Open any news site or paper, and you will find at least one page dedicated to the new players proving their mettle this Indian Premier League (IPL) season. After all, who can ignore the nail-biting moments of Arshdeep Singh breaking stumps twice or Arjun Tendulkar, son of erstwhile batsman Sachin Tendulkar, making his debut?
The adrenaline rush of batsmen running between the wickets to score extra runs is enough to send our pulses soaring. Even the most avid financial influencers discussed cricket more than personal finance strategies on their social media handles.
While finance cannot be treated as a game nor can be labelled as fast-paced as cricket, you cannot for sure ignore the important investing lessons that cricket teaches. The “Greatest of All Times” Sachin Tendulkar has much in similarity with the financial genius, Warren Buffett.
Let’s see how simple lessons from cricket are synonymous with investing lessons.
Check the pitch before the match starts
Cricketers do not just decide to go out and play cricket. They decide on a strategy about who is going to bat first, the second in line to the last man standing based on ground conditions. Ballers are instructed and fielders are positioned accordingly. This is true for investing too. You must check how much money you must invest to secure your financial goals in the future. For this, you must know well about your earnings, savings, and essential expenses.
Start early in life
The first six overs in any IPL match are the most crucial as batsmen hit around the ground to score more runs. IPL aficionados identify this as the “powerplay” wherein their favourite batsmen rain sixes and fours in the stadium. Six overs gone, and the game comes to a slow wherein the batsmen are forced to be content with singles and may hit a sporadic “sixer” here and there. Investing is so similar to cricket, wherein you must start early. This means that you must start planning your investments on the day on which you receive your first pay package.
Decide at what age you would like to retire and how much corpus you want in hand to secure your post-retirement expenses. Unless you start early in life, there is no way that you will be able to reach your financial goals on time.
More risk is equal to more runs
If you know why RCB all-rounder Glenn Maxwell calls Virat Kohli the "GOAT of IPL”, you will automatically realize the risk that Kohli takes to make runs off every ball he strikes with his bat. There is the risk of being bowled, getting stumped, or being run out while playing. Investing also involves some similar risks with the money being put in the wrong kinds of stocks or allocated to non-performing mutual funds or overinvestment in fixed-income plans or completely disregarding the element of safety in government-sponsored schemes like the provident funds, Sukanya Samriddhi Scheme, National Pension Scheme (NPS), and more. But then, risk equates to returns, which is why you must be willing to take calculated risks while deciding on your investments. This will not help protect your capital but garner more money in the long run.
Be persistent in your approach
Consistency is the key to winning any game, big or small. No player can think of scoring a century and contributing nothing to the next game. Every cricketer must contribute in a big or small way to each game he plays. The same is with your investing strategy. You must consistently invest to ensure that your investments are regular and not sporadic to build wealth over time. This will help you meet your big goals while causing a small impact on your monthly expenditures.
Let them say what they want to
“Let the haters hate” is the most meaningful advice seniors often give to young, budding cricketers who often find themselves being criticized for their unconventional gaming tactics or nonconforming playing strategies. During times like these, cricketers must not be distracted.
Investing is much like cricket wherein others’ views do not matter till you are sure of what you are doing. Remember that it is your money that is at stake, so you must allocate according to your risk appetite and not rely much on what finfluencers share or propound on their social media handles or comments by your peers.
Work on a proper combination
You will never see the same set of batsmen playing in the same order or bowlers doling out similar types of deliveries. Diversification matters in cricket and so in investing too. You cannot rely on only one type of investment to achieve financial independence. Look at any successful cricket team and you will find how they keep rotating and rejigging their players as per the pitch and opponent players.
You must churn your investments accordingly by switching between equities, debt funds, fixed-income instruments, gold, real estate, and more regularly. However, too much churning can cause you to suffer unwarranted losses, thus, depriving you of desired returns.
A good coach can work wonders
Irrespective of how experienced the players might be, you cannot discount the benefits of having a good coach at the helm. A good coach is someone who has his eyes and ears on you, who realizes your potential, and who knows how to push you to reach your optimum. Similar is to investing, where you must resort to handholding by a personal financial advisor. Financial planners and advisors offer advice to clients on wealth management and other aspects of their personal finances and create plans or suggest particular investment products and vehicles that suit their needs.
Always check that the financial advisor you choose complies with fiduciary standards, which are the legal requirements that they operate in your best interests and disclose any conflicts of interest.