Three monsters who eat your money

Whenever we receive money as a salary, sale of shares/mutual funds, sale of property etc we lose a part of it to three monsters who eat of money and doesn't let you save and invest for the future.

First Monster

I am sure you must have noticed that if you earn say 6,00,000 per annum that comes to 50,000 a month but the actualy amount you get in hand is approx 35 k - 40 k. yes here is the first monster which eats your money before ti comes to you. TAX TAX TAX

Second Monster

This one eats your money every single day. The house you dream of buying one year down the line is not affordable after one year. Your dream vacation is now too expensive to afford. Thanks to the second monster INFLATION

Third Monster

I'll keep this one simple. The third monster is YOU who doesn't invest money for his future but live in the present spending all the money unaware of the big commitments in future.

We can reduce the burden of tax by investing in the right instruments.

We cannot do anything about inflation as we do no control it but yes we can definitely invest in instruments which gives us returns more than the inflation rate and keep our money safe.

Lastly, If we will not save for our self and our family's future...Who Will.

Decode Your Insurance Policy

I am sure all of you will agree that insurance is the most mis-sold financial product.

If you have bought an insurance policy the chances are very high that the agent has not suggested you the policy keeping your requirements in mind.

Either you you will end up paying high premium for low insurance or you will not be told the charges of the policy and will ultimately lose your hard earned money and the compounding effect on it too.

This post is for all those who are considering buying an insurance policy or have already bought one and want to decode the same.

I would be more than happy to help you with correct and ethical advice. My mail id - plannershaishav@gmail.com

Investing for Kid's Retirement

I stayed in a big house when I was a kid. My grandfather had bought the house for INR 30,000 in 1960. We sold the house in 2003 for INR 10000000. The money was distributed between my father and his siblings which helped them buy their own houses. So, that is the legacy my grandfather had left behind for his kids.

But, if he had planned better and invested smartly he would have been able to leave enough wealth which can take care of even his kids retirement.

The point I want to make here is that today, when inflation is very high and lifestyle expenditure as almost equal to what we earn, we have to invest very smartly to lead a good retired life. If we plan slightly better we may be able to accumulate a huuuggeee amount for our kids which can be left behind as legacy.

I don't want my daughter to turn 30 years old and then realize the value of saving for retirement. If I do, I am knowingly losing the compounding for 30 years.

So, If you start investing a very small amount for your kids retirement I am sure you will be able to leave a legacy behind in terms of money and also the legacy of the idea to invest for kids retirement.

Retirement Planning - Options you have when you retire

The two risk you have in life are:

• Dying too early
• Living too long

In both cases, your family suffers the most. The first risk can be covered by buying an insurance policy but the second one is very unpredictable because you can live for 70 years or can live more than 100 years. If you live too long the money you have accumulated may not be able to cover your living expenses (i am not even considering health care expenses).

This is why retirement planning is very very important. I feel an individual has the following option when he retires (I call it C-C-S-S)

C - Child (Depending on your child) very common in India but I am sure no one wants to be in that situation.

C - Care Homes (in case your kids abandon you) this is the only option for you.

S - Self Sufficiency (save and accumulate enough for retirement) If you have planned and invested smartly you may retire as a self sufficient individual without depending on anyone else.

S - Suicide (If you don't find yourself in any of the above categories this is the only option available.Its unreal as no one will commit suicide but anything else will be a compromise)

Analyze your current investments and investment habits and see which category you see yourself in at your retirement. If the situation is alarming and you still have time...TAKE ACTION TODAY