Money Lessons to be Learnt this Holi

July 21, 2021
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Holi is a festival of colors and it is celebrated with great fervor in different parts of the country. This festival signifies the triumph of good over evil. Beyond the festivities, Holi is festival of colors teaches several key money lessons that will help us make a way towards achieving the robust financial planning.

Enjoy Colors of Diversification

We celebrate Holi with diverse colors that we smear on each others faces and make the festival enjoyable. Playing Holi with just one color will make the festival dull. The multiple colors that we play in Holi teach the benefits of diversifying the investment portfolio.

Financial experts always suggest, not to put all your eggs in one basket when it comes to investing. The diversification of investment among various asset classes will help in maximizing return and minimizing the risk. The diversification enables the investment portfolio to grow, when the market is in boom state and even when the returns collapse in one sector. Diversification works well towards achieving the financial goal.

Reap the Sweetness of Investments

On Holi, we have a long list of savories like gujiyas, shakkar paare, jalebis, and thandai, etc. that we enjoy a lot on this festival. These special recipes carry some sweet lessons too. We enjoy various sweets in Holi, likewise as we are heading towards the end of the financial year, it’s time to book profit on the investments already made. By making a sweet choice of staying invested for a long-term, you can take advantage of lower volatility and get the better returns as well. If you want to see growth in your investments, it is imperative to go for long term investing.

Get away from the Evil of Bad Debt

We celebrate Holi for the victory of good over evil, by burning ‘holika’. Holika was the sister of the evil king Hiranyakashipu, made various attempts to kill his son Prahlada, as he was the devotee of the Lord Vishnu. Holika sat on a burning pyre with Prahlada with the intention of killing him. Holika was burnt to ashes, but Prahlad escaped unscathed.

Likewise, if you want to flourish in life and accumulate savings that can last through your golden years, then only saving and investing is not enough. You also need to burn out the burden of bad debt as soon as possible. Bad debts are the ones which you can’t afford and it’s not essential, it’s better not to borrow it. Even if you have taken a bad debt, it is advisable to make all efforts to repay your high-cost debt firstly.Opting for a good debt-management strategy also helps in managing your debt, such as choosing the best loan option, pay back the debts from your savings as early as possible, minimize regular debt expense, etc.

Play Safe

The zeal of this festival of colors prevails, if you play safe. Some people make use of hazardous colors while playing Holi. However, one should play with organic colors that will have the least effect on health. This way you can make the festival memorable as well.

In the same manner, you should opt for safe investment options that will help you to gain returns with relatively little risk. These types of investments usually bear low, but assured rate of return. In a safe investment, the chances of losing your invested money are almost negligible and it yields returns as well. You can also invest in stocks, as it offers high return, but carries the investment risk so you need to assess properly before investing. The long-term investment in stocks say for about 10 years tend to become a safe investment option.

Review the Investments

At the festival of Holi, we look forward to sort out all grief and miseries with anyone. We gather with friends and family and celebrate this festival with love and laughter, revive bitter relations and build new relations as well.

Likewise, check the performance of the stocks which were earlier not performing and assess if it makes sense to include in your investment portfolio. You should also consider including new stocks to the portfolio. When it comes to reviewing the investment portfolio, you need to check the return of stocks you are investing in and ascertain whether your investments are providing a minimum rate of return you need every year. You only need to pick a right mix of investments and invest the amount needed to reach the target.

Final Words

While celebrating Holi and having fun, as the financial year is also approaching the end, it’s a good time to assess your financial goals properly and re-build the portfolio to fulfill those goals. Financial lessons learnt from this  festival may help you build upon your returns. May the colors of Holi make your portfolio flourish in the year ahead. Happy Holi!

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