POSTED BY June 4, 2018 COMMENTS (35)ON
Do you want to read the story of an investor who has tripled his networth in just 8 yrs and learn about his great skills in financial planning?
We bring you the money story of one of our readers from Pune, who agreend to share about his life journey and his acheivements. Over to him …
First let me start by thanking you and Jagoinvestor team for running this great learning portal (Jagoinvestor) and giving me an opportunity to tell my money story which may help some of the readers.
Little bit about my family
To give you some quick background on myself, I live in Pune and I am an IT architect by profession working with Wipro. I come from an upper middle-class background with my father (passed away last year) been a banker and mother being housewife.
I also have a younger sister who has been married and well-settled. I have been married with a 4- year old kid now and my wife takes care of home.
My introduction to money management started at very early age. My father and mother were always advising us both kids to spend it right and all genuine/reasonable demands were met. However, we didn’t get any pocket money any time as we had been asked to ask for our needs and no money was just given to spend as we like.
Even during my teens, we had a simple practice of giving complete account to mother/father for the money that was given to buy any items. So, I have always valued money to be spent and would continue to do that with my kid.
My father was also a good investor in his time even with no internet and mobile phones available. He had invested in some stocks, some land/flat, FDs and PPF during my growing up days. As a kid, when I used to see him receive cheques for shares dividends for paltry sums, I used to ask him what is this that you keep receiving. He used to tell me that you will understand more with time.
So, the curiosity started very early.
My hands-on work in personal finance and financial planning space began when I started working in Bangalore at a very low salary (~10K in hand) and was always trying to see the best I could make out of it in terms of savings. To me, money saved was always money earned.
So, I looked up on all possible legal ways of reducing income tax to start with and then investments in other avenues. It also gave me great boost that all friends used to ask me on how best to save taxes. Later, I did the same even when I was outside India by understanding IT laws of that country and ensuring I only paid required taxes.
As my interest grew in financial planning, I started covering all bases including insurance policies, PPF investments. Interest in investments led to Stocks, MF, real estate and eventually Portfolio Management Services (PMS).
For fixed income instruments, I keep some investments in Sukanya Samruddhi, NPS, FD and of course PF. Had created cash inflow/outflow projections for next 20 years and my estimated expenses at various stages considering inflation.
This has led to investing as per goals at various stages like buying flat, child’s education expense at age of 15, 18, 21 and then marriage, retirement corpus etc.
From where I started (10K per month salary with zero bank balance) 15 years back to today with well-over 6 figures take home salary, of course the salary has grown many folds but then expenses have too. My net worth has tripled in last 7-8 years (my salary went up by 50% in that time), Stocks/MF/PMS portfolio stands over 1 cr, 2 flats owned.
Money attracts money and so, more investments I made, more returns I got. I bought a flat with no home loan few years back because of the investments made and that gave me great satisfaction.
My Equation with money
In one sentence, my equation with money is to maximise my potential. Be it earning through all legal means or maximising returns on my investments. Money has and will always be important to me just like others. Having enough money to me means all needs (and not necessarily all wishes) at different stages are met with ease.
Spending money to me means that every rupee spent is worth the object to be bought. When I meet either of these, I am a happy and content man. If I fail on either one, it’s not losing money which troubles me but it’s the standard/process that I couldn’t follow which led to loss of money.
My primary experience with money is that you need to be diligent with money management. When I was not diligent enough with couple of investments, I made bad calls and lost money. Similarly, informed decisions in investments have given me substantial returns. Like other aspects in life, Wealth creation takes time and knowledge.
You have to be alert and keep reading to understand views from experts. Blogs like Jagoinvestor help a lot when you start on this journey.
Money is not everything as they say but not having enough money brings everyday problems, I believe.
People crib about not earning enough but they don’t know how to manage and invest what they are earning which leads to higher dissatisfaction. Then come compromises on various needs which have butterfly effect on other aspects of life.
I have seen someone in my family who has retired from a very high post in Income Tax department, still doesn’t even own a single house and not enough retirement kitty which ssahows not being diligent enough with money management. He lost money in bad investments with no tracking and his family simply loved spending on shopping time and again.
Then came excuses and defensive attitude. That’s the worst case of lack of money management that I have seen around.
While I am still learning, there are some experiences/habits/learnings which have helped me and would like to share –
So, that’s it, folks. Hope my story helps some of you and you can benefit from learnings/best practices I shared. Would like your views on areas that you think I might be able to do better in money management.
What is your money story?
I hope everyone has learned a lot from his story.
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