He had ₹15 lakh in savings but still lost money. Here’s how a 32-year-old fixed his portfolio

Being careful with money does not always mean that one has made a sensible financial decision.

Let’s talk about a 32-year-old software engineer who has built up ₹15 lakh in savings. He was single, earning well and had money coming in every month. There was no bad stock, risky investment or crypto crash involved.

Posting about his woes on LinkedIn, Abhishek Kumar, SEBI RAI and advised at SahajMoney, said that his mistake was extremely simple – he left almost all his money in a savings account for four years.

He hadn’t lost anything, so he assumed he hadn’t lost anything. But the math told a different story.

While his savings account earned around 3%, inflation was running at about 6%, his money was losing roughly 3% in purchasing power each year. However, he could have fixed it with a very simple method, without taking any risk.

He didn’t need stocks, mutual funds or a complicated investment strategy. An FD, which provides 7% return, would have done the job.

So, how was his portfolio fixed?

“When we sat down, we didn’t touch anything exotic,” the financial planner said.

The first step was to give his money a purpose.

₹4 lakh was set aside as an emergency fund through a combination of a sweep-in FD and a liquid fund, and it was agreed that part would stay boring on purpose.

Then came three specific goals:

• a down payment on a house in five years,
• a health fund for his parents,
• and retirement.

“Money without a goal goes nowhere, and his had been going nowhere for 4 years,” the planner said.

Around ₹6 lakh was set aside for the house down payment; for this, most of the amount was allocated to debt funds because a five-year horizon wasn’t considered long enough to take on significant equity risk.

For retirement, he started a ₹45,000 monthly SIP in equity funds. It was his first investment in equities. The SIP was increased eventually, but only after he became comfortable with market fluctuations and stopped checking his investment account every morning.

Insurance was also addressed before investing aggressively: a ₹2 crore term insurance policy and ₹10 lakh health cover, costing less than ₹30,000 a year.

There were no stock tips or exotic products involved. Just a simple change: giving every rupee a job.

Eight months later, the investor summed up the lesson in one line: “I didn’t realise doing nothing was also a decision,” Kumar concluded