Financial Success, Emotional Stress: Who’s Really in Control?

In today’s era, from college students to retirees, everyone is talking about stocks and SIPs. While this shows that people want to know more about finances, experts say the growing fixation with portfolios and returns is raising a bigger question. So when does healthy investing cross the line and become an obsession for people?

People are not able to manage finances and it is getting difficult for them to save money. The current generation of investors is more likely to be investing in stocks, mutual funds, etc. through the medium of digital platforms. 

The increased level of interest from new participants in the investment arena has generally been viewed positively. 

However, as investing becomes an important topic for conversation and now the stock prices and news dominate one’s social media feed.  Is this creating a better-informed group of Indian consumers making more financially intelligent decisions or does the pressure to continually make investments and seek higher returns create a situation where you cannot avoid doing so?

Investing has evolved from a financial activity to a cultural phenomenon

A decade ago, investing in equities was largely confined to seasoned investors and affluent households. Today, discussions around SIPs, market corrections and asset allocation are no longer niche topics. 

According to Anand Rathi Wealth, the share of equities and mutual funds in household financial assets has risen less than 7% in 2015 to nearly 14% today. The wealth manager believes higher technology penetration and increasing organised sector employment have made young investors explore the market and start investing.

Social media is making people aware of finances

The rise of social media has transformed investing into a highly visible activity. From influencers sharing stock picks to reels are expanding SIPs and their portfolio. Financial content is getting more accessible nowadays, This has helped to know more about the finances.

But the constant stream of information can also create pressure to act. Viral success stories and trending sectors often prompt investors to make portfolios and chase the latest market theme without adequate research.

People are rushing to build wealth

The young investors are rushing to buid wealth. That means they embrace wealth creation more as compared to the previous generation. 

Experts suggest that emergency planning, health insurance and life insurance are always looked at as being essential to long-term financial security. Before chasing returns, they recommend creating an emergency corpus equivalent to 6 to 12 months of expenses and ensuring adequate insurance coverage.

Young investors are focused on doing investments early, but they lack the knowledge and importance of creating emergency funds that makes them broke.