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4 Pillars of Financial Success for Individuals in India

· 5 min read
D Balaji

In the pursuit of financial success, individuals often dedicate a significant amount of time to consuming financial news, financial literature, minimalist techniques or simply ask their friends for ideas. In this article, we will focus on four essential pillars of financial success for individuals with an Indian background. By following these principles, individuals can strive towards a more secure and prosperous financial future.

By focusing on steady income growth, reducing liabilities, avoiding major losses, and holding long-term growth assets, individuals can enhance their financial well-being and build a solid foundation for the future.

Steady growing income

Establishing a steady growing income is a fundamental principle for individuals in India who aspire to achieve financial success. In a country where many middle-class individuals experience limited job growth and security, relying on a single source of income can be precarious. Personally they have to rack up atleast one year worth of expenses in a liquid fund or fixed deposit which I categorize as lazy funds.

Its surprising to see senior advocates, doctors, businessmen making handsome income in their late 80s but a retired engineer making nothing other than his pension if any.

Tip #1: Choosing a retirement proof career is key in financial planning.

If you are already mid way through career, start and grow a promising business because business owner cannot be fired or forced to retire by labour laws.

Declining or reduced liabilities

Traditionally, individuals in India would secure employment within their local communities and often live with extended family or in joint households. Consequently, recurring expenses such as rent, electricity, and locking up money in the form of advances or security deposits were relatively unheard of. However, the modern lifestyle has led to an alarming increase in imprudent accumulation of liabilities. Even before securing employment, individuals often find themselves burdened with education loans, followed by payday loans soon after receiving their first salary. While it is not fair to blame individuals entirely, the expenses associated with metropolitan living necessitate managing multiple financial responsibilities with a limited income, leaving minimal room for savings in their 40s.

Maintaining strong family connections, prioritizing children's needs, and preserving cultural traditions can quickly deplete financial resources, making one's 30s more challenging than anticipated. Ultimately, achieving financial success requires generating income several times greater than one's liabilities. If it proves difficult to substantially increase income, it is imperative to focus on reducing costs and minimizing liabilities. Many successful individuals have chosen to retain modest lifestyles, refraining from upgrading furniture, driving smaller vehicles, and using the same vehicle for extended periods.

Tip #2: Avoid the shiny, fad and impractical expenses. Think long term before you commit for something.

Not incurring major losses

It is an undeniable fact that the path to wealth creation has always been filled with risks and uncertainties. A notable story from the book "The Richest Man in Babylon" recounts an individual who lost their investments due to misguided advice when purchasing gold, resulting in poor decision-making. Today, individuals continue to face similar challenges, often influenced by biased recommendations from stockbrokers, mis-selling insurance agents, and other vested interests. Countless individuals have taken leaps of faith only to discover that their ventures led to significant financial losses, whether through failed businesses or ill-informed investment decisions. Such losses can have long-term consequences on one's financial stability and progress.

Tip #3: In new ventures, Diversify even if the returns are less because losing capital means losing the game of financial success.

Create & Holding long term growth assets

Anecdotally, we often encounter stories of individuals who achieved substantial wealth by merely leading ordinary lives and retaining inherited ancestral properties. While inheriting wealth is undoubtedly advantageous, those without such fortune must exchange their money for the creation, growth, and retention of assets.

It is essential to recognize that assets need not be limited to gold, stocks, or land. Owning a thriving tea stall in a strategic location that was once neglected but is now a prime spot exemplifies a valuable asset. Many successful family businesses in India trace their roots back to the entrepreneurial efforts of grandparents who fearlessly embarked on ventures that yielded fruitful returns.

Rather than advocating for excessively frugal lifestyles or sacrificing vacations to save money, it is more advantageous to focus on creating assets that can generate significant returns over the long term.

Tip #4: Put time in creating assets instead of trying to save rupees in short term


The road to financial success is not easy especially when you have a family which includes dependents, a society who pushes new fads like spending 2 lakhs on child first birthday, a govt which introduces taxes on whatever you do and use, a job where growth is like a slow moving train, etc. But good use of money can make you comfortable financially. Its okay to be comfortable than be miserable in terms of money.

Achieving financial success in India requires a combination of discipline, informed decision-making, and a long-term perspective. By prioritizing a steady growing income, reducing liabilities, avoiding major losses, and focusing on long-term growth assets, individuals can enhance their financial well-being and increase their chances of achieving their financial goals.