From “ZERO savings” to “Debt FREE house”

POSTED BY Jagoinvestor ON September 22, 2019 COMMENTS (15)

Here is an interesting financial journey of one of our readers who went from “zero savings” to “debt free house owner” .. I would like to handover to him directly so that he can share more about his journey and thought process.

Hello All, Rahul here.

I was born in typical middle-class family where my father has spent around 32 years serving as professor in government college and mother is housemaker. I have completed my Masters in computer science and secured a job in multinational IT company.

All is NOT set

Like everyone who enters in his first job with good company after completion of college, it was looking “All is SET”. But when I started looking around and inside, I was feeling that something is not what I was expecting. My salary was finishing by mid of the month.

Savings were ZERO.

zero savings and investments

Rest of the month was either going on credit-card or killing daily needs. When I looked around in first year of my job, I found that I am not the exception and same is situation with all my colleagues who joined with me. Also, in first three years after talking with my school and college friends I observed that situation is same across almost all my friends either they were doctors, lawyers, IT engineers or self-employed who were earning excellent amount.

What was wrong?


Fortunately, from my college time, I had ample amount of interest in finance specially in wealth management. I realized at that point of time I read multiple bogs and books on personal finance but never applied them. Once I started my job and money started flowing, I thought irrespective of my low expenses – money would be over one day and that was devastating thought.

I have never saved for future in first two year, borrowed by credit card and in next month paid all my expenses which were already done in past.

Before I move ahead, if you think changing habits and continue progress on this is easy please see below video link:


My wealth issues provoked me to jot down each basic principles of personal finance three times and started following them. Those were :

Step #1 : Saving

As per basic rule of personal finance I changed my equation from :

Saving = Earning – Spending to Spending = Earning – Saving

In summary I need to save before I spend. As soon as I would receive my salary 30% of that I would save, 50% would be for necessities and rest 20% for splurging (for different people percentage would defer).

Step #2 : Start Investing

As I was avid reader on personal finance it was known fact to me that only saving is not going to help me. Inflation would eat all my savings. My savings needs to grow. It needs to be invested at some place where even if I am not present my money is growing.

Initially I invested in tax saving instruments like PPF, NSC, ULIP policy. At the end of fifth year of my job I realized that even though I am saving tax that become my main focus instead of investment. I need proper solution which solve my both the goals.

Step #3 : Equity investment

Meanwhile in addition to different blogs like JagoInvestor (, I read three books which completely changed my view on wealth (which was money till then). I read them again and again and implementation of lessons in those completely changed my life.

Book one : The Richest Man in Babylon – I was (few of) in luckiest people who came across this book. When implemented lessons in this which are given in form of stories, I was able to grow my wealth, was more wiser while handling my finances and had tools like life insurance, medical insurance to safeguard it.

Book two : The Intelligent Investor – When I read this book first time I was not that much convinced (as Warren Buffet was) but this book has done wonder in my life.

I tilted towards my favorite investment instruments – Equities/Share market. I re-read that book and took multiple lessons from it specially “Margin of safety” and “Theory of Mr. Market who is manic-depressive with his estimate of the business’s value going from very pessimistic to wildly optimistic.”

I have started making good fortune with this. My investments were growing and wealth was generating more wealth without much of my active presence. Still I was feeling that I am making lots of financial mistakes. I have closed my ULIP policy as that was one of my worst financial mistake.

Still I was loosing fortune. Stocks which I was selling on 20-30 percent profit were becoming 10-12 times of my purchase price while many of my stocks were sitting idle in my portfolio either with zero or negative returns.

Here I came across something which changed my investment approach completely. I got my (imaginary) mentor “Charlie Munger”. I heard speeches of Charlie Munger” and finally read his book :

Book three : Poor Charlie’s Almanack – After listening and reading to Munger I found where exactly I was lacking. Ideas were not complex, but I never realized I am in simple but wildly affecting traps. Those were “Heuristic Biases” .

Those were as simple as If I am trying to search a flat for rent, broker would show me first two flat which I would directly reject (broker already knows that) and in last would show which I would exactly looking for. I would say immediate ‘Yes’ (hindsight bias). If he might have shown me last flat as first I might have asked to show him better flats. Same things were happening in personal finances as well.

My so called financial advisers (originally salesmen) were showing me financial products which they know I would reject and later showing something for which I would say …Yes….and would later realize, in market hundreds of much better options were available.

I started grasping different biases which impact our financial decisions like confirmation bias, red queen effect, social-proof which are close to hundred and still practicing them.

Now I have a solid Value Investor portfolio with which I say “Value Investment plus approach”. In addition to cigar butt approach it has margin of safety of Graham, growth prospects for which I paid more and management quality as top three priorities.

After 12 yrs, How it helped me?

Life after Debt

After 12 years of IT experience and practicing savings, investment and controlling different biases I have benefited on all aspects of my life :

  • On financial front I am feeling completely secured. Bought a two bedroom flat in Bangalore for which completed EMI in in first 7 years.
  • On personal front I have happy married life with my wife and kids as I am assured on their future needs and able to spend more time with them
  • Iam not limited to single occupation. Both active and passive wealth systems are working for me. I am practicing financial instruments, learning cutting edge IT technologies (if thrown out of job, I can go in teaching) and learning how to cook healthy food.
  • I can return to society what I received from them. In addition to social charity for needy people, I am managing finances of my close friends and relatives

8 lessons for Jagoinvestor readers

Manish always kept his first priority as benefit to readers of Jagoinvestor. He requested my learning from above journey which can help his readers. Below are the pinpoints which I nailed down on my desk. Hopefully it would be useful for you as well :

Lesson 1 : Spend less than you are earning irrespective of in which job/occupation you are. Save and invest some money every month before expenses.

Lesson 2 : Create an emergency fund. The fund should be ideally equal to 6 times of your monthly needs.

Lesson 3 : Buy life and medical insurance. Life insurance plan must be pure term insurance plan. Strictly NO ULIP, no Endowment, no Money-Back, no Child Plans.

Lesson 4 : Before starting any investment in direct equity try with selected mutual funds.

Lesson 5 : Equity must be necessary component of your portfolio. None of the fix return instruments like FD, NSC, Bonds are going to make you wealthy. Take calculated risk in equity (share market) with keeping important point in mind “Liquidity should be always available for your daily and emergency need”.

Lesson 6 : Don’t jump in to F&O segment of share market. You can never predict share market direction in short term. Option can hedge but you must have at least ten years of experience in value investing.

Lesson 7 : Keep learning and IMPLEMENT them.

Lesson 8 : Practice controlling biases which are negatively affecting you. As Munger says “Practicing few hundred biases would make not only a successful investor but a successful man (woman).

Happy Investing friends!!!

Do share your thoughts about my journey in comments section.

15 replies on this article “From “ZERO savings” to “Debt FREE house””

  1. Pradeep H says:

    Good read. Thanks for sharing!

  2. Padmesh KC says:

    Very good article on jagoinvestor site…as usual. Appreciate you sharing your personal experience along with book references.

  3. Pulak Kumar says:

    I have learnt important life lessons from this article.

  4. Mohit says:

    Hi Manishji and team,

    a very basic and incomplete article. Quality of previous personal finance stories have been much higher.
    In my sense, personal finance story has to sound more “personal”. Above is like a generic write-up. Also while subject talked of “debt free house”, there was almost no mention nor any connection/journey from equity to house-purchase.

    Feel so connected with Jagoinvestor blog that I feel terrible while giving negative feedback, but that’s how it is…

    1. Jagoinvestor says:

      Hi Mohit

      Thanks for your critical feedback. I agree that this money story might not be that detailed and insightful like earlier stories ..

      All I can say is that not every person who gives money story might go deeper like others, as everyone might want to share only some part. I also do not change their stories beyond 5% and try to keep it original.

      Also, in my last 10 yrs of writing, I have made a mistake of always trying to deliver the BEST and AWESOME content which sounds great, but then that limits the frequency to very few articles in a month, so from some time I am trying to have a mix of all type of content ranging from very good to average.

      Apart from that, there are some people who have commented that they found value in the article and have learnt from it. So lets also agree that a content might not be great in our eyes, but can be useful for others.

      But Mohit, I accept your feedback and thanks a lot to not hesitate to share what you feel about it. Happens very less and I think its healthy thing. I would try to be better going ahead. My focus had shifted a bit due to other things in last few months.. I am trying to regain it !


      1. Mohit says:

        sure, keep up the good work. cheers.

  5. Naga.K says:

    I am one of regular reader for, The article is more useful it was very nice.Could you please advice what are the precautions we need to take for current economic slow down or financial crises.

    1. Jagoinvestor says:

      Hi Naga

      I am not sure from which angle are you asking for precautions ? Are you asking at investment level? Job level ?

  6. Anand Kulkarni says:

    Thanks Rahul for the eye-opening post, every new comer in job might have experienced this.
    Thanks Manish for sharing this article!

    1. Jagoinvestor says:

      Welcome Anand.. glad that you liked it !

  7. Where did you get Poor Charlie’s Almanack? Is it available only in book-format? No kindle-version seems to be available.

    1. Jagoinvestor says:

      Hi Sambaran

      I don’t think there is kindle version for every book .. So if you are getting hard copy, better have it !

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