Wars and geopolitical tensions often send shockwaves across
global markets. Every time a conflict erupts - be it the ongoing conflict in
the Middle East involving the USA, Israel and Iran, the Russia-Ukraine war, or
tensions between India and Pakistan - there is temporary panic in financial
markets. Investors scream volatility, and uncertainty dominates the news cycle.
But if history teaches us anything, it is this: markets
bounce back. In fact, in India’s case, markets often rise swiftly after the
initial panic. Why? Because, while wars may shake the world, India’s economic
story continues to unfold with strength and stability. It is wiser to view
markets in 3-5 year periods, not through daily headlines. And this does not
apply only to wars. Be it any bad news - markets have seen it all and still
gone up over time. Panic is temporary. Progress is permanent.
We are a young nation with a median age of 28, and a
population that loves to spend. A young population, rising incomes, and growing
consumption power our economy - not just during peaceful times, but even amid
global uncertainty. Our domestic demand, digital innovation, and reforms keep
the long-term growth story intact.
So, ignore the macros. Focus on micros. Forget the global
noise. Focus on your personal finances.
Here’s the real question: Are you investing enough in
inflation-beating assets like equity mutual funds, stocks, and gold?
Because, while wars come and go, inflation is the real enemy
that quietly eats into your savings. And the only proven way to beat inflation
is by investing in growth-oriented assets - equity mutual funds, direct stocks
and gold. Not by letting your money sit idle in low-interest instruments.
Here’s what you should focus on:
·
Do sufficient systematic investment plans (SIPs)
in the above assets. Atleast 30% of your in-hand monthly income.
·
Increase your SIPs every year. Your income is
growing, so should your investments.
·
Don’t just stop at SIPs - whenever you have
extra cash handy, consider lumpsum investing.
·
Have sufficient health insurance to protect your
savings in case of medical emergencies.
·
Secure your family’s future through adequate
life insurance, especially if you have dependents or financial liabilities.
Market dips driven by war or fear may feel uncomfortable,
but they’re often opportunities in disguise - for those who stay calm and
invest smartly.
Because in the long run, it’s not about timing the market.
Your time spent in the market (remaining invested) beats timing the market.
Time is the best fund manager. Don’t wait to invest. Invest and then wait. The
best time to invest is as soon as you have the money to. The pessimist bear may
sound smart, but the optimist bull creates wealth. Scared money never wins.
Kaustubh Kale
Chartered Accountant, CFA(USA)
