(The views expressed in this article are his own)

Money management for an individual or a professional fund manager requires a basic theme and strategy as a starting point. Money management is different from taking bets in a bullish equity market. A professional fund manager may manage different funds with different objectives. Accordingly, management of a fixed income fund, a balanced fund, an equity fund or a hybrid fund will each vary widely in style and content. Within each of these categories again there can be many specified variations.

Managing money for an individual (or by an individual) is not different from the professional fund manager's jobs. The preliminary requirement in managing money for an individual is to first define his or her objective. Obviously, this will vary widely with age group, income class, financial liability/obligation, geographical location, etc. Thus, a young professional from a middle class family will have investment objective and return expectations very different from that of a high net worth (HNI) businessman in his (or her) fifties. Individuals can also be conservative or aggressive by nature on managing money. In any case, it is most important to know one's own realistic and natural goals and objectives for managing money. Once that is done honestly, it is not to set difficult to set up a proper plan and mechanism to manage your money.

In the current bull market, it may appear that managing money and doubling it in a few months is easy. A wise man had once defined a 'bull market' as a random market movement causing an investor to himself for a financial genius! Another investor, after several attempts, had defined 'market correction' as the day after you buy stock!

In fact even in the current bull market, a good return from equity investment objective and temptations we should not be either overly optimistic in a bull market or overly pessimistic in a bear market. My slogan for sound personal investment is ''save, insure, spend and Enjoy", an investor should first save for his/her basic needs and then create a portfolio with gradual scaling of risk profile. Thus, an investor should first take full advantage of all assured-return tax efficient investment schemes that are on offer from the government, RBI, post office, insurance companies, etc. once this avenue if fully utilized, the balance investible surplus should be divided between debts and equity investments, based on the risk profile of an investor.

The risk profile of an investor is based on age, health, income group and liabilities. For an average investor, 30:70 formula for equity-debt mix would be advisable for a conservative, long term portfolio. An average should regularly allocate investible surplus in equity and debt in the ratio of 30:70. This discipline of regularly investing, booking profit after reaching target and reinvesting is the key to consistent, safe long-term return. Here, I must add that, while everyone involved with the capital market talks about retail and rural, investors from this category must fully explore the assured return category, before allocating investments in market-related instruments, which entail greater volatility and risk.

The 70-30 mix of debt and equity is for an average investor. The ratio should be adjusted with the risk profile of the investor. Younger or affluent investors can take higher exposure in equity however, protection of core capital without for all investors by my definition, core capital is one in which an investor cannot withstand downward correction without losing sleep.

Those who wish to enjoy the excitement of investing in the stock market directly (this is more so in a bullish market) may earmark 30 per cent of the money for direct investment in the stock market (out of the 30 per cent equity component). However, the balance 70 per cent of the equity component should be invested in sound equity mutual funds. My benchmark for a sound equity mutual fund is consistent, above average performance over a period of time ( and not necessarily

The most important criterion for defining investment objective and expectation is to have a control on greed and temptations

The best at a given point of time) from a fund house, having excellent track record as a reliable, stable, transparent player. Out of the 70 per cent to be allocated in fixed income, 10-20 per cent may be put in bank deposits. Bank deposit is necessary to make payments through cheques, credit/debit cards, ATM facilities. The balance should be Invested in good fixed income mutual funds. An overall personal investment portfolio is never complete without a plan for spending the fruits of investment. It is important to spend in a should use part of the savings/ investments as margin to own property for shelter over one's head and then for assets of essential comforts consumer durables, vehicles or even personal/education loans when required.

The strategy above provides, for a built-in-asset allocation formula. Interestingly, the men-folks in rural India have traditionally, parked their savings in cattle and land, while the women folks in gold. This is a great social ethosdriven asset allocation for long term investment, without formal training, rural investors have thus adopted a good investment strategy. Old wisdom is the basils of this sound, grass-root investment plan. However, as liberalization and sophistication improves, geographical diversification by way of cross border investment in each asset class for the HNI category will become important and essential.

Managing money is, thus a systematic, regular, consistent, planned approach in different asset class. Managing money is "not like flying an aeroplane; Hours boredom interrupted by moment of intense activity". A disciplined approach to managing money can profitable let you have your cake and eat it too. The "Save, Insure, Spend and Enjoy" strategy of managing money can then become the money manager's formula for "Healthy, Wealthy and Wish" life.