I'am somebody , who has been planning to buy a car for ages now . I know which car to buy , when to buy , why to buy , what are the car loans available , I can even give you a hundred reasons for me not to buy a car . Except for buying a car, i have done everything else , what is the value of all this knowledge without action ...hmm... ZILCH
The same applies to investing .. you may make mistakes or rather blunders when you try .. but without action , you will never be able to build long term wealth .
Financial Inertial , is something which people find very very hard to overcome .
Financial Inertia : Is continuing to do nothing about your financial state, knowing perfectly well what needs to be done and how
A friend of mine approached me with all his investment details and we found that , he had very little idea of what all he has invested in and why . So we started with a plan of set things in order by first making sure we gathered all the information like folio numbers , policy numbers , kind of policies and state of each policy . After we had all these details i wanted him to make sure that his contact emails were updated in all his investments and also wanted him to start SIPs in some good MFs instead of taking direct exposure to equity
In persuance towards this goal, made sure he had the PDFs of all the MF application forms and instructions on how to fill them . All that he had to do was to fill those forms , attach a PAN card/KYC photo copy and submit it at the CAMS office, along with a cheque . It has been about a month now and my friend has not done any progress.. this is Financial Inertia .
And trust me , this is not a isolated case . I have seem this pattern of inaction over and over across a crossection of people
Image : FreeDigitalPhotos.net,Photographer: Filomena Scalise
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