Let me start with a story of a man who was fishing with his fishing-rod on the shore for long hours. A rich man who was watching him from his luxury suite in the adjoining hotel and came down to the shore to have a chat with him.
He asked the man what he was doing. The man said he was fishing. The rich man took a look at the two fish the man had caught and asked him how long he had been fishing to catch the two fish.
The man said that he didn’t know, maybe 20-30 minutes. The rich man laughed and said, “You have been fishing here for the past three hours, mate.” The man just smiled and continued to fish. The rich man was taken aback.
He sarcastically asked, “Mate do you mind if I give you a piece of advice.” The man looked at him.
“You can obtain a bank loan and buy a small fishing boat. That will give more opportunities to increase your yield of fish.”
The man looked at him puzzled. The rich man was delighted, and he continued. “After 6-7 months, you can go for youre second boat through another bank loan. The bank will grant you more facilities. You can buy your fishing nets, deepfreezes and other equipment using borrowed money. Then you can hire people to fish for you. After you have established yourself, you can buy a trawler or two.”
The man asked the rich man what he would have to do after that.
The rich man said then you can put them to work and live happily, maybe fishing at a lonely place on the shore will be a good option.
Then the man asked the rich man, “What do you think, I am doing now?” The rich man was dumbfounded.
This reminds us of the definition of richness. We all have a different perceptions of the word richness. One person’s perception of richness is not the others. While wealth can accrue through money, richness cannot accrue through money alone. People have different perceptions and mind settings of their own, to feel that they are rich.
Whatever it is, we will see how to become rich and acquire a billionaire mindset by using the little we have.
Live within your means
I have two friends. One has a professional title before his name, 2-3 classy cars worth more than Rs. 40-50 mn each, 2-3 houses at super-luxury addresses locally and globally, beautiful girls around him and makes frequent overseas trips. This maybe his rich life and his billionaire’s mindset.
The other friend is always contributing something back to society from what he has learned academically and socially, driving in a basic but decent car, having a comfortable and clean house to live in, owns a few acres of cinnamon cultivation and is surrounded by his loving family.
On the face of it, the first one looks very glamorous. But I know his bank overdrafts have reached close to a half a billion and he spends many sleepless nights thinking whether the banks will acquire his wealth. The second one lives a simple life. He has no stress, no worries, sleeps well. Instead of bank overdrafts, banks owe him money in the form of savings totaling Rs. 40-50 mn.
Now let us see which one is rich. From the outer appearance, it is the first one. But, in reality it is the second one. His net worth is greater than the first one. As far as the intangible living necessities such as peace of mind, tranquility, and good health are concerned, the second friend lives a better life than the first one. But the first one looks at the second one condescendingly.
For him, the second friend doesn’t know to enjoy his wealth. The first friend always say had he got the amount of money the second one has he could have owned a private jet by now.
On health, issues he says, he will hire the best doctors in the world to look after him if anything unexpected happens to him. When inquired about his peace of mind he says, “What else do you want mate, I live a luxurious life, I have everything to enjoy and bank overdrafts are part and parcel of my ecstasies. I like seeing them coming behind me begging for their own money.” Now, where do we stand.
This is why I said people have different attitudes on the characteristic of richness. However, we shouldn’t get carried away by my first friend’s perception of richness. Let’s look at the second friend’s approach which will put you on the correct footing to win life’s goals like the man who was fishing on the lonely shore by the side of the luxury hotel.
Money is part of life and there no point saying that you are not interested in it.
It is pointless saying that you are not interested in money. You have to have money to live a comfortable life. If someone says no, he or she will need to re-visit the remark that was made and justify it. Ever since money came into circulation, as the mode of effecting transactions, instead of the old barter system, society got used to it. Today, we can’t live without it. It is a fact, and we have to realise it.
Check what is important in life and how money can support it without obstructing it Just now I was listening to the six o’clock news bulletin. A father of two aged 42 years has been given the death sentence for possessing 126 grams of heroin. I was just thinking to myself, why? Only 42 years, the best years of his life. The two children, probably schoolgoing. Wife, nothing was mentioned. Most probably a housewife.
Imagine the plight of this family. The convict has been in remand custody since 2014. He would have been 37 when the crime was committed. He would have been dreaming of a luxurious life with his family. But finally ended up in the gallows. What was important in life has been obstructed by the greed for money. Learn to earn ethically through legalised means. No matter how difficult it is. But earn ethically.
Think of what you want in life and of your goals (if you don’t have, set some today).
Set your life goals at an early age. Your savings goals. At the age of 23, I was saving Rs. 500 from my salary of Rs. 2,300, monthly. I have been teaching these savings habits to hundreds of people ever since. The latest are the painters who are painting my house. I advised them to set aside Rs. 250 per day from their daily earnings of Rs. 2,500 and get used to live by using the remaining Rs. 2,250, daily. The youngest painter was 25.
Assuming he has 35 active working years ahead of him, over Rs. 3 mn can be saved by him on the straight-line method. If he can save Rs. 500 per day, the amount could be doubled.
The young painter was stunned. He was not sure of what he was being told. Then I showed him the workings. Then he was convinced. I said he can get a pension of at least of Rs. 50,000 p.m. till his death if he doesn’t withdraw the money. The following day he opened a savings account and placed his first Rs. 250.
Be a futurist
You will need money for different purposes and circumstances. Build dedicated reserve pots in banks for each purpose. You also can buy a plot of land to dispose of for future essential needs such as family weddings, overseas education. Similarly, you can purchase a vehicle which has a good second hand value. It can be used and disposed to meet any of your future financial commitments. Jewellery is another option for you to invest in while using them.
When you get into a certain standard of living, draw the line there and stay there for some time. Relax and enjoy. Reward yourself for the scarifies made. Then move forward. But again, gradually. Don’t rush. Let life flow. Be cool. Enjoy life while saving. Don’t save like a slave. Don’t overdo. You should have time to go fishing while saving.
I am writing these articles related to savings as I have noticed many in our society are not informed and educated about savings tips. Most of them are only told of savings habits but not on savings methods.
As a result, they don’t know the beauty of saving. If one can enhance his knowledge of savings methods which ultimately leads to enhancing his savings skills, he will never feel uncertainty in his life.
In the next article we will discuss further tips on money saving based on the billionaire mindset such as money is not the only thing in life but if you ignore it it will go away or will be taken away; ways of getting rich and taking control of your money.
- The writer is a former CEO/General Manager of a non-bank financial institution and holds a Masters Degree in Business Administration from the UK.