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Some Simple Thinking On Money Management

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K

krish44

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Many of us find managing money and becoming well off difficult.

Actually, it is not complicated.

For senior citizens It might be sensible to live frugally to fulfill his needs. Most might be thinking that it is outdated thinking.It might put many off.If needs are less

, automatically there might be savings.May be over a few years say 7 or 8 you might have a sizeable amount as savings which can support rest of life

Many crave for luxuries seeing the neighbour. We would like to boast that we have the latest car ,luxury villa or where to invest. It improves our standing in social

circle.Thats no way of becoming rich.

To do well , one needs to do compounding of money saved.Thats why schemes like PF or PPF are good . At end of life at retirement most have a sizeable sum.

It would be a good idea not to go for short term withdrawal.

Risk taking one needs to avoid.If one has lifetime savings, investing all of it for higher return in one entity is risking. Some investment might be justified after

setting apart a major amount in hard saving instruments.

If you are investing a small amount spread it over a number of companies or mutual funds -debt funds with good returns or mix of debt and equity.Invest in

solid companies with long time good records. Do not be carried away by what you see on TV or news.

We need to look at our own life and lifestyle instead of our well off children earning and playing with big money with lifestyle which matches it.Let us be self

sufficient with our own money and remain viable until end of life
 
hi sir,

what abt retirement home investment/.....any project yet?

....pondichery project prospects any?
 
TBS garu
I am registered in some real estate portals.

I am getting replies.

I am looking for a site or home in well developed area at the right cost.

Let us see.

If really some thing good clicks I will let you know.
 
krish44 said:
TBS garu
I am registered in some real estate portals.

I am getting replies.

I am looking for a site or home in well developed area at the right cost.

Let us see.

If really some thing good clicks I will let you know.
Click to expand...
hi

thanks....keep on hunting...i saw somebody land developer in our forum few days months back..
 
My money mantra for living is availing various subsidies given legitimately like for power or water,reducing power consumption to avail power subsidy, Using free water

with sufficient storage.

I have a ratio of 30%-70% profile on saving instruments and equities.

The returns on equities [about 20% average ] Against 6% on savings after taxes keeps my profile with good returns.
 
Many elder citizens expect reciprocity from children for educating them and getting them married and incurring large expenses on them. They spend big amounts in

ostentatious marriage incurring huge expenses to show off their status . Many take loans to get children educated abroad or pay donation in local institutions for

admitting their children

I know many cases where these persons are not able to maintain themselves as they have blown off a major amount from their PF and serviced loans taken.

In single income families, this is common.

How many have the wisdom to keep back expenses for their own support in old age?.Most are left with their pension and some old house they live in.

It is never late to replan and relocate if necessary to change over to an affordable life style.

Some wise give their land and one storey house to a builder to get couple of flats in return.This is wise. One flat to live in and another to live off.

Others shift to suburbs or far areas where rents and living are cheaper.

2. Most parents feel hurt when children earning well do not reciprocate. Even if the children give money support, they expect services in return from parents.Many

parents end up as baby sitters or cooks . They get abused mentally and sometimes even physically.It would be best if dependance is made minimum and money

managed for self sufficiency.One needs to look into own assets and perhaps capabilities and see if money can be generated from them for own needs.Keeping a

reasonable distance from children, except in medical or other emergency is sensible.
 
It is never too late in life to plan ahead for financial viability.

We can take stock of whatever we have and meaningfully redistribute if possible for better future.

Many buy Gold during akshya tritiya. Or invest in gold for safety.

It might be a good idea instead to buy Gold bonds issued by banks or stock holding corporation.One can buy in multiple of grams, paying 50rs less than market price.

They are redeemable after 8 years with exit option after 5 years. They give an interest of 2.5% on nominal value.When redeemed , it is exempt from capital gains tax.

However interest is taxable.The gold bond papers -in demat form if desired can be used for loans or selling in share market.It is absolutely safe and one gets good

returns,

If one goes vacationing abroad ,one can buy small amount of jewellery one likes. It might be purer and cost less as they charge only making charges on Gold price.

After paying customs duty on it in india, one can save at least 20-25%.

If one goes abroad for holidays Try UK with pound being battered due to brexit and rupee being extra strong at Rs64 per dollar.
 
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Real estate is in doldrums. Crackdown on black transactions and RERA has sent the industry into a tailspin. The Small players are out and bigger ones are trying to get

their act together trying to figure out the implications of RERA.It might be a good idea to collect small pieces of land in suburbs of metros or new smart tier 2 cities .One

can invest some small money. Our next generation will thank us for these minor acts after couple of decades.TV channel Mirror is the best one relating to real estate.

Faye Desouza is one of best anchors in this channel.
 
Inflation has further come down leading to further clamour for interest rate cuts.

Retired persons living off interests on bank deposits should worry more.

Banks would first promptly reduce the FD interest rates degrading their lifestyle further.

Though bank lending rates may reduce, the bank may take their own time to reduce and not pass on the cuts fully.

Most senior citizen may think of corporate deposits with slightly higher interest[ NOT worth doing IMHO].Or head towards Mutual funds.

It might be sensible to go for mutual fund with debt of about 70-75% and equity of 25-30%.Also got for schemes with interest payout regularly or tax saving.

Of course , if one has old property in metro, It would have appreciated a lot. But many have compulsions of living in them. One way is sell and use half to buy a flat/house

in smaller cities and get some cash also.Alternatively sell the house and move to an old age home with putting money from sale of house in deposits. Reverse mortgage for

regular income does not appeal to many.The best is to go for a bargain if possible with inheritor kids to pay interest value of house they will inherit from you.Another

possibility is buy another house/flat of lower value jointly with son/daughter and funded by both for parents stay until death and sell the old house.The last one is attractive

if the parents can move near son/daughter by purchasing a house/flat nearby.Most educated girls with jobs do this. They are able to help parents financially and be of

mutual help.
 
I think we should not go near real estate for next 1 to 2 years...We can postpone buying to next year after clarity emerges on RERA & GST..Most think that prices will further reduce by 5 to 10%..That wlll be a bonanza of sorts in case there is a revival in real estate after 2 years
 
Good advice given Krishji.

Regarding "investment" in kids, I think one should do it without expectation of (financial) payback. I view it as a pay-it-forward scheme. My parents gave me a good education. Hence I view it as my duty to give them the opportunity of good education. Beyond that, it is upto them.
 
biswa said:
Good advice given Krishji.

Regarding "investment" in kids, I think one should do it without expectation of (financial) payback. I view it as a pay-it-forward scheme. My parents gave me a good education. Hence I view it as my duty to give them the opportunity of good education. Beyond that, it is upto them.
Click to expand...
One has to be pragmatic in living.

Not all children of this generation think like you and those of parents generation over invested in their children selflessly did not plan for new economics of low interest rates

They did not put away much for themselves for a rainy day at fag end of life.One sees so many of them only having an old house of their own and some deposits in addition

to pension.Most do not have decent medical cover.Families having gone nuclear,children have their own commitments and desires to fulfill in new age economy.All are

invested in flats of their own with borrowing, They have on credit all consumer durables. Even with spouses working what they can spare for parents of either side is limited.

If parents live with children, the parents get exploited and end up as domestic helps and sometimes open themselves to abuse.Lifestyles and family living have got distorted.

Parents also need to be wiser and safeguard themselves for all eventualities with least dependance on next generation
 
vgane said:
I think we should not go near real estate for next 1 to 2 years...We can postpone buying to next year after clarity emerges on RERA & GST..Most think that prices will further reduce by 5 to 10%..That wlll be a bonanza of sorts in case there is a revival in real estate after 2 years
Click to expand...
No time is bad for real estate.

RERA and GST are not answers to cheaper housing.

For all the logics you might have,you might end up paying more after the new regulations.

Builders -large ones will protect themselves in view of new laws and pass on extra cost to end user.

Lowering cost of inputs also they will pocket.

Best is take what one can get and collect flats that are about 80-90% complete even if it is from small builders.
 
Yesterday, the NIFTY of stock market hit a new high-10000.

Though there were celebrations, they were muted.

Price to earning ratio of 18 plus for Nifty make many believe that our shares are over valued.

Some are jittery that good times may not last long.

Shares of most companies have reached new highs .

Though it is claimed that inflation has come down, it is not quite visible on the ground.

Demand is just not picking up.

But there is clamour from Govt for interest rate cut,RBI may oblige with 50 or 25 basis point cut.

This will further reduce FD rates of banks.{ whaty will senior citizens do now]

Manufacturing is shrinking .Exports down.

I really doubt figures of 7% plus growth in GDP.

Some sectors like electricity and rural economy require fixing.

Discoms losses are in downtrend but not good enough.

Cheaper power thru solar is a Godsend for india and making generation cheaper.

But it has to go to rural areas and every rural household needs power at low rates.[Now village is considered electrified if common areas like community halls, health

centres ,schools and 10% rural homes are electrified]. If every house is with metered connection and power is with low tariff, it will boost rural economy and demand will

pick up.

It will alleviate rural suffering.
 
What do we do with urban poor?

In bigboss tamil show when one brahmin lady used the term chery for those in slums there were social protests.

Yet the plight of those slums is really bad.

They depend on middlemen [normally a person belonging to the slum itself, sometimes local politician or muscleman ] to get them the essentials like ration cards, electrical

connection, aadhar and any other cards.These men serve as a bridge between govt agencies the slum dwellers. They go to him for dispute settlements with neighbour as

they fear the police.

Delhi govt simply waived off all their electricity dues and metered their houses at nominal cost. Govt reduced their electricity rates to more than half and water supply free .

These slum people started paying their electricity bills or consuming less power. Power thefts reduced.

Similarly they made health care -including all tests free in all their speciality centres for these slum dwellers.

With all these measures delhi govt is nurturing its base.
 
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