Savings Vs Investment Portfolio

It’s been rightly said “Never place all the apples in one Basket”. And I realized it when all my savings specially fixed deposit and liquid cash saved in one of our locality bank got bankrupt overnight. Since a financial emergency can occur at any point of time and at that moment if your savings are not supporting the situation then it usually becomes pointless in making such investment. Let’s understand this point through an example. So let’s say my two friends i.e. Vinod and Waseem, they both save 4000 monthly, but the difference is Vinod saves complete 4000 in equities directly and Waseem diversifies his investment into equities, debt and liquid cash. Now at the time of financial emergency unfortunately the share market crashed badly. So under this situation Vinod suffered a huge loss since all his savings were invested in equities whereas for Waseem the loss was minimized or almost nullified as the debt and liquid cash was doing well which almost served the purpose. So in my opinion the concept of diversifying your investment in multiple options and covering the same with proper insurance resulting in a proper complete chunk is called a portfolio.

So the question is, How to build a good portfolio from scratch?


In my opinion I would suggest based on our age and risk taking capability our portfolio allocation should be maintained. So let’s say, I have 4000 every month to invest and as a young investor my allocation would be for eg. 60% – equities (Shares & Mutual Funds) 30% – debt (FD, RD, Liquid cash in account, Government bonds etc) and probably remaining 10% – Gold (Physical Gold, Gold bonds, eGold etc.). This is just an example and based on my priority, goals and the market performance I can drive my portfolio. Also as a good practice it is always advisable to check your portfolio minimum on yearly basis, so that we can churn our allocation towards changing market condition and our requirements.


Now once your portfolio allocation is set, now it’s time to protect it from uncertainties. And as we all know the biggest impact on our savings comes mostly through hospitalization or sudden death of the earning member from the family. So to protect your investments from this situation, it’s always advisable to cover yourself with adequate Insurance cover which will take care of such situations occurring in the future without disturbing your hard earned savings.


So to initiate a portfolio creation, begin with diversification and there will be more components added further. Keep a regular track on all these stream and get the best out of it at any point of time. I wish you all have a healthy portfolio maintained for your investment and get the better returns out of it. Also don’t forget to reach out to me at for any feedback or suggestion. Till then Happy Investing…

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