“Joydeep, I think I have too many investments.”
That was how the conversation started.
It was with an old colleague.
We had not worked together for years, but we had remained in touch.
He had done well.
Very well.
His salary had grown.
His business interests had grown.
His properties had appreciated.
His investments had accumulated.
He had crossed the point where saving money was no longer his biggest problem.
Managing the money was.
And that is an interesting transition.
Because the financial advice industry rarely tells you this:
The problem changes as wealth increases.
When you are starting out, the question is:
“How do I save ₹10,000 a month?”
Later it becomes:
“How do I invest ₹1 lakh a month?”
Then:
“Where should I invest ₹1 crore?”
And eventually:
“How do I manage everything I already own?”
That’s when complexity enters.
THE PORTFOLIO HAD BECOME A MUSEUM
My colleague showed me his investments.
One mutual fund.
Then another.
Then another.
Different equity funds.
Debt funds.
Insurance.
Fixed deposits.
Gold.
A few other products.
Some were old investments.
Some had been recommended recently.
Some he had forgotten why he bought.
I asked:
“What is the objective of each investment?”
Silence.
Not because he was financially illiterate.
Quite the opposite.
He was financially successful.
But he had accumulated products faster than he had accumulated a framework.
That is a very common problem.
PRODUCT COLLECTION IS NOT WEALTH MANAGEMENT
Let’s say you own:
10 mutual funds.
3 insurance policies.
4 FDs.
2 PMS accounts.
Gold.
NPS.
PPF.
A second property.
And some shares.
Does that automatically mean you have a sophisticated portfolio?
Not necessarily.
It may simply mean you have many products.
The more important questions are:
What percentage is equity?
What percentage is debt?
How much is liquid?
How much generates income?
How much is locked in?
How much is exposed to one asset?
What happens if your income stops?
What happens to your spouse if something happens to you?
What happens to the portfolio during a market crash?
Now we are discussing wealth management.
SO, DO YOU NEED AN ADVISER?
Sometimes yes.
Sometimes no.
And sometimes you need an adviser—but not necessarily a product seller.
That distinction is important.
A professional adviser can help with:
- Asset allocation
- Retirement planning
- Tax considerations
- Risk management
- Estate planning
- Succession
- Behavioural discipline
- Portfolio construction
- Family wealth structures
These can be valuable services.
But the question remains:
Does every investor need all of them all the time?
Probably not.
START WITH THE FINANCIAL DASHBOARD
Before buying another product, I would build a one-page financial dashboard.
INCOME
How much do you earn?
EXPENSES
How much do you spend?
ASSETS
What do you own?
LIABILITIES
What do you owe?
CASH FLOW
What remains every month?
NET WORTH
Assets minus liabilities.
LIQUIDITY
How much can you access quickly?
INCOME FROM ASSETS
How much does your wealth actually generate?
Suddenly, the portfolio starts making sense.
THE SIMPLE PRODUCT TEST
Take the basic instruments.
FD
Useful for defined capital-preservation and liquidity needs, subject to interest-rate, tax and institution-specific considerations.
RD
Useful for disciplined recurring savings.
PPF
Useful as a long-term government-backed savings instrument within its rules and limits.
NPS
Designed around retirement accumulation and subject to its own contribution, withdrawal and tax rules.
INDEX FUND
Provides diversified exposure to an underlying index through passive management. SEBI describes index funds as a simple, transparent and generally lower-cost approach to tracking an index.
GOLD / SILVER ETF
Can provide exposure to precious metals without the ownership and storage issues associated with physical metal, though costs, tracking and market risk still matter.
Notice what is missing?
Nothing exotic.
Because the objective isn’t to make investing exciting.
The objective is to make investing effective, understandable and sustainable.
WHY DO WE KEEP ADDING PRODUCTS?
Partly because finance has a psychological problem.
People equate:
more products = more diversification
But diversification isn’t about counting products.
It is about understanding underlying exposures.
Ten mutual funds can still have overlapping holdings.
Three funds can potentially provide broader diversification than ten poorly chosen funds.
A ₹2 crore property isn’t diversification simply because it is worth ₹2 crore.
If most of your wealth is concentrated in one city, one property and one asset class, you still have concentration risk.
THE 3-BUCKET MODEL
For many households, I would start the conversation with three broad buckets.
BUCKET 1 — PROTECT
Emergency cash.
Insurance.
Short-term needs.
Debt management.
BUCKET 2 — GROW
Long-term equity investments.
Index funds or other suitable diversified investments.
Retirement investments.
BUCKET 3 — CREATE INCOME
Rental assets.
Interest-bearing assets.
Other cash-flow-producing assets appropriate to the individual’s circumstances.
Then ask:
Does every rupee have a job?
That’s a much more useful question than:
“Which new product should I buy?”
AND THEN COMES THE BIGGEST COST
Not every cost appears as a line item.
There is also:
Complexity cost.
You don’t know what you own.
You don’t know why you own it.
You don’t know what it costs.
You don’t know when to exit.
You don’t know how it fits into your larger plan.
That uncertainty can be expensive.
WHEN SIMPLE IS NOT ENOUGH
Let’s be fair.
A UHNI with:
- Multiple businesses
- International investments
- Trust structures
- Succession issues
- Large concentrated holdings
- Complex tax exposure
- Family governance requirements
may genuinely need sophisticated professional advice.
That is not unnecessary complexity.
That’s complexity solving complexity.
My objection is not to sophisticated solutions.
My objection is to sophistication becoming the default starting point.
START SIMPLE. EARN THE RIGHT TO BECOME COMPLEX.
This is perhaps the principle I would put at the centre of my financial philosophy.
Start with the simplest solution.
Understand it.
Measure it.
Review it.
Add complexity only when the problem requires it.
This applies to investing.
It applies to borrowing.
It applies to insurance.
It applies to businesses.
It applies to life.
MY COLLEAGUE’S REALISATION
At the end of our conversation, my colleague said something interesting:
“Perhaps I don’t have an investment problem. I have a decision-making problem.”
Exactly.
He didn’t necessarily need another product.
He needed a framework.
And that is why I believe financial literacy should come before financial products.
Before asking:
“Where should I invest?”
ask:
“What am I trying to achieve?”
Before asking:
“Which fund?”
ask:
“How much risk can I actually take?”
Before asking:
“Should I buy property?”
ask:
“What job will this property perform in my financial life?”
Before asking:
“Should I hire a wealth manager?”
ask:
“What problem do I want the wealth manager to solve?”
THE REAL QUESTION FOR HNIs
The moment your wealth crosses a certain level, everyone starts offering you something.
A fund.
A PMS.
A structured product.
An alternative investment.
A portfolio.
A private opportunity.
A wealth-management solution.
But perhaps the most sophisticated question you can ask is:
“Do I actually need this?”
That question protects more wealth than another product brochure.
And perhaps that is the paradox of wealth:
The more money you accumulate, the more important it becomes to know what NOT to buy.
That’s not an argument against wealth advisers.
It is an argument for better questions.
And if an adviser helps you ask—and answer—those questions objectively, their value can be substantial.
But if the primary output is simply a larger collection of products?
Then perhaps you don’t need a more complicated portfolio.
Perhaps you need a simpler financial life.
What would you choose?
A portfolio full of products you don’t completely understand?
Or a smaller number of financial building blocks you understand, monitor and review with discipline?
That is the conversation I believe we should be having.