My Two Fils
By Damodhar Mata
But sure, it grows when you invest your savings wisely!
Learn how to grow wealth, create passive income, and achieve your goals faster with Damodhar Mata on the My Two Fils podcast.
This show covers financial planning and investments in detail, weekly market updates in summary, and insightful interviews with people who have been there and done that.
Tune in every Saturday to this personal finance podcast and make the best of your new weekend in UAE.
My Two Fils Apr 16, 2022
5 Crucial Life Lessons from the Movie Sharmaji Namkeen
Have you watched this move Sharmaji Namkeen?
It is a Sumptuous Food for Thought.
We all loved it.
You should watch it if you haven't already.
It is Rishi Kapoor's swan song, in which he managed to capture the hearts of young and old for one last time.
It is also a celebration of food, friendship, family, and the feelings of a lonely and not-so-old man forced into early retirement.
While the movie was light-hearted and entertaining, it is full of life lessons and a thought-provoking screenplay.
This is Episode season one, episode 5, and today, I will share the Five Life lessons I observed and learned from the movie Sharmaji Namkeen.
Click here to download the Ideal Retirement Planner and here to arrange a Complementary session with me.
How to grow wealth using the Pay Yourself First Strategy?
Every month when you receive your salary, you pay so many people!
You pay your...Landlord or the bank for the house You pay for the electricity and water Mobile, telephone and internet Your Children's school The Supermarket for groceries Apple, Netflix, Amazon
The list goes on and on...
But when do you pay yourself, or do you even pay yourself at all?
Paying yourself first is saving money for your future before spending on your needs, wants, and, more importantly, luxuries!
It is one of the fundamental principles of financial success.
The pay yourself first strategy is quite simple to understand, isn't it?
But it looks like it is not so easy to implement!
Because not many are following this strategy, and among those who do, only a few are doing it consistently.
Why is it so difficult?
You may find it difficult if you follow the traditional budgeting approach of saving what is left after bills and payments. It is quite possible that not much is left after spending on your needs, wants and luxuries. And sometimes there could also be too much month at the end of money.
Reminds me of the funny but ironic song Too Much Month (At The End Of The Money) by Marty Stuart. Listen here...
You could keep going back to this comfort zone, with an excuse that bills come first or I don't have enough for today; how can I think about the future?
So how do you get around this?
The best and the easiest way to pay yourself first is by following the Payday Savings Strategy.
It is deciding how much you can and want to save, automating the savings to coincide with your payday, and then spending the rest guilt-free and at your discretion.
Set up a Systematic Investment Plan(SIP) on or just after your payday. So that a particular amount is debited from your account and invested automatically into the assets of your choice.
So let's say you earn 30000 Dhs a month, and you can and want to save AED5000 every month. Then you could set up an automatic transfer every month(5000) into a savings account or an Systematic investment plan and spend the rest(25000) on your needs, wants, and luxuries.
it not only helps you accumulate wealth consistently, it also helps you harness the power of compounding and the dollar cost averaging.
Isn't this a simple and efficient way to pay yourself first and accumulate wealth consistently.
Let me know what you think and arrange a free consultation to know more about SIP, Dollar cost averaging, power of compounding and many other useful financial concepts.
Click http://bit.ly/Meet-Damodhar-Mata to arrange a free consultation.
The 4 key learnings from Apple's Founding Story.
Is First April, a Fools Day?
While the world was busy fooling people or getting fooled, three individuals got together to create the world's biggest company on 1st April 1976.
Guess which company it is?Yes, it is Apple.
Apple reached the 3 Trillion Dollar mark on January 2, 2022, when its share price touched $182.86.
Apple was also the first company to hit a $1 trillion market cap on August 2, 2018.
It just took a little over two years to double its market cap to $2 trillion on August 19, 2020, despite Covid-19.
Apple Computers, Inc. was formed on April 1, 1976, by college dropouts Steve Jobs, Steve Wozniak, and Ronald Wayne, who was then working at Atari as a chief draftsman.
Jobs was 21, and Wozniak was 26. They wanted to make computers small enough for people to have them in their homes or offices.
Both Jobs and Wozniak were young and enterprising, but Wayne was nervous and skeptical about this venture's prospects. He was 41 then and did not want to stake his savings on these young lads.
After 12 days, he sold his 10% stake in the company back to Jobs and Wozniak for $800.
Little did Wayne forecast that the young Turks could put a dent in the universe...
Today, a 10 percent stake in Apple would be worth $285 Billion. This number is bigger than the biggest Indian company Reliance Industries, whose market cap is around 230 billion.
It doesn't end there...
Wayne kept his original partnership contract from 1976 for many years until the early 90s, when he sold it for $500.
Wayne told Cult of Mac.
"I had this Apple contract sitting in my filing cabinet, covered in dust and cobwebs, and I thought, 'What do I need to hold onto that for?"
According to The Filthy Rich Guide, the same contract was sold at an auction for $1.59 million in 2011.
Image Source: https://www.cultofmac.com/475927/ron-wayne-quits-apple/
Now Wayne is more than 80 years old and Networth is less than 500,000.So what do we learn from here?
For me the following are 4 key takeaways from this story…Patience is a virtue and a much necessary trait when it comes to investing or building a start-up. It is vital to see the bigger picture and, more importantly, trust your team instead of having a narrow, short-term vision. It is essential to take some risks or Maybe a little more to achieve big things in life. While someone somewhere is busy creating another big company like Apple, you can build one or invest intelligently in many such companies. You could end up being a part of something huge and create lasting wealth for yourself in the process.
Is there anything else you can learn from this story?
Share your views in the comments below..Now, Coming back to my original question, Is April 1 the Fools day? Yes and no, I guess...
Please share your thoughts on the above...
Arrange a Free Consultation to understand how you can participate in the growth story of worlds largest companies and create lasting wealth for yourself in the process.
Visit http://bit.ly/Meet-Damodhar-Mata to arrange to schedule our meeting.
How to manage your investments when the markets are falling?
Here is an interesting Chinese fable about a group of frogs and an investment lesson we can learn from this story.
Markets go up and they go down, but our Investment goals are typically constant and not dependent on market conditions.
With so much uncertainty, negative news and gloom predictions, it can be quite a challenge seeing your investment value go down!
You may be unsure if now is a time to cut the losses and sell, buy more or do nothing....
What if you sell now and the market recovers in the next few days...
Or what if you buy now and the market goes down...
Or worse what if you did nothing and the market kept on falling further...
Learn how to manage your investments when markets are falling and you are nervous about your investments.
Feel free to arrange a free expert second opinion of your portfolio to help you understand if your portfolio is aligned to your risk appetite and goals.
And if you are looking to invest for a specific goal, arrange a Free Holistic Financial Planning session.
Let me know what your thoughts are on the investment lessons from the deaf frog and share this with your family, friends and colleagues to help me spread the word.
Click here to arrange a free consultation.
The Five Golden Rules For Successful Investing.
Imagine a monster eating away your savings for breakfast, lunch, and dinner.
That is inflation.
It is the most potential but least understood financial risk.
Investing your savings helps you beat inflation and grow wealth. If you don't invest your savings, then you could be denying yourself the opportunities to enhance your wealth and achieve Financial Freedom.
While investing certainly involves some risk, it can be well managed if you follow the 5 Golden Rules of Successful Investing.They are Investing is not Gambling - Stay invested for the long-term Focus on your goals and not on Market Returns Excesses are never permanent - Don't be greedy during bull markets A Market Correction is an opportunity - Don't pull out your investments during bear markets Don't put all your eggs in one basket - Diversify your investments.
As a qualified and independent financial advisor, I can help you define your goals, determine your Personal Hurdle rate and build a diversified portfolio to achieve your financial objectives.
Arrange a Free Consultation to understand how we can work together.
Click http://bit.ly/Meet-Damodhar-Mata to arrange a Free Consultation.
Welcome to My Two Fils - A Personal Finance Podcast in the UAE
Exercise is good for health, junk food is bad, and smoking can kill, we know this stuff, yet we indulge!
Much like that, when is come to building lasting wealth, it is not just about what you know and how much you know?
It is more about what is what needs to be done, and how well you are doing it.
I am Damodhar Mata, Author, Blogger and Financial Advisor in Dubai, with more than a decades experience in helping people win with money.
Here is My Two Fils, a Personal Finance Podcast in UAE.
My Goal here is to provide actionable ink each and every episode of this podcast, helping you grow wealth, create passive income and achieving your financial goals faster.
Tune in every Saturday for a brand new episode on how to win with money and dont forget to Subscribe on Apple or Google Podcasts or your favorite podcast app.
Until next week, stay safe and stay invested.
How to grow wealth with regular savings and the power of compounding?
When you invest $10,000 at a 10% growth rate, it will grow to $16,100 or 1.6 times in 5 years.
In 10 years, it will grow to $25,930 or almost 2.6 times.
Imagine by how much it will grow in 25 years?
It will grow to become $93,130 or 9.3 times, just by keeping the money invested and reinvesting the profit/interest.
This is the Power of Compounding.
“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.” ― Albert Einstein
Your success as an investor is a product of two essential ingredients The rate of return the length of time you remain invested. Of late, investors are more focused on the rate of return and much less on the length of the investment.
Little do they realize that the magic of compounding needs both these factors to work in tandem when looking to create long term wealth. So while looking to get better returns on your investment, you should also remain invested for a longer horizon to get the maximum benefit of the magic of compounding.
Bank Deposits vs The Stock Market/Mutual Funds Unlike in the past, the bank rates are not so rewarding; hence, investors are now considering mutual funds, ETFs and stock market investment to grow wealth.
Also, unlike bank returns, Mutual funds or market-linked assets can be volatile with potential risk to capital invested. Hence it is crucial to ascertain your investment horizon and the ideal risk-reward balance to build a robust investment portfolio.
Regular Savings or Systematic Investment Plan SIP - Systematic Investment PlanAs the Magic of Compounding, the systematic investment approach is equally powerful in helping you accumulate capital, grow wealth and mitigate market risks.
Benefits of Regular Savings or Systematic Investment Plan
1. You can start with a small monthly investment.
2. It helps you build a disciplined saving and investing habit.
3. Dollar-Cost Averaging - Dollar-cost averaging helps you benefit from the market fluctuations. When the stock prices fall, You buy more units and buy lesser units when the stock prices increase, thereby averaging your buying cost.
4. Diversification - You can invest in a diversified portfolio of Mutual funds with a SIP or regular savings plan.
Individually both the Power of compounding and the SIP investment approach are very powerful. When you combine them in the right way, they can exponentially enhance your wealth accumulation process.
Here is a Potential Wealth Table showing the combined power of the Magic of Compounding and Systematic Investment;
Click here to view the blog post with the Potential wealth table and chart.
Financial Planning and Investment
Advice As an Independent Financial Advisor, I can help you achieve your financial goals by harnessing the Power of Compounding and the benefits of Systematic Investment Plan.
We can build a diversified investment portfolio to suit your investment goals, horizon and risk appetite.
I can also help you regularly review your portfolio and rebalance when necessary. Click here to arrange a free consultation.
Is now a good time to invest in the sustainable energy sector?
Steve Cutts has a Youtube channel with only 12 videos in 9 years but has more than 1.2 million followers. In 2012 he released a video titled "MAN". As of today, this video has more than 51 million views.
This 3.36 minutes video highlights the damage caused by the Man on the planet in pursuit of profits and share value.
Thanks to many such awareness efforts, social media, white papers, and lobbying by pro-environment groups in the last few decades, the corporate world, policymakers and regulators have taken this cause seriously.
They now are keen to reverse the damage as quickly as possible by focussing on Sustainable Energy instead of carbon fuels. Many companies and governments have pledged to become carbon neutral between the years 2030 to 2050.Rapid Growth in the Sustainable Energy sector
Sustainable Energy as an industry has grown by leaps and bounds, with trillions of dollars invested for this cause over the last few years.
The following chart shows the amount of investment in the energy transition sector-wise;
In the year 2020, global investment in the low-carbon energy transition was $501.3 billion, up by 10+% from 2019 and by more than double from 2010.
Additionally, an investment of $110 trillion US Dollars globally is estimated to flow into Sustainable Energy and ancillary sectors by 2050, creating a massive opportunity for investors to capitalize on this momentum to create wealth.Shifting S(t)ands
Investors preferred to stay away from capital-intensive renewable energy projects like Wind and Solar and electric vehicles until a decade ago. They perceived this sector as risky and less rewarding.
Instead, they continued to invest billions of dollars in hydrocarbon projects, particularly in the USA, boosting the Shale Oil projects, helping America becoming energy independent.
Now the s(t)ands are swiftly shifting towards Sustainable/Renewable energy sectors. Companies like NextEra, and Tesla are the new favourites.
This sector has gained so much popularity that even Oil and Gas companies have started investing in it substantially.Is there still an opportunity for Retail Investors?
Post Biden Election, stock prices of Sustainable energy companies soared quite substantially in 2020. However, it appears that the party is just getting started.
The world is now more committed to reduce its Carbon footprint and focus on clean energy alternatives than ever before. This trend is very likely to continue over the next few decades.
In light above, including this sector in your portfolio can be a good idea in the medium to long term. While there could be intermittent volatility due to macroeconomic factors in the short term, this sector is likely to do well in the medium to long term horizon.
As an Independent Financial Advisor, I can help you create a Holistic Financial Plan and a Robust Investment strategy.
We can build an diversified investment portfolio including different sectors like Sustainable Energy, technology and healthcare, helping you grow wealth.
I can also help you regularly review your portfolio and rebalance when necessary.
Click here to arrange a free consultation and start investing in stocks.