plan.

??Manage risk to ensure alignment with your evolving goals.

60-90 Years (Retirement)

DIY Approach:

??Shift to stable investments like bonds and cash equivalents.

??Plan for healthcare costs and minimize withdrawal rates to sustain your corpus.

With a Financial Advisor:

??Structure income streams and optimize withdrawals to minimize tax implications.

??Plan estate transfers to leave a legacy.

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Thumb Rules That Evolve

1.?Equity Investment Rule: Traditionally, "100 minus your age" determines?your portfolio's equity percentage. With increasing life spans, this can be adjusted to "110 or 120 minus your age."

2.?Withdrawal Rule: The old 4% withdrawal rule is?now?adjusted to 2.5%-3%, especially in the Indian context, to account for inflation and longer life spans.

Snowball Success Story

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Investing is as much about behaviour as it is about numbers. Even when we know the importance of equity and mutual funds in creating wealth, taking action and staying invested can be incredibly challenging, especially during turbulent times.

Our client's story, Prakash (name changed), perfectly embodies this journey.

Seven years ago, he had no meaningful equity investments. Today, his portfolio has grown to ???.???????????????, with immense discipline and trust in the process.

But the turning point? It happened during the COVID-19 crash.?

When markets plummeted, fear set in. Everyone around him, trainers, advisors, and peers, urged him to sell. He was restless, panicked, and ready to exit. I still remember meeting him just before the lockdown began.?

I told him bluntly: “You’re not selling. Markets fall temporarily, sometimes sharply, but this is the time to stay put or even invest more.”

It wasn’t easy. He had to trust me when his portfolio had dropped to around ?65–80 lakh. But he held firm. Today, that decision to do during the storm has turned into ?4.25 crore of wealth.

This story is not to highlight the numbers but to help understand the power of staying invested. Markets will rise and fall; 30–50% declines are normal and temporary. What matters is having an empathetic and trusted guide to help you stay the course.

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You don’t have to predict markets.

You don’t have to react to every dip or rise.

Sometimes, doing nothing is the hardest and smartest thing you can do.

Wealth creation happens with constant action, discipline, faith, and focus on your financial needs. The best investors are those who resist the urge to act unnecessarily, even when the noise around them is deafening.

Final Principles to Remember

• Higher risk typically means higher returns—balance wisely.
• Avoid withdrawing from long-term investments prematurely to leverage compounding.
• Keep an emergency fund for short-term goals.
• Regularly review, reprioritize, and adjust your financial plan for success.

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Financial planning isn’t static—it’s a process that grows with you, ensuring you remain on track to achieve your goals while creating a secure future for?future generations.

?Let’s continue building wealth, one step at a time.

Ready to take control of your financial future??Book a call?with us today to begin planning your financial future!

See you next month!

Srinivas V