How I made my first 300K before 26!
Did you ever imagined being broke or not being able to fulfill your dreams whether it is materialistic things (generally) or non-materialistic things? Or Did you ever give a second thought towards your monthly income statement and thought why am I not able to save or not able to achieve even the most important things though I am earning this much?
Brief about me!
Hi, I am Ashimabha Bose a.k.a Ashim. Bachelor of Engineering or B.E in Mechanical Engineering, Masters of Engineering or M.Tech in CAD-CAM, PGDM in Data Science, a part-time coder (newbie), having 1.5 years of industrial experience in the pharmaceutical industry as an Analytics Executive cum Data Analyst.
And after these many years of changes throughout my career i once again decided to pursue something extremely challenging and creative as well, and hence, here is my first ever article which I supposedly thought would be extremely useful for people, around any age group and from any geographical region in India, Who should reconsider before taking steps into different critical phases of their life.
I personally have faced a lot of challenges during my school days, during my college days and after college and even now as well I am having several different challenges. Not having monetary freedom was one of the biggest challenges among others.
Being an average student I literally used to hate mathematics and numbers. I always tried to skip classes or tried to rot formulas for examinations which did not help me in the long run. Hatred for numbers is so unacceptable that even though I graduated from college and joined my first organization (a start-up) as an Analytic Executive, my whole life was surrounded by numbers and complex procedures (let’s keep that part for some other day !)
I still remember it was near the end of the year 2015 when I decided to start my first-ever investment in the securities market with just Rs.500! Per month only. Is it not amazing when I say Rs.500 only?. Yes, I am in my senses and truly believe that anyone and everyone can start with just as much money as they usually spend on eating junk food or drinking whiskey or going out frequently, etc. During that time the procedure became somewhat easier and less documentation needed.
There are ways that will fetch you enough money to quit your 9 to 5 job and fulfill every dream. I began with investing in simple instruments of the securities market which are MUTUAL FUNDS (SIP). Simply Mutual fund might feel extremely easy to go with as shown in television ads but the real mechanics is quite different and interesting. TV Ads never tell you deep inside the product description. Did you guys check the Ads of Mutual Funds tend to show a huge document at the end of the video which shows the tagline “Mutual fund investment are subject to market risk, please read the documents carefully before investing”. This is where they tend to hide the extreme details and you get a different picture as if these are extremely loss-making products, so, let us not put emphasis on it. Did this happen ever? If yes then you are among others who think investing in these types of instruments/products will make them lose money. The number of returns you can expect out of these simple yet beautifully crafted complex products is exponentially humongous.
My initial investment : Rs.500 x 6 months = Rs.3,000
Stage 0: Rs.1,000 x every month (+10-20%increment every month)
Stage 1: Rs.6,500 every month (+10–20%increment every month)
Stage 2: Rs.10,000–15,000 every month (+10–20%increment every month)
And so on……….
The real basics behind building money are not investing lots of money every month but to consistently input that amount with a gradual increase in the percentage amount per month. Along with the amazing effect of compounding you will be getting nearer to your dreams.
Let us take an example:
One sharing pack of two Mexican McAloo Tikki will cost you Rs.287.62 (inc taxes). If you eat it twice it would have cost you Rs.575.24, and four times it would be Rs.1150.48 only.
One medium/large-sized dominos pizza would cost you approximately Rs.400–800 or even more depending on the add-ons.
And whatever the above numbers I am telling you above does not count for a meal three times a day. I know I am blunt but in the end, you have to understand the issue in a broader manner.
“If we command our wealth, we shall be rich and free. If our wealth commands us, we are poor indeed.” — Edmund Burke
Things I do before making tough decisions
Before I even started making pocketing gains from any of the markets, I have gone through several resources whether it is online or offline. Below are a few of my favorites which I recommend to everyone, whether you are a beginner or an expert. These recommended resources will help you build a solid base in the field of the security market.
Online resource/s:
Investopedia will be enough for the long run as it contains every bit of information that is required to play smart in the market. It included a large database of market information that is categorized from A-Z and covering market and product across the globe.
Another great resource is Zerodha Varsity, which is focused on the Indian market specifically. It does have a mobile app that contains bit-sized but sufficient courses for free to learn about the market in a broader manner. They have created several sections according to the market products so that you do not get messed up easily.
Books I recommend:
The intelligent investor by Benjamin Graham
How to avoid loss and earn consistently in the stock market by Prasenjit Paul
Coffee can investing by Saurabh Mukherjee
There are tons of books but for a beginner’s points of view, these three books will be a great starting point for you as an investor. Among these three the very first book by Benjamin Graham is considered to be the bible in the world of investment. It is realistic and will be quite lengthy as well which might make you sleepy at first but in the end, you will be an expert who not only understands just the simple investing but also every bit of grains in it. The second and third book is quite engaging plus the brownie points for their unrealistically simple explanation over language.
Disclaimer: I will surely make an article on these books shortly, where I will be covering every detail of the books plus will also give you bonus tips which will be extremely helpful in your long run ahead.
How I managed my investments every month
Initially, it was quite tough for me to invest my monthly savings back into something that I never even thought of before!
Previously, I have never imagined that good saving habits would give me such extreme decision-making skills later in life.
“If you would be wealthy, think of saving as well as getting.” — Benjamin Franklin
It all started when I was about 18–19 years old when I slowly started saving Rs.50–100 from here and there for purchasing electronic devices or gadgets for fun. I used to hold all of my savings in my piggy bank which over a period of time gave me happier returns which during my age was something of a big achievement for me. This extremely small but powerful adrenaline boosts helped me understand one life lesson and that is:
“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” — Albert Einstein
Now, I know you might have a question, if you already know a bit about compounding effects, how come my saving habits were correlated to Albert Einstein’s theory?
Here, I would love to tell you that my habit of saving cannot be compared directly to the above theory but if you look closely into the level of grains, i was actually adding up a small amount of money every second or fourth day or week which eventually grew into a huge pot of money.
Disclaimer: The huge amount of money I am talking about was around 3000–7500 only.
How anyone can be as smart as an investor and things to avoid
The year when I first jumped into the securities market was, for a complete beginner and have no sense of the broader market, the toughest and the boldest decision for me. I know here you might be thinking why this guy is telling me the “securities market” is really the tough call when he himself had experienced so much from there? I may or may not agree with the above statement because there are extremely important things to take care of even if you are an experienced one. To add up to this argument I will like to put forward a saying, which you can find in almost any beginner’s handbook in the starting pages. “90% of the people’s money is being taken away by 10% of the remaining”. So, who are they and how do they do it? If this is the case then why do people say the stock market is a gambling arena? True for those who knew nothing, and they never tried to study or learn anything apart from what others said. These types of people are known as “Retail investors”. Technically anyone who is earning or doing a full-time job and investing a given amount from their savings are termed as retail investors. Most of them get attracted by the fancy ads where the other person show them as if they are millionaire or billionaire, having luxurious lifestyle, cars and of course, lots of money in their hand and they in return assure us that they are experts and can multiply our money 10 folds or 30 folds within a couple of months. Here is my piece of advice “STAY AWAY FROM THESE TYPE OF SCAMS”. Put it in your head as the very first advice.
Let me show you a real-life example:
Vijay Kedia, a well-known investor, and businessman invested Rs.35,000 in a company named Punjab tractors in the early eighties, which grew up 6 times to Rs.2.1 Lakh within 3 years.
If you had invested Rs.10,000 into Infosys in the year 1993, by 2017–18 it would have given you 2,973 times return at a CAGR of 39% which is nearly Rs.3 crores!
Conclusion: Bonus tips for newbies
I hope you loved my very first article on how to achieve your goals in the long run whether it is money or any other goals in your life.
If you have gone through my complete article, below are the short points to remember and this useful piece of information you might use in your personal life for achieving different objectives.
- Never look at the end results, instead, look into the process flow.
- Start small which might eventually end up big.
- Before jumping into conclusions in any field, try to follow up with experts or someone you can share your thoughts with.
- Always be clear about your end objectives so that you can create and iterate the process flow.
- Anyone can start with as little as Rs.500 per month. There are other facilities available nowadays where you can go as low as Rs.100 per month only.
- Instead of investing lots of money suddenly, you should try to pour a steady amount into the process plus an incremental percentage increase per month will skyrocket your returns in the long run.
Courtesy: https://geek2investor.com for giving the required permission to re-post the article.
