hello and welcome to musings by Amit
Patel you know that on this channel I share my thoughts about very diverse
topics I talk about jobs careers selling entrepreneurship but today I have a very
important topic which I am sure will be interesting for all of you
irrespective of who you are whether you are in a nine-to-five job whether you
are a person who is building your own business whether you are a professional
of some kind like a cricketer or an actor or or someone who does his own
thing yes I’m going to talk about money today
what kind of a feeling does money invoke in you you know whenever I see that
money invokes extreme feelings in everyone you know some people feel
really guilty about having a lot of money whereas there are others who feel
ashamed because they don’t have enough money money has this power at the core
of it money has this power the power to create something or it has the power to
destroy you can you can start you can fund a dream with money or you can start
a war you can use it as a gift or it can become a weapon in your hands so money
has this feeling where you might feel you will feel your spirits are high or
creative or are really happy if you have enough money and you might feel
frustrated or angry or you might hate money when you don’t have enough of it
and I’ve been through all this emotions about money since the time I started
earning money for my living today in this episode in the philosophy of life
ok I’m going to talk about financial wisdom I’m going to talk about a few
principles that I learned because of all the mistakes I made and because of the
way in which I studied other people who either really became free because of
money or were stuck because of money so why why am I making this video on money
because a few days back I saw the news about Boris Becker Boris
Becker the legendary tennis player who’s who’s the only player in the world to
hold the record for youngest person to win the memory he has that record has
not been broken in so many years he’s the person who was awarded the German
male athlete of the year for four years in a row he’s the person who’s won more
than 49 singles tournament and six Grand Slam Awards that guy the person who’s
earned so much money and fame throughout his life he had to go through a very sad
thing he has to select all his trophies and awards just so that he can clear the
debts that he has on him how did he get into this situation in 2017 Boris Becker
was declared bankrupt so how much money do you really need in your life how much
how much money do you think you need okay is 1 million dollars 1 million
dollars enough to live a good life is 2 million dollars in the bank good enough
for living your entire life of having everything that you want of living a
good life or is 25 million dollars good enough Boris Becker during his
career of 14 years had earned 25 million dollars but in 1999 after he stopped
playing professional tennis after 1999 he made some really poor decisions I
will call it errors of judgment as far as money is concerned and this errors he
kept on repeating these errors in such a way that
by 2017 a court in London declared him bankrupt and he had still a lot of
people from whom he had taken money for a business that he had done and that
business went down and with that everyone’s money went down but these
creditors were asking for money from Boris Becker and in 2019 that is now
finally he has to sell off all his trophies and awards so that he can pay
back to his debt to his creditors now Boris Becker is not the only famous
personality to have gone through this there is Mike Tyson Michael Jackson our
own Amitabh Bachan he’s a legendary actor in India he is one of the biggest
stars in the Indian cinema I remember in 1995-96 Amitabh Bachchan
started a corporation called Amitabh Bachchan corporation limited to make
films but in that same year in 1996 this company went bankrupt
it seems he lost 80 crore rupees in this company and he was in such a situation
if you want to find out go and watch the video by Arnab Goswami of Amitabh
Bachchan Amitabh Bachchan talks about how low he went because of losing all
the 80 crore rupees in that business and it was not just his money that he lost
he lost money of a lot of people who had invested in that business he was in such
a situation that he did not have work at that point of time as well as he did not
know how he’s going to pay back to his creditors but Amitabh Bachchan being
Amitabh Bachchan he made sure he found he found a new way of
doing work in the television coming from the big screen to small screen which
everybody told him not to do and he earned back every penny that he had lost
he not only earned it back he repaid every derp that he had on his list now
these are two contrasting stories but money can do that to you that
irrespective of how much you earn if you do not build some simple disciplines if
you do not learn some few simple rules of managing money then irrespective what
amount of money you earn during your lifetime you can lose it all within a
few days or weeks or months I am making this video just so that all those people
who are maybe starting your career now or who have been in some kind of a job
or who are enterpreneurs who are professionals or earning money are
facing some kind of a struggle with money and I came up with some rules
around money and this rules are not something like an advice to you I am not
giving you an advice I am not qualified to give you financial advice these are
some rules that I learned with my own journey of struggle with money for the
first fourteen years of my career I was living paycheck to paycheck and I was
struggling as far as money was concerned I had to borrow money from the bank I
had to borrow money from my friends I had to borrow money from my parents and
I was not able to make my ends meet in 2008 I changed my track and
everything fall in place but after that me and my wife sat down and we laid down
some simple rules for managing money and I learned some simple
principles which helped me in living a comfortable life I’m not like Boris
Becker or Amitabh Bachchan who has 25 million dollars in the bank but I am
someone who’s understood how money works and I understood the few rules that you
need to follow and the earlier you start following these rules the earlier you
will be able to become better as far as your finances are concerned and why am I
telling you this because money is all about freedom if you have enough money
in hand it means freedom if you have money than it is security for you and
your family if you have money then then you can enjoy the good things in life
maybe a good vacation maybe you can live in a better house maybe you can own a
better car maybe you can fund your advanced education I don’t know what you
want to do with your money but whatever you do in this life you need some money
to go with it so I’m going to talk about this rules which I have learned over a
period of time the first rule is spend only as much as you can earn this is a
very simple rule to follow but it is also the most difficult rule to follow
you know often you will know that simple things are usually difficult to do okay
why because they are simple everybody ignores it okay you only spend as much
money as you are earning right from beginning of your career if you are
running ten thousand then your monthly expense should be less than ten thousand
okay if you cannot save money that is fine but at least do not start getting
into the debt right from being of your career okay so only spend as
much money as you can possibly are okay that brings us to the second rule invest
your time and energy into building your skills and your attitude you know
whatever money you earn in your life whether you are in a job whether you are
an entrepreneur whether you are a professional like a professional
musician or a film director or an actor or or any person who is earning money
he’s going to earn money because of two things one is the skills that he
develops okay what is your skill what do you know or your programmer do you know
your programming well are you a sales executive do you know how to sell really
well if you are an accountant do you know your accounts really well so it is
the skill the primary skill because of which people are ready to give you money
and the second but very important thing is your attitude because you might have
all the skills in the world but if you do not have the attitude to carry that
skill then chances are that you’re not going to get the good work that you need
to do you can see a lot of examples all around you and you will find out that
some person has amazing skills but because of his attitude he’s not able to
stick to a particular job he’s not able to do a business or he’s not being given
work as a professional okay so the second rule is invest in your skills
invest the time and energy into improving your skills and your attitude
the third is never work for free never work for free if you are doing some
volunteer work if you are helping someone that is a different thing what
I’m talking about is if you are working for someone
and that someone is using your work to get money then you should get part of
that money okay so you cannot join a company and work for free you can build
your YouTube channel or you can build your your blog for free you can write a
book for free you can take photographs for free okay because that is an
investment into your own own assets these are all assets if you if you build
your YouTube channel this is an asset okay if you write your own book this is
an asset and you can sell your book to earn money but when you are working for
someone when you are in a job for someone for example you are working to
help someone to build their business don’t do it for free okay so that is the
third rule that never work for free the fourth and very important rule is pay
attention to the flow of money in your life you know what what is the flow of
money from where your money is coming in and where is it going pay attention to
that okay often it happens that people spend their entire salary before it it
will hits their bank account and that happens because you’re not you don’t
understand what is your outgo versus your incoming okay so have a clear idea
about how the money is flowing into your life from where the money is coming in
and generally people have one or maximum two or three incomes that’s it okay if
you are an entrepreneur if you build multiple income streams then maybe you
are having three four different income streams but there are the incoming part
is very easy to track and you know from where this money is coming in but the
outgoing part is very difficult because there are so many things that you can
spend your money on so pay attention to the flow of money
and make sure to follow the rule number one that is spend less money then you
can earn the fifth rule is once you have negotiated your contract whether you are
going in a job and you have negotiated your contract of how much salary you
will get per annum or you are a professional maybe an actor who is
asking for an acting fee and once you have negotiated that contract and you
have agreed to that to that amount or you are an enterpreneur who’s
negotiating a contract with a client where you are going to get certain
amount of money from the client based on the work that you will deliver once
you’ve negotiated the offer then forget about the money and focus on the work
you have to deliver this is very important okay there are a lot of people
they are so obsessed about money that they forget that money is just a medium
of exchange okay and that medium of exchange is to or to give value to
whoever is giving you that money so once you’ve negotiated your contracts
one shall agreed to the price to the cost after that don’t think about money
just think about delivering the value just think about doing that work in the
best possible way so that you get another contract from the same person so
that if you are in a job your income will go up as you keep on delivering on
the work that you are doing that is a rule number fifth once you have
negotiated the contract then don’t think about money think only about our focus
only on the work you have to deliver avoid the sixth rule is avoid borrowing
money unless it is to save your life you know people say that life is everything
and that is true and you can borrow money only if it is
required to save your life there was a time when I lost my job and I was in
such a situation that there was a lot of debt
I had the mortgage payment to make I had various bills I had to pay for my
daughter’s school fees all these expenses were there okay and I’d lost my
job and I was not getting another job I did not have money in the bank and that
was the time I borrowed money from one of my uncle now this is the time you
don’t borrow money from credit card this is the time you don’t borrow money from
the bank this is the time you don’t borrow money from anywhere where you pay
interest because you are already in trouble you’re already in – if you do
that then very soon you will go bankrupt so what I did was I borrowed money from
my uncle and I told him that it is going to take some time to pay back this money
I have lost my job and by the time I get my job and then I accumulate the money
I’ll be able to give it to you in few months time and he gave it to me and
that was for survival purpose that was to save me and my family from coming on
the streets okay so don’t borrow money unless it is to save your life unless it
is for your survival that takes us to the seventh point and the seventh point
is if you borrow money then make sure that you work hard to pay it back as
soon as possible you know if you have any kind of a debt you are in some kind
of a burden your mind will always keep thinking about this money that you have
borrowed I told you that money can feel make you feel ashamed the time when I
borrowed money from my uncle I used to always feel ashamed whenever I used to
make a call to him because I I used to think that I have to
pay him back his money okay and what he must be thinking about me so if you
borrow money work hard and try to pay back all the money as soon as possible
okay make a plan make sure that you are
keeping aside a good amount of cash so that you can pay back and if you can pay
back if somebody is ready to take the money in installments why not this leads
us to principle number eight cash is more important than all your assets
combined you need to understand this and cash I’m not talking about physical cash
cash in the bank is also fine but money which you can immediately
withdraw money which you can use immediately okay
your house is an asset but you cannot sell your house and use the money okay
it takes time to sell the house so you need you need money in the bank
you need cash in hand okay the more cash in hand you have the more freedom you
are going to have so learn you you need to find out a way so that you can save
as much cash in hand and fixed deposit is also a cash in hand because you can
break your fixed deposit at any point of time but a mutual fund may not be cash
in hand there are mutual funds which have lock-in period from five years to
seven years and if you are investing in that thinking that okay when I need it I
will have it okay you will be you will have a big challenge okay there are some
life saving instruments but they will have a period in which you cannot
withdraw that money okay so cash in hand is more important than
all the combined assets that you have okay and strive to have as much cash in
cash in hand as possible can be in your bank it can be in fixed
deposit it can be in recurring deposits but it should be someplace where you can
access it immediately only give your only lend your money to someone when you
are comfortable with the idea that that money is not going to come back you know
sometimes some people will borrow money from you it can be your friend it can be
somebody you know really well and they may be in real need now if they are in
real need at that point of time you can help if you have enough money with you
but you help only when you have enough money with you if you are struggling and
you try to help your friend with that then you will get into a problem where
you are trying to now get back the money and that person does not have money so
lend money only when you are certain that okay even if this money does not
come back I’ll be fine I won’t have a problem okay I have learned money to
people and I have said okay fine that’s for them and when they have money they
are going to give it back to me and and it has worked out completely fine I
never had to go and ask back for the money because in my mind I had enough
money to take care of myself the tenth point is to save as much money
as you can whenever you can in the initial years of my career I was not
able to save any money I had no money in the bank I had no money in my pocket
whatever used to come every month used to get spent in fact I used to always
spend more than what I used to get I used to borrow from someone I used to
borrow from credit cards to borrow from a bank okay so I was always in debt
during that period so there was no question of saving but
after I started understanding and after I started putting in this simple
principles okay simple principles in place after that I have started saving
money so that I have enough money whenever I need it
okay so whenever you get some extra lump sum amount you can put it in your saving
okay but again save it in instruments where you can get it back immediately
save it has cash as much as possible may be fixed deposit or recurring deposit
that is fine but save as much money as you possibly can because you don’t know
when when things are going to go up and down you don’t know whether your job is
going to work out the way it is working today you don’t know whether you are
going to be earning the same amount of income every year okay so same enough
money as much money as you can okay and this is not just for people who are
salaried this is for enterpreneurs this is for people who are professionals
everyone needs to save as much money as they can when the flow of money is good
and you can spend excess money there is no harm in buying a big car there is no
harm in buying a big house there is no harm in in living a great
life there is no harm in that based on how much money you have you know like if
i am boris becker and if i can earn twenty five million dollars yes of
course i will buy a big house but i will also protect my money and also protect
my money so that I can protect my standard of living I can protect my
freedom I can protect my security so how savings as much as possible that
is the most important thing now this is a final principle which I learned and
this I learnt very hard to be you know I lost a lot of money in schemes which
people explained to me is going to make me rich
okay when I bought a house at that point of time I went to the bank to get a loan
and the bank said it’s good to have this loan but along with the loan why don’t
you also invest in this particular it’s kind of a policy that will protect you
against bankruptcy and I was okay and I did not know it was a mutual fund scheme
and there was a lock-in period of seven years and I was paying like ten thousand
rupees every month into this scheme now after three years I really needed money
and I was not able to pay this ten thousand rupees every month and I really
wanted to withdraw from this scheme and what I understood from the person at
that point of time is this scheme is locked in for five to seven years and if
I were drawn now I will get less money than I had invested and I had to
withdraw it because I I was in such a state that I needed money at that point
of time so I had to withdraw that money but I lost a substantial amount of money
and this is not happened once this happened twice three times this happened
and then later on I understood then when somebody comes to me with a scheme then
there are terms and conditions applied okay what I have learned during this 20
23 years of my career is that there is not a single scheme on this planet which
can give you returns over 15% okay only people like Warren Buffett Ray Dalio or
or some of the big investing Minds can make money on stock market or mutual
funds but as far as the common people like me are concerned I feel that if
someone says there is a scheme to make more money it’s a scheme to lose money
and I always stay away from this scheme I am Oh
with a fixed deposit I’m okay with investing in mutual fund where my money
does not get locked in where I can withdraw my money anytime and it’s okay
if that money is sitting there in a discerning just 5% or 7% does not matter
because I know that none of the majors fund scheme can give you more than 10%
interest so the whole point I am trying to make is that don’t invest in schemes
without understanding what it is don’t invest in anything don’t invest in a
business without knowing what that business don’t even become a partner in
a business where you don’t have to invest money but you are a 20% partner
because if that business goes down your 20% will be then attached to that
business so very be very clear when you are investing your money when you are
investing your time and energy in any kind of a partnership or anything okay
so these are these 11 these are some of the principles that I have learned over
a period of 23 years about money this is you can call it philosophy of life on
financial wisdom you can call this my philosophy of life on financial wisdom
and I thought I will make this video for a lot of you who may be starting out
your career just now or maybe struggling with money and whatever I have said is
not advice I don’t I don’t think you can follow this rules this rules I came up
with these rules for myself because of what I saw in my experience okay I know
I have a friend who used to who had a very humble beginning used to stay in a
very small house with seven people staying in the same one single room and
a small kitchen in a washroom they were staying in this small house and I know
him because I was very good friends with him
during my high school years and he went ahead because he he had only education
to bring him out of this poverty he only had he he knew that he had to study so
that he can come out of this and make something out of his life what he did is
he was he was one of the best students of us of our high school he went on to
do engineering okay in engineering he came second in the entire university
okay entire university he came second then he
got got to in campus interview for LNT LNT is one of the premier engineering
companies in india and he worked there for two years after which he did he went
to do masters in us and when he was in us again he studied really hard and
became kind of a topper in his college he got to campus he got to offers one of
HP helmet packard and another of Intel now the Intel offer he first rejected
the Intel offer he went with HP but after a few months he switched to Intel
since that time now it’s 20 years he’s been with Intel he stayed in us for
somewhere around 15 years and during that time he steadily build his income
during that time steadily build his assets in such a way that today he’s
kind of having four houses he’s bought four houses one house he lives him few
of them he has given it on rent he’s had has enough cash in bank okay and he’s
come out of that from that humble beginning if anybody knew the humble
begin nobody can think that he’s the same guy today who owns all these
properties and these properties are in Mumbai one of the costliest cities in
India so you can imagine that a person can
lose all his money by errors of judgment which is repeated over a period of time
or build an empire build a fortune by following a few simple disciplines in
life and if you take one thing from this video it is that you need to take care
of the money that you are earning you need to know how much you’re earning and
how much you are spending you need to build your fortune nobody is going to do
it for you you yourself are responsible for that
and once you are understand the few simple rules of handling money I am sure
that you will be able to live a rich life okay you’ll be able to live a life
of freedom you’ll be able to live a life of security you’ll be able to give your
family whatever they need and whatever they want I hope this video helps you if
you know someone who needs this video then please share this video with them
thank you very much stay focused stay rich see you in the
next video

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Dennis Veasley

One thought on “Boris Becker Bankruptcy. 11 Personal Finance Tips that will save you and your money.”

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