“It is not good to have zeal without knowledge, nor to be hasty and miss the way.”(Proverbs 19:2)
Everyone in the financial world is eager to hear what advice Warren Buffet has to offer in each New Year. This year he admitted that in America, most people begin this New Year with dampened enthusiasm and dented optimism (Though Dow Jones Index is now at more than 2 years high). Most of the maxims he offered are not new but I think it will be good to refresh them. Some of them are as follows:
Hard work: All hard work brings profit; but merely talk leads only to poverty.
Laziness: A sleeping lobster is carried away by the water current.
Earnings: Never depend on a single source of Income.
Spending: If you buy things you don’t need, you’ll soon sell things you need.
Savings: Don’t save what is left after spending: spend what is left after saving.
Borrowings: The borrower becomes the lender’s slave.
Auditing: Beware of little expenses; a small leak can sink a large ship.
Risk-taking: Never test the depth of the river with both feet.
Investment: Don’t put all your eggs in one basket.
I like his advice on ‘savings’ especially. Most of us tend to spend what we have and save only what is left behind. This will inadvertently lead to numerous times when there is no saving at all. In order to achieve financial health, we need to practice these principles consistently. With each passing year, may we grow wiser and not to ruin our lives (and our loved ones) because of our bad financial decisions.
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