Savings save you

By Dr Dhananjay (Jay) Datar

Published: Thu 7 Apr 2022, 10:44 AM

Last updated: Thu 7 Apr 2022, 10:46 AM

When we encountered heavy losses in the first year of business, we realised the importance of cold hard cash. We didn’t have enough savings to cover the loss or to raise fresh capital — hence we tried to borrow some money from our friends. But most of them expressed their inability as they also invested the money in their business. At last, my mother sold her entire jewellery and precious household items and raised some cash which provided a raft to our sinking business. The most important lesson I learned from that incident was that only your savings save you in challenging times.

A person’s real prosperity can be calculated not by his luxurious lifestyle but by his savings. I remember an incident. My wife and I were once attending a business party. When the dinner was over, I began searching for my wife. She was busy chatting with her friends. There, a lady was showing her new diamond necklace to the admiring gaze of the others. While driving back home, I curiously asked my wife what the topic of discussion was, and she replied that the necklace was worth millions of Dirham and was gifted by her husband. I casually asked the names of the lady and her husband. When my wife told me their names, I was surprised. I knew the merchant very well as he had suffered a loss in his business and was going through a rough time but at the same time was pretending as if nothing had happened. The wife was ignorant about her husband’s miserable position. I told my wife that either the husband would have lied to his wife or else the wife would have lied to her friends about the true value of that necklace. A person on the verge of bankruptcy can’t give such expensive gifts to his wife. Whatever pricy adornments you use to impress others with your false prestige, ultimately the cash in your bank denotes your real prosperity to society.

I had told this simple philosophy to a bank manager also. Once I had sought some financial services from a suitable bank and approached one for the same. There was a lady manager there. She checked my company’s documents, and after understanding that my company was a mid-sized company, she sarcastically remarked that her bank had many clients with a huge sales volume. I smiled and replied: “Madam, don’t judge a company or a person by their turnover. The real strength or prosperity lies in their net profit or the savings they have.” Later my words proved true. The companies she referred to went bankrupt and had to wind up their businesses. The big names and the volumes only remained on the paper.

There is an apt quote by famous businessman Robert Kiyosaki regarding the same. ''It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.

Dr Dhananjay (Jay) Datar is the chairman and managing director of Al Adil Trading.

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