/ Inside SM

Millennials Learning How to Invest

Most of SimpleMoney’s users are people who know what they want. And what they want is a solution to their Spreadsheet-riddled problem of portfolio tracking. Given that our marketing budget is closer to zero than one, the fact that our users have found us is a testament to their deep Google diving and Internet searching skills.

Our users are resilient and tenacious. Many of them were among the first Indians to make a switch to direct mutual funds, and they have an interest in watching their money beat inflation, if not multiply, and they really needed a place to keep a track of it all, and they looked really hard for it.

Do SimpleMoney’s employees make ideal users for our product?


Our employee-base is a 100% millennial (this wasn’t intentional: we welcome more mature adults to join us, and even though we use the word “millennial” here, we don’t encourage wide usage because some find it annoying). Millennials are, according to a lot of research, some of the worst savers in the world. The privileged among us didn’t grow up with any post-Depression/Nationalisation era memories of poverty, and poverty today has become more nuanced than the “Living on less than a dollar” narrative.

This is, of course, barring those among us who live in abject, irrefutable poverty. In India especially, it is hard to ignore such kind of poverty. As a country, we experience astonishingly high, and starkly visible levels of inequality.

The kind of poverty-scarcity hybrid millenial condition that I am referring to here is synonymous with, if not a symptom of, social media fuelled aspirational living. Like this viral Buzzfeed article discussed, many of us who aren’t living in crippling poverty are crippled by the anxiety of not being able to afford eating out, partying and shopping. I can understand this world because I am a part of it. And I understand enough to know that it’s not a part of my parents’ world. Every time I visit my family home, I see a machinery of activity that enables us to have three home-cooked meals a day. After almost ten years of living away from home, I have shed some of that frugality and am far more likely to say yes to a brunch with friends today but when I go home, I reminded of how dining out used to be a rare occurrence in my past.

My mother and I recently flew out of the same airport at the same time. She packed sandwiches for the two of us; I was already thinking of my burger and fries order at the airport McDonalds.

This makes sense, given that I have far more disposable income than I used to, and am not (yet) bogged down by my parents’ responsibilities of family and child rearing.

But it still makes me sad.

Yes, something as innocuous as eating out at restaurants makes me sad because I know that my own family wasn’t always able to afford it. I am aware that sometimes, I spend far more money on dining out than what some people make. And I know some of these people. One such person took a loan to pay for his daughter’s first birthday party, paid for a tent to be put up at the birthday venue, only to have it washed down by rain in the evening. He woke up the next morning, with no party pictures to show his daughter years from now, and heavily in debt.

My mother has instilled in me a strong fear of debt (especially that of the credit card and EMI ilk). The only thing I fear more than debt is a gecko. But I know people who are burdened by smartphone EMIs and long running credit card payments. And that’s understandable: expenses always seem to add up to more than what we expect. Sometimes, I look at my grocery bill and wonder how all those individual items racked up such a large bill. I guess that’s how life works.

When Australian real-estate mogul Tim Gurner berated millennials for wasting the money that they would spend on real estate on avocado toast, the internet went up in a storm.

Gurner’s priceless words were:

“When I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each. We’re at a point now where the expectations of younger people are very, very high. They want to eat out every day; they want travel to Europe every year."

The avocado lobby was understandably upset. The math also didn’t up. The New York Times opened an outraged article with the lines: “Millennials have enough problems as it is. Must they give up their avocado toast, too?”

I don’t understand the allure of Avocados, but I get that the avocado is a metaphor, a symbol for haute-consumption, the kind that our parents’ generation might not have been able to afford, or didn’t know they could afford.

While Gurner’s sensational comments were a series of memes waiting to happen, and even though his math might not have added up, he might have a point. A startup founder I spoke with recently lamented that any business that depended on users, especially young ones, to save, was doomed. “Credit industries are where the money is,” he said.

Millenials have a bad rap for saving, and understandably so. Many of us don’t have the high powered far-sightedness required to imagine ourselves as old people. It’s easier to spend today rather than save for tomorrow, especially when consumerism in the middle class is in the rise, and our social upkeep requires a certain level of financial spending.

So here I am, not the ideal SimpleMoney user: I am young, my savings consist of what I have squirreled away for the past two years. I constantly fear that I am spending too much, and worst of all, I didn’t start investing in mutual funds until recently.

Before I joined the SimpleMoney team, I learned from Pranshu about the glorious merits of mutual funds (“multiply your wealth in seven years;” “beat inflation like a pro”). I was curious, and decided to figure out how to invest in mutual funds in India. I read tens of articles and I didn’t come out of it feeling like I knew much at all. Few things I learned: there is a KYC (Know Your Customer) registering process that almost always requires an in-person verification. Some of the websites that I had to navigate looked like they were made in the early 2000s for a 1990s audience, and the technology was not user-friendly. Most of my research revealed that the easiest way to get all this paperwork done was to get a distributor to do it for you (which often means foregoing the approximately 2% that gain when you sign up for Direct over Regular funds), or having it done through a financial planner. Finding a financial planner who would take me on with my small corpus of savings seemed like it would require a lot more googling, and I wasn't up to that task.

It took me far longer to sign up for my first mutual fund, and I only had the resilience to do it because I had a friend who spoke like he was a brand ambassador for the Mutual Funds Sahi Hai campaign, and also because I joined SimpleMoney soon after. Working for the company for a few weeks without being an investor meant that I had eyebrows raised at me whenever I asked for dummy data to be pushed to our test account so that I could have the experience of using our own product.

In an alternate universe, I don’t think I would have signed up for mutual funds by now because the process seemed too bureaucratic, and because I still may not have fully understood the urgency or importance of saving. Today, after reading many personal finance blogs and investment related articles for my job, I get why saving is a really good idea, and I know ways to go about it that are far less complicated than what I imagined them to be.

But what about someone who doesn't work for a fintech company specializing in mutual funds? Someone who, like me, doesn’t come from a finance background or a family of investors? Someone who has a tense relationship with money? Someone who, thanks to her millenial status, is used to having a technologically simple solution to every administrative task, and doesn't want to bother with all the paperwork and research? Someone who probably isn’t reading this article because they don’t know what SimpleMoney is, or don’t think SimpleMoney would be useful to them because they don’t want to/care to/know how to invest in the Indian financial markets?

Actually, I can imagine how the process would be for such a person because I’ve been asking my cousin to sign up for mutual funds, and when I described the KYC process, and the paperwork involved, his eyes glazed over and I lost him to stress-induced Amazon shopping.

So, in a series of posts for Stories by SM (to follow), I will take you through my process of signing up for mutual funds and the philosophical underpinnings of my thoughts as someone who has shied away from the overwhelming world of financial markets.

If you're cooler than me and know what mutual funds are, and mastered that KYC process like a pro, please use SimpleMoney to track your portfolio. Too cool for mutual funds? Only invest in direct equities? No problem - we track Equities too!