1.       First decide the reason why you want to invest? Document your financial goals, what you want to achieve, in how many years.

2.      Understand the asset allocation that you are comfortable with. Also, understand the asset allocation that is required for each of your goals. Both can be different.

3.      Asset allocation is the base of wealth creation. You should allocate your investment in various asset classes as per your risk-taking abilities. Fixed income products must also be an important part of your wealth creation. It will help you to stabilize risk and returns of your portfolio.

4.      Start you SIPs in equity mutual funds (and if necessary, debt MFs).

5.      Do not stop your SIPs. Especially when markets are down since that will help in accumulating more and more units at lower rates.

6.      You should in fact invest more money when markets are down, or fall drastically. You should invest more instead when P/E or P/BV are at low.

7.      Don’t invest additional money when the PE or P/BV is high. If you do have surplus money, then put in liquid fund and STP into an equity fund.

8.     When people start discussing that SIP in last few years has given lower returns than bank FDs, consider investing additional amounts.

9.      When stock market returns in last few years have not been good, consider investing additional amounts.

10.  Direct stock investing is tough and not suitable for everyone. You should have enough time, enough money and enough knowledge of stock market and country’s economy. It should be considered only after investments in SIP and SIP top ups have been done.

11.   Focus on increasing your income (if possible, side income too). You can only save or invest a part of what you earn.

12.  Don’t spend too much on unnecessary stuff, but may want to spend money on experiences.

13.  If you earn well and save money well in initial years, you can get the money to work hard for you instead of you working hard for it.

14.  Buying a residential house for own stay is needed and should be planned. But buying real estate as an investment may not be a good decision. Rental yields are unlikely to even beat inflation.

15.  Having loans is no excuse for not investing. Try to invest along with your loans. Try to reduce your loan liability as soon as possible. They are killers of your wealth creation.

16.  Use common sense and be willing to be a contrarian. But don’t be a contrarian just for the sake of it or to sound intelligent.

Above mentioned ideas are very basic ideas towards the journey of wealth creation.

Happy Wealth Creation!