Mastering Financial Fitness: Building a Robust Relationship with Your Finances

By Nishchay Ag

Financial stability plays a crucial role in one’s ability to maintain overall well-being. Those with a solid financial foundation are often better equipped to address challenges promptly, accessing high-quality care for all their needs without any delays. And the first step starts with cultivating a sense of financial security in order to secure one’s quality of life.

Why Small Steps Count

For those who typically struggle to save, it is essential to realise that savings need not necessarily begin with big amounts. There are various savings options, including micro-savings, daily savings, purchasing gold digitally, etc. For instance, a micro-savings account in a microfinance branch comprises a small deposit account for families or individuals having low-income to park funds for potential use later. While a micro-savings account can be operated like a standard savings account, it is structured around much smaller amounts. The minimum balance requirement is usually waived so consumers may save small amounts of money without being charged for the service.

In developing geographies, micro-savings plans are provided as a way of encouraging savings for educational purposes or other upcoming investments. The rationale for micro-savings is simple – people who invest in such programmes are better placed to deal with unexpected expenses that usually affect those with low income. In this context, one rarely publicised benefit is the potential of micro-savings via gold purchased digitally.

The Significance of Buying Gold Digitally

With the rise of digitisation and as digital-first natives like millennials and Gen Zs enter the earning cohort, studies show a decline in physical store purchases even for products like jewelry. Being digital natives, young Indians are more inclined to purchase precious metals, like gold, speedily through digital means. With the proliferation of fintech platforms, gold can now be purchased online, making it a safe and secure investment option.

A KPMG report reveals that the digital gold market size in India is anticipated to touch $100 billion by 2025, driven mainly by the rising adoption of fintech platforms and the increasing awareness among young investors of gold as the starting step to their financial security journeys. Another report notes that India had 16 firms offering digital gold products in 2023, holding an estimated 5 to 6 million active gold accounts.

Nonetheless, for younger investors who may be wary of purchasing digital gold products, there is an exciting alternative without the conventional risks associated with big-ticket, one-time purchases. Instead, a premier platform for buying gold digitally has gamified the habit of savings and investments by making it more tangible and engaging for users.

In this savings scheme, the seamless investment takes only 45 seconds by permitting customers to begin saving with as low as ₹10 in 24K, 99.9% pure gold.  The autopay savings feature ensures that users can set up recurring deposits with ease, allowing their savings to grow automatically without needing frequent manual interventions, simplifying financial planning by ensuring convenience and security in the process.

For an average Indian, gold is an asset class that is easy to understand and trust and by transforming it into an accessible and straightforward savings tool, it helps them foster a saving habit while removing any psychological barriers that stand in the way of their investments.

The Incremental Power of Compounding

Based on the traditional piggy bank, this simple method empowers users to create wealth incrementally over months and years by leveraging the compounding nature of gold as an asset class. To strengthen the savings behaviour, the platform even encourages and rewards its users for consistency, reinforcing the winning habit over time.

To elaborate, a user may not have opened the app in months and, instead, only set up a few SIPs. While other apps may simply display the status of this user’s portfolio, the app for buying gold digitally will provide precise savings details for the specific period of inactivity. In essence, it highlights the amount of gold the person has accumulated during this inactive period. Surprised by the incremental savings, users are encouraged to save more simply by showcasing their immediate savings growth.

Users are then nudged towards daily savings via gamified engagement and interactive flows. Tangible improvements are also triggered since user awareness is boosted regarding their savings habits. By the fourth month, many users have noticed an uptick in their savings appetite by 10-     20% more than what they did when they began.

By the end of year one, the savings can almost double. Within two years, users may save nearly 1.7x more than what was invested initially. Slowly but surely, their savings habit grows through constant nudges and the reinforcement of good savings behaviour. Ultimately, users’ savings journey that commenced with a single step ends up with many memorable milestones etched in 24K gold. Perhaps there is no better way to emphasize the incredible power of compounding!

Building a strong foundation for financial fitness can begin with a small step, a step that encourages a habit of saving by leveraging gold’s historical nature of value appreciation. Such a habit ties the timeless value of gold to the pursuit of a secure and resilient financial future.

(The author is Nishchay Ag, CEO and Co-founder of Jar, and the views expressed in this article are his own)