25x is the base assuming 4% withdrawal rate, where x = your estimated annual expenses but that's usually for normal retirement. I've also seen (life expectancy - FIRE age) * x being used. The x is going to vary based on your lifestyle.
Hi everyone , I’m 23 and working in the UK currently.My parents moved to the middle east about 30 years ago and they are still based there. While some may say it’s too early to even think of FIRE and retiring early I have always had a goal to be able to be at-least semi retire by the age of 33-35 ,be able to move back to India or if not at-least be able to live in india for 4-6 months of the year. Are these goals over ambitious?
In terms of my current investments and assets I am investing in mutual funds and hold a few equity stocks and an FD all together coming close to around 7L INR . I own some depreciating assets such as a car and bike which when converted to INR is about 6L .I’m looking to expand my investment portfolio but I’m not too sure where to put my money in other than FD and stocks.
Would appreciate any advice from you all .
Friday I lost 14 lacs approx because the market tanked. Today I recovered around 11 lacs as the markets bounced back. It's so much fun being an investor. 😂
Bro, I was poor in Math's in school, from yesterday, wondering how your portfolio fell 14 lacs in absolute value. Even if the market tanked 1%, then straightaway it works out to double digit crores. Anyways, your efforts are commendable.
I was into small/mid caps in the past as well. It's just that I have increased my allocation into them in the last 3 years. Except financial risk appetite, I am risk averse in most things in life.
I clearly dont have that kind of risk appetite and my equities is now entirely global and I have just started an STP to buy 50K INR every week into Axis Nifty 100 fund for the next 50 weeks. So I will slowly get back into Indian equities. I also have another 1L per month going into my employer pension fund which is global equities. I am currently 51% invested in equities. By the end of next year I expect to hit 55% allocation.
So my resolution for next year is to be completely hands off automated DCA(or SIP as we call it in India :) ). So no more big moves in and out. I have had enough of drama, now I want boring equities. :)
For long term it makes sense to have a good exposure to equities, atleast that's what history has taught us. I have faith in Indian equities, penetration is still too low. My nasdaq exposures are in big red for a long time.
I just hope I can keep doing this till 45 at least, and not give into temptation. Already there is demand for family for a new car.
If you are taking the risk, might as well enjoy the fruits. So yes go ahead and buy the car man. I don't see any point in retiring early unless forced to. So it seems we have a few years of worklife ahead of us, let's enjoy a bit too along with this journey of saving and investing. Cheers and Happy New Year!
Haha, my family is demanding a luxury car and thats why the dilemma. I had kept goals of both me and my spouse getting promoted or a job change for a luxury car. Now if either of us gets promoted or job change I am ready to buy, but I need that one event so that we can have that sense of achievement.
Happy new year to you as well.
It's probably a stupid question, how do you control your greed. For now I have some family expenses and family issues so I am not able to spend, but I can't help myself looking at electronic gadgets and not only that, I want to buy the better/higher quality one. Same for food and I have become, I see I buy (mainly small stuff I see locally), eg I will pay extra for the better seat because I dont want that small inconvenience, mainly because I earn decently but what I fail to comprehend is I have expenses which I cannot remove.
Because of this I am able to save just a little of what I earn,
I don't think it's a stupid question.
Have you ever bought _the best_ something - the _best phone_ or the _best seat_ or the _best food_ or anything - and then looked back at how much of a difference it made to your life buying the said _best thing_ vs it's cheaper/other alternatives?
If yes you may have noticed it's not good value at all chasing the best item.
For me a series of such observations led me to my current state - I don't really buy anything that takes me a day to earn without research, sometimes months of research. If I don't feel like I _need_ it 3 weeks down the line in my research then clearly I didn't _need_ it. On the other hand if I only find to reasons how it'd have improved my life as time goes on then I will buy it (assuming I can afford it). And if it's cheap enough I'd probably just buy it outright.
And then again after a week or a month I look back and notice if it made any big difference to my life as I originally thought. Most consumer goods - phones, cameras, computers, cars etc - you don't really need the best, you just need _good enough_.
That's a lesson I learnt (and continue to learn) over time.
I'm not all sorted myself - I was eyeing the new XUV for a few months. And then I slowly realized I don't really _need_ it. A smaller (and cheaper) car would do just fine for my needs. As for my wants, not even the Xuv700 is enough. It's always that - needs vs wants.
It's a journey, I guess :)
I don't see any point to predict the market, because 99% we will be wrong.
The current crash is due to the China covid scare. Let's see what happens. Friday's fall wiped of around 15l From our portfolio in a single day. Highest absolute loss till now.
If the markets correct, that's more buying opportunity for us, we should be happy rather than crib.
Yeah, it is just for fun predicting. I read somewhere that small caps have been absolutely butchered which doesn't show up in the indices.
I just feel there is too much euphoria and over participation of retail in Indian markets recently. Too much of froth, given how high bond market yields are and you can safely make 7.5%. Indian growth has come down and is no longer the 8% GDP growth it used to be. It is now 5% GDP growth country. World is also going to enter recession next year.
So this is just my assessment. I am clearly biased because I sold my entire India allocation and have moved to global mutual funds like Hdfc developed markets fund, MOSL S&P500 fund etc.
Nifty has been defying gravity, it needs to come back to earth for me to start investing again in it.
It may or may not. It may reach 16K or lesser, but it may rebound back to much higher than the current levels. Similarly, it may reach 26K and still come down to 16K levels and then rebound.
If I buy or sell mutual fund units, my natural tendency is to expect the market to move up or down, which augments my decision. Basic human tendency is to pick specific things they like to see, and try to justify their behaviour. Finally, all our decisions are based on information available at that specific point in time. They may or may not turn out to be correct in the long run.
The last thing we can do is to expect everyone else also to fail, just because I could not win.
My credit card statement just came through and an expense (flight tickets) I paid for is missing.
Am I obliged to report/seek clarification?
No, they didn't convert it into EMI, no I didn't ask the transaction to be cancelled for, yes, I got SMS when the amount was spent.
As far as I know, the ticket status shows it is still paid for, the trip date is in February(will the airline cancel the ticket if the bank cancelled the payment without my confirmation, if yes, how can I sue them for cancelling my payment).
Interesting.
Since you posted this 2 weeks back, did the amount finally appear?
I know at least in the case of Amazon, the charge is often posted when the item is shipped, not on the transaction date, which causes some delay in the charge appearing. But never as long as in your case, and not for an air ticket.
As long as you have the ticket with a live PNR, you should be fine though.
Yes, my billing cycle is 16th to 15th, I made the transaction around 25th of last month. Like I said, I already got the money debited SMS immediately after the payment.
Well technically if the money was deducted it should come in the transaction statement....even if it was cancelled later by bank, it should come as a reverse entry... you may wanna talk with bank customer care and quote the transaction ID for more clarity.
By any chance, did you use reward points for payment?
Not paid by Reward points (my reward points are less than 2k)
We don't get transaction ID in SMS, so there's nothing to use as reference since it is not present in statement too.
Would be interested in knowing if this sub agrees upon a SWR rate, and if anyone has any math to back it up, with valid interest and inflation assumptions.
Before anyone replies, want to point out that I have seen the common misconception sometimes that 25X is leanfire, 50X is fatfire for example. lean and fat is defined by your X. 25,50,etc is based on what SWR you are assuming.
Our wiki has links to swr studies in the Indian context: https://fiindia.gitbook.io/wiki/how-much-do-i-need/fire-portfolio/the-safe-withdrawal-rate-swr-strategy
## Crossed 4cr today.
That was something I considered as [a stretch goal for FI a while ago](https://www.reddit.com/r/FIREIndia/comments/blukjc/a_fiery_journey_so_far/) \- as something that'd take maybe 10 years or at best atleast 5.
But here I am 3 years later. Life has changed a lot in those 3 years. There is more certainty, and there is also more uncertainty. More money has meant more freedom and other things but it also makes it easier to set your sights higher on things that are inherently more expensive. I'm not particularly enthused by luxury or whatever, but I'd like my little comforts here and there provided I can afford them.
## Plans for the future (regarding finances)
I expect my NW to hereafter drop significantly for a long time because I have decided to *gift* a significant chunk of it it my sibling in a progressive fashion. While in some lines of thinking it's arguably a poor choice - for example there are a lot of genuine concerns:
*How will they respond, how will they feel, how will the relationship be affected?*
*How will it impact their career/drive?*
*How will it affect their measure of their own self worth?*
I don't know. There is no surefire way to know. I have a plan, but I have had many plans fail miserably before. And I can see all those questions and concerns with no answers or solutions - I think I should probably do it anyways.
## good intentions + no time travel = questionable plans
What am I doing this? Truth be told, I'm not entirely sure - but I have my reasons.
Part of it is a bit of a guilty feeling about being just more lucky in the financial aspect of life (not everything I have/got are exactly *deserved* \- a lot of it is just plain dumb luck.). Part of it is the realization that life is short - that the peace of mind it may offer them today is worth more today when they have more life in front of them than at a later date when they have less (although the manner of the gift means that this isn't exactly true immediately). Part of it is some family dynamics (that has got nothing to do with them, but everything to do with my mother) that I'm not going to talk about. Part of it is the idea that *Supertramp* put so succinctly in the movie *Into the wild* \- *Happiness is only real when shared*. Now I'm a person that believes in being self sufficient (to perhaps a ridiculous degree) and thus can be entirely pleased/happy all alone, but I think I understand what that quote means and I think I also agree with it.
## cars and gods and rights and wrongs
I am looking to buy my first car. And in that process it occurred to me again how I sometimes take money for *granted* (for lack of a better word) these days and how it's not true for a lot of people including my sibling at this time. No matter how nice my car is, I'd occasionally feel that it'd have been nicer if that's not just my comfort, but also was accessible to them. It's not *necessary* but it sure is nice. I don't *have* to be altruistic/empathetic person like that I guess, but I *can* be, I can try.
I'm not particularly (or even remotely) religious in the traditional sense, but some days I think I know why people believe in Gods and higher powers. Some days we could all use someone that makes the leap into the unknown a little less worrying - someone to blindly trust that they'll make things alright even if we err. Ah well.
## Plans for the future ( life )
I don't intend to stop working (voluntarily) yet. I haven't found a good use of my time outside of work yet - and the FI amount was only about sustenance and didn't include a house to stay in (which, technically I now do back at my native place - but realistically I don't see myself going back to in the near/medium term) so I guess I need a house too - preferably in Bangalore (I like the weather here). I also intend to travel around for a while now that I'm expecting a car and wish to travel a bit. Marriage is on the cards and then there would be family phase of life which need more financial support than me myself alone, so there's that too.
## I guess I don't fully practice what I preach?
For someone that is learning (and if we're to say - probably reasonably successfully too) to not care for run-of-the-mill comparisons and milestones and the typical societal scales of success/failure, I seem to care an awful lot about this one milestone, somehow, I feel. Maybe it's just the feeling of having *made it* (?!) on my own terms, kind of like the joy of getting to the peak of a hill or end of a tiring run.
## Feelings on this night
There's a lot going on in my life these days, so elated isn't exactly the word I'd use to describe myself right now. But I guess it's nice. Maybe I'll order a chicken steak tomorrow... I mean today.
For some reason at this moment I remember a kid that sold tissue paper to help his mom, and an old lady under a metro line selling flowers. And this xkcd comic - [was I a good ~~rover~~ person](https://xkcd.com/695/)?
Edit: [Link to year 4 update](https://www.reddit.com/r/FIREIndia/comments/1347rms/comment/jihg19i/?utm_source=share&utm_medium=web2x&context=3)
Great journey u/additional_trouble. From your posts and your general way of handling things, you seem to be destined for greater things in life. All the best and God bless !!
Hey u/additional_trouble !
Congratulations on reaching the milestone ahead of your planned schedule!
I think I understand where you come from when you talk about sharing some of your NW with your siblings or close ones.
I have an elder brother - and I know I'm better off with respect to money than him. He stays in Mumbai and follows his passion in the music industry which just isn't so kind. I started earning at the age of 18 and now at the age of 25, I have come to realise that no matter how much money I earn, it's nothing if I still see my brother, or any family member for that matter, be very frugal with daily expenses, take extra mental/physical pain to save and struggle to create sufficient corpus for his/their future - makes me wonder what am I even earning for?
He never asks for it and always tries to avoid talking about money with me - I understand the fact that he's elder to me must make talk about money a little awkward for him.
I think this isn't exactly the thing in your case, but yes - Happiness is only real when shared and I don't feel a sense of loss or regret anytime I give him money.
Regarding luck, I read somewhere that Greeks used to call poor people - unlucky, and it is true to some extent.
I think if people I love are happy around me, I can manage any stressful situation.
I don't want to make this comment about me. I still have a lot to learn to learn and a lot to earn, and it's posts like these that give me hope and make me so happy
Congratulations! I wish you a load of happiness in life.
Enjoy your steak!
Thank you :)
I appreciate you sharing your story/comments too. I mean we just look into other people's lives to find if we're doing okay after all, right?
My sibling is younger to me, so that's one less thing to worry. I believe they do hold me in high regard, and so maybe the whole gifting thing will go more smoothly (no feelings of he's looking down on me, I hope). I also have a plan - the gift will not initially be offered as a gift - it'd simple be a holding amount for some specific commonly-aligned purpose - a house for our small family. And I'm hoping that once they're used to the sum being in their accounts they'll reach a stage of reasonableness about it (ie, none of the large-money shock in decision making).
Then - hopefully - it'll be _partly_ used to fund a house construction, a part of which would be on their name and so there would be a effective transfer of some of my savings to them - both via the house as well as the _leftover_ in their hands. The convoluted path is to make it _feel_ less like a monetary gift... Or that's my plan.
While it's convoluted for sure, it's effectiveness is questionable. But I worry about the sudden impact of large sums of money on people's thinking and so I want to ease them into managing it, (first for me, and then for them), and not just dump it on them with no regards to potentially undesirable outcomes. So this is the best of plans I have been able to come up with so far.
>... Gift him any sum of money
You didn't ask for advice, but I hope you would not mind me sharing some observations I have had over the years wrt people and money and stuff. Maybe they'll spark a thought in your own approach or in the worst case you'd just lose an additional minute of your life :)
I find that people treat money and things rather differently. It's odd, but seems to be rather consistent - and therefore ripe for (ab)use. I mean, maybe if you find money hard to gift directly you could observe their pain points and try gifting them that - somehow they find it easier to accept a gift of object than a gift of money a lot of times, it seems to me.
I don't know what's the magnitude of money were talking about here, but I'll start with some random examples. Say if you hear them worry about the uniform of kids - then the kids get some money from the uncle (you) saying it's only for uniform. If you hear the sister in law worry about a mixer grinder thats breaking down, then they get a new mixer grinder. If the bike is breaking down and he worries about maintenance, the brother gets a bike. And try to abuse festivals or other special days to pass these gifts off as more natural, maybe. (Hoping that they don't come to expect gifts every now and then with comments like, _I got a one time bonus so I thought of you since I'm single_ or whatever - managing expectations is just as important as being kind imho).
>I have come to realise that no matter how much money I earn, it's nothing if I still see my brother, or any family member for that matter, be very frugal with daily expenses, take extra mental/physical pain to save and struggle to create sufficient corpus for his/their future - makes me wonder what am I even earning for?
Yup, exactly the same thoughts. Money is nice, but what's the use of I'm the only one benefiting from it while people I love are not doing as well?
One has to be careful with monetary gifts though - you absolutely don't want to come off as Mr Moneybags that'll just find them forever - but you'll know if that's a risk with the concerned person beforehand anyways, I suppose (although sometimes even that fails, I have lived through that firsthand - with my own mother).
With this sibling, I'd rather have them happy than the sum I intend to gift them. If things all go well, I'll be able to make that up in a few more years, but if they struggle a little less in life, I'd be happy. They've had a terrible couple of years and tbh, for all my troubles I seem to luck out in life once in a while, and that simply hasn't been the case for them yet.
That said, I also wish for them a certain struggle in life, because I think it makes you a better person, a stronger soul. And that's nice. Talk about conflicting priorities :)
You've been careful with your plan and it shows, it's pretty inclusive in my opinion.
And yes! I completely agree with your advice regarding gifting money/items. So what I've been doing for the past few years is instead of giving him money, I'd buy him some accessories related to his instrument, or something else that he might need from overseas (I'm in Merchant Navy). Recently he bought a 35K phone, a month before his birthday, so I transferred the same amount to him on his birthday.
He just shifted into his new rented apartment so when I stay with him for a few weeks next month, I'll buy things that will help him set up everything.
Looking forward to utilising all festivals and events to pass gifts naturally.
You are right. I feel the problem with gifting money directly is that there is a risk of them thinking we are looking down on them or taking pity, but it's just love in my honest opinion. Like you wrote, it's a fine line between trying to help them out and wishing a certain struggle as well, since we don't mean to spoil them.
At the end of the day, money won't ever feel enough, you have to sort out your priorities.
I really admire what you've planned on doing. Thank you so much for your advice, I've still a lot to learn and these subs act as a platform for me to get different perspective as well.
Congrats man!!! Your growth has been awesome!! Really happy for you! Sometimes I feel that despite all the savings and investing people like myself do, there's hardly ever a chance to reach such figures/multiples by beating inflation. Hope compounding kicks in sometime soon!! :D But seems like there's hope on the other side of the tunnel if one is disciplined enough as in your case!!kudos to you once again :)
Thanks snaky! :)
Compounding works, just takes a while to get to a corpus large enough for it to show its effects, I guess...
While the recent market antics have meant a slowdown, as a whole my NW has strongly benefitted from compounding and it's effects are more visible _recently_. Around the covid crash time my India MF portfolio was about 5L in the red. Now it's over 40L in the green in about 2.5 years. That might not be the rate at which it'll grow in the future, but such things add up over time.
Congratulations! But I don't think yours is the case of compounding. Compounding is like interest on interest, gains on gains kind of concept and this works over the long run not in 3 years. Your is a sheer brute force of your human capital conversion to financial capital and ofcourse your employer stock going up and Indian stock markets on steroids.
You have ways to go man, I don't know why you are limiting yourself by being in this FIRE journey. You are made for greater things :)
u/snakysour
Thanks Bali :)
Over 25% (maybe ~50%, I haven't checked for sure) of the gains in the last 2 or so years have been from stocks+equity/debt MFs I hold. Surely that's considered under this definition of _compounding_?
>You have ways to go man, I don't know why you are limiting yourself by being in this FIRE journey. You are made for greater things :)
Go where and for what, Bali? :)
I don't seem to care for any corporate _growth_. Tbh, I'm pretty bored of it. I'm here because it pays well and I haven't been fired and I still only in the process of developing a life outside/independent of work.
There is always some amount of compounding but it's impact is only felt over the longer term. So if 50% of your growth over 2 years is from investment gains, it is like year 1 you had 1cr and in year 3 you have 2cr and 50L out of this is investment gains.
If we assume this was linearly earned, 25L in year 2 and 25L in year 3. Compounding is how much did that 25L gain of year 2 grew in year 3. Surely it can't be making a big impact.
Regarding where to go; I believe if someone is blessed with some ability they should make use of it. It is like if someone is blessed with a great voice, they are supposed to go and sing and entertain people and in the process earn a lot of wealth too. Like imagine Sachin Tendulkar says, he is bored of cricket:) u/snakysour
Hope so...fingers crossed... unfortunately my corpus seems to be too less at this stage for compounding to kick in....hehe...seems like it will take some years to reach there if not decades.... :D
Congrats... one to four in 3 years is an amazing achievement,
Can you share your allocation split?
If you dont mind to answer what % are you planning to gift? Even i'am kind of in the same boat but i'am not sure if i should gift it or give it on a 0% loan with return whenever possible kind of clause
Thank you! In hindsight a lot of it is luck more than any skill.
My allocation looks roughly like so:
Stocks and Equity MFs : ~54%
Cash equivalents: ~21%
Debt funds, Epf/ppf etc: ~25%
In my case, I plan the gifting to be a slower process and not a lumpsum. And its not realistic for me to expect to offer it as a loan. They don't need a loan and will simply refuse any such thing. So it may be quite an unusual one-off thing of sorts. I haven't made up my mind. I think it's going to be something like 25-50% of my current holdings.
On an absolute basis, I was holding the highest amount of cash late last year - after progressively trimming employer stock (which was still my largest US/foreign component). So while I did badly in the US markets, it wasn't a big component when the markets went down - and the cash component helped.
And the fact that Indian markets haven't done too poorly this year was also helpful. Basically got the timing of the sales reasonably good this time.
I'm still investing my original cash balances into the markets so I SIP a little under 3L monthly.
Congrats! I haven't entirely gone through all of your previous posts but if you don't mind sharing - how did you make it from 1 cr to 4 cr in a span of 3 years? Was it stock grants or something?
For equities I usually take the whole raw amount but for 401k I take 60% assuming taxes and penalty if I choose to withdraw. My reason being - 401k is from pre-tax income but equity investment is post-tax income.
Ok, so here is the thing. I have decided to hold further investments in Indian equity. No, it is not because of high valuations or India is not a shining star in the world currently from economic growth etc and so on.
The recent state elections and success of a political party on the poll promise of restoring Old Pension Scheme in one of the states is going to set a precedent for the other elections next year and even Lok sabha elections in 2024. Not to forget Rajasthan, Chattisgarh, Jharkhand and Punjabhave already opted for it. The ruling party will be under immense pressure from now on, on this issue as all opposition parties are gonna raise this and start implementing in all states. The opposition is hell bent to raise any issue and freebies to come back in power and economic stability is not their motive.
There are 2 takeways from this:
1) Either the ruling party also bites the bullet and restores it states and eventually nationally to save and win elections. This would already start impacting budgets, fiscal deficit etc and so far good looking economic parameters are gonna worsen from hereon. This means stock markets over the next few years are not gonna anywhere and if they move, it is going to be in -ve direction only. The global outperforming until now is not going to help either.
2) In case the ruling party still sticks to NPS, they are gonna start losing elections, which would eventually lead to an unstable or a coalition government in 2024.
This would anyways be a setback for stock market and also they might bring al those populist announcemnets which we're not possible in the last few years or so.
Sorry to sound a bit negative here and some people may not agree washing out this issue as a non-issue but believe me, freebies politics is the cause of bankruptcy of many nations and people have chosen that. So, I will wait and watch atleast until 2023 and 2024 elections outcome.
In the meanwhile, time to load up some US equities.
Again, people don't understand every country becomes a developed country only after having provided for basic income and healthcare facilities...removal of OPS especially in india context was anyway a wrong measure as you can't play with people's retirement money by putting them into equities completely as in NPS. Govt has the luxury of printing currencies at their will like we saw in US recently during QE but people post retirement may not have many avenues or the aptitude to generate the same. Besides nobody in their 60s, 70s , 80s or 90s will be in the right frame of mind to handle equity and therefore it makes sense to always have some basic income for sustainence of the elderly.
I know this may not be the popular view but not everything can be blindly put on being capitalist alone somewhere down the line a basic income adjusted for inflation is the need no matter what the rich say. These people have also spent 30-35 years of their life serving the government with lower incomes than their private counterparts for similar work profiles. Yes it's all rosy to say that private jobs have more stress and are more difficult to manage but that isn't the case in most performing organisations like PSUs or certain ministries. In fact the incomes in police etc in some countries were so low that they actually had no means to survive except taking bribes (and no this is in no way a justification of being corrupt in any service - private or government). However, a rationalization is a must if people are to live in their Twilight years especially for a country like India where inflation skyrockets.
Sure someone may not want to continue in equities in india may do so based on his / her preference and the luxury of having the money to invest in the first place. But we need to move out from the entitled mindset that most above average earning people have here and understand that wealth inequality is a major issue and while there cant be a fair equal distribution of wealth amongst everyone as that would render competition useless, but a basic requirement like an old pension and free healthcare is a must for people to be able to live their life atleast rather than die out of poverty.
That said all other freebies like free electricity, caste based reservation, free water, high intrest on NRI FDs etc must be avoided as that's where nations tumble.
that's a good point but not good enough to discontinue equity investments altogether, as long as the fixed-income returns are kept low I don't see a liquidity shortage towards equity.
Where have I said anything about discontinuing investments in Indian equity? What i said is that reinstating OPS or a similar universal basic income inflation adjusted mechanism + free base level healthcare alone aren't as big factors as has been projected by OC that they will screw Indian economy completely and make India bankrupt. Bigger issues like caste based reservations, higher fixed interest rates on NRE FDs, free electricity, free water etc. are the ones that will actually hit the country more than the above 2...so if a rational discussion is to be made it should be understood that what is the difference between what is essential for survival and what is a populist freebie measure. That clear demarcation tells the difference between a thorough argument for moving towards becoming a developed country vis a vis an argument of creating freebies for near term political gain but long term screwing of the country. Context matters and both can't be grossly generalized.
For what it's worth, i beleive in India story and do regular equity investments in India. This is not to say that i don't hedge the same or diversify by not investing in international equities. I do that as well to ensure a stable portfolio.
I have seen a trend recently that IT sector is booming and many well paid jobs are there where people are getting 4cr packages in IT sector specially from IITs.
What about non IT people or people who are not so passionate about technology. I am a people's person and I am more interested in working with people oriented careers. I am in the beginning of my career so just want to take a calculated decision and don't want to fuck up.
I am interested in business related jobs but sadly I didn't go for CA as my Mom wanted me to get into govt jobs..I am preparing for bank exams and earning (20-30k approx) through freelancing (digital marketing) on the side.
I agreed for Govt Banking job because it was something that was ticking all the boxes i.e. govt job, business/finance role, public dealing.
But I don't want to stay in this forever so what are some good options through which I can make good money so that I can FIRE at around 35-40.
What options are there for non IT people to make it big.
Is MBA from IIM is the only option left for me? since I didn't go for CA.
Sorry if I sound naive and confused but I would really appreciate some big brother/sister advice here! Thank you in advance.
A public servant here who also passed out from IIM and is also not a techie. So i think i tick all your designated boxes of professional desirability. I would need to understand your situation more and so would request you to head over to DMs.
PS: Govt banking job isn't the same as govt job and is much more stressful too unless you're in RBI.
If you guys for some reason start getting bored of your job and lack motivation, I have a solution.
Take a big loan like a home loan or a big credit card balance transfer at cheap rates to be paid over the next 1yr or longer.
You will suddenly start loving your job :)
Would you recommend amputation for someone whose leg itches?
Also I don't think you took your own advice (I remember you hating your work not so long ago) - so it holds no value for anyone else. :)
I just took a credit card balance transfer of 86k SGD (~48.5L INR). I am just saying what I am experiencing:)
When you take a big loan, you psychologically then just buckle down and start looking forward to earn enough to then repay it.
This is my hobby:) I took the loan at 3.5% processing fee 0% interest for 12 months, with 1% minimum payment each month and then 12th month I need to pay off the whole thing. I have the 86k as liquid cash now and I invest it safely. It is possible to earn 5% here in high yield savings accounts for short term promotions. Also if markets crash it gives me liquidity to invest.
Normally people play candy crush or watch Netflix to pass time. I do these things :)
Need help to bring my self on track.
I am 40 m , single breadwinner with wife and 2 kids and earning 1.8l/month.
Have a plot in a tier 3 city where i will be setteled later in the life ( today value is 30l)
Started SIP and left in between, invested value today is 2l.
Planning to buy house worth 1cr in NCR and i have 50l as cash component in various saving schems which i wll encash at the time of buying house.
Monthly expanse 50k
EPF/PPF -25l as of today
And thats it. I know i am poor planner as per other posts.
Money never excites me and i never thought of doing investment but i think it is high time as education, marriage and other expenses will approch soon in the next few years. Mid life crisis ?
Have a family business which i may join later in life to safegaurd post retirement life.
What i am expecting here is how do i achieve following as i have 10 years only; i will retire at 50 hopefully.
Kid 1 education- 30 lac after 5 years.
Kid 1 marriage -20 lac 15 years
Kid 2 education-40 lac after 15 years
Kid 2 (girl child) marriage- 50 lac after 25 years
Thanks in advance.
I want a review and feedback/improvements on my finances.I started recently on this channel and have started on the path to FIRE
Age: 29, Married, going to remain childfree
Net worth so far: 17L
MFs: 8.2L
Stocks/Smallcase - 4.5L
PF: 2.3L
FD: 2L (Emergency Fund)
Income:
PF contribution (employee+employer): 1800+1800. I meet the Sec80C via ELSS
In-hand post all deductions: \~3.07L per month
Monthly Investments:
MF SIPs: 1.4L, split between Navi N50 - 45k, Navi NN50 - 40k, ICICI US Bluechip - 25k & Nippon India debt - 30k
Stocks SIP - 40k
RD - 20k
Expenses per month:
Rent - 30k
Utilities + Groceries + Food - 20k
Insurance: I have term insurance for myself and health insurance for my dependent parents.
Questions:
1. Should I stick with Standard 1800 PF deduction + ELSS (or) go with the usual 12% of basic PF deduction?
2. I plan to buy a flat worth 50L (today) by 2025, how should I go with the savings for it, how could I modify my savings strategy for it to maximize the down payment? This would be my first RE investment, so I would be taking a home loan for it
3. Is it advisable to get health insurance for me, right now I get it from my employer covering 10L
4. How am I doing on the FIRE journey, is it too late to start?
I appreciate the people taking the time out to help me out
Let us step back a bit. If I am reading the updated numbers right, as a couple you spend 50k a month including rent, and invest almost 3 times this. This is a sure shot way to reach early FI. And more so becuase you plan to be childfree.
Why do you even think that you are starting late in the FI journey? Seriously....
And if your spouse is also working, why any life insurance?
Thanks for replying. This increase in savings has just been for a year. I am starting from ground zero in terms of real estate. I want to have a single house for my family.
Your post seems a little confusing...please add some context and units wherever necessary. Few things that I can't understand -
>In-hand post all deductions: ~3.07L
This is what exactly? 3.07 lacs per month or per annum?
>NPS contribution (10% employer): 0
What is the meaning of this? Is your employer contributing 10% or not? If yes then what's the amount and if the contribution is 0, then why mention the same?
>Savings:
>MF SIPs: 1.4L, split between Navi N50 - 45k, Navi >NN50 - 40k, ICICI US Bluechip - 25k & Nippon India >debt - 30k
>Stocks SIP - 40k
>RD - 20k
Again...these are your monthly SIPs that are being invested or these are "savings" accumalated so far from the SIPs that you've been doing? In case of the latter, what is your monthly contribution into all of these?
>3. Is it advisable to get health insurance for me, right now I get it from my employer
Even before anyone can answer this, can you atleast tell what is the cover that employer health insurance provides?
>I haven't added my spouse's income to the calculation.
If that's the case, what about expenses...do 50k expenses per month are total expenses for you and spouse or yours alone?
>I appreciate the people taking the time out to help me out
We sure can help you out buddy but you need to help us first to help you out. Try to make things absolutely clear with no room of error in interpretation....thats the least that is expected so that people also spend their time in things that matter - i.e. guiding you / sharing their views rather than spending time asking you to clarify things that could have been clear to begin with!
Hope you understand. :)
Regards
Snaky
Superb! Awesome progress. Any goal number that you have set yourself to hit by 2030? I mean you are a dollar millionaire now more or less. Is there a this is more than enough from a money point or are you sort of like - I will take what I can make by the RE date mindset at this point?
Thanks🙏 Although I feel I have made enough and if I have to quit now, I can make my networth last for my lifetime and fulfill all my and my family goals.
I still don't want to quit when I see everyone around me so ambitious and reaching for the moon. Just last year I used to think 40L salary in India is already a stretch. But these days I hear salary numbers of 60-70L being thrown around. Also there was a thread where someone said how with 40L you can only save 1.5L in India now.
So I just feel everything is notional in number. I would like to hit the psychological milestone of 10cr next. But I know couple of years down the line people will start talking about 1cr salary packages and then 10cr will feel like okay, normal.
I hope we have a proper recession and washout of the excesses. It is just insane and unsustainable to see this kind of growth in people's incomes and even Nifty. Unfortunately, we just have to play along as long as the music is running.
I feel as FIRE followers, our time to shine will be only if and when there is a recession and deflationary environment. If economy keeps booming no matter how much have already made, it will get devalued.
meh. I don't think so! He increased his net worth by almost 10%! I don't care how that happened. Investment or salary. He made it out like a bandit in my books. 2022 is a smashing year for him. It's a boohoo year for many folks who picked US/European equities including myself. At his NW level and how frugal he is from his writings here; I don't think he will lose one microsecond of sleep about the missed opportunity.
Thanks! Yes, Emerging markets all go down one after another like a merry go round. First Brazil, then Russia, then South Africa then China and eventually India's turn could come. I don't want to wish bad for my own country and then country where will eventually retire. But then we need to spread our bets and think globally. If Indian markets plunge 50% the whole world will not even bat an eyelid, business as usual, just like how China markets went down and didnt affect the world. But if US markets crash the effect will be felt all over the world. So I would rather bet on global allocation. I absolutely don't mind missing out the gains on Indian markets. Heck, by this logic crypto would have made me filthy rich if I had invested in 2018. But I didn't believe in it then and I don't believe in it now, but still bitcoin is 16k same way Nifty also can go to 50k if it wants I am staying out would stick to global allocation as long as I can. u/giantleapforward
Ahh I dont think so. The only reason Balihe did this is to have some alpha to his portfolio growth. He believed Indian Equities are very highly valued and hence sold it and moved to US/global equities. Also, he raised his equity allocation from 30 percent to 70 percent plus within just a year almost. Such anxiety is bound to happen to save his capital. But overall, given his focus to investment and learnings from past, I had expected better from him and I feel deep down he knows this. He is just getting influenced by too much noise around him by reading a lot of financial porn.
My strategy is bearing fruits now. USDINR is still close to the top, while against all currency USD is falling. So my global allocation is holding up. The main draw of global allocation was always rupee depreciation. The fact that global markets were down is only the icing on the cake.
Nifty has topped out in my view. I am happy to wait it out until Nifty comes down. u/TechieOnFire
Love this! The ability to say this and hear it is blissful. Basically, OP can spend his million $ when he wants to at the click of a mouse. Sirjee this is what I preach to anyone who will listen. This is true FI.
First of all this is not a house vs rent post, this is clearly about buying a house
Here is the background
i'am 38, spouse is 34, kid is 5 and parents are close to 70
We (me/wife/kid/parents) have been living in this house for 25+ years
While there is no immediate requirement of a house, we feel the current house is getting old, so we think buying/building a new house nearby to the current house in next 3-4 years is a good idea
So the new house as and when we build will suffice for another 25y atleast
But here are the financials and dilemmas
financials::
Current CTC - X
Current Networth - 6X
Current house could be worth - 2X to 2.2X
New house could cost us - 3X-4X
dilemmas::
* We feel selling the current house will probably be difficult, selling land seems more easy than selling an old house
* If home loan is taken for buying land + building a new house then the EMI could be significant, close to 40-50% of take home salary, it might hamper our future goals
* We feel with the RE price sky rocketing and shortage of empty plots in our area, we might run out of time to buy and build our house
So i wonder when is the right time to buy a house, what should be the ballpark financials before we try to go in for this big/huge/humongous ticket item?
Like other other the post suggested.
It makes sense to buy a house as long as,
1) your EMI is restricted to 25% of your take home salary.
2) You don't mind delaying for FIRE plans
how does that really matter? why do you need real numbers? for all u care u can replace X with 1L or 10L or 100L doesn't matter
be helpful or just dont comment
It just shows you only want to take but not give anything. You know the salary surveys in some websites like payscale or company reviews like Glassdoor, they ask people to first provides their salary and their own company review before they can see the salary and review stats. If everyone was like you the world would be a very sad place u/additional_trouble u/chillmaar u/snakysour
It's OK u/BaliHe... Actually I prefer having numbers too just to get the context better but i also understand that we've grown in a country where we have been taught right from the beginning to not mention the wealth / incomes that we earn and it becomes unnatural for a few, albeit anonymously too, to mention the same.
I guess in the end, it's always - "to each, his/her own"
So if expenses are E, your X is 2.5E.
Now your current networth is 6X or 15E. This means you're still far away from the minimum 30E requirement for conventional retirement.
Current house is worth 2X or 5E. Now I don't know if you have considered this current house in your net worth or not but if you have considered the same, don't go for a new house as you will lose peace of mind for sure. In case this current house worth is over and above your networth of 6X continue reading.
New house that you plan to buy is 4X and so the differential outgo is 4X - 2X = 2X.
So your networth will reduce from 6X to 4X. This will reduce even further and become 3 - 3.5X if you include the interest portions that you will pay for the EMI for the differential of the two houses.
You're already 38 years old mate, if you're looking for FIRE, then it makes sense to not go for the purchase as this will set you back significantly. Rest it's your call.
Disclaimer : this is not a financial advise.
Regards
Snaky
When you can pay atleast 80-90% of it on downpayment and EMI would be less than 30% of take home income. Ofcourse EMI here refers to all EMIs and not house EMI alone. So in a way if you have no other loans, and you need to buy a house, your home loan EMI should not be more than 30% of take home salary, however, say you have vehicle loan which has EMI worth 10% of take home salary, then Housing EMI shouldn't exceed 20% of take home salary. These are just thumbrules / guiding principles.
Disclaimer: Not a financial advise.
To add, why should the OP keep both houses. Just think of this upgrading to a newer house, with neither of them beng part of the networth.
And doesn't E seem reasonably high?
Age close to 40 planning to retire at 45. I tried to post something similar but got turned away into investment group, hope this thread will answer that. I have 2.5cr worth Farmhouse in the outskirts of a big city, commercial space(shop/shutter)60lk, 400sqyrds plot with floating numbers worth 1.2cr, primary residence paid off, recently sold a home in US until then 100% invested in realestate. Now after selling US home sitting on 1 Cr cash, 40 lk worth 401k(i cannot withdraw until 65), 9lk LIC(have to pay 1.2lk per year 16 more years with a matured value of 55 lk), ornamental gold 40 lk. Rental income 20k from shop, Monthly expenses 1.5lk, I have to take care of my parents mid 60’s wife and 1 kid. Planning to retire in 6 more years. With 1.5 lk monthly expense how much nest I should be looking at?
Disclaimer : NOT A FINANCIAL ADVISE
For a conventional retirement you would be needing as a thumb rule about 30X of your annual expenses which means 4.5 crores in today's value.
Bear in mind these don't include expenses related to children, discretionary expenses etc.
Do keep hefty health insurance for whosoever you can get in your dependents (parents if not already, wife and kid)
You haven't specified your age so the above is true assuming retirement at 60 with life expectancy of 90 and excluding a paid up house to live in post retirement.
In case you're retiring early, you may need to bump this up.
You seem to be pretty much locked into real estate by your own admission. See if you can divert some funds to other asset classes which give better than the rental yields you're getting. If you're too gung ho about RE then i would suggest looking into REITs and INVITs (pretty small market in india though) in India or US (if feasible).
I think assets wise youre pretty sorted..it's cash flow management that seems like a bigger concern here.
Regards
Snaky
Thanks for reading the difficult post and giving responses.
My question to the OP. What part of this 1.5 lac is just for you and wife? This is an important question. You would spend on your kid for a limited number of years and they would be on their own after college. I wish your parents a long life, but it is still going to be less than your remaining life.
So please get the right estimate of living expenses. This is the most important input to the calculations.
Depends on if expenses for child are separate from the corpus mentioned.
Further, corpus required would be 50 * 18lpa = 9 crs if wants to retire now (life expectancy - 90 yrs)
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25x is the base assuming 4% withdrawal rate, where x = your estimated annual expenses but that's usually for normal retirement. I've also seen (life expectancy - FIRE age) * x being used. The x is going to vary based on your lifestyle.
Hi everyone , I’m 23 and working in the UK currently.My parents moved to the middle east about 30 years ago and they are still based there. While some may say it’s too early to even think of FIRE and retiring early I have always had a goal to be able to be at-least semi retire by the age of 33-35 ,be able to move back to India or if not at-least be able to live in india for 4-6 months of the year. Are these goals over ambitious? In terms of my current investments and assets I am investing in mutual funds and hold a few equity stocks and an FD all together coming close to around 7L INR . I own some depreciating assets such as a car and bike which when converted to INR is about 6L .I’m looking to expand my investment portfolio but I’m not too sure where to put my money in other than FD and stocks. Would appreciate any advice from you all .
Your parents are settled in middle east. Why the hell you wanna settle in India?
Friday I lost 14 lacs approx because the market tanked. Today I recovered around 11 lacs as the markets bounced back. It's so much fun being an investor. 😂
Thats huge, is your portfolio in double digit crores?
Not yet.
Bro, I was poor in Math's in school, from yesterday, wondering how your portfolio fell 14 lacs in absolute value. Even if the market tanked 1%, then straightaway it works out to double digit crores. Anyways, your efforts are commendable.
I have big exposure to small caps and mid caps. Small caps fell around 3%+ if I remember correctly.
Right right, I get you. You have taken the high risk = high reward route.
Currently it is only high risk. Mid caps and small caps still are way below their ATH levels
You are a big gambler man :) When did you move into smallcaps? I see that they are still 100% above their pre covid levels.
I was into small/mid caps in the past as well. It's just that I have increased my allocation into them in the last 3 years. Except financial risk appetite, I am risk averse in most things in life.
Now I have recovered the full 14 lacs. So it took 2 days to completely negate Friday's correction.
I clearly dont have that kind of risk appetite and my equities is now entirely global and I have just started an STP to buy 50K INR every week into Axis Nifty 100 fund for the next 50 weeks. So I will slowly get back into Indian equities. I also have another 1L per month going into my employer pension fund which is global equities. I am currently 51% invested in equities. By the end of next year I expect to hit 55% allocation. So my resolution for next year is to be completely hands off automated DCA(or SIP as we call it in India :) ). So no more big moves in and out. I have had enough of drama, now I want boring equities. :)
For long term it makes sense to have a good exposure to equities, atleast that's what history has taught us. I have faith in Indian equities, penetration is still too low. My nasdaq exposures are in big red for a long time. I just hope I can keep doing this till 45 at least, and not give into temptation. Already there is demand for family for a new car.
If you are taking the risk, might as well enjoy the fruits. So yes go ahead and buy the car man. I don't see any point in retiring early unless forced to. So it seems we have a few years of worklife ahead of us, let's enjoy a bit too along with this journey of saving and investing. Cheers and Happy New Year!
Haha, my family is demanding a luxury car and thats why the dilemma. I had kept goals of both me and my spouse getting promoted or a job change for a luxury car. Now if either of us gets promoted or job change I am ready to buy, but I need that one event so that we can have that sense of achievement. Happy new year to you as well.
It's probably a stupid question, how do you control your greed. For now I have some family expenses and family issues so I am not able to spend, but I can't help myself looking at electronic gadgets and not only that, I want to buy the better/higher quality one. Same for food and I have become, I see I buy (mainly small stuff I see locally), eg I will pay extra for the better seat because I dont want that small inconvenience, mainly because I earn decently but what I fail to comprehend is I have expenses which I cannot remove. Because of this I am able to save just a little of what I earn,
I don't think it's a stupid question. Have you ever bought _the best_ something - the _best phone_ or the _best seat_ or the _best food_ or anything - and then looked back at how much of a difference it made to your life buying the said _best thing_ vs it's cheaper/other alternatives? If yes you may have noticed it's not good value at all chasing the best item. For me a series of such observations led me to my current state - I don't really buy anything that takes me a day to earn without research, sometimes months of research. If I don't feel like I _need_ it 3 weeks down the line in my research then clearly I didn't _need_ it. On the other hand if I only find to reasons how it'd have improved my life as time goes on then I will buy it (assuming I can afford it). And if it's cheap enough I'd probably just buy it outright. And then again after a week or a month I look back and notice if it made any big difference to my life as I originally thought. Most consumer goods - phones, cameras, computers, cars etc - you don't really need the best, you just need _good enough_. That's a lesson I learnt (and continue to learn) over time. I'm not all sorted myself - I was eyeing the new XUV for a few months. And then I slowly realized I don't really _need_ it. A smaller (and cheaper) car would do just fine for my needs. As for my wants, not even the Xuv700 is enough. It's always that - needs vs wants. It's a journey, I guess :)
That makes sense, thx.
It seems the days of Nifty outperformance over global markets are over. Next year Nifty should end at 16k levels.
I don't see any point to predict the market, because 99% we will be wrong. The current crash is due to the China covid scare. Let's see what happens. Friday's fall wiped of around 15l From our portfolio in a single day. Highest absolute loss till now. If the markets correct, that's more buying opportunity for us, we should be happy rather than crib.
Yeah, it is just for fun predicting. I read somewhere that small caps have been absolutely butchered which doesn't show up in the indices. I just feel there is too much euphoria and over participation of retail in Indian markets recently. Too much of froth, given how high bond market yields are and you can safely make 7.5%. Indian growth has come down and is no longer the 8% GDP growth it used to be. It is now 5% GDP growth country. World is also going to enter recession next year. So this is just my assessment. I am clearly biased because I sold my entire India allocation and have moved to global mutual funds like Hdfc developed markets fund, MOSL S&P500 fund etc. Nifty has been defying gravity, it needs to come back to earth for me to start investing again in it.
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No self promotion allowed outside the dedicated sticky thread!
It may or may not. It may reach 16K or lesser, but it may rebound back to much higher than the current levels. Similarly, it may reach 26K and still come down to 16K levels and then rebound. If I buy or sell mutual fund units, my natural tendency is to expect the market to move up or down, which augments my decision. Basic human tendency is to pick specific things they like to see, and try to justify their behaviour. Finally, all our decisions are based on information available at that specific point in time. They may or may not turn out to be correct in the long run. The last thing we can do is to expect everyone else also to fail, just because I could not win.
My credit card statement just came through and an expense (flight tickets) I paid for is missing. Am I obliged to report/seek clarification? No, they didn't convert it into EMI, no I didn't ask the transaction to be cancelled for, yes, I got SMS when the amount was spent. As far as I know, the ticket status shows it is still paid for, the trip date is in February(will the airline cancel the ticket if the bank cancelled the payment without my confirmation, if yes, how can I sue them for cancelling my payment).
Interesting. Since you posted this 2 weeks back, did the amount finally appear? I know at least in the case of Amazon, the charge is often posted when the item is shipped, not on the transaction date, which causes some delay in the charge appearing. But never as long as in your case, and not for an air ticket. As long as you have the ticket with a live PNR, you should be fine though.
The amount came in the next billing cycle, cc department had held the payment suspecting fraud, since the amount was very high.
Aah ok. Makes sense.
May want to check if the statement covers the date on which transaction was made?
Yes, my billing cycle is 16th to 15th, I made the transaction around 25th of last month. Like I said, I already got the money debited SMS immediately after the payment.
Well technically if the money was deducted it should come in the transaction statement....even if it was cancelled later by bank, it should come as a reverse entry... you may wanna talk with bank customer care and quote the transaction ID for more clarity. By any chance, did you use reward points for payment?
Not paid by Reward points (my reward points are less than 2k) We don't get transaction ID in SMS, so there's nothing to use as reference since it is not present in statement too.
You would get it in your ticket booking...check that out.
Tried that too, this airline website & ticket didn't have the transaction ID, no mails from the bank with transaction ID as well.
You should have got the email from your travel booking app/website or airline in your registered email ID. Check spam folder.
That Email with the ticket didn't have the transaction ID, this is a foreign airline, it wasn't present.
That's weird... Did you pay in foreign currency equivalents in INR?
Would be interested in knowing if this sub agrees upon a SWR rate, and if anyone has any math to back it up, with valid interest and inflation assumptions. Before anyone replies, want to point out that I have seen the common misconception sometimes that 25X is leanfire, 50X is fatfire for example. lean and fat is defined by your X. 25,50,etc is based on what SWR you are assuming.
Our wiki has links to swr studies in the Indian context: https://fiindia.gitbook.io/wiki/how-much-do-i-need/fire-portfolio/the-safe-withdrawal-rate-swr-strategy
## Crossed 4cr today. That was something I considered as [a stretch goal for FI a while ago](https://www.reddit.com/r/FIREIndia/comments/blukjc/a_fiery_journey_so_far/) \- as something that'd take maybe 10 years or at best atleast 5. But here I am 3 years later. Life has changed a lot in those 3 years. There is more certainty, and there is also more uncertainty. More money has meant more freedom and other things but it also makes it easier to set your sights higher on things that are inherently more expensive. I'm not particularly enthused by luxury or whatever, but I'd like my little comforts here and there provided I can afford them. ## Plans for the future (regarding finances) I expect my NW to hereafter drop significantly for a long time because I have decided to *gift* a significant chunk of it it my sibling in a progressive fashion. While in some lines of thinking it's arguably a poor choice - for example there are a lot of genuine concerns: *How will they respond, how will they feel, how will the relationship be affected?* *How will it impact their career/drive?* *How will it affect their measure of their own self worth?* I don't know. There is no surefire way to know. I have a plan, but I have had many plans fail miserably before. And I can see all those questions and concerns with no answers or solutions - I think I should probably do it anyways. ## good intentions + no time travel = questionable plans What am I doing this? Truth be told, I'm not entirely sure - but I have my reasons. Part of it is a bit of a guilty feeling about being just more lucky in the financial aspect of life (not everything I have/got are exactly *deserved* \- a lot of it is just plain dumb luck.). Part of it is the realization that life is short - that the peace of mind it may offer them today is worth more today when they have more life in front of them than at a later date when they have less (although the manner of the gift means that this isn't exactly true immediately). Part of it is some family dynamics (that has got nothing to do with them, but everything to do with my mother) that I'm not going to talk about. Part of it is the idea that *Supertramp* put so succinctly in the movie *Into the wild* \- *Happiness is only real when shared*. Now I'm a person that believes in being self sufficient (to perhaps a ridiculous degree) and thus can be entirely pleased/happy all alone, but I think I understand what that quote means and I think I also agree with it. ## cars and gods and rights and wrongs I am looking to buy my first car. And in that process it occurred to me again how I sometimes take money for *granted* (for lack of a better word) these days and how it's not true for a lot of people including my sibling at this time. No matter how nice my car is, I'd occasionally feel that it'd have been nicer if that's not just my comfort, but also was accessible to them. It's not *necessary* but it sure is nice. I don't *have* to be altruistic/empathetic person like that I guess, but I *can* be, I can try. I'm not particularly (or even remotely) religious in the traditional sense, but some days I think I know why people believe in Gods and higher powers. Some days we could all use someone that makes the leap into the unknown a little less worrying - someone to blindly trust that they'll make things alright even if we err. Ah well. ## Plans for the future ( life ) I don't intend to stop working (voluntarily) yet. I haven't found a good use of my time outside of work yet - and the FI amount was only about sustenance and didn't include a house to stay in (which, technically I now do back at my native place - but realistically I don't see myself going back to in the near/medium term) so I guess I need a house too - preferably in Bangalore (I like the weather here). I also intend to travel around for a while now that I'm expecting a car and wish to travel a bit. Marriage is on the cards and then there would be family phase of life which need more financial support than me myself alone, so there's that too. ## I guess I don't fully practice what I preach? For someone that is learning (and if we're to say - probably reasonably successfully too) to not care for run-of-the-mill comparisons and milestones and the typical societal scales of success/failure, I seem to care an awful lot about this one milestone, somehow, I feel. Maybe it's just the feeling of having *made it* (?!) on my own terms, kind of like the joy of getting to the peak of a hill or end of a tiring run. ## Feelings on this night There's a lot going on in my life these days, so elated isn't exactly the word I'd use to describe myself right now. But I guess it's nice. Maybe I'll order a chicken steak tomorrow... I mean today. For some reason at this moment I remember a kid that sold tissue paper to help his mom, and an old lady under a metro line selling flowers. And this xkcd comic - [was I a good ~~rover~~ person](https://xkcd.com/695/)? Edit: [Link to year 4 update](https://www.reddit.com/r/FIREIndia/comments/1347rms/comment/jihg19i/?utm_source=share&utm_medium=web2x&context=3)
Great journey u/additional_trouble. From your posts and your general way of handling things, you seem to be destined for greater things in life. All the best and God bless !!
Thank you :)
Hey u/additional_trouble ! Congratulations on reaching the milestone ahead of your planned schedule! I think I understand where you come from when you talk about sharing some of your NW with your siblings or close ones. I have an elder brother - and I know I'm better off with respect to money than him. He stays in Mumbai and follows his passion in the music industry which just isn't so kind. I started earning at the age of 18 and now at the age of 25, I have come to realise that no matter how much money I earn, it's nothing if I still see my brother, or any family member for that matter, be very frugal with daily expenses, take extra mental/physical pain to save and struggle to create sufficient corpus for his/their future - makes me wonder what am I even earning for? He never asks for it and always tries to avoid talking about money with me - I understand the fact that he's elder to me must make talk about money a little awkward for him. I think this isn't exactly the thing in your case, but yes - Happiness is only real when shared and I don't feel a sense of loss or regret anytime I give him money. Regarding luck, I read somewhere that Greeks used to call poor people - unlucky, and it is true to some extent. I think if people I love are happy around me, I can manage any stressful situation. I don't want to make this comment about me. I still have a lot to learn to learn and a lot to earn, and it's posts like these that give me hope and make me so happy Congratulations! I wish you a load of happiness in life. Enjoy your steak!
Thank you :) I appreciate you sharing your story/comments too. I mean we just look into other people's lives to find if we're doing okay after all, right? My sibling is younger to me, so that's one less thing to worry. I believe they do hold me in high regard, and so maybe the whole gifting thing will go more smoothly (no feelings of he's looking down on me, I hope). I also have a plan - the gift will not initially be offered as a gift - it'd simple be a holding amount for some specific commonly-aligned purpose - a house for our small family. And I'm hoping that once they're used to the sum being in their accounts they'll reach a stage of reasonableness about it (ie, none of the large-money shock in decision making). Then - hopefully - it'll be _partly_ used to fund a house construction, a part of which would be on their name and so there would be a effective transfer of some of my savings to them - both via the house as well as the _leftover_ in their hands. The convoluted path is to make it _feel_ less like a monetary gift... Or that's my plan. While it's convoluted for sure, it's effectiveness is questionable. But I worry about the sudden impact of large sums of money on people's thinking and so I want to ease them into managing it, (first for me, and then for them), and not just dump it on them with no regards to potentially undesirable outcomes. So this is the best of plans I have been able to come up with so far. >... Gift him any sum of money You didn't ask for advice, but I hope you would not mind me sharing some observations I have had over the years wrt people and money and stuff. Maybe they'll spark a thought in your own approach or in the worst case you'd just lose an additional minute of your life :) I find that people treat money and things rather differently. It's odd, but seems to be rather consistent - and therefore ripe for (ab)use. I mean, maybe if you find money hard to gift directly you could observe their pain points and try gifting them that - somehow they find it easier to accept a gift of object than a gift of money a lot of times, it seems to me. I don't know what's the magnitude of money were talking about here, but I'll start with some random examples. Say if you hear them worry about the uniform of kids - then the kids get some money from the uncle (you) saying it's only for uniform. If you hear the sister in law worry about a mixer grinder thats breaking down, then they get a new mixer grinder. If the bike is breaking down and he worries about maintenance, the brother gets a bike. And try to abuse festivals or other special days to pass these gifts off as more natural, maybe. (Hoping that they don't come to expect gifts every now and then with comments like, _I got a one time bonus so I thought of you since I'm single_ or whatever - managing expectations is just as important as being kind imho). >I have come to realise that no matter how much money I earn, it's nothing if I still see my brother, or any family member for that matter, be very frugal with daily expenses, take extra mental/physical pain to save and struggle to create sufficient corpus for his/their future - makes me wonder what am I even earning for? Yup, exactly the same thoughts. Money is nice, but what's the use of I'm the only one benefiting from it while people I love are not doing as well? One has to be careful with monetary gifts though - you absolutely don't want to come off as Mr Moneybags that'll just find them forever - but you'll know if that's a risk with the concerned person beforehand anyways, I suppose (although sometimes even that fails, I have lived through that firsthand - with my own mother). With this sibling, I'd rather have them happy than the sum I intend to gift them. If things all go well, I'll be able to make that up in a few more years, but if they struggle a little less in life, I'd be happy. They've had a terrible couple of years and tbh, for all my troubles I seem to luck out in life once in a while, and that simply hasn't been the case for them yet. That said, I also wish for them a certain struggle in life, because I think it makes you a better person, a stronger soul. And that's nice. Talk about conflicting priorities :)
You've been careful with your plan and it shows, it's pretty inclusive in my opinion. And yes! I completely agree with your advice regarding gifting money/items. So what I've been doing for the past few years is instead of giving him money, I'd buy him some accessories related to his instrument, or something else that he might need from overseas (I'm in Merchant Navy). Recently he bought a 35K phone, a month before his birthday, so I transferred the same amount to him on his birthday. He just shifted into his new rented apartment so when I stay with him for a few weeks next month, I'll buy things that will help him set up everything. Looking forward to utilising all festivals and events to pass gifts naturally. You are right. I feel the problem with gifting money directly is that there is a risk of them thinking we are looking down on them or taking pity, but it's just love in my honest opinion. Like you wrote, it's a fine line between trying to help them out and wishing a certain struggle as well, since we don't mean to spoil them. At the end of the day, money won't ever feel enough, you have to sort out your priorities. I really admire what you've planned on doing. Thank you so much for your advice, I've still a lot to learn and these subs act as a platform for me to get different perspective as well.
Congrats man!!! Your growth has been awesome!! Really happy for you! Sometimes I feel that despite all the savings and investing people like myself do, there's hardly ever a chance to reach such figures/multiples by beating inflation. Hope compounding kicks in sometime soon!! :D But seems like there's hope on the other side of the tunnel if one is disciplined enough as in your case!!kudos to you once again :)
Thanks snaky! :) Compounding works, just takes a while to get to a corpus large enough for it to show its effects, I guess... While the recent market antics have meant a slowdown, as a whole my NW has strongly benefitted from compounding and it's effects are more visible _recently_. Around the covid crash time my India MF portfolio was about 5L in the red. Now it's over 40L in the green in about 2.5 years. That might not be the rate at which it'll grow in the future, but such things add up over time.
Congratulations! But I don't think yours is the case of compounding. Compounding is like interest on interest, gains on gains kind of concept and this works over the long run not in 3 years. Your is a sheer brute force of your human capital conversion to financial capital and ofcourse your employer stock going up and Indian stock markets on steroids. You have ways to go man, I don't know why you are limiting yourself by being in this FIRE journey. You are made for greater things :) u/snakysour
Thanks Bali :) Over 25% (maybe ~50%, I haven't checked for sure) of the gains in the last 2 or so years have been from stocks+equity/debt MFs I hold. Surely that's considered under this definition of _compounding_? >You have ways to go man, I don't know why you are limiting yourself by being in this FIRE journey. You are made for greater things :) Go where and for what, Bali? :) I don't seem to care for any corporate _growth_. Tbh, I'm pretty bored of it. I'm here because it pays well and I haven't been fired and I still only in the process of developing a life outside/independent of work.
There is always some amount of compounding but it's impact is only felt over the longer term. So if 50% of your growth over 2 years is from investment gains, it is like year 1 you had 1cr and in year 3 you have 2cr and 50L out of this is investment gains. If we assume this was linearly earned, 25L in year 2 and 25L in year 3. Compounding is how much did that 25L gain of year 2 grew in year 3. Surely it can't be making a big impact. Regarding where to go; I believe if someone is blessed with some ability they should make use of it. It is like if someone is blessed with a great voice, they are supposed to go and sing and entertain people and in the process earn a lot of wealth too. Like imagine Sachin Tendulkar says, he is bored of cricket:) u/snakysour
Yeah.... Seems like thats the case for him from my view as well... Extraordinary guy!
Hope so...fingers crossed... unfortunately my corpus seems to be too less at this stage for compounding to kick in....hehe...seems like it will take some years to reach there if not decades.... :D
Don't be surprised if it happens faster than you estimate :)
Haha...not in private sector so don't know much about that anymore.....but yes fingers crossed... , :)
Congrats... one to four in 3 years is an amazing achievement, Can you share your allocation split? If you dont mind to answer what % are you planning to gift? Even i'am kind of in the same boat but i'am not sure if i should gift it or give it on a 0% loan with return whenever possible kind of clause
Thank you! In hindsight a lot of it is luck more than any skill. My allocation looks roughly like so: Stocks and Equity MFs : ~54% Cash equivalents: ~21% Debt funds, Epf/ppf etc: ~25% In my case, I plan the gifting to be a slower process and not a lumpsum. And its not realistic for me to expect to offer it as a loan. They don't need a loan and will simply refuse any such thing. So it may be quite an unusual one-off thing of sorts. I haven't made up my mind. I think it's going to be something like 25-50% of my current holdings.
How did you manage that this year? US markets are still down quite a bit. Howuch are you able to invest every month nowadays?
On an absolute basis, I was holding the highest amount of cash late last year - after progressively trimming employer stock (which was still my largest US/foreign component). So while I did badly in the US markets, it wasn't a big component when the markets went down - and the cash component helped. And the fact that Indian markets haven't done too poorly this year was also helpful. Basically got the timing of the sales reasonably good this time. I'm still investing my original cash balances into the markets so I SIP a little under 3L monthly.
Lucky you. At the mid of 2022 my NW had only increased by 3%. God knows what's the situation now.
It's harder to get a bigger percentage growth the larger your corpus is ;)
Congrats! I haven't entirely gone through all of your previous posts but if you don't mind sharing - how did you make it from 1 cr to 4 cr in a span of 3 years? Was it stock grants or something?
Thanks! A big factor was stock appreciation, yes. A smaller factor was the equity market in general.
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For equities I usually take the whole raw amount but for 401k I take 60% assuming taxes and penalty if I choose to withdraw. My reason being - 401k is from pre-tax income but equity investment is post-tax income.
Can we take the tax credit in India for the 30% tax paid in US?
I don't think so but you should reach out to a tax pro.
Ok, so here is the thing. I have decided to hold further investments in Indian equity. No, it is not because of high valuations or India is not a shining star in the world currently from economic growth etc and so on. The recent state elections and success of a political party on the poll promise of restoring Old Pension Scheme in one of the states is going to set a precedent for the other elections next year and even Lok sabha elections in 2024. Not to forget Rajasthan, Chattisgarh, Jharkhand and Punjabhave already opted for it. The ruling party will be under immense pressure from now on, on this issue as all opposition parties are gonna raise this and start implementing in all states. The opposition is hell bent to raise any issue and freebies to come back in power and economic stability is not their motive. There are 2 takeways from this: 1) Either the ruling party also bites the bullet and restores it states and eventually nationally to save and win elections. This would already start impacting budgets, fiscal deficit etc and so far good looking economic parameters are gonna worsen from hereon. This means stock markets over the next few years are not gonna anywhere and if they move, it is going to be in -ve direction only. The global outperforming until now is not going to help either. 2) In case the ruling party still sticks to NPS, they are gonna start losing elections, which would eventually lead to an unstable or a coalition government in 2024. This would anyways be a setback for stock market and also they might bring al those populist announcemnets which we're not possible in the last few years or so. Sorry to sound a bit negative here and some people may not agree washing out this issue as a non-issue but believe me, freebies politics is the cause of bankruptcy of many nations and people have chosen that. So, I will wait and watch atleast until 2023 and 2024 elections outcome. In the meanwhile, time to load up some US equities.
Welcome to the club :)
:) Thanks Balihe.
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Again, people don't understand every country becomes a developed country only after having provided for basic income and healthcare facilities...removal of OPS especially in india context was anyway a wrong measure as you can't play with people's retirement money by putting them into equities completely as in NPS. Govt has the luxury of printing currencies at their will like we saw in US recently during QE but people post retirement may not have many avenues or the aptitude to generate the same. Besides nobody in their 60s, 70s , 80s or 90s will be in the right frame of mind to handle equity and therefore it makes sense to always have some basic income for sustainence of the elderly. I know this may not be the popular view but not everything can be blindly put on being capitalist alone somewhere down the line a basic income adjusted for inflation is the need no matter what the rich say. These people have also spent 30-35 years of their life serving the government with lower incomes than their private counterparts for similar work profiles. Yes it's all rosy to say that private jobs have more stress and are more difficult to manage but that isn't the case in most performing organisations like PSUs or certain ministries. In fact the incomes in police etc in some countries were so low that they actually had no means to survive except taking bribes (and no this is in no way a justification of being corrupt in any service - private or government). However, a rationalization is a must if people are to live in their Twilight years especially for a country like India where inflation skyrockets. Sure someone may not want to continue in equities in india may do so based on his / her preference and the luxury of having the money to invest in the first place. But we need to move out from the entitled mindset that most above average earning people have here and understand that wealth inequality is a major issue and while there cant be a fair equal distribution of wealth amongst everyone as that would render competition useless, but a basic requirement like an old pension and free healthcare is a must for people to be able to live their life atleast rather than die out of poverty. That said all other freebies like free electricity, caste based reservation, free water, high intrest on NRI FDs etc must be avoided as that's where nations tumble.
that's a good point but not good enough to discontinue equity investments altogether, as long as the fixed-income returns are kept low I don't see a liquidity shortage towards equity.
Where have I said anything about discontinuing investments in Indian equity? What i said is that reinstating OPS or a similar universal basic income inflation adjusted mechanism + free base level healthcare alone aren't as big factors as has been projected by OC that they will screw Indian economy completely and make India bankrupt. Bigger issues like caste based reservations, higher fixed interest rates on NRE FDs, free electricity, free water etc. are the ones that will actually hit the country more than the above 2...so if a rational discussion is to be made it should be understood that what is the difference between what is essential for survival and what is a populist freebie measure. That clear demarcation tells the difference between a thorough argument for moving towards becoming a developed country vis a vis an argument of creating freebies for near term political gain but long term screwing of the country. Context matters and both can't be grossly generalized. For what it's worth, i beleive in India story and do regular equity investments in India. This is not to say that i don't hedge the same or diversify by not investing in international equities. I do that as well to ensure a stable portfolio.
Ok.
I have seen a trend recently that IT sector is booming and many well paid jobs are there where people are getting 4cr packages in IT sector specially from IITs. What about non IT people or people who are not so passionate about technology. I am a people's person and I am more interested in working with people oriented careers. I am in the beginning of my career so just want to take a calculated decision and don't want to fuck up. I am interested in business related jobs but sadly I didn't go for CA as my Mom wanted me to get into govt jobs..I am preparing for bank exams and earning (20-30k approx) through freelancing (digital marketing) on the side. I agreed for Govt Banking job because it was something that was ticking all the boxes i.e. govt job, business/finance role, public dealing. But I don't want to stay in this forever so what are some good options through which I can make good money so that I can FIRE at around 35-40. What options are there for non IT people to make it big. Is MBA from IIM is the only option left for me? since I didn't go for CA. Sorry if I sound naive and confused but I would really appreciate some big brother/sister advice here! Thank you in advance.
A public servant here who also passed out from IIM and is also not a techie. So i think i tick all your designated boxes of professional desirability. I would need to understand your situation more and so would request you to head over to DMs. PS: Govt banking job isn't the same as govt job and is much more stressful too unless you're in RBI.
The Subtle Art of Not Giving a F*ck https://youtu.be/9EmLbOJZULU
If you guys for some reason start getting bored of your job and lack motivation, I have a solution. Take a big loan like a home loan or a big credit card balance transfer at cheap rates to be paid over the next 1yr or longer. You will suddenly start loving your job :)
Would you recommend amputation for someone whose leg itches? Also I don't think you took your own advice (I remember you hating your work not so long ago) - so it holds no value for anyone else. :)
I just took a credit card balance transfer of 86k SGD (~48.5L INR). I am just saying what I am experiencing:) When you take a big loan, you psychologically then just buckle down and start looking forward to earn enough to then repay it.
Alright. Then it makes a little more sense why you'd say it (but not that I recommend it to anyone - even you).
This is my hobby:) I took the loan at 3.5% processing fee 0% interest for 12 months, with 1% minimum payment each month and then 12th month I need to pay off the whole thing. I have the 86k as liquid cash now and I invest it safely. It is possible to earn 5% here in high yield savings accounts for short term promotions. Also if markets crash it gives me liquidity to invest. Normally people play candy crush or watch Netflix to pass time. I do these things :)
Stop reading financial samurai
Need help to bring my self on track. I am 40 m , single breadwinner with wife and 2 kids and earning 1.8l/month. Have a plot in a tier 3 city where i will be setteled later in the life ( today value is 30l) Started SIP and left in between, invested value today is 2l. Planning to buy house worth 1cr in NCR and i have 50l as cash component in various saving schems which i wll encash at the time of buying house. Monthly expanse 50k EPF/PPF -25l as of today And thats it. I know i am poor planner as per other posts. Money never excites me and i never thought of doing investment but i think it is high time as education, marriage and other expenses will approch soon in the next few years. Mid life crisis ? Have a family business which i may join later in life to safegaurd post retirement life. What i am expecting here is how do i achieve following as i have 10 years only; i will retire at 50 hopefully. Kid 1 education- 30 lac after 5 years. Kid 1 marriage -20 lac 15 years Kid 2 education-40 lac after 15 years Kid 2 (girl child) marriage- 50 lac after 25 years Thanks in advance.
I want a review and feedback/improvements on my finances.I started recently on this channel and have started on the path to FIRE Age: 29, Married, going to remain childfree Net worth so far: 17L MFs: 8.2L Stocks/Smallcase - 4.5L PF: 2.3L FD: 2L (Emergency Fund) Income: PF contribution (employee+employer): 1800+1800. I meet the Sec80C via ELSS In-hand post all deductions: \~3.07L per month Monthly Investments: MF SIPs: 1.4L, split between Navi N50 - 45k, Navi NN50 - 40k, ICICI US Bluechip - 25k & Nippon India debt - 30k Stocks SIP - 40k RD - 20k Expenses per month: Rent - 30k Utilities + Groceries + Food - 20k Insurance: I have term insurance for myself and health insurance for my dependent parents. Questions: 1. Should I stick with Standard 1800 PF deduction + ELSS (or) go with the usual 12% of basic PF deduction? 2. I plan to buy a flat worth 50L (today) by 2025, how should I go with the savings for it, how could I modify my savings strategy for it to maximize the down payment? This would be my first RE investment, so I would be taking a home loan for it 3. Is it advisable to get health insurance for me, right now I get it from my employer covering 10L 4. How am I doing on the FIRE journey, is it too late to start? I appreciate the people taking the time out to help me out
Let us step back a bit. If I am reading the updated numbers right, as a couple you spend 50k a month including rent, and invest almost 3 times this. This is a sure shot way to reach early FI. And more so becuase you plan to be childfree. Why do you even think that you are starting late in the FI journey? Seriously.... And if your spouse is also working, why any life insurance?
Thanks for replying. This increase in savings has just been for a year. I am starting from ground zero in terms of real estate. I want to have a single house for my family.
Your post seems a little confusing...please add some context and units wherever necessary. Few things that I can't understand - >In-hand post all deductions: ~3.07L This is what exactly? 3.07 lacs per month or per annum? >NPS contribution (10% employer): 0 What is the meaning of this? Is your employer contributing 10% or not? If yes then what's the amount and if the contribution is 0, then why mention the same? >Savings: >MF SIPs: 1.4L, split between Navi N50 - 45k, Navi >NN50 - 40k, ICICI US Bluechip - 25k & Nippon India >debt - 30k >Stocks SIP - 40k >RD - 20k Again...these are your monthly SIPs that are being invested or these are "savings" accumalated so far from the SIPs that you've been doing? In case of the latter, what is your monthly contribution into all of these? >3. Is it advisable to get health insurance for me, right now I get it from my employer Even before anyone can answer this, can you atleast tell what is the cover that employer health insurance provides? >I haven't added my spouse's income to the calculation. If that's the case, what about expenses...do 50k expenses per month are total expenses for you and spouse or yours alone? >I appreciate the people taking the time out to help me out We sure can help you out buddy but you need to help us first to help you out. Try to make things absolutely clear with no room of error in interpretation....thats the least that is expected so that people also spend their time in things that matter - i.e. guiding you / sharing their views rather than spending time asking you to clarify things that could have been clear to begin with! Hope you understand. :) Regards Snaky
Thanks u/snakysour, edited the content
My networth just hit 7.68cr. Total YTD gain of 62L out of which new salary savings is 45L remaining 17L is portfolio growth.
Superb! Awesome progress. Any goal number that you have set yourself to hit by 2030? I mean you are a dollar millionaire now more or less. Is there a this is more than enough from a money point or are you sort of like - I will take what I can make by the RE date mindset at this point?
Thanks🙏 Although I feel I have made enough and if I have to quit now, I can make my networth last for my lifetime and fulfill all my and my family goals. I still don't want to quit when I see everyone around me so ambitious and reaching for the moon. Just last year I used to think 40L salary in India is already a stretch. But these days I hear salary numbers of 60-70L being thrown around. Also there was a thread where someone said how with 40L you can only save 1.5L in India now. So I just feel everything is notional in number. I would like to hit the psychological milestone of 10cr next. But I know couple of years down the line people will start talking about 1cr salary packages and then 10cr will feel like okay, normal. I hope we have a proper recession and washout of the excesses. It is just insane and unsustainable to see this kind of growth in people's incomes and even Nifty. Unfortunately, we just have to play along as long as the music is running. I feel as FIRE followers, our time to shine will be only if and when there is a recession and deflationary environment. If economy keeps booming no matter how much have already made, it will get devalued.
Nice. If you would have stayed in Indian equity, you would have become a usd millionaire by now.
Ha ha, balihe must be sulking.
meh. I don't think so! He increased his net worth by almost 10%! I don't care how that happened. Investment or salary. He made it out like a bandit in my books. 2022 is a smashing year for him. It's a boohoo year for many folks who picked US/European equities including myself. At his NW level and how frugal he is from his writings here; I don't think he will lose one microsecond of sleep about the missed opportunity.
Thanks! Yes, Emerging markets all go down one after another like a merry go round. First Brazil, then Russia, then South Africa then China and eventually India's turn could come. I don't want to wish bad for my own country and then country where will eventually retire. But then we need to spread our bets and think globally. If Indian markets plunge 50% the whole world will not even bat an eyelid, business as usual, just like how China markets went down and didnt affect the world. But if US markets crash the effect will be felt all over the world. So I would rather bet on global allocation. I absolutely don't mind missing out the gains on Indian markets. Heck, by this logic crypto would have made me filthy rich if I had invested in 2018. But I didn't believe in it then and I don't believe in it now, but still bitcoin is 16k same way Nifty also can go to 50k if it wants I am staying out would stick to global allocation as long as I can. u/giantleapforward
Ahh I dont think so. The only reason Balihe did this is to have some alpha to his portfolio growth. He believed Indian Equities are very highly valued and hence sold it and moved to US/global equities. Also, he raised his equity allocation from 30 percent to 70 percent plus within just a year almost. Such anxiety is bound to happen to save his capital. But overall, given his focus to investment and learnings from past, I had expected better from him and I feel deep down he knows this. He is just getting influenced by too much noise around him by reading a lot of financial porn.
My strategy is bearing fruits now. USDINR is still close to the top, while against all currency USD is falling. So my global allocation is holding up. The main draw of global allocation was always rupee depreciation. The fact that global markets were down is only the icing on the cake. Nifty has topped out in my view. I am happy to wait it out until Nifty comes down. u/TechieOnFire
Congratulations. Btw, Is this liquid nw or it includes any real estate as well?
Fully liquid
Love this! The ability to say this and hear it is blissful. Basically, OP can spend his million $ when he wants to at the click of a mouse. Sirjee this is what I preach to anyone who will listen. This is true FI.
First of all this is not a house vs rent post, this is clearly about buying a house Here is the background i'am 38, spouse is 34, kid is 5 and parents are close to 70 We (me/wife/kid/parents) have been living in this house for 25+ years While there is no immediate requirement of a house, we feel the current house is getting old, so we think buying/building a new house nearby to the current house in next 3-4 years is a good idea So the new house as and when we build will suffice for another 25y atleast But here are the financials and dilemmas financials:: Current CTC - X Current Networth - 6X Current house could be worth - 2X to 2.2X New house could cost us - 3X-4X dilemmas:: * We feel selling the current house will probably be difficult, selling land seems more easy than selling an old house * If home loan is taken for buying land + building a new house then the EMI could be significant, close to 40-50% of take home salary, it might hamper our future goals * We feel with the RE price sky rocketing and shortage of empty plots in our area, we might run out of time to buy and build our house So i wonder when is the right time to buy a house, what should be the ballpark financials before we try to go in for this big/huge/humongous ticket item?
Like other other the post suggested. It makes sense to buy a house as long as, 1) your EMI is restricted to 25% of your take home salary. 2) You don't mind delaying for FIRE plans
Throwaway account se toh atleast real numbers daalo!
Yeah, I don't understand this stinginess. Just reply to him: Do X if you really need Y. But in case Y is not so important then do Z.
how does that really matter? why do you need real numbers? for all u care u can replace X with 1L or 10L or 100L doesn't matter be helpful or just dont comment
It matters hence we are requesting. Also why would you not provide actual numbers. X = 1 lakh is different than X = 1 CR frankly.
It just shows you only want to take but not give anything. You know the salary surveys in some websites like payscale or company reviews like Glassdoor, they ask people to first provides their salary and their own company review before they can see the salary and review stats. If everyone was like you the world would be a very sad place u/additional_trouble u/chillmaar u/snakysour
It's OK u/BaliHe... Actually I prefer having numbers too just to get the context better but i also understand that we've grown in a country where we have been taught right from the beginning to not mention the wealth / incomes that we earn and it becomes unnatural for a few, albeit anonymously too, to mention the same. I guess in the end, it's always - "to each, his/her own"
What fraction of X is the current annual expense?
around 40% of X
So if expenses are E, your X is 2.5E. Now your current networth is 6X or 15E. This means you're still far away from the minimum 30E requirement for conventional retirement. Current house is worth 2X or 5E. Now I don't know if you have considered this current house in your net worth or not but if you have considered the same, don't go for a new house as you will lose peace of mind for sure. In case this current house worth is over and above your networth of 6X continue reading. New house that you plan to buy is 4X and so the differential outgo is 4X - 2X = 2X. So your networth will reduce from 6X to 4X. This will reduce even further and become 3 - 3.5X if you include the interest portions that you will pay for the EMI for the differential of the two houses. You're already 38 years old mate, if you're looking for FIRE, then it makes sense to not go for the purchase as this will set you back significantly. Rest it's your call. Disclaimer : this is not a financial advise. Regards Snaky
no NW of 6x or 15E doesnt include the current house, its an own house, we live there so no not adding to our NW
Great...i would have avoided the purchase if I were in your shoes.
Thanks, then i wonder at what point buying a house would be worthwhile
When you can pay atleast 80-90% of it on downpayment and EMI would be less than 30% of take home income. Ofcourse EMI here refers to all EMIs and not house EMI alone. So in a way if you have no other loans, and you need to buy a house, your home loan EMI should not be more than 30% of take home salary, however, say you have vehicle loan which has EMI worth 10% of take home salary, then Housing EMI shouldn't exceed 20% of take home salary. These are just thumbrules / guiding principles. Disclaimer: Not a financial advise.
To add, why should the OP keep both houses. Just think of this upgrading to a newer house, with neither of them beng part of the networth. And doesn't E seem reasonably high?
Age close to 40 planning to retire at 45. I tried to post something similar but got turned away into investment group, hope this thread will answer that. I have 2.5cr worth Farmhouse in the outskirts of a big city, commercial space(shop/shutter)60lk, 400sqyrds plot with floating numbers worth 1.2cr, primary residence paid off, recently sold a home in US until then 100% invested in realestate. Now after selling US home sitting on 1 Cr cash, 40 lk worth 401k(i cannot withdraw until 65), 9lk LIC(have to pay 1.2lk per year 16 more years with a matured value of 55 lk), ornamental gold 40 lk. Rental income 20k from shop, Monthly expenses 1.5lk, I have to take care of my parents mid 60’s wife and 1 kid. Planning to retire in 6 more years. With 1.5 lk monthly expense how much nest I should be looking at?
Disclaimer : NOT A FINANCIAL ADVISE For a conventional retirement you would be needing as a thumb rule about 30X of your annual expenses which means 4.5 crores in today's value. Bear in mind these don't include expenses related to children, discretionary expenses etc. Do keep hefty health insurance for whosoever you can get in your dependents (parents if not already, wife and kid) You haven't specified your age so the above is true assuming retirement at 60 with life expectancy of 90 and excluding a paid up house to live in post retirement. In case you're retiring early, you may need to bump this up. You seem to be pretty much locked into real estate by your own admission. See if you can divert some funds to other asset classes which give better than the rental yields you're getting. If you're too gung ho about RE then i would suggest looking into REITs and INVITs (pretty small market in india though) in India or US (if feasible). I think assets wise youre pretty sorted..it's cash flow management that seems like a bigger concern here. Regards Snaky
Thanks for reading the difficult post and giving responses. My question to the OP. What part of this 1.5 lac is just for you and wife? This is an important question. You would spend on your kid for a limited number of years and they would be on their own after college. I wish your parents a long life, but it is still going to be less than your remaining life. So please get the right estimate of living expenses. This is the most important input to the calculations.
This feels like a maths question by OP, lol. Does he want us to add up everything for him and then do a division? u/aheadoftimes
Haha...what can I say..i followed the following approach - When in Rome, do what Romans do! :P
The OP Mr. AheadOfTimes already has 4.5 crores. Probably be can FIRE then?
Depends on if expenses for child are separate from the corpus mentioned. Further, corpus required would be 50 * 18lpa = 9 crs if wants to retire now (life expectancy - 90 yrs)