Six lessons from World Cup match – India V/s Pakistan
Recently, the exciting cricket match between India and Pakistan was one of the most intense match with lots of ups & downs all thru the match and maybe imparting some important life lessons for people who follow cricket. Let us check some key lessons from the match and see how we can benefit from this to fine tune our personal finance.
Lesson#1 Keep a cap on your discretionary expenses.
Giving away so many runs in the second half of the innings to Pakistan after keeping them in check for most of their innings or loosing 4 quick wickets in the beginning of the innings can be equivalent to spending your hard earned money on not so necessary purchases – unplanned, envious or impulsive buying can be the key reasons for majority of financial mismanagement leading to unnecessary stress for the whole team or our family. Benjamin Graham the father of investing has famously quoted “If you buy things that you do not need, one day you will have to sell things that you dearly need “Keeping a tap on your expenses is a great financial habit.
Lesson #2 – Have Clarity of Purpose
Inspite of loosing so many wickets of key Batsmen, one of the reasons India could win the match is having clarity of purpose. The partnership between Virat Kohli & Hardik Pandya scored the crucial runs because they assessed the situation, played with controlled aggression & utmost responsibility drawing from their experience to attack the weak balls or weak bowlers & confidently waiting patiently for the opportune moments.
Similarly, in our life too we may time and again face unplanned expenses due to sudden bad health to a family member or loss of income because of accident or illness; but instead of getting bogged down by these events – if we keep our resolve & pursue our goals with persistence & patience; we too can win the matches of our life. One of the key attribute of financial success in life is having crystal clear clarity of your goals and the plan to achieve them.
Lesson#3 – Start early and invest regularly.
India’s target was 160 in 120 balls that are some 1.33 runs per ball. Does it seem to be very challenging task? If singles could be scored from the very first ball with occasional boundaries, the target would have been easily achievable.
Just like that, start small investment with your first paycheck and add up part of your bonuses & continue till you reach your financial goals. Your effort should be to be disciplined and consistent and leave the rest on power of compounding. You will notice how effortlessly you have achieved your financial goals, well before time. For eg: a monthly saving of Rs.10,000 earning 12-13% p.a. growth can accumulate to Rs.1 Crore in 20 years – all you need is simple discipline and perseverance.
Lesson#4 – Have a Good protection for your life & health
One of key faults of both India and Pakistan’s batting was loosing the wickets of key batsmen early in the innings; but at the same time the match was extremely competitive because both teams had enough other capable batmen; especially the all rounders.
Likewise many a times we are so busy with our profession that we forgot to look at our family and take adequate protection for them. One sudden death of the earning member or a critical health issue of any family member could jeopardize your financial goals completely. Having substantial term for the bread earners of the family and enough health insurance can guard your family from falling in any financial mess in case of major illness or any eventuality.
Lesson#5 – Build a partnership, with your advisor.
It needs two to tango! One of the big reasons why India achieved the target is that two batsmen could build a robust partnership. History shows, a winning team mostly represented by marvellous partnership from any two batsmen. The role of coaches in all sports has been quite visible in sporting successes be it P. Gopichand in Badminton, Bhaichung Bhutia in Football or Gary Kirsten or Rahul Dravid in Cricket.
Similarly building a long-term mutual relationship with your advisor based on trust and compassion can be a good trait. The advisor can guide you best in the ups and down of financial matter and at the end both of you can come out as a winning team in the lifetime tournament of wealth creation.
Lesson#6 – Champions have self belief & huge goals:
Virat Kohli’s scintillating batting display & ability to remain calm in tough situations must be the output of relentless efforts in rigorous practise sessions; great discipline in good habits and a purpose to achieve mega goals of his life.
Similarly when we are investing; we need similar qualities of investing hard for your future needs with utmost discipline; backed by sound planning & confidence to stay invested in tough times will stem from your efforts to understand your investments & strong manifestation of your goals & make you a real champion in life
Happy Investing…
Mutual Fund Distributor
Rajendra Bhatia
rb@aarthashastra.com