Why Invest?
Income and wealth are two different things, and we often tend to forget the same. All of us have been in this position that we think an investment is only for businessmen trying to channel their income across new investments. But none of the clients of Bullstockindia would agree with you, why?
Let’s explain. An income is an amount coming to you but wealth is an outcome of the intelligent plan you come up with to generate assets and liabilities. Is it getting too complex? Okay, let’ sit back and try to understand something we have been knowing since always.
Our grandparents did it. Our parents also did it without any formal education or even being aware of it. Yes, you read it right. investment. Wealth used to be inherited and so was the investment knowledge. Be it the gold coins we invest in every year across different festivals or the pieces of lands we have been revering as ancestral property, clearly, we have been guided by our traditions to understand that financial freedom and backups have to be created.
Especially in the modern world where the opportunities exist for all, we have heard enough rags to riches stories. Also, we know people who ended up in very bad situations while earning a large amount of money, whereas some people with lesser income have a better lifestyle, in the long run. How is it possible? Let’s understand this with a story:
The Story of Amrit and Anand
21-30 – Save | Learn
Is it too early to do investment?
2 friends Amrit and Anand studying in a college got placed just after college. Amrit received a package of INR 13 lacs per annum while Anand managed to get a job awarding him INR 6 lacs per annum. Amrit was of the mindset that the young age is about enjoying life as savings can be done later. Also, with the higher income, he had a certain lifestyle that he couldn’t avoid as his peers in the company would have a similar lifestyle, like a flat in a society whose rent was INR 15,000/month.
Anand had a different mindset and he always considered wealth as a personal support system that would be of help in the hour of need. He believed that beyond a certain lifestyle, expenditure shouldn’t be done in a blind manner as problems don’t look at age.
Without even realizing, Amrit started spending INR 25,000/month while hardly receiving INR 80,000/month in hand. He also started investing whatever amount he would save on gadgets, trips, etc. Gradually after 2 years, Amrit ended up with INR 1.5 lacs in his account.
Anand had a fixed tap of INR 10,000/month out of his INR 40,000/month salary as a monthly expenditure. He would also invest a small chunk of INR 7,500 on the various opportunities creating wealth from income while saving on taxes as well. He would take professional consulting from Bullstockindia as he realized that he would rather let the experts play the game as the right investment is not only about saving but the right returns. Gradually, after 2 years, Anand got left with INR 3.5 lacs in his account.
Amrit had started realizing that he can’t become rich just because he has a higher package. In a very bitter way, he had understood the complexities of Wealth. It was time to get married and both the friends had an extension in their families with a wife.
31-40 – Save, Invest and earn | Appreciate
I can manage my own investments, can’t I?
Quite mature now, Amrit started planning his investments on his own. He started saving a decent chunk and mitigating the same across various opportunities. But he couldn’t see returns to be good enough. His expectations were very drastically higher than the realities he encountered.
To have higher returns he started taking higher risks and channeling his money across multiple things. Ultimately, most of the high-risk investments ended up into loss and because of variable investments, it became tough for him to even keep a check for the red flags.
Anand had fully realized with his previous experience that these things require expertise and the amount of criticality behind can’t be dealt with part-time. Also, funnily, the returns an investment can bring have no limits. The better the plan is the better will be the outcomes. At times, things might take time but Anand clearly knew that investment is done with a vision. He left the burden of the whole thing on Bullstockindia and kept a check on the plans. He had accepted the sweet fact that investment is nobody’s privilege, it is a birthright. And today’s poverty can only be transformed into tomorrow’s riches by investment.
41-50 – Save, invest, earn and reap benefits | Reward
The Seeds We Sow in Life
Amrit had a good career path so far. He was enjoying promotions and a happy family life with his son and daughter ready to join college. He had saved much but the expenses future demanded were quite high. Kids wanted to go abroad to study further and the home loan had been taking a toll already. Marriage of children, enough savings for old age to live the dream retirement, etc. Amrit at 45 felt the heat of the lack of assets in his life. Money had come and money had gone. He was looking at loans and the plans to pay back the loan.
Anand sent his two daughters for their studies and simultaneously paid back the large chunk of his loans. Most of his long-term investments had multiplied into sums that could let him live his old age as he had planned. But still a client of Bullstockindia, he decided to not hurry and liquidate things with a strategy, while following his golden rule - Problems see nothing. And the recent investment he did in his mother’s surgery by liquidating one of his past investments solidified his belief in letting the planned approach continue for ‘you never know’ and ‘you can never be ready’.
51-60 – Save, invest, earn and reap benefits and Re-invest to enjoy extra rewards | Acknowledge
The Fruits
Amrit retired finally with a good chunk saved with him, good enough to pay back the loans on time and have a fine retired life. An honorable man who had addressed his responsibilities well, Amrit felt that the richness he had imagined as a young boy didn’t really come to him. He started contemplating what exactly is being wealthy is? And finally concluded that wealth is an aggregation of a lifetime, done across a lifetime. To achieve the same, one can never be too early.
Anand also retired, with a lot of returns waiting for him. He planned to start re-investing, not because of the need but more for the fun. As a financially stable man, he could engage with better deals and actually start enjoying the process. Still engaged with Bullstockindia, Anand got more involved as it became more than a basic necessity of life. Anand felt that he had taken the right decisions. Wealth can never be generated just like that but accumulated through proper management.
Moral?
The world we live in, money dynamics have changed. The majority of the efforts in our life is towards creating wealth. And after a few years we realize, managing the wealth was the actual area of challenge.
Unfortunately, in the formal education system, money management skills are not taught. And the result, chaos, confusion, anxiety, fear, sometimes feeling blank! Also, it is always told that investment is something which shall be done only when you have a large sum of wealth in your reserves, surplus so that you can start worrying - what do with so much of wealth? But no, sorry you have been a victim of myths. Surplus wealth is an outcome but not a state one reaches randomly. We at Bullstockindia exactly know how to make that outcome happen for you and as our friends Amrit and Anand taught us with their story, no time is the right time. The earlier the better!