Laxmi Ji or Saraswati Ji – Whom Should You Worship for Wealth?

Last Updated on April 9, 2026 by teamtfl

“An investment in knowledge pays the best interest.” – Benjamin Franklin

My grandmother never went to school beyond Class 5. She raised seven children, ran a household on a modest income, and never once opened a mutual fund account. But by the time she passed, she owned a small piece of land, a fully paid home, and enough savings to distribute to each of her children.

How? She kept separate envelopes for every expense – food, school fees, festival, repair. She spent only from the right envelope. She saved first, spent later. She never mixed money meant for different purposes.

She had never heard the words “financial planning.” But she had worshipped Saraswati – in the most practical way possible. And Lakshmi followed.

India’s Great Savings Paradox

India’s household savings rate is consistently between 20-24% of income – among the highest in the world. More than Germany. More than the United States.

And yet we are not among the wealthiest nations per capita. We save more than most. We end up with less than we should.

Why? Because saving and investing wisely are two completely different skills. One is discipline. The other is knowledge.

According to SEBI’s Household Finance Survey, approximately 55-60% of Indian household financial savings still sit in bank deposits, post office schemes, and traditional insurance policies. These instruments, after accounting for tax and inflation, often provide zero or negative real returns. We are saving diligently – and then storing those savings in instruments that quietly erode them.

Saraswati has been neglected. And so, despite Lakshmi visiting regularly through our salaries, she does not stay.

What Equity Has Done Over Time – The Proof

When this article was first written in 2009, the Sensex had just doubled from 8,000 to 17,000 in under six months after the 2008 crash. It seemed like an extraordinary recovery at the time.

Today in 2026, that same Sensex stands near 75,000.

The investors who understood equity – who bought consistently through 2008, 2011, 2015, 2018, 2020, and 2022 – multiplied their wealth several times over from that post-crash level. The investors who treated equity as speculation and kept rotating back to FDs have, at best, preserved purchasing power.

Long-term equity performance is not theory. It is a 40-year Indian fact. The variable is not whether equity works. The variable is whether the investor has the knowledge and temperament to hold through the years when it does not.

The Wealth Difference Knowledge Makes

Why We Invest Where We Feel Comfortable, Not Where It Works

There is a well-documented pattern in Indian investing. In FY 2007-08, when markets were near their peak at 21,000, equity mutual fund inflows were at an all-time high. In 2002, when the Sensex was at 3,000 – genuinely cheap by any measure – we were barely investing in equity at all.

We buy when it feels safe. We avoid when it feels dangerous. And “feels” is driven entirely by recent experience, not by fundamentals.

Psychologists call this the Dunning-Kruger Effect combined with Familiarity Bias. The Dunning-Kruger Effect (Kruger & Dunning, 1999) is the finding that people with low knowledge in a domain tend to overestimate their competence. In investing, this is devastating. SEBI’s 2023 study found that 89% of individual F&O traders lose money – yet most of them entered with confidence they understood the markets.

Familiarity Bias explains why Indians over-invest in gold and FDs. We “know” gold. Our grandmothers bought gold. It feels safe. The fact that gold has significantly underperformed equity over long time horizons is irrelevant to this feeling – because the feeling is driven by familiarity, not analysis.

The solution is not courage. It is knowledge. When you understand why equity outperforms over long periods, you no longer need courage to stay invested during a crash. You simply stay invested because you understand what is happening.

What Worshipping Saraswati Actually Looks Like

It does not mean reading research reports every week. Most investors who read too much actually perform worse – they trade more, react to noise, and underperform simple SIP investors who check their portfolio quarterly.

It means understanding a few foundational truths and never forgetting them. Markets go up and down in short periods. They go up in long periods. Inflation is the silent thief that destroys savings kept in low-return instruments. Time in the market beats timing the market. A diversified equity mutual fund portfolio, left alone for 15-20 years, has never lost money in the Indian market’s history.

That is the entire curriculum. The investors who internalize these five truths and act on them consistently will retire wealthy. The ones who don’t – regardless of their income – will struggle.

“If you find your investment exciting and you are having fun, you are probably not making money. Good investments are always boring.”

– Hemant Beniwal, CFP, CTEP | Founder, RetireWise

Read next: Holding Period and Investment Risk – What 38 Years of Sensex Data Actually Shows

My grandmother’s envelope system was not sophisticated. But it was built on understanding – knowing where the money was going, and why. That knowledge kept Lakshmi in the house for a lifetime.

First worship Saraswati. Lakshmi will herself come to your doors.