#2 Ink and Water experiment on the importance of Time and Goal based planning in creating Wealth .

 

    Heyya school time😂- Monday 1st  Session- Venue- Science Lab - PS: Students without  lab-coats can stand outside the class !!! 😅

    Alright ! Now, imagine a transparent glass with water filled in it .Now  add  a drop of blue ink in the water and alas ! the water inside the glass changes its entire color to blue through the process of dispersion.  Now ,what is the take away with this school science lab experiment related with personal finance;

    To relate things here, let us  call the water the  “time” available  for achieving our financial goals and let us call  the drop of blue ink as the “a small systematic contribution of money” towards our goal , let us call the transparent glass as “rational investment vehicle” and  finally let us  take the volume(capacity) of the transparent glass as the “total corpus required to achieve our financial goal.”

     Just by adding a small contribution of money (a drop of blue ink) and by giving it time (the water in transparent glass), the value of money will inherently grow through the process of compounding (process of dispersion-where the colorless water turns blue creating required wealth ) through a rational investment vehicle (the transparent glass) ,which would positively cater and fulfil the needs of our financial goals (capacity of the glass).

    Ah !Let us take a break✋ -That was a lot of science though -😏 This small  idea is only to provide a glimpse to hang on with rationality of investments ideas and not carried away with fancied euphoric financial products which markets and promises with high glittering returns- like "Oh wow ! take a look! a glass with a golden handle—lets add water into it"---nahh! Just be ok with the normal glass of water! Trust the wisdom of natural economics- It will do its job and eventually get our work done at peace😊.

"There seems to be some perverse human characteristic that likes to make easy things difficult.”- Warren Buffet . 

Conclusion: Patience, Consistency and Rationality are the bedrocks to achieve your desired financial goals. The simple ink, water & Glass example is a representation of something known as " Positive Risk Adjusted Return". One does not have to take mighty risk for a mighty return. As in personal finance, the greatest risk of all is not having the required money at the time of need. So it is important to tame risk and more importantly not to chase high returns .All these could be attained through a rational approach by a method called Goal based financial planning.( Holy grail of family finances !).  

I will present a separate blog on the topic Goal based financial planning in my upcoming blogs.

Hope you enjoyed reading this one. Thank You, keep safe & Be Empowered... 😊

This blog “Empower Finclass "is an effort to educate and spread the word of financial knowledge and awareness whilst empowering the community with a touch of practicality on personal finance.

For any queries and assistance related with incidental financial advisories and for goal based financial plan, you may write to the "contact us" form in the blog or you may please ping a message through Whatsapp (Mobile No: +91 9499979180) or call at the mentioned mobile number and I will be most glad to guide your path to financial freedom.