5 Money Lessons Which Many Will Realize Too Late

If I were allowed to tell you only 5 money lessons, here’s what they’d be.


NUMBER 1 OF 5 MONEY LESSONS: Being able to invest money well, is a life-altering skill. And yet, very few will ever learn it.

Knowing how to grow and protect money in a stress-free manner, is as liberating a skill as knowing how to use a computer or drive a car. It creates a new set of life choices at every step of your life. It can allow you to retire early, comfortably take several years off work to master a brand new skill, work on a life project, improve your health, or allow you to spend more time doing the things that truly bring you joy.

To see the difference which just one well-calculated investing decision can make, have a look at the graphic in this post here.

The impact of several years of good investing, is simply incalculable.

And yet, many will never learn the skill well, despite being fairly aware of its impact. The fear and the inertia towards understanding finances better, will always remain a widespread psychological phenomena of sorts.


Number 2 of 5 Money Lessons: No one will take care of your money as well as you would.

  • More than 98% of financial advisors in India are commission agents.
  • In FY 2018 alone, mutual fund middlemen made an incredible 8500 crores as commissions.
  • The highest selling life insurance products in India have agent commissions as high as 35%.

All of this means, that the chances of you encountering someone who you could fully trust with your money, are rather low. The lure of commissions is strong, and ulterior motives kick in sooner or later. I know several advisors who provided good recommendations at the start, but then resorted to suggesting NFOs or expensive PMSs to their clients; both products which most investors can comfortably avoid. SEBI has gone to the extent of warning mutual funds, about excessive distributor commissions.

The entire financial system is designed in a way that it allows the financially educated minds to bypass these commissions with ease. But since that is a very small group, a majority of individuals will lose lakhs and crores by the time they retire, and only a portion of them will even realize that they have. The only way out, is to learn the field yourself. No one will take care of your money as well as you would. Period.


Number 3 of 5 Money Lessons: ‘Growing money’ and ‘Saving money’ are two vastly different things.

Most of us in India have been taught rather well on the ways to save money. We are a nation of savers. Consequently, most intrinsically believe that creating wealth for future means cutting corners and saving as much of income as possible. So even if they invest their money, they invest in places which guarantee to keep it safe.

But this is a terrible approach to accumulating wealth, and is a ‘poor’ man’s idea of wealth creation.

Accumulating wealth is truly not about saving as much of it as possible, but about growing as much of it as possible. There is no doubt that continuous financial prudence helps. Indeed, a man who always eats moderately never has to go on diet. But growing money requires a level of financial understanding which saving money rarely does.


Number 4 of 5 Money Lessons: The quantum of knowledge required to generate wealth in a safe and stress-free manner, is shockingly low.

But this crucial knowledge tends to get drowned in a sea of noise, and is scattered beyond belief. The only way for you to be able isolate this core knowledge, is by first learning how to identify and ignore the noise. A lot of what you’ll read and see on a day-to-day basis is completely useless and is mostly there to fill TV air time and news paper sections.

Once you’re past learning the fundamentals well, all matters of money become second nature. You’ll be able to see through the fog and succeed effortlessly by focussing on a few core, shockingly simple principles. It is again, like learning how to drive a car. It seems daunting at first. But with enough practice, it becomes muscle memory, at which stage, you need a very tiny portion of the mental resources you needed earlier.


Number 5 of 5 Money Lessons: After a tipping point, any additional wealth will fail to bring an equivalent, additional happiness.

There is a reason why study after study shows that several rich, self-made individuals, continue to live surprisingly simple lives despite their wealth. This does not mean that they live poorly. It just means that they seem to be content with what they already own, and aren’t in the race to accumulate incrementally better things year after year.

And there’s a reason for this. Once you’ve reached a state of financial security, and know how to create more wealth, you tend to intrinsically lean towards things which are far more rewarding than the temporary joys derived from accumulating things. One tends to get involved in activities like investing more time and effort in their families, teaching, arts, learning new skills, helping local communities, and charity.

At this stage, any incremental wealth fails to bring an equivalent, incremental happiness. Because by then, one has already learnt to derive happiness from the things which either cost very little or nothing.

Those there were the five things which many will realize too late. You’re now free to click away and wander the depths of the internet.


However, if any of this has inspired you to take your first steps towards understanding money better,

There are two ways you could get started

1. You could read a good book on finances

I sympathize with you if you aren’t a book reader. But there’s simply no way around it for now. Because the devil is in the details. You cannot gather the core knowledge by watching a Youtube video once a while, or reading an article here and there. Imagine how long you’d take to learn how to drive a car, if you learnt how to operate the brake one month, the clutch another month and so on. It just doesn’t work.

You’re free to start with any good book. But I do suggest Smart Money Moves for two very critical reasons.

  1. I’ve been reading resources in this field for more than a decade, and am still to find one which is as comprehensive as Smart Money moves. The book lets you learn everything in one single place. From investing, to insurance to taxation to salary structures, while still being really easy to read.
  2. It’s ruthlessly impartial, and unaffiliated. There are no products to push, no commissions to earn. Everything you’ll learn about, is something which will work best for you and for you alone.

There’s a reason why its predecessor ‘Grownups Are Just Kids With Money’ was called the ‘Bible of Finance’. As an author, I hardly make 10% of the book’s listed price. So I truly have very little incentive to sell you the book. But you on the other hand, stand to gain a 10 year head start on financial knowledge, for the price of a pizza meal.

2. You could look for a financial workshop in your city

Good workshops are even harder to come by, but you may just find one.

You could also find courses which you could take online, but fair warning; online courses usually have a 96% dropout rate. So you’re better off keeping a tab on the events in your city for an in-person workshop. A word of caution again here, is that several commission-earning platforms often masquerade as financial education providers. Many even offer free workshops and courses, since they stand to gain a lot in commissions from your investments. In which case, you’ll not be signing up for education, but for propaganda.

I conduct a program called ‘The Moneyplanting Program’. You’ll find some details here. If tickets are full, I’d suggest you subscribe to the site so you can receive an alert. I tend to close attendance to each workshop awfully early since I enjoy teaching small groups.

Happy Moneyplanting.


[Update: Look for the upcoming weekend workshop dates by clicking here. ]