All the advise that you get must be saying ‘Look you jerk you do not know how to handle your money..give it to a mutual fund, life insurance company, brokerage house…and they will manage it for you’ …correct?

Well most of the financial media, the people who write, the people who appear on the TV have a vested interest in the Managed Money Industry. Hence there seems to be a bias against managing your own money without the help of fund managers.

Let us look at some of the solutions that I have seen people use effectively:

1. Buy a house and give it on rent: No planner will give you this advise – unless he is a builder or at least an agent! I am not even saying this is a good idea or a bad idea, but such ideas are rarely considered as feasible!

2. Build your own portfolio: I am dead against direct investing by the ‘retail guy’ . However I have seen many very successful investors too. One such person is now a very senior person in a big group. He has created a Rs. 10 crore corpus – apart from his real estate holdings and his ESOPs. Alas he has very little investment in debt products – except the customary PPF, nsc, etc.

3. Invest in Equities in their ’70s: My father is an investor beyond the age of 82…simply because he has a full equity portfolio and his dividend income is far greater than his total expenses…giving him a surplus. Debt instruments and debt  mutual funds have accumulated enough for him and my mother…..

4. Buy a house in a place where older people are treated reasonably well and servants are available. In a worst case scenario the house can be sold, along with the furniture -and you can shift to a smaller place. Makes sense to downsize the house..as you get older.

5. Create your own pension like buying National Savings certificates – every quarter and knowing that 7 years from now it will mature every quarter.

Unfortunately none of these ideas make money for the distributor…and some are so tightly priced that you will not see any money being made by any of the customers…