Let’s talk about Money 💵

Photo by Fabian Blank on Unsplash

Disclaimer: First of all, I am not a certified individual on matters of investing or in general anything. Please do your own research or hire a wealth manager.

Time is a force

Start investing today. We can differ on where to invest and how much to invest. But, no one can deny the fact that early you start better it is.

“The best time to plant a tree was 20 years ago. The second best time is now.” – Chinese Proverb

Most of us, who were lucky enough to have an education ran into a concept called compounding and compounding is the place where the magic happens.


As a thought experiment:
So we put in 10K/monthly for 20 years and that means principal is

Instalment of 10,000/month * 12 = 1,20,000 /year

Invested for 10 years makes it 1,20,000 * 10 = 12,00,000

We stayed invested for next 10 years, that makes total holding time to be of 20 years .

What was the return approximately 40,00,000 Did we just tripled it?

Magic, magic happened. but for it to happen we need to stay invested.

So basically , each year on the money we invested we got a return and that money became the capital for next year. So the trick is time duration, so start early.

Build and fortify your moat
Now where to go, First lets fortify the fort. Good foundation is the key. First of all, we need to get some health insurance cover. You first and then rest of the world. If you take good care of yourself, you will be in a position to help other. Tax benefits are also there.

Second, get a life insurance as well. I prefer term plans. Totally subjective. Also helps in tax.

Next, Save for the retirement. Use the government provided schemes. Whether you want or not, old age will come. Again helps in tax.

Cut the baggage

Baggage only drags you down, slows you. Imagine yourself with two suitcases in each hand trying to catch a running train. You need to drop them to make the cut.

This is easier said than done. Different people, different needs. The mantra is don’t pile up debt.

Live below your means. No don’t sleep on a bunk bed. Don’t cut the heat supply. But spend money wisely. Starbucks coffee is not going to make you richer. Sure, once in a while splurge but be wary of little expenses which are not needed. Little holes can sink the ship.

If you have debt, work actively to get rid of it. Put some money and think time to it. The baggage needs to go lighter, to help you go faster towards your financial goals.

Credit Cards : Good Servant Bad Master ?
Get a credit card with good reward points. It will cost you, but if the points balance out the cost. Helps in building your credit score. Better ability to manage and track funds. Win win. Again, if it is ballooning your debts, cut the card. Cheaper to borrow from friends and family. Still, if possible avoid the debt trap completely.

Modern day PiggyBanks
Now comes the investment chunk. Let’s say we have 100 left to invest where should we put it?

Split it in chunks 40–20–10–10 .These chunks will vary as per your need and research.

40%: Active long term investment

Stock market, it is better to go for mutual funds. Mutual funds are the way to go if you want to invest minus the headache of tracking the market and emotional joyride. Preferably index funds. Because the whole pretext of investing in the market is that market will grow and if the market grows, index grows. Look for funds with low charges lot of earning is diluted in form of fees. Aim for a direct mutual funds. Lower fees.

If you want to dip your hands in market take a further small chunk from this and try your hands. Don’t fall for star investors. Someone can beat the market once, twice maybe even 10 times but eventually market will win. Maybe, if you are in Ocean’s eleven you can time the market

Danny : Because the house always wins. Play long enough, you never change the stakes, the house takes you. Unless, when that perfect hand comes along, you bet big, and then you take the house. — https://www.imdb.com/title/tt0240772/

Invest in Gold: Be the Gold digger

Invest in real estate, yes become a land baron. Don’t try to buy property which you can’t afford, remember run from debt trap. Aim for properties within the financial reach not involving a lot debt.

20%: Rainy day fund

Keep building this doomsday kit. You should have 6 month to 1 year backup build up to keep the lights on. You never know when the zombies will be out for our brains.

10%: Long term safe investment

Invest in government bonds and debt funds, safer lower return. Lot of people advice a switch from equity to debt market as we age. So basically as you age and risk capacity decreases. Increase safe modes of investment and reduce volatile modes of investment.

10%: Go crazy

Crypto anyone? Buy them bitcoins
Risky stocks? Buy them if your research says, this can be a multi-bagger.
Investment in friends business? Who knows, tomorrow in the biography you a re quoted as the visionary.


Nassim Nicholas Taleb(Author of Antifragile), says that 90% of capital should be invested in safe Risk-Free assets and on the other side 10% of the capital for risky investments. So 10% can literally go 0 but if it clicks it will take you to the moon.

The chunks are no golden ratios, so vary it according to your need and risk appetite.

More nuggets

Buy less items. If you really want something, and it is a big investment. Don’t buy it for 30 days and see if you still have the urge to buy it.

Buying things will never get you the satisfaction. We are still kids with the urge for toys. Once we get the toy, it looses the shine. On the other hand if it adds value to your life buy it. Like a standing desk. Phone at the end of the day will be a phone only.

Practice minimalism, simplifying life gives you more time for other things. Empty them cupboards, empty the kitchen and pack stuff or donate.

Wealth is not made by making millions, you need to grow it. Like a tree, you keep watering it to be ready to give you fruits which you can pluck. How about planting more plants. Good to expand into more passive income streams. Stock market, real estate rental, your own published content, training others skill courses.

Go plant some today. 🌲 🌳



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