Friday, March 06 2020
Source/Contribution by : NJ Publications

The best lessons we can learn is from the experience and lives of successful people. Words of wisdom from those who have achieved great heights of success, starting from nothing, must be heard with full reverence. In this article, we share the life lessons and advice from one of the most respected businessman from Asia – Hong Kong billionaire Li Ka-shing.

Sir Li Ka-shing is a Hong Kong investor, business magnate and philanthropist. Li, aged 91, though retired from active business, still features in the Forbes richest people in the world and was once the richest man in Asia. Li has an incredible rags-to-riches story. From being forced to drop out of school as a child to support his family, he has achieved what few have ever dreamed of. Today, we share his life's lessons and words of wisdom...

Li Ka-Shing money advice: The five sets of funds

Li was a strong believer in making the best use of the resources you have. He proposed the famous five-set of funds method to creating a successful and fuller life. Li suggested that we split your earnings into five sets of funds as given below. Please note that we do not expect everyone to follow the exact proportion for funds allocation in real life. It may change from person to person and situation to situation. What is more important though is that we follow the idea / spirit of the message in our lives...

1] 30% - Living expenses:

The most important things in life have to be entertained. However, what constitutes living expenses? Have we segregated 'needs' from 'wants'? Li suggests that we do a strict budgeting exercise living expenses to the minimum sustainable level. If your budget for living expenses exceeds 30%, you have a red flag. Try considering your expenses, be ruthless in removing unwanted things in life. Li shares that when he was poor, he used to have haircuts only once in three months. Hopefully, you don't have to go to that extreme but some strict action is surely required.

For those at the bottom of the pyramid, even this may seem to be difficult. Understand that if you are not even making such minimum income (matching 30% of living expenses) from the present job or business, it is a red flag in what you are doing. You need to work harder and smarter in life. If you have already spent good time, say at least couple of years, and you still aren't making more than this, then you need to reconsider what you are doing and have only yourself to blame. Li suggests that we move on and find more profitable avenues to put our time and mind. You may also look for other ways of earning income or having multiple streams of income.

2] 25% - Investing:

Li has been a strong advocate of continuous investing. He suggests that we invest in a diversified portfolio of assets. Investing has to be followed like a habit, a discipline. The more you cut on your unnecessary expenses, the more will you be able to save. 25% is the minimum savings required. The rest of the things can later follow. What is also important is that you know that is important in life and spend money on only those things, as we will talk later.

Buying too many clothes, eating our frequently, spending on luxury, etc must be avoided at all costs if you are serious about being wealthy one day. The amount of investments you have will ensure that you never run out of money and your quality of life never goes down drastically. Of course, it goes without saying that you have to spend less.

Li also suggests that we share our dreams and goals with the people around us. It is also okay to spend few times on those you love but it is also important to share to them why you are being thrifty and spending less money. Share with them what you plan to achieve doing so and what your dreams and goals are. One sure that people will then see you differently and appreciate what you trying to do, perhaps even support you.

3] 20% - Networking:

Jim Rohn once said that 'You are the average of the five people you spend the most time with.” The most successful, rich and powerful people are almost always those who are well-connected and have a very good network. Network yourself with the right people, those who have bigger dreams than you, who are more successful than you, are more ambitious than you and more richer than you or the people who have helped you in your career or from who you can learn a lot.

Networking is not cost-free. Even if you have to spend sometimes on such persons, it is all justified. You can spend by forwarding greetings, gifts or fitting the bill when dining out, etc. You may also spend money in joining clubs, associations, etc where such persons can be met and befriended. Spending money for networking is like investing in relationships, ones which teach you, help you, guide you or be of use when required. The valuable lessons and relationships that you earn are the returns which will be useful in life, making you a better person.

4] 15% - Learning:

Learning is a life long activity. Li suggests that you have to set aside some part of your funds to learn something. Use say 5% of your funds to buy books and learning resources. Spend about 10% of funds in attending seminars, conferences and training which will help you to develop and skill yourself and expand your knowledge and understanding. Apart from learning, meeting the right people at these forums is also a part of your investment.

GoodGood learning is that which is not easily forgotten. You have to learn with all seriousness and eternalise the lessons and strategies. You have to materialise your learnings into actions and share them with others. In short, learnings have to be put to action and used, else they will be soon forgotten.

5] 10% - Travelling:

This may be a bit of surprise for many. However, Li believed that one should travel and see the outside world. The big idea here is to rejuvenate yourself. During these 'off'' mode, you can take a break and relax. One cannot always keep performing at the highest levels at all the time. Use this time wisely to recharge yourself, build on your passion and more importantly also think. Travelling perhaps is the most rewarding and popular way to unwind and also offers other advantages. Meeting new people, exploring new worlds can also open up your imagination and can even open up new opportunities. A holiday at least once a year should charge you for the rest of the year to continue following your dreams with even more passion.

It is not mandatory that you travel or always travel far and wide. You may even choose to pursue any other passion or hobby that you may have. Travelling also need not be expensive. You can stay in budget hotels, plan your holidays much in advance, in off seasons or to places which are not hot on the tourist circuits.


Continuous self-improvement is an important ingredient for one's success. You have to always seek ways to grow yourself. If you are stuck and not growing as a person, in Li's words, 'you should be ashamed of yourself'. In today's dramatically changing world, every job and every business is subject to disruption by technology. You have to invest in yourself if you wish to be successful. Once you are rich and successful, you have to stay at home more than yourself and keep a low profile i.e., don't show off and don't let other people make use of you. Just keep spending money on yourself as many others are doing just the opposite.

Imp.Note: We are registered NJ Wealth Partners and this interview published is sourced from NJ Wealth with due permissions. Reproduction of this interview/article/content in any form or medium by any means without prior written permissions of NJ India Invest Pvt. Ltd. is strictly prohibited.
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