Dear Editor,

When I started my career in the late 90s, fresh out of B-School, an era before the Internet, my source of knowledge was books and that of inspiration was men like Bill Gates. The more I read about him, the more I wanted to learn about being rich and how to get there. As a young IT professional, Warren Buffet too was my inspiration from whom I learnt one of the most important lessons of creating wealth - (buy into businesses and) stay in the game. In those days I also came across Peter Lynch’s One Up On The Wall Street that empowered me to think with clarity and simplicity.

Outlook towards money as a young boy and professional:

I grew up in a small town in Southern India. The financial constraints growing up shaped much of my attitude towards money. Very early on, I wanted to learn how to make money and learn how money grows. I spent a lot of time in libraries and with books learning just how to do that.

Being a mathematics and engineering student, I quickly understood the concept of compounding and realised the power it has and what it can do to idle money. Thus, when I started making money, I knew that whatever I could save, needed to grow and grow fast. Did I say faster than inflation, yes !

Starting my financial independence journey:

The trick that helped me efficiently spend, save, and invest was budgeting. I would budget every single `100 and was popular among my friends for my ‘budgeting skills.’ With budgeting my income, I always knew when I had surplus income and therefore, the freedom to choose what I want to do with it.

While I was having my fair share of fun, living in the present in Maximum City, I was also planning five years ahead when it comes to money with a target number in mind and working toward it. This meant that I was willing to delay instant gratifications and instead, plan, save, and invest for my indulgences.

2003:

I started investing by doing my own research and started with stocks and mutual funds in 2003. With stocks, I had some hits and some misses but within a year, I figured out that outcome is not predictable and the risk is quite high. Mutual funds, on the other hand invest your money in multiple stocks and therefore, diversify the risk. I stuck to mutual funds. I started small but I never missed or skipped an SIP, gradually increased the amount I invested with salary hikes every year, and like Buffet, I stayed in the game.

So much so that when the worst financial crisis hit in 2008, I was tempted to completely withdraw my investments like everyone else. At that time, my investments took a major hit. Like anyone, I was shocked. However, I did not make any hasty decisions. I waited for several days to decide what I wanted to do. By the way, I decided to do nothing. My patience and inaction were rewarded. The market bounced back and that crucial decision helped me reach financial independence seven years later in 2015. Financial independence, to me means that I no longer need to depend on a salary for my lifestyle and expenses. I had reached that point in 2015.

Guiding principles:

Always have a goal, be it for life, career or even your money. When you invest for a goal, it gives you a purpose and a direction. Then all your effort and money is focussed on achieving those goals. It could be your retirement, children’s education, buying a home, or financial independence like mine. Plan, save, invest, and stick to it.