Regular checkups can keep you both healthy & wealthy
An oft repeated adage – health is wealth – is true to label in all aspects. Be it health or wealth, both need to be carefully nurtured to enjoy and experience a good life. While sound health keeps us fit, a sound wealth plan can help an individual meet his financial goals and remain stress free. If we closely observe, there are many more commonalities between the two (Table 1).
Table 1 – Commonalities between health and wealth plan
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In today’s fast life, people are conscious about their health but the awareness about creating long-term wealth is negligible. Individuals fail to follow the 5-step financial planning process - risk profiling, goal analysis, asset allocation, product selection and portfolio monitoring.
Since the various aspects of sound health and wealth are similar, an investor just needs to know the ingredients to put together for a diet / financial plan that is right for him or her.
Just like we have a ‘food pyramid’ which helps us to identify the proportion of, carbohydrates (bread, cereals, pasta), vitamins (fruits and vegetables) and proteins (meat, legumes, dairy products) for a healthy ecosystem, a ‘wealth pyramid’ must be followed for a ‘wealthy ecosystem’. This includes the asset classes and products that can be mapped as per one’s risk profile (See Chart 1).
Chart 1 – Wealth Pyramid
Mutual funds can be a convenient and effective way to achieve long term financial goals and investors can look for diversifying their assets through investments in various asset classes like equity, debt, gold etc.
Regular Checkups
Be it a health plan or a financial plan, both change according to the individual’s physical and financial health depending on his age and other situational parameters. Hence a regular review of an individual’s health as well as wealth profile is very important. For investments, at a young age, people can focus on risky investment products such as equity but as they near their retirement age, they can move to debt investments to provide security and stability to their retirement income.
Conclusion
While the importance of good health can never be underestimated, it is equally important to maintain a financially healthy life with the help of disciplined investment planning. Having the right balance between a health plan and a wealth plan is the key. What physical trainers / dieticians are for physical fitness and health; financial advisors are the equivalent for wealth creation as both health and wealth need expert advice. Regular check-ups by these experts can help an individual remain stress free. Thus, being healthy is not an option but a way of life while following a financial plan is not a luxury but a necessity of life.
By Jiju Vidyadharan
An oft repeated adage – health is wealth – is true to label in all aspects. Be it health or wealth, both need to be carefully nurtured to enjoy and experience a good life. While sound health keeps us fit, a sound wealth plan can help an individual meet his financial goals and remain stress free. If we closely observe, there are many more commonalities between the two (Table 1).
Table 1 – Commonalities between health and wealth plan
| Health | Wealth | |
| Roadmap | Both need disciplined approach and long-term thinking | |
| Interval | Both need regular monitoring | |
| Rebalancing at regular intervals | Physically underweight/ overweight | underweight/ overweight by asset class (equity, debt, gold) |
| Exercise | Overall physical developments by using various forms of exercises like weight, aerobics cardio, yoga, etc. | Optimum diversification by investing across asset classes. |
| Suitability | An exercise plan is drawn up keeping the person in mind - their height, weight and gender | Asset allocation plan is based on the individual's risk profiling and goals |
| Caution | Overwork or lack of sleep | Concentrated portfolio |
I
In today’s fast life, people are conscious about their health but the awareness about creating long-term wealth is negligible. Individuals fail to follow the 5-step financial planning process - risk profiling, goal analysis, asset allocation, product selection and portfolio monitoring.
Since the various aspects of sound health and wealth are similar, an investor just needs to know the ingredients to put together for a diet / financial plan that is right for him or her.
Just like we have a ‘food pyramid’ which helps us to identify the proportion of, carbohydrates (bread, cereals, pasta), vitamins (fruits and vegetables) and proteins (meat, legumes, dairy products) for a healthy ecosystem, a ‘wealth pyramid’ must be followed for a ‘wealthy ecosystem’. This includes the asset classes and products that can be mapped as per one’s risk profile (See Chart 1).
Chart 1 – Wealth Pyramid
Mutual funds can be a convenient and effective way to achieve long term financial goals and investors can look for diversifying their assets through investments in various asset classes like equity, debt, gold etc.
Regular Checkups
Be it a health plan or a financial plan, both change according to the individual’s physical and financial health depending on his age and other situational parameters. Hence a regular review of an individual’s health as well as wealth profile is very important. For investments, at a young age, people can focus on risky investment products such as equity but as they near their retirement age, they can move to debt investments to provide security and stability to their retirement income.
Conclusion
While the importance of good health can never be underestimated, it is equally important to maintain a financially healthy life with the help of disciplined investment planning. Having the right balance between a health plan and a wealth plan is the key. What physical trainers / dieticians are for physical fitness and health; financial advisors are the equivalent for wealth creation as both health and wealth need expert advice. Regular check-ups by these experts can help an individual remain stress free. Thus, being healthy is not an option but a way of life while following a financial plan is not a luxury but a necessity of life.
By Jiju Vidyadharan
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