In a special 50th episode of the Simple Hai! show, Vishal Kapoor reflected on his 30 years in the financial services industry, marking the 25th anniversary of Bandhan AMC. Speaking to senior finance journalist Vivek Law, he explained how India's economic progress has shifted investor behaviour from "scarcity thinking" to "adequacy thinking." He stressed the importance of long-term investing and early financial discipline and reflected on three decades of change in India's mutual fund industry.
Evolution of Mutual Fund Investing
Law began by asking Kapoor about the state of the mutual fund industry when he entered the sector in the mid-1990s. Kapoor said that India was still in the early stages of economic reform, facing "birth banks related challenges." At that time, investors were more safety-conscious and less risk-taking, as they couldn't afford to take on risks.
Comparing the past with the present, Kapoor noted that today's investors, with a per capita GDP nearly 10 times higher than 25 years ago, can afford to take on greater risks.
Challenge of Holding Periods
When Law raised the issue of SIPs often stopping during market corrections, Kapoor acknowledged that although challenges remain, investors today show greater maturity. He explained that in the last four to five years, market volatility had only a "mild" impact on SIP flows, unlike 15–16 years ago.
Kapoor attributed this maturity to two factors: India's economic progress, which reduces scarcity, and increased awareness created by the media, regulators, and digital content.
However, Kapoor admitted that the real challenge was not participation but "the tenure or length of holding." He noted that almost half of equity investors exit within two to three years, despite expert advice to hold longer. "In chasing returns, we end up compounding the issue," he said, cautioning that excessive activity in investing often destroys returns. A quality fund, if held for 20–25 years, would deliver far better outcomes than constant switching, he added.
Overcoming Procrastination in Investing
Law observed that while people are careful about spending, they often make poor investment choices, buying high and selling low. Kapoor said this stems from the misconception that a large amount is needed to start investing. Even with as little as ₹50, investors can begin their journey, he explained.
He emphasised that waiting for the "right time" or a "tip" only delays progress. "You have to start early; don't keep procrastinating with these types of arguments," he advised, reminding viewers of the golden years of compounding lost to indecision.
Power of SWP and Financial Freedom
Law highlighted Bandhan’s investor-focused campaigns, particularly the "Salary Wala Plan", which he himself had used. Kapoor described the Systematic Withdrawal Plan (SWP) as a "powerful feature" that provides investors with regular withdrawals, allowing the remaining corpus to continue compounding.
"Investing is not only about sacrifices; investing is also about financial freedom," Kapoor said, stressing that wealth should be enjoyed, not merely accumulated. He explained that a substantial corpus brings "relief, confidence, and joy," and that SWP offers a flexible, tax-efficient, and convenient replacement for salary, especially during early retirement, job loss, or entrepreneurship.
When Law pointed out that elderly investors are becoming "stingy" and insecure despite having wealth, Kapoor pointed out that SWP reassures them that their corpus can sustain them for "120–130 years," giving them the freedom to enjoy life.
Personal Journey and Influences
When asked about his career path, Kapoor agreed that joining the mutual fund industry was never part of his plan. A project during his MBA at IIM Ahmedabad led to his recruitment by a multinational company to set up a mutual fund. This early exposure allowed him to build a fund house from the ground up, a "blessing" in what he called a sunrise industry.
Kapoor said that he believes in "retiring from work, not from life." With the right financial planning, he suggested that individuals could aim to build a corpus by 40, use SWP for income, and pursue meaningful passions.
Investing and Financial Freedom with Vishal Kapoor
The conversation between Law and Kapoor traced three decades of transformation in India's mutual fund landscape. Kapoor emphasised how rising incomes and awareness have created a more mature investor class, although short holding periods remain a challenge. He strongly advocated starting small and early, avoiding market timing, and relying on the power of compounding. Most significantly, he championed SWP as a tool that transforms investing from a sacrifice into a path to financial freedom and choice.
The episode offered valuable lessons on patience, discipline, and enjoying wealth while building it, making it a must-listen for anyone serious about financial independence.
