Dust to Dust ... Riches to Riches!

Stocks!- sounds as lucrative as a Development Project does it?, Savings - thats as mundane as a maintenance Project(but as we all know it pays off well!). But as I have learned the hard way, you need to save some to gain some.

We software geeks were amused by a recent article posted on rediff.com citing that there are going to be around 30 overnight crorepatis among TCS employees through the recent IPO. But was that piece of news something to be laughed off? Look a bit more closely around you and you will find truth in the article.

There's your friend who,heeding his uncle's advice, invested in Divi's lab IPO in March 2003, the Ten Lakhs he had saved from his last trip to the US. Right now he must be having a cash holding of a crore rupees in his bank account(provided he had sold off the shares at their peak value)!

Take another example of my friend who had invested("speculated" really... you will get to know the difference as you follow this column) in a PSU named Indraprastha gas, last year. He was lucky enough to be alloted Rs. 1 lac worth of shares. And can you believe that a few DAYS after the listing of the shares on the market, he reaped in Rs. 5 lacs!!

Let me share MY story, and don't be jealous. My father being a banker, and expecting a above-average growth in the banking industry suggested in December of 2002 that I invest in banking stock. I followed;thought knowing zilch about either banking or stocks. Since I had an amount of Rs. 10,000 (too less really to seriously play the investing game!) I went ahead and invested in Bank of Baroda (the place where my dad works). You could have chosen any other PSU bank for that matter. And today that money has grown by four times! Joyous as I am, I also cant help regretting the puny amount I had invested. Only if I hadn't gone on a mindless shopping spree that month and had saved more! Moral of the story..... oops! no moral science lessons in my first article!

Enough of case studies (I am sure you would come up with more on your own). While you may not become a millionaire overnight, but given a few years of intelligent saving/investing you can get to your first million in 5 years and a first crore in 15 years!

So Whats the recipe? Nothing much; no on-site trips(well if it does come, you can reach your goal a year or two ahead of time!), no waiting for your rich uncle from Africa. Just forego that extra pair of jeans that you really don't need right now and invest the bucks saved!

Remember... 10% of what you earn before TAX is yours forever(minimum 5 years). Follow this space for more investment advice.