I wish someone had taught me this when I was 22!🤔Twenty-two years old, Ethan Nguonly is on track...
Six Chess-Inspired Moves to Win With Money
I recently started playing chess,( yes I am late, but better late than never😉)
it is so engaging and addictive...I ended up playing 536 games in the last 90 days.
In the beginning, I was quite bad at it, but within a few days, I started getting better😎.
Slowly I started to understand the rules of the game, and then I started applying my imagination on how to use them during the game.
Last weekend, I was thinking If I could draw parallels between chess and personal finance and I came up with the following...
6 Chess-inspired Moves To Win With Money
Chess is not just a game!
It's a strategic endeavor that involves Planning, Risk Management, and Decision-making on the go.
One good move can win win the match for you, while one wrong move can undo the whole game.
Talking about moves, different chess pieces move differently and offer various strategic advantages, much like different aspects of personal finance.
Let’s explore the parallels between how chess pieces move and what they teach us about Personal Finance;
1. Pawn: Small Steps, Big Rewards.
- Chess: ♟Pawns move forward slowly and can transform into a queen if they reach the other side.
- Finance Lesson: Small, consistent investments (like pawns moving forward) can lead to wealth accumulation and exponential growth (pawning to a queen) over time.
2. Bishop: Navigating with Limitations
- Chess: Bishops move diagonally and thus can only access half the board.
- Finance Lesson: While our goals are ambitious, the available resources like surplus income, time & investment opportunities are limited.
You have to 🚢navigate wisely within these limitations, by optimizing your income and expenses to create an investable surplus every month. Invest your savings in a robust portfolio to grow wealth and build a corpus for achieving financial goals.
3. Knight: Non-linear Moves and Flexibility
- Chess: Knights move in an L-shape, offering unique strategic opportunities.
- Finance Lesson: Market moves are never linear. You have to follow a flexible approach to review and rebalance your portfolios and if necessary realign your investment strategy to suit the changing market situations or personal situations.
- Also, it is important to avoid the herd mentality, especially when the markets are euphoric
4. Rook: Straight Paths and Castling
- Chess: Rooks move in straight lines and are involved in castling, a defensive maneuver.
- Finance Lesson: Stability and defense in a financial portfolio are crucial for protecting against risks and market volatility. Creating a financial safety net, like an emergency fund, and Investing within your risk appetite provides support and defense against unforeseen financial challenges and adverse market conditions.
5. Queen: Versatility is Power
- Chess: The queen can move in multiple directions and covers a lot of ground. Also, the queen, while powerful, works best when complemented by other pieces.
- Finance Lesson: A versatile investment portfolio that explores various avenues (Stocks, Bonds, Gold, Real estate, etc.) is pivotal in navigating through diverse market scenarios and optimizing returns.
Just like how the queen becomes more powerful when paired with another piece, The assets in your portfolio should complement each other, helping you maximize returns and reduce risk.
6. King: Protection is Paramount
- Chess: The most vital chess piece, but has limited mobility, moving only one square at a time.
- Finance Lesson: Like the King moves one step at a time, your income comes in once every month, and is your most important asset.
It is crucial to protect against loss of income & your family’s financial future using life insurance with Critical illness benefits.
I enjoyed drawing these parallels to Chess and Personal Finance, can you think of some more?
If yes, please share in the comments below.
Also, if you play chess online, let's play to challenge and learn from each other.
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