It’s a combination of what my grandfather and my mother did.
As soon as my salary hit the account, my grandfather made an FD. Mother used to buy some gold every 5-6 mknths. Continued this till 2019 when I consolidated all FDs into just 5 FDs.
I basically did some equities and gold mf recently because I’m doing no FD/RDs now.
Gold MF is giving me good returns. MF equity is just about okay. Nothing great. It’s just I’m doing it as sab kar rahe ha and maybe kuch exciting returns mil jayega 10-15 saal baad … I have 5.5% ka hi return … but haan I had taken out my gains in equity and put them in debt MF in 2021. Market was at 42k and ab dekho 60k chali gayi…
Most money I have made is in PPF or EPF till date mast interest add ho jata ha Har saal but yeah I can’t withdraw it
My tax outflow is surely one of the main reason I’m contemplating about my investments.
The only way I can more taxes against my salary is by taking a home loan. I just don’t want to create any leverage for a sword to hang on my head. Plus I simply hate my job. The only reason I’m continuing is because my parents want me to continue doing it saying Har jagah aisa hota ha … chup chaap yaha naukri karte raho
The only fact I like about my job is that acche bacche ki tarah month end mein salary de dete ha. And yeah kind of job security ha … bas rote rote aur 10 saal kar lenge … like a government job… this is my overall strategy
Like my financial decisions I’m very passive with my job also… all in all I have zero fucks wrt the organisation. I’m currently in middle management … aur 4-5 saal ismein nikalenge then koi top management ke role mein 4-5 saal and then just call it quits…
Your portfolio looks excellent for anybody who is retiring in 5 years. The higher weightage on debt will give you peaceful sleeps.
Since you have 10 to 15 more years left for that, the first major thing you could do is re-invest the capital that is getting released from the FD maturity into something resourceful and having lesser taxes.
Also your portfolio has a hidden gem in it. If the markets crash 30 to 40% you can quickly rebalance by adding equity.
Meanwhile suggesting you to research on the equity, mutual funds & ETF directly and not via a portfolio manager. Even though it may seem you are not making progress in 1st year, over a 3+ year span you will outdo any third-party.
Investing in self via research gives the highest return!
i never understood the “lacks” spelling and its origin.
at first i thought its a typo but it seems thats how you spell it everywhere.
any reason?
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For a salaried employee, to be tax efficient is very difficult and there are only very few options such as 80C 80D etc. which you might have already exhausted.
I also believe that tax saving by taking a home loan is also not a very wise idea. Instead of paying the taxes, you would be paying interest to the bank. Furthermore, I have less trust in the unregulated development going on in most of the cities and towns of India. If it is for apartments, the structural integrity of most of the buildings and their legal work is also questionable. The rental yield is in the range of 2-3% which does not beat your FDs.
If I were you, during my earning years, I would be investing 50% in Index ETF, and the rest 50% to Gold ETF/SGB, Silver ETF and Debt. This is because index ETF is much more safer than stock investments. The draw-downs are limited when compared to individual stocks during a black swan event. Now index ETFs are tax efficient because the dividend declared by the companies is reinvested into the ETF and there is no need to pay taxes on the dividend. But the same dividend will be taxable when you receive it in your bank account(when holding individual stocks). The index ETFs are also highly liquid(Ex. NiftyBEES). In emergencies, you can pledge the index ETF and also take a short term loan or you can easily sell the ETF proportional to the emergency. No need to sell everything.
In your retirement years, you can reduce equity exposure in systematic manner and then increase the FD or Debt so that you get regular cash flow into your account which could be like your salary. You can adjust the exposure to debt based on your needs and this way you can be tax efficient.
These are my ideas and also what I am implementing but I do not know what the future can bring. Other experienced investors and traders could also comment on this idea.!!
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Yes.
Yes, I I used to work for JPMorganChase&Co, but kept my money elsewhere
You’re the FD queen of TQnA, you know the downsides of chasing yield, and also the the downsides of going towards the most risk-free option especially in times of a crisis. I’m sure you will guide your friends on the right path.
Thanks. Spoke to them about few banks which were offering higher rates as per your list. They were not aware of these names. Maybe these are like our small finance bank but regional in nature. I told them to continue with FCNR with Indian banks for the time being.
Need to find out more about these names.
Oh Nooooooo. You are correct. It should be lakh. Not sure why, I keep typing lack. I think its an habit.
Anyways learnt two important things from this post. Thank you.
Goodness need to go and check what spell I used when I gave out post dated cheques. Quite embarrassing to tell the holder of cheque, that I need to replace the cheque as I made spell mistake. But till date none got returned, so should be ok…I guess.
The right answer to this is that it depends While, you’ve shared your investments, there’s more to your personal finances than just investing. In fact, I’d go so far as to call investing a waste of time. There are far bigger priorities that you should focus on. I wrote this recently, hopefully, it helps.
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There are no shortcuts, investing is the only way to truly learn this.
Hey @viswaram
Kinda unrelated but this comment of yours really did give an amazing insight.
So imagine a freshman 22 year old guy , just graduated from college and the goals are
- 65L 2bhk debt free
- 6L car debt free
- 1 L bike debt free
- 15L Bank balance and 7L of investment
- 6L marriage expenses
So assuming the guy is Outta college has no education loan, no liability starting from account 0 , isn’t going to abroad and is purely salaried class , no credit cards. With income tax slab rate and say salary around 5 – 9 LPA average and 8 years of working, it’s near impossible to fulfill all above criteria by Age 30 isn’t it?
Numbers are not adding up.
9L/annum x 8 years is max 72 lakhs
taxes + expenses together will erode 33% of it → you will have 45 to 48 L if you are that frugal. No way you can buy the home debt free. All other items sounds like possible – but the mindset wont allow you to buy car/bikes w/o loans.
What will be the monthly expense of a 22yr old bachelor these days?
Id disagree slightly on this buddy!
I’m not a huge fan of corporate world or the job scenario in India but I’d just want to add my 2 cents here:
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Irrespective of the age, as soon as you enter the workforce, be clear about two aspects: Maximise your earnings and at the same time your savings. Don’t limit your thoughts in 5-9 lac bracket. It’s a purely transactional world. Friends, colleagues or relatives or girlfriends etc are just a waste of your time and energy. Focus on earning and maximising your potential. Period.
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Barring necessary transportation purchases, ones got to be flexible in terms of location. No need to buy a home till the point you are clear that you are going to settle down at that very location for next 10 years minimum that too with family.
In short only two things are under your control:
- Your growth in corporate wrt compensation. Simply go where they pay you more.
- Your savings. Be frugal and it’d serve you best once you are say 35-40. Because tab tak saare shauk khatum ho jayenge.
?
Can you please elaborate on this. A commerce graduate would just have completed his graduation at 21 and not even done his masters. Max he could do ICWAI inter during his graduation period. Now if he is a IIT, have little knowledge but I am sure it will take him a bit more than 22 years to complete and get such huge salary. Now what is the meaning of Transactional world.
What exactly do you in the corporate world which is working 9 to 5 job and getting sizable salary at the age of 21/22
This is what I am searching for since I started working, but it is not that easy – is it ? How many jobs can you jump in 10 years – max 2. For all this, what a person needs is solid education plus experience or are you saying that you keep educating from 22 to 30.
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Well I’d not get into the dynamics of age/stream here. Education tracks and opportunities basis that will differ for each other, The net message im trying to convey here:
- Whatever age you enter the workforce after completing your education (UG/PG). One must simply focus on 2 aspects: 1. Maximise earnings 2. Enhancing Savings
Ofcourse earnings can be maximised by switching jobs/upskilling or other means. One got to be ruthless and be at it at all times. Even if you say start at 3 lpa, you got to every day night think what do I do to make it 6 lpa then think what do I do to make it 12 lpa so on and so forth.
- What I meant here by transactional here is that any job you do, whether you work in IT or a Law firm or CA firm or MNC, it’s a transactional relationship. Paisa do kaam do ; have no emotions whatsoever at workplace ; things like this that I love my job, my WLB is great; my Org is great ; my colleagues are great; is all plain bullshit
Plain simple math is what hits your account every month, after giving your 9-10 hours to your bosses. Period.
Well I did the traditional education that most Indians do that’s BTech + MBA.
I have been with the same Org that I joined staraight out of campus. Haven’t switched job for the last 7 years.
Anyway guys the objective of this post is not to discuss careers etc. let’s stick to the financial arguments…
Any other suggestion that I could incorporate? I’d be happy to hear them
I agree with your points 100+% and unfortunately that is how the world is working. Pure Capitalism. It is so sad to see that fresher still earns something around 3.5lpa after doing a BTech which now costs around 10-20lakhs for a 4 year degree. After this much investment, I do not see any point to work for 3.5lpa. The salaries for the same freshers 10 years ago were still around 3lpa. The starting salaries does not even cover the inflation.
So every employee should be ruthless in up-skilling and demanding enough remuneration for their skills. Plain and Simple. Everything else in corporate life is secondary and waste of time and should be limited as much as possible.
Most companies are so greedy that one of the report from Moneycontrol finds out that the CEO salaries increased by ~840% in the last 10 years but the employee salaries increased by ~45% and this is unfortunately the sad state of the society. They further have so many complaints about moonlighting etc. In this scenario, every employee is completely responsible for their career and there is no point in blaming the company at a later point in time. The sooner they understand this the better it is!!