Uma Shanker, a 43-year-old mutual fund investor, started his investment journey 14 years ago, with a small amount of Rs 500 via SIP in an ELSS or tax saving mutual fund scheme in October 2005.
“It was a big decision for me that time because before that I was investing in NSC (National Saving Certificates) only for tax saving. It took a lot of courage as I was afraid of the market,” says Uma Shanker, who works in a PSU. Since Uma Shanker was not well-versed with investments, he hired Ashish Modani, a Jaipur-based financial planner and advisor, as his mutual fund advisor.
Like many novices, Uma Shanker had his share of doubts about investing his money in an equity-linked scheme. He started reading about mutual funds and discussing his doubts with his mutual fund advisor to be doubly-sure about whether he was making the right decisions.
“I was happy to see my investment go up day by day in the equity market. I continued reading about mutual funds, and particularly about my scheme (an ELSS from Reliance Mutual Fund). It gave me confidence,” Uma Shanker says.
After he gained the confidence, Uma Shanker increased his SIP amount in 2008 and made it equal to his PF deduction amount.
“I increased the amount once I thought that I understand the basics of mutual fund investing,” he adds.
However, things didn’t go as per his plans. The year 2008 was a scary one for the equity markets all over the world, including India. And Uma Shanker wasn’t prepared for the meltdown.
“I saw my investment value coming down by 50% and all my profits vanished. I thought about stopping my SIP and to restart it again after the market stabilizes. It was a tough time but I kept my faith because of my own readings and my mutual fund advisor,” says Uma Shaker.
My mutual fund advisor reassured me, and said that nobody can predict the market. “If you are a long term-investor, focus only on long term. Short term tremors shouldn’t disturb you,” Ashish Modani, my mutual fund advisor, told me.
After the short-term tremors of 2008 were over, Uma Shanker had all his investments in mutual funds, apart from his pension and PF. “I still remember my colleagues suggested not to make this mistake of keeping the money in the market. However, my understanding of the market and advice from mutual fund advisor made me confident of my choice,” says Uma Shanker.
With the same faith, Uma Sanker continued his SIP and by 2014, the tiny amount he invested had become a considerable corpus. From 2008 to 2014, Uma Shanker tried educating, motivating more people, including his colleagues and family, to start SIPs to beat inflation.
“Approximately 120-150 people started their SIP only on my words. I even started my father’s SIP after his retirement in 2010, until his retirement, my father used to invest all savings in FD, NSC and his PF,” says Uma Shanker.
Uma Shanker says that he has seen many bear and bull market phases in his journey by now. However, he has understood that what really matters at the end of the day is how much your portfolio has earned in the long term. “I increased my SIP amount again and continued till date. Now we are in a bear market, but still I have percentage return more than the average inflation in the last 10-15 years,” says Uma Shanker.
“In the last 14 years, I learnt only one thing: keep your investments simple and don’t keep tracking the market. Focused and consistent approach with goals set never fails you. It didn’t fail me. One more thing, never race for returns and don’t switch funds regularly for best performance because you can’t predict which fund is going to perform at what time,” says Uma Shanker.
