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An almost 40 year old father’s advice on money, savings and investing to his daughter

An almost 40 year old father’s advice on money, savings and investing to his daughter


There is a bus most of us missed in our younger years. Anything you invest in (no matter how small) compounds over time. At most times, growing up, we look at things that will give us immediate gratification, and the stuff we’re asked to focus on for the long term are things like education, career and in some cases, some forms of physical fitness. Saving and investing money isn’t in our immediate set of priorities or (let’s be honest) things we think will matter in the near term.

For years, I tried to invest time and focus towards my career, then towards being an entrepreneur. But, somehow, the whole focus on what you do with your money seemed always to be a “let’s do the bare minimum”, so I did what most people in my generation did bought some insurance, a few mutual funds, and never really did anything else.

But we’re heading towards a different age an age where younger generations will have learnt the merits of understanding personal finance from the days you learn about algebra ( i still don’t know how that’s useful). And I’m in many ways learning this from scratch, and I’m putting down what I’ve learnt over the last few years. In many ways, they’re fundamental principles which I don’t believe with change:-

Park a double-digit % of any money you earn. Start at 10% and increase over time. (It can start with pocket money to your eventual salary) and invest in things that you’ll keep for a decade. This is your foundation. Safe, secure and compounding in as risk-free a form as possible

Only risk the amount which you won’t lose sleep over. Nothing is worth losing a good night’s sleep over. I’ve mainly been risk-averse my whole “investing life”, and I sleep like a baby. To understand your risk appetite and, over time, look to minimise it rather than expand it. That’s how you de-risk yourself in life.

When you risk, choose to risk in things you understand. Don’t risk on trends, “sure-things”, and Twitter pundits. You need to decide if this makes sense and if you lose out on a big payday because we didn’t know enough about its fundamentals, learn to learn more things so that you won’t miss the bus twice.

Invest time in learning how things work from a macro perspective. Having a base understanding of first principles and frameworks keeps your knowledge from becoming redundant. It also allows you to take a long term perspective rather than a short term bet. Betting is for gamblers. Invest in being knowledgeable, so you don’t have to be one.

Keep a small set of money aside to spend without the expectation of returns. Not everything needs to be an investment for monetary returns. Invest in experiences that bring you happiness and expand your worldview. You can’t put a price on experiences, and no amount of money in the bank compares.

These are the principles I follow, and they’ve helped me be secure and happy with how my money compounds. More than that, it helps give me peace of mind, and that’s the best investment you can make in life.