Financephobic: Why Zerodha messed up by hiring me

It is 2017.

I’m sitting on a gleaming warm-white Western commode, lid down, pants up, listlessly playing a tower defence game that I have already been bored of for a week. My cheeks throb with the dull, twitchy ache you sometimes get after many days without sleep. I barely register the animated fireworks on my phone that reward me with three pixelated diamonds for clearing level thirty-nine. I’ve seen too many of these. They’re familiar now. Stale. Joyless.

My stomach is fine. I just need a break. I am a second-year Associate at a prestigious law firm, pushing three companies through hundred-million-dollar deals. My work usually runs late, and tonight, it’s getting to me. It is already 11 PM. The clamour of the office has died down. Its halls are now filled with a clickety-clack chorus from the keyboards of two hundred corporate lawyers in a hurry to get home. They’re lucky. My smiling, toad-faced Principal Associate has just sentenced me to four more hours of work. It’s another sleepless night.

So I steal fifteen minutes for myself and pretend to use the loo. It’s the one break I can demand. A quick game in the sterile, scented environs of the office bathroom usually lifts my spirits. It isn’t working today, though. I’ve become numb to the game, and besides, all the work has run me down. I need another distraction.

The only real perk to this life is the money. They pay you well. A little too much, to be honest, at least at the age of twenty-three. Not that it lasts. I’ve already learnt to spend it all, on upscale restaurants, full-grain leather shoes and double chocolate ice-blended coffees. I am broke at the end of every month.

It was fun at first. There was a heady excitement to spending a lot and finding that I was still fine. Not any more. Big purchases now feel like a third slice of cake, when the sugar no longer gives you a kick, but every bite fills you with shame. And besides, my friends are getting concerned. Only last week, Dhiraj sat me down and told me to save my money and invest it instead.

Annoying as he is, you always listen to Dhiraj. He knows things. He doesn’t talk, he gives speeches. He packs every conversation with pointed facts and numbers, and because getting a word in would take research, you shut up and resent him instead. Last week, he went on – about how financial independence could set me free, how wealth grows by compounding, and how betting on the economy is the smartest decision I could take. All important, useful, actionable stuff. Damn the well-intentioned.

But I tried. I swear I tried. I downloaded an investment app and completed my KYC, and then I began Googling how to select a mutual fund. Dear lord, why did I bother? The internet lectured blandly: check returns for three years, and ten years, and fifteen years, and check the exit load, and research the fund house, and research the asset manager… yeah, not a chance. I throw money to kill boredom. I won’t tolerate boredom to earn it back.

Tonight, though, I’m at boredom’s mercy. I’m still tapping mindlessly at my screen, barely registering the green, two millimeter-tall monsters determined to storm my castle, when the app throws up an advertisement. A thirty second, unskippable advertisement for a new, gimmicky dating app, full of generic cool, young people hanging out and flashing lifeless, psychopath-like smiles. I shut it in disgust.

My restlessness still gnaws at me. I perhaps have another ten minutes away from my desk before people notice my absence, and I’m determined to take them. I swipe through my phone, from top to bottom and back again, hoping for something to pop up. Something bite sized and entertaining, something that takes no effort but rejuvenates me instantly. Nothing does. I do, however, see my investment app. It is what I’ve last downloaded. It sits right at the end of my queue of apps, ignored and unloved.

I tap on it. Instantly, my eyes glaze over.

The app assaults me with dense phrases and numbers. It begins with a dashboard announcing that I haven’t invested a single rupee, and then immediately opens into a bouquet of investments. Large-cap funds. Small-cap funds. Liquid funds. Debt funds. Gold funds. Retirement funds. Tax saver funds. A pop-up asks me the kind of investor I am. I’ll be damned if I know. I tap, almost at random, to find myself in a menu of mutual funds. I pick one. Instantly, there is a heap of figures before me. NAV. CAGR. AUM. Exit Load. Expense Ratio. There is a graph in the middle with two dancing lines – a blue one, the benchmark, and a yellow one, the fund. They intertwine like mating snakes. Sometimes the blue line is on top. Sometimes the yellow one. Is this a good fund? I have no idea. I now have five minutes to spare. How will I ever know what any of it means!

On the top right corner, however, are stars. Four of them, to be precise. I don’t understand much, but I understand star ratings. And four, as far as I know, is a respectable number of stars.

And so, I buy. I put in ten thousand bucks into my maiden purchase of a mutual fund. A giant green tick mark announces that the transaction is through, and immediately, I feel a thrill run through me. I now have an investment. A little nest egg. It’s a big expense, but the expense makes me feel responsible. It is intoxicating. Like shopping, but you get to keep the money.

I get up, turn the flush to keep up appearances – just in case someone was listening outside – and then head back to my desk. Though the night is long, for now, the stress feels bearable.

---

I chase this feeling for months. When I have money to spare, I push it into a mutual fund. I look at my portfolio often, noting every slight movement. 2017 was a good year, and on more days than not, I earn a couple of hundred bucks without lifting a finger. Every jump upwards gives me a kick.

Buying new funds is my main thrill. I don’t use SIPs. I enjoy the process. Someone once told me about diversification, and I figured that the smartest thing to do was to buy a piece of every fund I could and then forget about it. And so, at the start of every month, I sit with my phone and flip through funds. Four stars and five stars, all. I don’t research. I don’t plan. I buy anything that looks nice. Investing is a drug. It feels like rebellion. Instead of expensive watches and clothes, I keep money for things that really matter.

I no longer feel like an irresponsible child drunk on money. I’m now a prudent, mature adult.

I meet Dhiraj many months later, at his palatial house in Noida. Another friend of his, Tarun, is over. We speak about enjoyable nonsense – politics and cricket and funny videos we have watched. Dhiraj is his usual bulldozer self. Tarun, having newly met me, is sugary-sweet.

As the afternoon drifts on, we run out of regular things to talk about. Our conversation turns to the banal. Financial planning. Investments. For the first time ever, I am eager to contribute. After all, I’ve built up a nice little corpus myself.

But when they speak, I feel out of place. What they say goes over my head. Dhiraj explains, in detail, why he moved from one mid-cap fund to another. Tarun muses idly about investing in a US-based fund. The two debate sector allocations and geographical risk. It is all very meticulous. Almost scholarly. I feel an uncomfortable tingle in my spine. All my blind bets, I suddenly suspect, were poorly thought-out.

“Guys,” I ask tentatively. “Is it bad to invest in too many mutual funds?”

“Well, it really depends?” Tarun responds. “You pick different funds based on your goals.”

“Right… But still, what’s a good number to have?”

“My mom’s made me invest since I got to college, so I have eight or nine now. But you should start with two or three. Go from there.” Tarun says.

A pit forms in my stomach. I mutter a thanks and Tarun gives me a friendly nod. Dhiraj, though, catches on to something being wrong.

“What have you done?” he asks me, with the terrifying sternness of a school headmaster.

“Nothing” I falter. “Just spread my investments a little thin.”

“How many?” he prods. I try offering a non-committal reply. He pushes on. “Tell me. How many?”

“T-twenty four?”

“What!” Dhiraj spits sharply. Tarun, too, sits up, his eyes wide with bemusement.

I look at both of them blankly.

“He probably means stocks or something.” Tarun says mildly, defending me out of first-meeting politeness.

“Do you mean stocks?” Dhiraj shoots at me.

“Uh… No. Mutual funds.” I reply.

“Twenty four! What is wrong with you!?” Dhiraj exclaims. His face is contorted into a mix of annoyance and concern.

I gape wordlessly. There’s a pause. Both stare at me, nonplussed.

“ABBBEEEY GADHEY!” (T: YOU DONKEY!) Dhiraj finally yells at the top of his voice, before abruptly breaking into a ringing, full-throated guffaw. Tarun shakes off his politeness as well, grinning widely.

I try thinking up something clever to save myself a shred of dignity, but it’s already too late. Dhiraj attempts to explain why too many funds are counterproductive with a straight face, but he keeps breaking into laughter, loudly exclaiming “kaisa hai bey tu!” (T: What sort of a person are you?). Tarun looks on, cackling everytime Dhiraj’s exasperation crosses a threshold. I keep my gaze fixed downwards. I am mortified. Even when I try being smart, it seems, I do it in the daftest way possible.

---

I think I am financephobic.

I abhor finance. Maybe not the field itself – I don’t understand it at all – just how it feels. Numbers, percentages, ratios, tables, ledgers… they all seem alien. Frigid. Lifeless. They conjure up spine-chilling images of careful, detail-oriented men in three-buttoned suits and thick-rimmed glasses, mumbling about the innards of a spreadsheet. Intellectually, I know financial decisions are important. I still find them revolting. I usually take whatever option would require me to think the least.

The problem, as you might have guessed, is that I’ve somehow gotten myself a job at Zerodha. India’s largest stockbroker. A company that lives and breathes finance. 

And I have no idea what I’m doing. 

This wasn’t a secret. I swear. I didn’t lie. I put it to them straight during my interview: I am clueless about the financial world, and besides, I’m not a very clever person. They didn’t listen. They perhaps thought I showed radical honesty, like Raju Rastogi from 3 Idiots, so they actually hired me. Bless their poor, naive souls. 

Now, though, I’m living through the part they don’t show in the movie. The part where Raju goes to office for the first time and his smile is ripped right off his face as he sees, clearly, why he should have studied all those years. The part where he wanders zombie-like from conversation to conversation, his brain unable to string together words he does not comprehend. The part when it dawns on him, at last, that his entire career now depends on understanding that the way an induction motor starts is not “vroom vroom”. 

I’m clueless. I’m disoriented. I’m overwhelmed. And everyone here is a god damned Rancho. 

The disgusting truth, though, is that you can’t really escape finance. I have been foolish with money for all my adult life, and my incompetence cuts a little deeper every year. My peers, meanwhile, have taken care of their money for almost a decade now. They are well ahead of me. The things they do – buying nice cars, travelling to exotic countries, putting down payments on a house – are all, to me, distant fantasies. They’re still things that I imagine I’ll do when I “grow up.” Only, I’m a whisker under thirty, and the quality of my life is still comparable to what it was in college.

I spend far too much, buying things I don’t need. I’ve never made myself a budget. My strategy, I think, is to purchase and then pray that I still have enough. I have just a single bank account, no frills, which came with my first job. They gave me a nice credit card too, but I never used it so it lapsed. I didn’t have health insurance until recently. Same with investing: I just stopped, mid-way, and never started again. I have only a hazy clue of what I earn. All through my last job, I thought I was earning five thousand bucks more than I actually was. I simply never paid attention.

I need to get a grip. I need to understand how to take charge of my own financial life. From scratch. 

Luckily, I work at Zerodha. My colleagues are money insiders. They don’t just see money when they get paid, or when they buy things. They’re at the back end, observing as awe-inducing mountains of capital snakes its way through the entire financial system. They understand money the way a plumber understands water. It’s intimidating for a dullard like me, but there’s a lot that I can learn. 

In this series, I’ll try fixing my financial life. And I’ll share what I learn with you. 

It’ll all be basic, of course. At my level. I don’t know how to beat the market – heck, I’m not too sure of what the “market” is. If you’re the kind of person that reads their stock broker’s blog posts (and evidently, you are), you probably already know a lot of what I’ll write on. 

But you’re probably the Dhiraj to some other financephobe, exasperated at how little they seem to understand or care about something so crucial to their lives. Send them here. I can speak to them at their level. After all, I’m just like them.

I’ll see you in the next one.