As a financial planner I do spend a lot of time with 16 year olds working in call centers, media companies, banks and so on. When I am with them and discussing their problems, the one question that often comes to my mind is, “If these guys cannot make their monthly salary stretch one month, how will they be able to stretch their ‘retirement nest egg’ for 30 years?”

The normal problems are over running their credit limits, paying partly for their cell phone bills, delaying the rent cheques, and all this, despite being paid well.

I try telling them the virtues of saving, starting early, investing, life insurance, mutual fund and all that. At my age I guess I sound like their dad/mom giving them advice, so like dutiful children they hear me patiently and ignore me nicely. Whenever I run into them again, in the canteen or the corridor, they sheepishly tell me “Sir, I was just looking for you.

Will you be there till 4.30 pm?”

At 5.30 pm when I am leaving, there is no sign. But by now I know their game, so I shrug it off! But surprise, surprise one day a smart, young woman comes up to me and says “Can I invest in a mutual fund or an insurance policy, or preferably both?” I flipped.

I had been chasing a lot of these people and only a couple of them had come voluntarily to invest. So I had to probe. Then came out the secret…and I liked it. And since she was a media person, I asked her to write the story in her own words. So here it is…. in her own words.

“I was on my way to work and Murphy’s law had struck in the form of a traffic jam. In an attempt to dissuade my cab driver from blaring Himmesh Reshamiya’s latest assault on music, I began to chat with him. In the course of my discussion, I asked him if the taxi he drove was his or was he on a shift system like many others.

His reply had me speechless. Not only was the taxi he was driving his own, but he also owned six other fiat taxis, one Toyota Qualis, which he hired out and was now debating between a truck and bus for his next acquisition. Wow! I asked him where he got the money from… slightly nervous that I was riding with a possible hit man for Dawood. And his answer was even more surprising.

He said “Madam, whenever you need to go some place you take a cab and go. When I have to go some place and I don’t have a fare going in that direction, I park my taxi some place and hop into a bus.”

I listened as he spoke, “How much does it cost you to travel from your home to your office?” Rs 100 I said. “Well, Rs 200 for a round trip?”, he continued. “ Well let’s say you travel through the month by taxi. How much would that cost you?”

Some quick math later, I came up with the answer…Rs 6,000! I was spending Rs 6,000 a month to travel Then he said “The bus ticket costs you Rs 10 and say another Rs 20 to get from your home to the bus stop. That’s Rs 60 per day for a round trip. You are saving Rs 140 everyday. That’s Rs 4,200 a month… nearly Rs 50,000 a year. If you invested that in something, you’d be able to buy your own car!”

What could I say? I now travel by bus. And am doing a Systematic Investment Plan in a mutual fund and paying a monthly premium in a Unit linked insurance plan.“

What I could not do in 18 months, a taxi driver had done in 18 minutes.

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  1. Well,better late than never.It was only after several years in a decently paying job that the need to invest in equity struck me(I was already investing in the apparently ‘safe’ debt instruments)This was simply because I just didn’t have the slightest idea about financial products.People generally need a good kick in the behind to make them start saving.When you are 20 and have just earned your first paycheck,most people have only one thought in their mind – BLOW IT UP!

  2. But one shouldnt be “penny wise, pound foolish”, the growth will hit a wall sometime. Spending on some comforts are good, too much saving focus will make life a struggle leaving little energy for other activities which can fetch far more wealth – like “innovation, taking risk and finding a much more paying job, study more, spending money on relaxation activities etc” . But yes, this is wholly true for the group you mentioned, who spend too much.

  3. good thoughts rrp but the way our leaders and experts heading this country is, we soon be dissatisfied with everything. We already are. Things have gone out of control. Only thing you can do is save, invest or spend. No good music, no good literature nothing. Simple joy of living has already gone from our live. You cannot speak/think/write in your mother tong. All we are doing is spend 8-10 hours in office. Travel for 1-3 hours and then worry about financial status we have. But anyway nice story. Isn’t this our forefathers lived and survived like this? Why do we do it like this?

  4. //What I could not do in 18 months, a taxi driver had done in 18 minutes.//

    Well said….!!! It’s a powerful way of instilling the value of savings. I am going to use this Cab Driver in my Training programs….!!! Thanks for that.

  5. A great story,

    The point is… as a financial planner and trainer you are expected to say these things…. so people take the advice for granted, but when the same advice comes in a seemingly casual way from a source unknown and unexpected… it gets into you bang…into the place where it has to… the mind and heart….and then it moves you into action…

  6. When she found out about the seemingly (her assumption) averagetaxi driver, she got stunned by comparing it with her own life style and expenses…

    The moral to me is – if i look up to warren buffet or subra sir, may be I just shrug off their success stories.

    But when it comes as a hard blow from average (seemingly) and completely unexpected people it really makes one realize the power of savings….

    On the other day I was telling my neighbor about term insurance.. He asked whats the return after the term ends.. I said if you live then you lose even the principal…. forget the returns… Its pure risk cover…

    He replied that only fools will buy that….. I stopped talking about personal finance to him from then….He and many others needs powerful blows from similar taxi drivers

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