Investing and Sex have more in common than you might think. However more people think about Sex than investing (which is equally important in an person’s life) so we decided to do a comparison so that you can start investing in a planned manner and grow your money better.
Here are some ways in which Investing is very similar to sex.
1.) The earlier you start, the more you get.
Sex – It is a perishable commodity. The later you lose your virginity in life, the less you get of it. There is no way you can reclaim lost time to get more of it.
Investing – Similarly, in investing, the earlier you start, the more you can grow your money via the magic of compounding.
Here’s an example:
If you start investing Rs 5000 per month from age 25, you can have about Rs 3.5 crores at age 60.
If you start at age 35 instead (10 years later) you will probably have only about Rs 1 crore.
Start early, even if it is only Rs 500 that you can invest per month. You can increase as your income grows
2.) You can get burned so be careful.
Sex – If you are lucky to start early, you need to be careful. If you don’t use protection you can get a STD (sexually transmitted disease) or worse, get pregnant (or your partner pregnant if you are a man reading this) – Not the best thing to happen if you are in your 20’s.
Investing – Similarly, if you dive into the world of investing without planning and start buying stocks based on your friend’s (or an ‘expert’ on TV’s tips) without doing proper research, you can lose your money very quickly.
The key in both scenarios is education – Learn about safe sex and get financially literate early on in life
3.) Ask for Directions
Sex – Almost everyone thinks they are great in bed. However, nothing could be farther from the truth. It gets better with time and the key is to ask your partner and get to know what gets them off better. It’s a skill that has to be learnt together.
Investing – Think about it – When was the last you attended a class in school or college about managing and investing your money better ? You probably can’t remember it because it never happened. Whatever we learn about investing is through our parents, friends, relatives and media.
Unfortunately, this also causes a lot of confusion because we end up learning a lot of myths and misconceptions while missing out on the basics.
E.g. – Do you know how inflation destroys the value of your money ? Or what is the current inflation today and over the last decade ?
Again, learn about the factors that affect your money so that you can grow it better.
4.) Size and Returns don’t really matter
Sex – A lot of folks are obsessed with size – However it doesn’t really matter because foreplay, intimacy and your mental makeup make a huge difference. The goal should be to make each other happy instead of focussing on “Larger size = better performance”
Investing – Similarly, one of the most common questions we get asked is, “What will give me the best / largest returns ?” – Large returns are not important if you invest with a goal(s) in mind.
E.g. If you need to save for your children’s education and want to have Rs 25 lakhs in 20 years, you will need to invest only Rs 2500 per month. Now this can be achieved with an average interest rate of 12.5%. Since you have set a low expectation, any additional money will only come as a happy surprise.
Focus on setting your goals and defining what you really want to achieve. Then plan accordingly instead of just chasing returns.
5.) It gets better with time (and practice )
Sex – Remember the first time you had sex ? Wasn’t as much fun as you thought it would be right.
Investing – Just as sex gets better with time, similarly, you will see your money growing gradually over a period of time. Yes, you might get lucky at times in a bull market but you should treat that as an exception rather than the rule. Also, as you start your investment journey, the more you make an effort to learn, the better you will become as an investor.
The key is to make small monthly investments so that you not only get into a disciplined habit but also make informed decisions as your knowledge increases.
We could go on but you have probably got the message.