scorecardresearchMoney and investment lessons from Boris Becker’s present

Money and investment lessons from Boris Becker’s present

Updated: 03 Apr 2022, 09:19 AM IST

Earning a lot of money isn't a guarantee for a comfortable life. Money issues even for the superrich are around the corner if not acted wisely. You must focus on your savings and investments now before you rush to spend your hard-earned money. 

Boris Becker finds himself in debt

Boris Becker finds himself in debt

Who would have thought that the former world No.1 tennis player, Boris Franz Becker would have to auction off his trophies to repay his debt

The once insanely rich Wimbledon champion who was declared bankrupt in 2017 is now gradually losing control of his most talked about trophies as lenders have initiated proceedings against him over a debt of more than £3 million ( 30 crores) on a loan on his estate.

This incident and many more stories of formerly rich turned paupers bring forth our attention to the most neglected triad concept of money – earn, save and invest. Why is not earning money enough? Why must you save your money? And, last but not the least, why is investing money imperative to achieving financial security?

In this age of consumerism, wherein our expenditure exceeds our savings, banks and lenders have constantly pampered us with financial tools including credit cards and personal loans. This has encouraged many to live on credit, thus, setting a dangerous precedent for many who live by the adage “Earn to spend and spend to earn.” In this rigorously vicious cycle of earning and spending regularly, we miss out on the two most important aspects of money – savings and investments.

These are the key investment tips by Warren Buffett. 

Why must you save money?

Those who question the futility of saving money must be inquired about their possible fiscal standing after retirement. While regular earnings ensure that there is no hindrance to the constant money inflow, systematic savings can help you steer off unexpected financial hurdles. If you are still not sure about why you must save your money, consider yourself in the position of Becker who was once counted among the most affluent, but now finds himself knee-deep in debt and penury. More than the financial security and freedom that your money guarantees, enough savings lend you the assurance of having enough to tide through a financial emergency. You are relieved from incurring unwanted debt by saving enough money, thus, securing you from unnecessary stress. Besides, it would not be wise for you to lose sight of your life goals including children’s education, marriage, big asset purchases and savings for retirement.

We do not ask you to fall prey to avarice, but you must necessarily focus on building your wealth. And for that, you must save adequately bit by bit each day of your life.

Why should you invest?

Ask yourself why you would want to be poor, and you will automatically why investing money is the first step to putting your money at work and growing your wealth gradually. Add to this the pain of inflation that reduces the value of your savings over a period. Loss of wealth over time can inhibit your chances of building the much-needed corpus to secure your finances. Investing helps generate inflation-beating returns that can have a positive effect on your intent to create wealth. Furthermore, savings alone cannot help you meet major financial goals like buying a house or paying for your children’s foreign education or parking your money in a major asset that will earn you returns over a period.

Money attracts money; wealth begets wealth. You have worked hard for money; it is time to let the money work for you.

There is no way you will find yourself short of opportunities considering the myriad number of investment options in the country. For example, you can invest in

You can either allocate a portion of your savings to only one investment option or multiple investment options depending on factors like your age, investment goals, investment horizon and ability to take risks.

So, unless you want to see yourself walking down the poverty lane like Boris Becker, you must start saving and investing your money now. An unsure future necessitates quick and mindful planning of the money that you earn to save and invest before you spend.

First Published: 03 Apr 2022, 09:19 AM IST