You need to take a step beyond Borrowing Wisdom
07 Sep, 2017
Career, relationships, bereavement, health, personality development; the answers to what should be done for success, what you’re doing wrong and how you can correct the situation can be found in a self-help book. So, it’s no wonder that self-help books are topping best seller lists, the world over.
These bestsellers consist of incredible stories, wherein ‘The Secret’ helps people achieve good health, immense prosperity, success in relationships and happiness. For instance, people who intend to lose weight but have been putting it off due to excuses suddenly pick up a self-help book about health and are transformed. Regardless of whether they might be able to put in the effort to actually lose the weight, the book serves as reinforcement of the fact that weight loss is not just possible, but in fact highly probable. When this is coupled with mentions of famous people in history using this same Secret to achieve the stature they enjoy, it’s no wonder that the masses flock to these books at the rate they do.
The premise that forms the basis of ‘The Secret’ is the Law of Attraction, which states that whatever you want can become a reality but only if you really want it and desire it passionately. So, if you think positively and prevent any negative thoughts from taking root in your mind, virtually anything can be achieved.
Napoleon Hills’ ‘Think and Grow Rich’ was a self-help book in the financial sector that pretty much followed the same pattern. While the book was informative, when it comes to the area of finance, there is a larger issue at play. Using self-help books to base one’s investment portfolio upon is a foolhardy mistake to commit because following someone else’s guidelines, without really doing any additional recon will eventually result in losses.
I too believe in The Power of Positive Thinking and understand that positive thinking can aid in achieving success. But I also believe that positive thinking MUST be followed by proper planning. Basically, inspirational quotes, unless tied to an action plan and executed with perseverance are unlikely to provide any results. So, my main grouse with the book is that it oversimplifies concepts and doesn’t really offer any concrete guidelines on how to truly achieve your financial goals. Having a positive outlook is quite important but there are a lot of people who simply rely on positivity and fail to create or act on a plan. What is important is to set goals, create a proper plan and execute to get the right results. More importantly, reworking the plan once a hurdle appears is necessary.
For instance, you might want a particular stock to hit Rs. 5000 from its current value of Rs. 1500 and may whole heartedly believe that it’s possible. But in hoping for the best, you mustn’t forget that there could be several hiccups along the way or that the stock may never hit that level.
To succeed in personal finance, diligence, in terms of savings, appropriate insurance and investment strategies, is of utmost importance. this should be followed by execution of strategies and evaluation from time to time. Taking stocks of internal changes like additions to the family, death, change of job, moving out of the country, inheritance, etc. are scenarios that must undergo reevaluation over time. External environmental factors like state of capital markets, interest rates and tax law changes must be taken into account as well.
Taking a leaf out of someone else’s book is more than okay but what’s necessary is having a strategy that suits your needs the best. Unfortunately, there are a lot of people who prefer the quick route to achieve their goals, who in their haste forget that shortcuts generally come at a price.
Perceiving ‘The Secret’ to be a ‘quick rich scheme’ is an imprudent step to take. There are never any easy answers to anything worthwhile in life and if you believe that you’ll increase your net worth simply by wishing for it, you will be proved very wrong. In the area of finance, as with any other avenue of life, having a positive attitude is important but it’s more important to believe in the virtues and principles of honesty, hark work, diligence and perseverance.
A good place to start, would be with ‘The 5 Big Money Questions”.