“To save must be a habit of childhood, but to invest must be the habit of adulthood” One survey conducted in the Indian urban class people revealed the fact that only 4% of the population was confident of the future financial security of self and family as they had generated enough wealth. More than 60% of the population has to work part-time even after retirement. (Read Budget for your savings & not investing)
Once a grandmother gave her grandson Rs.100/- on his birthday. He happily told his mom that he will buy candies with this money. But his mother explained that candies will spoil your teeth and it is better you put in your piggy bank. Reluctantly, he agreed. A few months later, his piggy bank was over-loaded with coins and notes. Both son and mother counted them and were delighted that the total was beyond their expectations. Again this time as a responsible mother, she advised him to put this fund into a savings account. She taught him to fill up the deposit slip. The boy tried, but could not. So his mom filled the slip and he left for the bank along with an office help.
Years rolled by, and his mom is now proud of his saving habits. However, the amount is earning interest only in the bank. As a responsible mother, she did right in inculcating savings habit in her son but not beyond.
This is a common story for Indians. We are one of the biggest savers in the world and an average Indian family saves over 33% of their income. Despite huge savings, we are still counted in poor countries.
The reason is that we do not know how to convert our savings into good investment. Let us quote from Rich Dad Poor Dad “The poor and the middle-class work for money. The rich get the money to work for them”
Movie on Saving, Investment & Growth
Youtube – Part 1
Youtube – Part 2
Learn how to convert our savings into good investment which can later lead us to financial freedom.