This short post reiterates the importance of avoiding an extremely harmful behaviour for your financial health – carrying credit card debt. This is a companion post to the India version of Harold Pollack’s Index Card – Pollack’s Index Card: All the financial advice that you ever need – India version Very simple rule – Pay […]
This short post describes a possible savings target in India – 30% of post tax income. This is a companion post to the India version of Harold Pollack’s Index Card – Pollack’s Index Card: All the financial advice that you ever need – India version The right Money Equation Many young earners ask the question […]
In popular imagination, Albert Einstein is supposed to have called compound interest as the eighth wonder of the world. He did not say any such thing. Nevertheless, compounding indeed is very beneficial for your financial health. This short post provides a few ways to visualize the effect of compounding. First, the formulae Simple interest is […]
A lot of people are interested in ‘Investments’ to create assets. An often asked question is how to begin investing. In this short article, we look at a sequence of steps in this process, with an easy to remember acronym – BASICS – Budgeting, Annual Cash Flow, Saving for Emergency, Insurance, Corpus calculation, and Start […]
The recent announcements on improvements in the New Pension Scheme (NPS see here) have created a lot of buzz around the scheme. The most impact is seemingly from the new ‘Exempt-Exempt-Exempt’ (EEE) nature of NPS. In this post we see why NPS is still not a good enough choice for most people as a retirement […]
Mutual fund dividends have been used in interesting ways in India. It is public knowledge that the dividends in mutual funds are not the same as dividends from stocks. Unlike dividends from stocks, mutual fund dividends are paid out from the fund corpus itself – any dividend then decreases the Net Asset Value of the […]
FIRE – Financial Independence, Retire Early This long article describes a calculator that combines a set of factors to assess the feasibility of achieving financial freedom early in life. Financial Freedom (FF), or Financial Independence(FI) can be defined this way – the state of having sufficient personal wealth to live, without having to work actively […]
Debt mutual funds are promoted as products that give ‘better returns’ than fixed deposits, while being quite safe. This is of course not true. Debt funds carry more risks than bank deposits. Another popular misconception is around one category of debt funds – Liquid funds. They are almost universally (mis)regarded as a direct alternative to […]