30 Oct 2008

Its all about money honey!!

Money money money!! Is that all an average person dreams of when he sleeps and thinks of when he wakes up? With the markets down.. due to recession, the value of life seems to dwindle with time... so does the value of a rupee. 5 years from now, we might have Rs 10,000/- note as big as someones face! Thats not the point here.. the point is that people consider the price of money and not its value. Today when the value of money is going down, rs 10/- is just a mere amount; whereas in the past.. if you have Rs 10/- in your hand....the whole world salutes you. Even a beggar in Delhi will throw back 5 rupee coin as alms. Its utter embarrassment to the person who do so. With soaring prices..and that too after staying here in Mumbai... i realized the value of money and not the price. I too did the same mistake of counting money in terms of price ..but later i realized that the index ..or the very base is wrong. Its like the difference in values of 9 for binary and decimal or hexadecimal system!

With each passing day,Mumbai teaches me new ways... new thoughts...new inspirations.. new lessons in life. Not just in terms of work life..but the value of every day today life...be it calling up someone or taking out time to meet someone. Because here in Mumbai..time is everything. Time is money here..i felt suffocated when i had went to Pune for my convocation... i felt like i will die if i do not do something worth the next moment. A moment spent idling gives me a shot in my veins nowadays. Life maybe different for someone.. coz my frens in Pune consider to have slow and lazy life (as compared to Mumbai life).AN ideal day for him would be ... go to work.come back home.. have some fun with frens.. catch up a beer at Apache.. or MG Road and maybe dinner or Movie later. Here in Mumbai, even when i am on my way to some hangout place ot movie..i am on my way...directing my vendors what to do and what not.. giving them orders....on what possibly is the right decision at the right time!

Financially speaking, I become very much exposed to it. I gained so much knowledge about tax system in India... how to save tax... where to invest...and what could possibly be the best option for me. I began even suggesting a fren or two.. and believe me.. he is satisfied with what i have suggested for him. :)
The fact is that.. you cannot depend only on your salary money for your son to have a degree from a top college or send him abroad. You need to have some extra income where you should invest...maybe investment or maybe insurance..or maybe some secured policies. Like todays financial experts advise to put in money from your surplus money and not your hard earned money into market, you need to put some extra effort to have that extra bucks. Am i talking sense? You will know when you calculate how much you want to have at the time of your retirement and how much you are saving at the moment.

Suppose you want to have at least Rs 50,00000 ( which is the price and not the value at that time) at the time of your retirement; lets calculate what amount you have to put in now. Lets say you are now 26 years old and you wish to work till the age of 60 years. That leaves us with 44 years of service.Supposing a decent package of some 4,00,000 per annum we have
Amount to be invested every month = 5000000/(44*12) = 9470/month (approx)
Can you afford to invest say ...9500 per month for 44 years? Thats the commitment you have to give yourself, taking into account the expenses of a new home, car, childrens expenses etc in the 44 years to come. Isnt it too much demand from yourself? Thats where SIP (systematic Investment Plan) come in. So next time when some insurance co comes to talk about your retirement plan, just think twice. You may say its your first job, you have a long time to retire.. but do you really have the time or money to get your wishes fulfilled; i doubt so!!

In the end.. money is all that matters (besides family and frens of course). Everyone dreams to have the comfort money can buy..and do not think of the depreciating value of money. See you next time.. happy investing.


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