How millennials can make Diwali their wealth-building season

There's a particular kind of WhatsApp message that arrives every October. Screenshots of online shopping carts. Vacation bookings to Goa. Plans for the "Diwali break". The underlying message is always the same: it's time to spend. For millennials, Diwali has become something different from what their parents experienced. It's less about gold coins from elders and more about curated gifting, experiential celebrations, and that annual bonus burning a hole in the bank account.

But here's what's quietly changing: a growing number of young professionals are asking a different question. Not "How much can we spend this Diwali?" but "How can we use this season to actually build wealth?"

The Millennial Money Paradox

We're a generation that's digitally savvy and willing to explore new investment avenues. Investors under 35 now account for nearly 40 percent of new mutual fund SIP accounts. Yet we struggle with something our parents didn't face: the relentless pressure to maintain a certain lifestyle.

Every Instagram story reminds you of someone's upgrade - the new car, the Bali trip, the designer purchase. Diwali amplifies this tension. The bonus arrives. The sales begin. And suddenly, wealth-building takes a backseat to keeping up.

Take Aditi, a 29-year-old consultant. Last Diwali, she spent nearly her entire bonus on gifts, gadgets, and travel. This year, she’s decided differently her first step was opening a SIP. “I realised the joy of gifting lasts a week. The relief of knowing my money is growing? That’s permanent,” she says.

Why Diwali Actually Works for Wealth Building

What if the festival season could accelerate your financial goals instead of derailing them?

The bonus timing advantage: Most companies pay bonuses between September and November. The mistake is spending first and investing whatever remains (spoiler: it's usually nothing). The strategy that works? Invest first, celebrate with what's left.

The psychological fresh start: Diwali carries the symbolism of new beginnings. Starting a SIP during Diwali isn't just financially sound but it feels right. That emotional alignment makes sticking to it easier six months down the line when motivation fades.

The forced decision point: Festival season creates a binary choice. Either the bonus disappears into consumption, or it gets deployed strategically. This clarity can work in your favor if you plan ahead.

The Practical Framework

The 50-30-20 festival formula:

● 50% toward investments before any celebration spending begins

● 30% for festival celebrations, gifts, and experiences

● 20% as a liquid buffer for unexpected expenses

This isn't about sacrificing joy for savings. It's about ensuring wealth-building happens first, then celebrating with genuine freedom from guilt.

Automate before you celebrate: Set up the SIPs, make the investments, lock in the wealth-building moves before your first festival purchase. Once it's automated, spending the remaining amount carries no guilt because the important stuff already happened.

What This Actually Looks Like

Say you receive a ₹1 lakh bonus. The traditional approach: spend ₹70,000 on celebrations, invest whatever remains (which somehow never materializes because that one extra thing always comes up).

The wealth-building approach: Immediately invest ₹50,000 across SIPs, digital gold, and a debt fund. Keep ₹30,000 for celebrations still generous for gifts, travel, and enjoyment. Park ₹20,000 in a liquid fund.

The celebration doesn't feel diminished. Your Instagram stories are just as festive. But wealth-building happened first, not as an afterthought with leftover money that doesn't exist.

The Compounding Diwali Effect

Here's where it gets interesting. Make Diwali your annual wealth-building reset. One year becomes five. Five years becomes a decade.

Start a ₹5,000 monthly SIP this Diwali. Add to it every subsequent Diwali with part of your bonus. Ten years from now, that discipline compounds into something significant—not just money, but the kind of financial confidence that lets you sleep peacefully at 2 AM instead of doom-scrolling through EMI calculations.

The millennials who'll thrive financially aren't necessarily those earning the most. They're the ones who figured out that wealth-building doesn't require sacrifice, it requires sequencing.

What This Season Could Mean

Diwali will always be about celebration. The lights, the family gathering, the joy of wearing new clothes none of that changes. What can change is the financial legacy you build alongside the celebration. Every Diwali bonus is a choice. Spend it all and start next year from the same financial position, or use it as an annual wealth-building accelerator while still celebrating fully. This Diwali could be just another expensive festival season. Or it could be the beginning of something different: a pattern of using cultural moments for financial momentum, of being genuinely present for festivities because the wealth-building already happened.

The choice, as always, is yours. But this opportunity? It arrives just once a year, wrapped in festival lights and carrying potential for something more lasting than any shopping cart could provide.

(Views are personal; the author is Joint Chairman and MD at BajajCapital)