What’s the purpose of investing?

“Investment” – This word is much used and often much abused one. One keeps on hearing this almost all the time be it in office or catching up with friends or attending a family functions – almost everywhere. More so when we are fed with lot of information about how one needs to make money work to get more money.

However, for a lot of people, the clarity on one question is often lacking – What is the purpose of investing?

what is the purpose of investing
And even if one knows his/ her purpose of investing, it is often not implemented in real life. For instance, purpose of one’s investments may be having sufficient funds in times of need. Yet they may opt for a personal loan when faced with pressing need for money.

Based upon my observations, below are some of the most common purpose of investments (in no particular order)

  • I invest because there is some sufficient funds lying with me and I can get great returns.
  • I am investing for some specific goal – buying a house, education of kids, marriage of kids and so on.
  • In future, I want to buy that one thing I have always dreamt of (e.g. a BMW)
  • Being financially independent – So that sometime in not too far future, my investments can take care of all my expenses.
  • I hope to get rich quickly, like double my money in 6 months.
  • I want to insure my life. And get money back if I live beyond that insured period.
  • Planning for retirement, as and when and if it comes.
  • I want to retire early, so I need to be prepared.
  • To get enough money to travel the world.
  • Getting initial capital for my business ready.
  • Save taxes as XYZ investment offers tax benefits.
  • Investment? I have started a SIP. And I have company PF. Rest I will begin once I close my personal loan and car loan. And I am planning to upgrade my car next year.
  • I invest because everyone is doing so.
What are your objectives for investing?

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