Last morning I got to attend a workshop on ‘Financial Literacy,’ organized by the Jaipur Chapter of FICCI FLO, an all India Organisation for Women!

Rewind a few hours to when I was being briefed about the aim and agenda of the talk at the office – “Okay, so we have a workshop on Financial Investments, wasn’t it just yesterday evening that your father was lecturing you on it, and you were sitting blank nodding,” my mind popped in between! (I hope my father doesn’t read this) But perhaps I was destined to attend another lecture, and so I set out to give it a try!

The pleasant weather added to my ride and even more pleasant was the welcome by the staff of Holiday Inn Centre. In few minutes I reached the venue hall, and the team representative of FICCI Flo showed me to my seat.

Before I proceed, let me tell you a little about the speaker, Mr. Bishnu Dhanuka. A successful investor and businessman from Kolkata, he is the co-founder and director of Millennium Mams, an organization dedicated to Empower Women through Financial Literacy.

And today he was in Jaipur to guide women around the many investment options that exist in our economy. He began with sharing his ‘mantra’ for financial literacy, “There is a difference between earning money and becoming wealthy. Where the former corresponds to spending all the earnings followed by looking out for loans, the latter holds true when one doesn’t simply spends, but also indulges in savings and investments.”

A strong advocate of World’s most successful Investor Warren Buffett’s ‘Investment Philosophy’, Mr. Dhanuka spoke about the pros and cons of the many long-running traditional investment avenues and went on to demystify the science of ‘shares’. For instance, did you know Fixed Deposit is referred to as ‘Suicide Postponed’ in the investment-world, or that investments in Gold are said to be worthy only for times of recession?

As he continued to talk about why investing in shares is a wise choice to make, provided one learns the ‘math and science’ that goes into it, I quickly jotted down the golden rules:

1. Investment in shares should only be done from ‘surplus money’, and not from one’s savings.
2. Look for multinationals that work for the interest of the shareholders and treat them like partners.
3. Choose a consistent and predictable business that can offer the highest possible return. It helps you get the best from the annual compounding rate of return, and with least amount of risk!
4. And also a business that has its consumer monopoly based on toll-bridge concept, as it helps in predicting future returns. Companies like Gilette, Tata, and Bajaj that are usually not capital intensive, have intangible assets and are also debt free. Since consumers depend on them, their returns are also assured and safe.

And last but not the least, follow Warren Buffett’s principles, “I made my fortune with a system available to all of us, and that is share market. But always remember these two Rules. Number 1: Never lose money. And, Number 2: Never forget rule number 1.” For more on it, read the book, The Tao of Warren Buffett.

But if like me, you too, are wondering about the equation that Shares must hold with Income Tax, let me share the speaker’s word on it, “Share investment is the best avenue with regard to Income Tax. One doesn’t have to receive any tax dividends, and if the investment is made for more than one year, i.e. if it yields long-term capital gain, no tax is imposed on it.”

The important takeaway being – you must educate yourself before buying shares, and never choose a wrong partner! Start by analyzing your needs, take an account of the surplus money, and research well. And according to Mr. Dhanuka, there can’t be a better time for Indians to indulge in share investments! Why? “Because our economy is moving fast from 2 to 5 trillion dollars, and is currently in the hands of the strongest Prime Minister we have ever had” If you get his hint!