Learn to earn book is a Beginner’s Guide to the Basics of Investing and Business.
Learn to earn book by Peter Lynch is the best and first book recommended for beginners to learn Stock Market investing.
Learn to earn book is written by Peter Lynch. He is America’s number-one money manager. He was portfolio manager of Fidelity Magellan Fund, which was best performing fund in the world under his leadership from May 1977 to May 1990.
A simple figure for you to trust Peter Lynch. One thousand dollars invested in Magellan fund in 1977 was worth $28000 when he left Magellan on May 31, 1990.
You might be thinking he is from the USA then why I should choose this book to learn to invest in Indian Share Market? The answer is very simple that the fundamentals of the stock market are nearly the same all over the world.
In my opinion, learn to earn book is the best book for beginners who want to understand how the Stock market works? Why do I need to invest? and many more questions related to investing in Stocks.
I have also read this book and that’s why I am writing a review of this book. I only write a review of the books I have personally read and found useful for investing in stocks.
Investing is a subject not taught in school or college but you should learn to invest to achieve financial freedom and become financially prosperous. Investing is the science of multiplying your money.
You will become rich if you understand how money works and investing will teach you that. If you want to know more about how money works then read Rich dad poor dad book review
Now coming back to the learn to earn book by Peter Lynch. There are four chapters in this book namely a short history of Capitalism, the basics of investing, the lives of the company and the invisible hands along with the introduction on companies around us.
Don’t worry I will not write the review of the whole book in the blog but I will just give a little insight about this book so that you can make up your mind to read this amazing book.
Some of the most important lessons I learned from this book are
1. Invest Now: What Are You Waiting For?
Peter Lynch has mentioned in the “learn to earn book” that many people wait until they are in their thirties, forties and fifties to start saving money which is definitely not good for financial health.
Saving followed investing on a regular basis leads to financial freedom. Start investing as early as possible because in the early stage of life you have fewer expenses and probably your parents are feeding you. Starting early will also help you to develop an investing mindset which will help you in the long run.
No matter how much money you start with, you are better than someone who is spending money on liabilities. You can start just by investing Rs 100. Investing mindset is more important than money and if you will start even with Rs 100 you are developing an investing mindset.
If you are thinking when I will earn a good income then I will start investing, then you are just losing the time. If you will not develop an investing mindset now then your spending will also increase with a decent income.
Money is a great friend, once you send it off to work. It puts extra cash in your pocket without you having to lift a finger.
Peter Lynch has focused on investing for the long term. He has mentioned in learn to earn book that the stock market is one place where being young gives you a big advantage over old people.
Many elders people may know more about Stocks than you do and also they’ve got more money to invest than you do but you got the most valuable asset of all – time. You must have come across an old expression “Time is Money” but it ought to be revised to “Time Makes Money”.
2. Picking Your Own Stocks
Peter Lynch has written this book to provide a basic education in investing because the school doesn’t teach us about the Stock Market, the fundamentals of our economic system and what they have to do with the stock market.
The average high school student is familiar with Nike, Reebok, Mcdonald’s. Nearly every teenager in America drink Coke or Pepsi, but only a very few own shares in either company or even understand how to buy them.
The same goes for our country India. Nearly all Indian engineering graduates are familiar with TCS, Infosys, Wipro, Tech Mahindra, HCL Technologies etc but only a few own shares of these top IT companies of India.
Nearly all Indian students are familiar with Classmate(an Indian brand of student stationery products) but very few know that Classmate is owned by ITC whose share price is nearly equal to the price of a thick classmate notebook(Rs 240) and hence very few own shares of ITC.
I am sure that every Indian people are familiar with Fevicol(an adhesive) owned by Pidilite Industries but very few take their time to know about shares of Pidilite Industries.
If the students will understand the fundamentals of investing then they will surely take their time to research about a company whose product they use on a daily basis. Students are better exposed to a product whose shares can turn out to be a multi-bagger.
Warren Buffett started investing in stocks at the age of 13 but in our country India, people start very late because there is a lack of awareness and financial education.
I am not saying you to just start buying shares from today rather I am saying you to learn the fundamentals of investing by reading investing books and then start investing in Stocks because knowledge followed by action leads to mastery. Warren Buffett reads 500 pages daily but you need not do so but at least start reading 5 pages per day from today.
Stocks that do well, in the long run, belong to companies that do well in the long run. This is one of the most basic principles in choosing a Stock.
3. The Lives Of A Company
In this lesson, you will learn about the different stages of a company. Peter Lynch has categorised the lives of a company as the company at birth, going public, the company when it’s young, the company in middle age and the company when it’s old.
– The Company At Birth
This as the name suggests the company is in its early stage. It is starting out with very small capital. You can think of Apple, Amazon etc starting out in the garage.
– Going Public
The stage in which the company issue shares to raise money from investors to expand its work. It is a very important day for the company when it goes public.
– The Company When It’s Young
The young company is full of energy, bright ideas and hope for the future. A young company can grow very fast and expand rapidly without loss of energy. The share price grows very fast in this stage of the company.
– The Company in the Middle Age
Companies that manage to reach middle age are more stable than young companies. They’ve made a name for themselves and they’ve learned from their mistakes. In short, you can conclude that it has reached a stable stage.
– The Company When it’s Old
Companies that are twenty, thirty, fifty years old are in this category. These companies are expanded all over the world and have no room to expand further. Some of the examples of this category are Coca-cola, IBM etc.
If you like the review and you want to gain basic education about investing then you must read this book. You can buy it from nearby book stores and if it is not available there then you can order the paperback edition of this book from Amazon.in by clicking the image below.
If you like to read on smartphones then you can buy the kindle edition of this book from Amazon by clicking the image below and start reading the book today. Don’t think much because the best investment you can ever make is the investment in yourself.
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