Yesterday i attended a financial literacy session. The speaker showed us what Rs.1lac could have grown over the last 25 years if invested in different ways. At first he talked about keeping money in the bank. For many of us it may feel safe but inflation slowly reduces its value .He gave examples that how Rs 1lac from 2001 could have value (or purchasing power) of only around 9 thousand today.Then we looked at national savings. Rs 1lac could have grown 15 lac which is around 11.5% in 25 years, if we take the average rate every year. When he calculated real estate with 13% annual growth Rs 1 lac could have grown into 21.2 lac in 25 years. The Gold was more interesting . Its one tola was around 8k in 2001 Rs 1lac were equal to 12.5 tolas at that time. today tola is around 465,000.It could be 58 lac today.
But the biggest surprise for me was mutual funds that had given a very high return in that period , including around 430% growth and islamic funds showed 287% growth. So if we invested Rs 1lac and it grew 25%, it would almost become Rs 4 crore. Offcourse these are the past records and cannot guaranteed the same progress in future but still it was huge. it was an interesting session and made me think what is my money doing while i m not using it?
If you had Rs 100,000 in 2001, where would you have invested in?
It is quite understandable that keeping money in the bank does not make you any profit, rather bank will help you to enrich themselves with your money, and give you nothing as interest. If you must save money in the bank, let it be for emergency alone , and your money should be properly invested to make good profit on the long run. However, there are many investment that can help you grow your money in a long period of time, and they are mutual fund, high yield savings account, stock, and Bitcoin. These investments, and assets mentioned can really make you gain financial freedom on the long run, and we should understand that wealth is more easy to build on long term investment, for instance assets like Bitcoin, and stock can make you good money, but only on the platform of patience, when you lack patience, you will actually give up before your success comes.
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