Will you be rich?

On doing the math, I discovered I would be able to achieve most of my goals provided I made some adjustments and invested more resources

In my investment advisory practice, I am reminded of this line: “Will I be handsome, will I be rich?” in the famous song “Que Sera Sera” sung by Doris Day in Alfred Hitchcock’s “The man who knew too much”.

Let me narrate a personal experience I had about a decade ago. I had a personal trainer, Ganesh, who would come home every morning to assist me with my exercise regimen. We were friendly and discussed many topics of general interest. During one of those discussions, I made a stray comment: “Middle class people like me naturally react like this….” Ganesh bristled at this rather innocuous comment. I asked what had irked him. He responded: “But you are not middle-class, Sir, you are rich.”

That’s when the penny dropped in my head. Ganesh was a professionally certified physical trainer. He had, by dint of hard work, done well. He owned a small flat in a faraway suburb, his child went to a good school, there was decent food on the table, he had the required white goods, and a motorcycle. His family had access to reasonable quality healthcare, and he had some savings in the bank. He was living the “middle class” life he had always dreamed of. When I called myself “middle class”, in comparison, he became “poor” because of the gulf in our living standards. Being labelled “poor”, even by implication, was not acceptable to Ganesh who was justifiably proud of his efforts to pull his family out of the poverty he was born in.

His response set me thinking: Why did my own mental model not allow me to climb out of the middle-class background I had been born into? Like Ganesh (but with access to higher resources and family support), I too had studied hard and acquired a professional qualification, and then worked hard to acquire the trappings of success. Yet mentally I viewed myself as a middle-class person still. I looked up the definition of “rich”. Websters dictionary defines “rich” as someone “having abundant possessions and especially material wealth”. The key word here is “abundant”. I had plenty of resources (more than Ganesh), but was not sure if they would suffice to meet my equally higher ambitions. I had never done the math to find out the answer. No wonder, I did not feel “rich”.

I sat down and made a list of everything I owned and everything I needed to do. I had goals for my children’s higher education, their marriages, and my retirement. I mapped the resources I already had and drew out possible scenarios on whether I would be able to achieve what I wanted. I discovered I would be able to do so provided I made some adjustments and invested more resources. The whole exercise was quite energising, especially because I involved my spouse and children and used their inputs as well. It took a few years, but as I became more certain that all my requirements would be met, my mind started accepting the fact that I am no longer “middle class”. I am now officially rich. It dawned on me that being “rich” is an emotion that must be felt, and not just a fact that has to be measured.
 

This exercise proved to be the foundation of my investment advisory practice. Now, whenever one of my clients asks the question that Doris Day did in the movie, I find it easier to answer: “Yes, you will be rich.”

The writer heads Fee Only Investment Advisers LLP, a Sebi-registered investment adviser