These Mantras of Warren Buffet -
Just imbibe and never forget!
1. On Earning:
"Do not depend on a single income. Invest and create a second/ third source of income"
While young, save and invest
For this is the time best
To create a second source
Of income thru the bourse.
The quicker you do it, the better
As this will help you unfetter
From a job later and set the tone
For you to go on your own!
2. On Spending:
"If you buy things that you do not need, you may soon have to sell things you need"
Don’t go on a spree to acquire
And buy stuff you don’t require.
Just to show off – don’t spend
Resulting in situations you can’t mend.
Spend but don’t over-indulge
And curb that urge to splurge!
Remember this adage
From a very young age.
3. On Savings:
"Do not spend what is left after spending; instead spend after you save / invest"
Learn to postpone consumption;
Instead look for a good option
To invest your savings sensibly
To lead your old age comfortably.
Remember this is not sacrifice
For you are building an edifice.
Understand, invest and then spend.
This will keep you happy till the end!
4. On taking Risk:
"Never test the depth of the river with both your feet"
If you choose to wisely speculate,
You’ll be able to gradually accumulate.
Start with investments of small amounts
That don’t majorly dent your accounts.
Study the risk factors well
Like inflation and market trends
That will often be able to tell
If your risk taking justifies the ends.
5. On Investing:
"Do not put all eggs in one basket"
Let your investment portfolio be
A judicious mix of debt and equity.
Also invest in some tax saving instruments
With assured returns and tax saving components.
Medical and life insurance
Provide you ample assurance
Of an adequate risk coverage
With provisions for tax leverage.
6. On Capitalizing on Stock Market Movements
"Buy when there is panic and gloom, sell when there is exuberance and boom"
Hone your risk-taking appetite
To sense opportunities right,
To offload or buy stocks,
To cushion market shocks.
Understand the lingo of bears and bulls
To ably discern market push and pulls.
Invest when there is panic and gloom;
Offload when there’s exuberance and boom.
7. On Expectation:
"Honesty is expensive; do not expect it from cheap people"
While seeking financial advice,
Always remain alert and wise
To what you’re being told
And what you’re being sold!
(Earlier posted on Muse India – Your Space)