Before I convince you to take up a book and start reading or tell you about the importance of reading in today’s world, let’s talk about how the rich are much smarter and different from the middle class and the poor when it comes to paying their taxes. Let’s go!
Here in India, the Income tax for any individual earning over a sum of Rs.10,00,000/- or more is a whopping 30 percentage points! That is humongous when juxtaposed against the 5 percentage points when it comes to the case of people earning in the slab of Rs.2,50,000/- to Rs.5,00,000/-
And this disparity is not just a practice in India. The Governments all across the globe tell the poor and the middle class that the rich must pay more for the betterment of the poor and the alleviation of the middle class. That’s the Robin Hood approach.
There is no single nation where the poor or the middle class are taxed a higher percentage of their income than the rich. And, this leads to a prosaic and obvious belief amongst the masses which I too am a part of- “The rich pay more tax than the middle class and the poor.” And the shocking truth is that only a small tiny fraction of the people know that it’s every bit a myth and a fallacy.
The general public seldom realizes that the rich guard their hard earned fortunes by creating corporations. And, ergo, their income tax comes down heavily. How? The income tax follows the concept that says- “Earn. Pay tax. And, then spend.” While the corporate tax follows the doctrine which says- “Earn. Spend. And, then pay tax on what is left (profit).”
That is the policy which rich make use of to save their wealth, as most of their expenses are covered under the pre-tax expenses on the bills of the corporations they themselves own. Be it dinners at five-star hotels, or be it meetings in Rome and Paris, it’s all their corporations covering the costs for them using the pre-tax income.
And, then what is left over is what accounts for the taxable amount. Ever wondered why Vijay Mallya was able to stay safe and protected all through arguing that he has no significant money to pay back the banks. Because he simply doesn’t have any money to his name. It’s the corporation that holds the money. That’s not all but is significantly helpful to explain the complexity involved to a layman.
The general people like me were never taught any of that in school. Thereafter I went on to get into engineering domain and was again not taught any of that. But, what’s saddening is that even most of the students pursuing the domains of commerce or finance are not aware of this simple thing either. That’s because the extant education systems don’t promote financial literacy.
So, how did I get to learn about this? I just completed the all-time Best-selling business book, “Rich Dad, Poor Dad” By Robert Kiyosaki. Had I never read this book, probably I would not have taken cognizance of the aforementioned fact and sundry other erudite nuggets that the mammoth businessmen and their corporations use to create wealth and assets.
And, if that would have happened, I would have been a financially illiterate person despite having completed over 14 years of schooling, and five years of college education. And, even writing about it makes me feel low. That’s is the grim picture of our world, which is beautified by books written by such sage and erudite men and women of our society trying to share knowledge and experiences.
Thanks to this book, I now stand at least an inch higher than the flood of financially illiterate people deluging the planet. Now, I have a better understanding of balance sheets, profit statements, how to make investments and what to study next to expand my nebulous knowledge of the subject to bolster my financial prospects.
I am one of those who doesn’t wish to be a job seeker after my college life ends in 2019. I am someone who aspires to solve one of the endless problems of the world by creating a strong business model around it. I aspire to be an entrepreneur, creating lots of jobs, earning lots of money and then reinvesting it back into the system to create even more number of jobs.
Had I not have been aware of something so critical and had just ventured into launching my entrepreneurial venture after college, I would have saved much lesser, paid much more taxes, created much lesser jobs, or could have ostensibly failed at my first attempt to make it large. And, a book of just over 196 pages saved me from all of that doom. At least it strengthened my chances. I hope.
That is the impact and difference that a single book has brought into just one aspect my life- The financial aspect. Now, think about this. I have completed reading 28 books over past nine months. Imagine the colours those other 27 books may have augmented to my life and my prospects for the future that I have envisioned. Imagine how better equipped and more erudite I am on those sundry aspects of one’s life than the average lot of people.
That is how imperative a role books can play in a person’s life. An author writes a book out of ingenuity, experiences, memories, or knowledge that one has gleaned over years of their life with hard work, failures and successes and ups and downs and what not. And, it’s all summed up into a bunch of pages bound together, all of which you can carry on your palm. A lifetime worth of experiences earned through endless travails compressed just into a palm!
People yearn to earn experiences and explore various facets of life. People wish to discover what has been hidden or sequestered from their reach. And, books are the gateway to that treasure which people have been striving for all their lives. Yet, only a handful of people prefers to read books. Some even go on to say that reading a book is a vapid activity.
Over a year ago, I too was one of that dominion who called reading to be a vapid idea. But, once I pushed myself into exploring the seamless colours of this world and what governs it via the medium of books, I have never again been able to say that it’s boring or a thing meant for the nerds. So, I guess if someone is not reading books, they are missing out on a lot of things.
But, maybe everything I wrote above is still not enough to coerce someone into reading books. So, let me try another example.
Let’s talk about the stock markets for instance.
Stock and share markets have been branded as an equivalent of gambling by very many sorts of people severing through all barriers. Several people detest the trade and call it something that never adds to one’s income in the long run, and only takes away one’s money. People say that only a tiny fraction of people getting into the trade turn out with a profit in the long run and only a few of that fraction are able to make it big.
Most of what people say is true, apart from the fact that stock market is equivalent to gambling. Most of the people get into this trade are the ones without any knowhow of how to analyze the markets, various sectors and factors that govern them. The sad part is that most of them are not even well versed with the basic jargon. Ask how many of them know that Return on Equity (ROE) is not a reliable factor to harbinger a share’s growth possibilities.
Seldom will you find any who would actually be able to tell you that it’s true because the companies often buy back their shares which leads to a pseudo growth in ROE while the actual performance of the company is not really appreciable. Forget that, some of the people would even ask back, “What’s ROE!”
Don’t worry if you don’t know what ROE means and what am I talking about. It was just an example to articulate how people get into various trades without any significant knowledge of it. And, when they fail to cope up and lose their money, they blame the trade to be a gamble which is just a money guzzler.
In the same time, the smart investors with knowhow take away gargantuan sums of money to their home, building up solid fortunes rarely losing any money. The problem is this- Most of us work on the methodology, “We would master the trade by doing it.” And, living in that bubble of ours, people (including me) often tend to forget another very important factor-
“While practical knowledge undoubtedly matters the most, but its pillars always need a strong foundation of the basics else no pillar would sustain the tough times.”
If I were to get into investing in the shares of a company, I would definitely want to earn the best possible returns. And, I know it well that no one does it better than Mr Warren Buffet, the greatest guru of investing in the today’s world. So, why would a person not invest time into reading a few books which talk about tricks and strategies Mr Buffet uses before making any investments?
There are sundry books written about the men and women who are best in their dominion. The best of business tycoons like Bill Gates, the best of peace preachers like Dalai Lama and Osho, the best of investors like Robert Kiyosaki and so on and on and on have all written books or have got books written on them. If you wish to be a billionaire, first learn how others like Steve Jobs, Bill Gates or Mr Buffet did that. Read books about them and discover their mantras and tenets to craft your success.
Similarly, there are books about fabled politicians like Abraham Lincoln, Atal Bihari Vajpayee, Winston Churchill, Sardar Vallabh Bhai Patel and endless other like that. Those were all amongst the greatest statesmen the modern world saw. If you wish to be a politician some day or want to be an exceptional leader, read and get lessons from the best of the trade like those great men who made it large.
I can go on writing about several domains and the people who have earned a slot at its hall of fame and have got books written about them. Those books are all nectar to success in life. Those bunch of papers or as these days people like me prefer it, the digitized formats of Kindle are all worth Trillions and Billions of treasure right there. They can tell you how to recreate Billions on your own name.
And, all you got to do is to open up yourself to the seamless possibilities that reading books can open up for you. In this post, I have used multiple stratagems and examples at my disposal to convince the reader to embrace the habit of reading books for once and give it a shot. If the reader is already into the habit, I am glad for you to have already opened yourself up to this world of seamless colours and possibilities.
And, if you haven’t yet done that, please don’t miss out on this great treasure that’s so cheaply available all across. You deserve it, and your future depends on it. Yes, you may turn out to be great in future. But, I can guarantee that a prolific habit of reading can multiply that greatness several folds, whose upper limit cannot even be estimated.
Some short books these days are available for as low as Rs.5/- here in India. So, giving it a shot won’t cost you fortunes. But, it can definitely earn you fortunes.