Why Investment is important?
This is Vijayalakshmi.
She is a famous South Indian actress. She has acted in around 37 movies including Kannada, Tamil, Telugu and Malayalam.
She has acted with almost all the big names of every South Indian film industry like Vishnuvardhan, Shivarajkumar, Raghavendra Rajkumar, Upendra, Mohan Lal, Vijay, Suriya, Arjun Sarja and so on.
She has also acted in a number of serials and hosted quite a few successful game shows.
Basically, every South Indian movie buff would be quite familiar with her.
Today, she is admitted in a hospital and is seeking monetary help from anyone she can. She says she doesn’t even have a house to go back to.
What happened?
How did such a successful actress fall from her grace?
Simple. When you are riding the high horse, you wouldn’t think of what would happen if the saddle comes loose. Basically, no investment for the future.
Sure, an actress has to splurge a considerable amount of money in terms of fashion and status to keep herself employable. But what happens when you are no more employable?
This situation can be averted by judicial investment of your finances.
A supporting actor for a serial today is paid around 3000 per episode excluding food and transport. So the main character will be obviously paid at least twice of that. For simplicity sake, lets consider it as 6000. Multiply that with 500 episodes (one of her serials ran for 845 episodes). 30 lakh rupees. And this is a conservative estimate. Main actresses get paid a lot more than that.
Financial literacy should be made a compulsory subject of high school academic curriculum. Else, we even as medical doctors, engineers, laywers or professors suffering from the same disease due to ignorance of financial management.
Well said; I was also wondering today why we don’t have such a course as mandatory in high school or in university freshman years. Preserving and growing money is as important as learning to earn money.
High salary/income and wealth are totally different, but most of us don't understand it. Often we feel that our current high salary could solved all future problems, but that's totally wrong.
A 30lac investment over a period of 10 years in an SBI mutual fund would have generated 94lacs!
She is crying and blaming all her co stars that no one is helping her. They probably should, but how can you think that they owe you something?
Hopefully she gets better and gets back to the stardom she had achieved and this time build a better future.
Why Should You Invest?
Investing is essential to achieve your goals. It is the only way to make your future better. By making investments, you are also saving and accumulating a corpus for a rainy day. Apart from that, making regular investments forces you to set aside a sum regularly, thereby helping you instill a sense of financial discipline in the long run.
Impact of Inflation and the Importance of Investing:
Inflation, in simple terms, is a surge in the price of materials and services. It decreases the worth of your money and reduces your purchasing power. When there is a rise in the inflation rate, you buy fewer things with the same amount of money. You have no control over the inflation rate. If you are to stay ahead of inflation, you need to have more money to purchase the extent of the goods you intend to in the future with the money you have today. But, money doesn’t grow on its own.
If your money has to grow, then it has to earn returns.
It is very important to earn inflation-beating returns, if not, you may not be able to afford materials and services in the future from the savings you are making now.
And that’s why investment is important.
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