How To Get Rich Ft. Ankur Warikoo

No one wants to get rich slowly." Entrepreneur Ankur Warikoo breaks down how to invest in your 20s.

Transcript

00:00I'm going to have to pay my Ferrari in for a Ford Fiesta.

00:02Oh my god, share bazaar, satte wala bazaar.

00:11So the biggest mistake that most people make is try and think that money will be made very quickly

00:16and that's not possible. I'll take you back to a fascinating conversation that happened

00:20between Bill Gates and Warren Buffett. Both of them are one of the richest people that

00:24the world has seen and Bill Gates is asking Warren Buffett, hey Warren, your investing

00:28style is just so simple that you invest and you invest for a really long time

00:32and you've gotten so rich because of that. How is it that so many people don't follow

00:35your advice and get rich? And Warren Buffett says, well Bill, it's because

00:39no one wants to get rich slowly. And that's message one. If you're starting early,

00:45if you're starting around your 20s, that's the best time to start because that 10-15

00:50years that you give to your investments is going to compound at a rate that is absolutely

00:55not desirable to the human mind. Do not focus yourself on, I need to start with a lot of money

01:01to start investing. Instead, focus on how long can I invest so that this becomes a materially big

01:07amount. It's called the 50-30-20 rule and it's one of the most fundamental rules of investing.

01:20What this means is 50% of what money you make needs to go towards your needs and these are

01:27things that you can't opt out of. These will be your EMIs, these will be your bills, these will

01:32be your utilities, your food, your transportation, the necessity items that you need to spend. The

01:39key here is don't go beyond 50. So don't take on more loans than you can afford. Then the remaining

01:4530% is towards what are your needs. So these are things that you want to do because you have a life.

01:52Yes, you want to go out occasionally. Yes, you want a nice happy phone. Yes, you want good clothes.

01:57Yes, you want to take a vacation. All of that should be within the 30%

02:02and then the final 20% is what you invest and that's the discipline.

02:07FOMO is going to get you to consider investments that you may not have earlier because lately

02:14there have been a lot of FOMO investments that have been made in asset classes which are very

02:18very risky and that's great. You still want to drive that risk because it may give you a high

02:24return but it'll be foolish of you to invest in something that you do not fully understand

02:30purely because you don't know how to do it. You don't know how to do it because you don't

02:35understand purely because of FOMO. Invest in things that you understand. Invest in things

02:41because you believe in them. Invest in things because you have that money and that risk appetite

02:46too and then after that let it compound over time.