One of the biggest problems with most people who are not able to invest is… No Money! Today we will talk about how you can build your INR 20 crore investment portfolio even when you no money to invest right now!
A friend of mine, fresh out of college and recently into a job, is finding it difficult to start saving from his salary for investment. He feels that he earns just as much as he needs to spend and hence have not been able to start investing yet.
While chatting with me the other day over a cup of coffee, I suggested that he first needs to analyze his existing portfolio of investments before starting fresh ones. That is when I realized that he doesn’t have any significant investment other than the yearly tax saving forced investment every year.
Now that was a serious concern! After analyzing his lifestyle, there were some simple steps that he could very easily follow to save some money by the end of the month and start investing for the future.
How to start saving without reducing your standard of living?
- A movie every week- A ticket for a couple costs at least INR 1000 including ticket price, parking and popcorn. So, if you reduce your movie outings to once a fortnight from once a week, then you can invest INR 2000 a month for investment.
- Coffee thrice a week- One cup of Cappuccino or Latte costs approx INR 150 in any café. For two of you, it would be INR 300 minimum, if you don’t eat anything. So, if you reduce your cafe visits to once a week from 3 times a week, then you can end up saving INR 300 X 2 i.e. INR 600 every week, i.e. INR 2400 every month.
- Dining out twice a week- Dining out would cost you a minimum of INR 1500 every time for two people without alcohol in a good restaurant. So, if you could reduce this to once a week, then you can save INR 1500 per week, i.e. INR 6000 per month. This will not only be cost-effective and help you invest but create a positive impact on your health in the long term. Just by following these 3 steps you could start savings INR 10,400 per month which could add up to INR 1,24,800 per annum.
Image by pch.vector on Freepik
INR 1,24,800 invested at a minimum of 12% p.a. CAGR will give you a corpus of:
- INR 1.02 crore in 20 years
- INR 3.63 crore in 30 years
- INR 12.24 crore in 40 years and
- INR 40.62 crore in 50 years
A small step leads to a bigger destination and hence it should start immediately.
Featured Image Credits: Image by pch.vector on Freepik
