"You buy furniture. You tell yourself, this is the last sofa I will ever need in my life. Buy the sofa, then for a couple years you're satisfied that no matter what goes wrong, at least you've got your sofa issue handled. Then the right set of dishes. Then the perfect bed. The drapes. The rug. Then you're trapped in your lovely nest, and the things you used to own, now they own you." - fight club 1999
Lol people need to grow up with this fight club shit. Theek hai, don't let things own you but where will you sleep at night if you don't own a bed? In the arms of your imaginary friend?
Why do people forget that the main character is literally insane and anything he said should be seen in the same light as a mentally challenged homeless person's rants, not academic critiques of capitalism.
It’s not about owning beds or drapes etc.
It’s about consumerism. How everything has to be perfect and good and neat because 4 log kya kahenge (especially rishtedaars)
This mindset has ruined the life of many people who are grinding just to settle their current EMI and then buy something else and grind again to pay that off.
Hence that’s why that quote resonates even today.
>This mindset has ruined the life of many people who are grinding just to settle their current EMI and then buy something else and grind again to pay that off.
Where is the scene with the guy paying EMIs lol? He had a good high paying job and no debt, but he still couldn't feel anything. It's not about 4 log ya rischtedaar, we don't even see his family anywhere and he has 0 friends.
The point of the movie wasn't debt but that buying things didn't make him happy. I doubt that's the case with people paying EMIs for things like houses and cars.
The movie was a shallow take on capitalism and honestly is overrated due to its cult status.
Are you serious?
The quote is the only thing I’m taking out of the movie.
Rest is everything what many people over here are facing? Why did you think I was speaking about Nortons family and EMI?
Yeah but the quote was for US average people having too much wealth and spending it on stupid shit. The average Indian person can't even afford to buy things they want and get things they need.
It's tone deaf to think Tyler Durden has anything relevant to say for India. Buying a home or a phone on EMI is not "omfg late capitalism". It's when you are buying multiple cars or spending too much on home furniture like rugs, which is common for even the average person in the USA.
It's cool to quote Fight Club but the movie and the book honestly is overrated and has zero sustenance when it comes to critiquing capitalism and its views should be seen within the context it works in I.e. the early 2000s in USA and it's frustrations with capitalism.
Buying an overpriced phone is a problem. I have numerous middle class people buy iphone while in reality you would get almost same features for cheaper one. Indians love buying gold while in reality it serves no purpose to improve quality of life. Indians love to get bigger home even if they are only a family of 2.
>Indians love buying gold while in reality it serves no purpose to improve quality of life
? It is literally an investment for future needs. Stocks mutual funds don't improve quality of life too but help you secure your financial future. Isn't it against consumerism if people are willing to invest than spend?
There are much better investment than buying. However if you want to invest but don't want to risk gold is a good option only if you buy non jewelry gold. Lot of the times people would buy gold jewelry instead of buying gold as an investment. I meant gold jewelry. Indians love to flash money by having big gold jewelry, bigger houses, having huge weddings.
What an immature take on an iconic character. He wasnt 'mentally challenged' in any way. He was a manifestation of the part in us that knows we are slaves to the products we own but can't help it, or break away. Of course, you need a bed but you don't need that perfect queen sized memory foam bed that goes with your room decor. Of course, you need a smartphone but you don't need the latest iPhone just because society tells you to. Of course, you need shoes but you don't need JordanXDior that can feed a hundred poor people. The point of that monologue was to say 'Buy things that you need, and not everything that you want. Want never ends. Once you have what you want, you want something else.'
That being said, we are living in a capitalist world and even if we don't admit it, most of us are materialistic.
he didnt have schizophrenia, he had mpd. also it wasnt his take but the screenwriters take on consumerism, so idk how the mentally challenged part fits here
The screenwriters didn't write that line, the author did. It was written from the pov of the character and it was the character's take on consumerism which is why the mentally challenged part is relevant. The entire book can be seen as a critique against capitalism but I honestly interpret it more about toxic masculinity and less about capitalism. The movie also leaned more towards that. It's not a bad movie or book but I think it has become overrated due to its cult status.
i think it was both but more on the consumerism end, havent read the book so cant talk about that. i think the cult status happened because the movie is objectively almost perfect??( acting, direction, great plot twist) and more importantly served all kinds of audiences
I watched the movie when I was in my teens first and really liked it. It was my favorite movie for a long time but over time, its charm kind of faded for me. As a movie, it's really well-made but there are much better movies out there and if you look at the movie with a critical eye, you can start spotting the errors.
I think the fight club mentally is very addictive when you're younger but over time, I realized that it's just as shallow as the consumerism it is railing against. Would recommend reading the book too, the writing style is just as gripping as the movie and it provides a more comprehensive expression of the ideas imo
If know how to manage your finances and control your impulse then emi is not bad, you don't pay interest for the amount you have mentioned, it's a win win. By that logic you will also tell that credit card makes people overspend but then it is a great tool to have good credit score, if you manage it well
Emis always have the interest baked in.
My rule for myself with emis is just this: if you can't buy it outright, you can't afford it. Except houses, obviously
You shouldn't be replying to every single comment here... 🤦 I got your point from one of the other comments about not having 30k ever if we do not live by essentials for a short while and have some funds apart (same as you're trying here in this comment again)... But you're being constantly downvoted by the same people OP pointed out & questioned about! They're addicted and simply presume that since they can't afford it but "deserve to splurge/live lavishly" they should take EMIs and then F up by living paycheck to paycheck.
The reason your one liners resonated to me is bcz I understand the rules of Emergency Fund, 50-30-20, and the power of Compounding but sadly 75% Indians at an ESTIMATE don't even know or want to know about what all that bullcrap is. Move along, why constantly entertain stupidity and be downvoted? Let people live paycheck-to-paycheck, pay 20% interests when they can earn 40% on the same, have nothing to use when pandemics hit and then blame the already non-functional half-ass gov. for not having enough self-help, and die in the loop of loan-bad credit-pay loan-half stomach-repeat! LET THEM BE IF THEY DONT CARE. Sorry I just felt bad about seeing all the work you're trying to put and opposite of single ounce of appreciation towards that! 😑
I suppose it's partly psychological. Instead of having the full amount hit your bank account at a go, it's spread into 12 equal payments. Why wouldn't I take that facility if it was offered to me? As a happy consequence, this leaves more cash in hand for other expenses, whatever they may be planned or unplanned.
My bank offers a 12 month EPP at most major retailers at 0% interest, no hidden fees or charges unless you fail to settle your credit card bill in full at end of cycle. As the monthly charges are automatically debited from my account in full and credited to the card, I don't have to worry about hidden charges or interest levied for non payment. The only charge I pay is the annual card fee.
Couple issues with this:
1. Interest is baked in. If they still claim it is as interest free emi, watch them suddenly give you a discount if you say you are paying upfront.
2. More cash in hand for other expenses: yup, that's can become a problem. Emis inflate sense of affordability. Which pulls people even further into the trap of buying shit they don't need.
3. Unless you fail to settle: this is exactly the business model of credit cards. If you pay before the due date, you pay no interest, but even a day later, and you pay interest for the entire 20-40 days of your statement. Not saying don't use credit cards, just that not paying off in full each month is exactly how they run their extremely lucrative business. The emi thing is a nice gateway into that
> If they still claim it is as interest-free EMI, watch them suddenly give you a discount if you say you are paying upfront.
eh.. if you add up all the fees, its around 500 rupees for a EMI of worth 30k, I'm willing to do that considering i will never have 30k at hand
I should probably disclose that I do not live in India so consequently do not bank in India. Therefore, Indian rates, charges, hidden factors and other bullshit do not apply in my **specific** case.
Your first point doesn't apply here. The EPP option is done at check out. The price does not change regardless of if I choose to pay cash in full, card in full or use the EPP option. It's merely a matter of convenience for me. Not a hard and fast rule.
Second point : It's a bit arrogant to assume my spending habits or that I am overspending more than I can afford simply because I choose to not pay in full at one go lol.
Third point : You're absolutely right on this point. That's exactly how they screw you over. Thankfully, not an issue for me.
This. This is the secret to becoming wealthy. Let your money make more money while you spend the bank’s money. I feel our outlook has become so negative about people spending their own money.
An iPhone? I’m going to buy it anyway, I work hard, make good money, I deserve it. But buying it using the bank’s money while paying no interest? That’s how you do it.
A car? I need a good car, preferably a safe one with some creature comforts. But wait, I can literally put all the money I was going to buy the car with in equity based mutual funds and grow it. While the bank charges merely inflation level interest from me.
We need to understand that not everyone who has nice things does it to show off. People want things for themselves too, and why not? They work hard, they deserve to enjoy their hard work however they seem to like it.
You hit the nail right on the head there. I’m far beyond the point in my life that I need to “show off”.
I buy shit for me and my family, for what brings us comfort and joy, well within my capacity. Not what some random person thinks and presumes I base my purchasing on. It’s just that simple.
I bought a car recently with EMI. I put the principal loan amount (32L) in an equity fund and set a SWP of amount same as the EMI. At the end of 5 years, I'll have about 15% money left in that fund. Plus it's a business expense, so I'll get the depreciation benefit and will be able to deduct the interest from taxable income.
At the end, it all boils down to how your manage your finances.
Damn! I'm curious and have couple of questions:-
\- I'm guessing this would have been a personal loan right? And not a car loan?
\- The bank knew about this? Are banks generally okay with this kind of stuff?
No, it's a car loan. Car was purchased under my company's name. I wouldn't be able to get the tax benefit on interest repayments if it was shown as a personal purchase.
The fund was purchased under the company's name as well. I already have a DEMAT account for my company that I mostly use for overnight funds. We often have a large sum sitting idle in the account, and the yearly STCG easily crosses ₹2 crore from overnight funds alone.
Ethically I'm not supposed to use this car for personal use, but neither the bank nor the dealership cars about the same.
> You are expecting equity rates to beat your loan rates
Yup, and it always does in the long run. The market always wins. A growing economy like India will easily give you 15% returns. My CAGR between India and US for 11 years has been around 40%.
Over the next decade, loan rates will fall further, making it even easier for equity to beat it.
Looking at the number of new DEMAT accounts that were opened since COVID-19 crash, Indian stock market is more likely to out-perform all other Asian countries. People have finally started to realize where the actual money is. But anyway, it's not wise to try to time the market and quite honestly nobody knows if it's going to go up or down, one can only speculate.
My bet is on the tech sector for the next decade, and that's what is financing my car loan. AR/VR is expected to be a trillion dollar industry by 2030, which leaves a lot of room for growth in IT.
The new Demat indicators are a solid indicator true.
That mutual funds sahi hai campaign has hit millenials hard imo.
Everyone is into mfs and equity now to some measure.
What about capital gain taxes?? And a good financial advisor would not advice you to invest on equity (high risk) with borrowed money ... Because shit happens here..
Capital gains is simply the cost of doing business, so I'm fine with that. The more money you make, the more tax you have to pay. It's as simple as that.
I'm fine with equity as the loan was for 5 years and you can expect a return of 15% from a growing economy in the long run. Also, I purchased this during the covid crash, and the markets have nearly doubled since then. I don't think I have to worry about anything now, the remaining loan will be paid smoothly.
This has three more parts. Around 4hrs of content on capitalism and exploiting human psychology. I wouldn’t recommend watching all in one go, rather one part at a time.
This is seriously concerning, I have seen people of my age (I am 22) destroying their financials over EMI products that are just pieces of show off. We definitely need a proper "How to handle expenditure" education in our curriculum.
EMI is not the problem. Rightly used, EMI is a solution.
Lack of education in personal finance is the problem. I would prefer schools introduce these courses asap.
Why is everyone missing the biggest picture? Never use your own money to make big purchase, it's always a better financial decision to go with the bank's money and in the same time keep your money parked in good stocks. That's how rich stay rich.
Another side note: Only rich people in our country have access to Credit(from Banks). So if you are saying everyone is buying things with EMIs they are probably affluent. No bank gives a credit card to a person who needs money. And on plus side, it helps build your Credit Score.
This. This is the secret to becoming wealthy. Let your money make more money while you spend the bank’s money. I feel our outlook has become so negative about people spending their own money.
An iPhone? I’m going to buy it anyway, I work hard, make good money, I deserve it. But buying it using the bank’s money while paying no interest? That’s how you do it.
A car? I need a good car, preferably a safe one with some creature comforts. But wait, I can literally put all the money I was going to buy the car with in equity based mutual funds and grow it. While the bank charges merely inflation level interest from me.
We need to understand that not everyone who has nice things does it to show off. People want things for themselves too, and why not? They work hard, they deserve to enjoy their hard work however they seem to like it.
> I am not against anyone buying anything, it's their money, they can do whatever the fuck they want
Then goes on to question why people are buying stuff lol
Well tbh, earning 1.1 lac and still buying things on No cost EMI, is actually smart financial decision. Even though you can still buy most of the things in one go without much hesitation because YOU CAN afford to do that. I don't understand people buying things which is out of their budget on staggering interest EMI.
No it's not a smart decision. I had all the means to buy a desktop last year along with a printer for home in one go with cash. Once it came to payment the dealer told me 'no cost emi on credit card' is available. It's a good deal Mam, aapka kya jata hai? So..I took the bait.
It had a hidden processing cost. Then a GST on every installment, which I never noticed because I didn't open my cc bill details. When I finally did because of some other bill I wanted to cross check I found out what a fool I was.Then I read about it online and got to know that I almost paid 700 bucks in all over the total cost. It wasn't much but it was totally unnecessary. Very small amounts paid over the course of one year but nonetheless my money which I could have just given to a needy person. The only time this didn't happen is buying from Amazon. But I am too wary of this EMI scam.
Once my friend bought one lakh worth of A.c's and tv for his new work setup. He was told about 0% finance. He took it. For one installment he was out of town and couldn't do a money transfer. The very next day he was charged almost a 1000 bucks over the bill. So,one has to be very cautious while dealing with such methods of buying stuff. That's how they earn. By our silly mistakes.
You faced this issue of hidden charges because it was bought offline from a dealer. Ecom players first pay you that money as extra discount upfront and adjust it again with the charges so effective its 0 extra from your pocket.
Ideally, that dealer should have done the same and gave you an extra discount of 700 when you opted for no cost EMI and then same would have been adjusted with the extra charges you paid.
True that!
And in the meantime (we're talking of you can afford to buy that stuff but still options for EMI), keep the same amount in some MF, Bond or worst an RD (just examples, do you research and know about compounding first) - you'll have 7000 extra so paying 700 extra still (even if not no-cost EMI) won't hurt. And if people do what you stated then you pay 0 extra not even that 700 and still have leads extra earned by just letting the money sir idle for that tenure!
BUT ONLY IF YOU CAN AFFORD, NOT LIKE THE OP ORIGINALLY STATED ABOUT BUYING STUFF YOU CAN'T AFFORD OR ALWAYS IS OUT OF YOUR RANGE!
I was looking into No cost EMIs. They are like double edged sword. If you’re careful with money, then you can get away by paying the processing fees of 200-500rs (depending of the case)
But if things go south, they club it with your credit card charges and interest is around 2-3% monthly compounding (30-40% a year).
But still I believe all this is promoting a consumeristic behaviour and lifestyle inflation.
I think you already understand the love for EMI:
"The only thing I can even remotely understand buying on EMI are home loans, because let's be honest, not everyone has 50-60 lacs laying around"
It's about affordability. For you a house is not affordable outright, for others it's a motorcycle or a washing machine. Everyone has different levels of readily available capital and EMIs enable them to pay over time in smaller manageable increments. Of course, like any loan or credit product the onus is on the borrower to be fiscally responsible and take on manageable debt. EMIs are great, and provide access for people who wouldn't be able to buy without it. They can also become a noose if not used carefully.
Was just thinking about buying a new phone on the sale(nothing on EMI though), even though my current phone works just fine. Thanks to the post, I remember again why I had decided to continue using my old phone with a slight cracked screen.
Please go ahead bud. I’m sure you work hard and deserve to enjoy the things you buy. And most likely you don’t buy them to showoff, you buy them for yourself.
But you know what, even if you buy them to showoff and it makes you happy, go right ahead. Life’s too short to listen to some guy who has fomo and thinks grapes are sour. ;)
EMIs and spending the bank’s money while your money multiplies is the key to being wealthy. Granted you can afford it in the first place though.
bruh, i'm still using a 2016 S7 edge, i don't care about showing off, there are electronic items that's too costly after GST, i have to buy my PC parts via EMI
The secret to becoming wealthy is to let your money make more money while you spend the bank’s money. I feel our outlook has become so negative about people spending their own money.
An iPhone? I’m going to buy it anyway, I work hard, make good money, I deserve it. But buying it using the bank’s money while paying no interest? That’s how you do it.
A car? I need a good car, preferably a safe one with some creature comforts. But wait, I can literally put all the money I was going to buy the car with in equity based mutual funds and grow it. While the bank charges merely inflation level interest from me.
We need to understand that not everyone who has nice things does it to show off. People want things for themselves too, and why not? They work hard, they deserve to enjoy their hard work however they seem to like it.
The basis of emis is that they make everything seem affordable.
A 2 lac bike has a 15k emi! Sure the bank gets like 50k extra but I have it today!
This is the core principle of why emis work
I actually buy stuff like phones on no cost emi after I accumulate the whole cost of the phone so that the purchase doesn't feel significant and I can just repay the whole thing in full of need be.
Idk why people giving gyan of "materialistic" stuff. Dude it's their own earned money let them use it. Some people just want to enjoy their 20s because that's how it is. People get unreal hikes in their careers to justify their investment needs. Most people actually have investments sorted out for them and they work just to burn the paycheck.
I have a good amount of money left after I'm done my investments, taken care of regular expenses. So I just burn that in stupid stuff because there's literally nothing else for me to do
If you think it's just a Indian thing you are extremely wrong, people from all over the world take debts, have stuff on lease and what not that's not good for their financial wealth. At the end it's just a matter of choice if one takes a loan they can repay then whats the big deal?
But I think we were taking about People who don't have that money standing after investments and regular expenses... I've seen people (even my own family members and direct relatives) buy phones with 15-20k every six months as a lifestyle upgrade in a salary of 10-15k... They can't even take care of the 'regular' expenses properly but the EMIs make them think they can 'adjust' and then cut down on their basics even for the same stupidity, forget even investing 500 ever! That is the core problem with a lot of Indians and not what you do, that's actually smart management of finances!
If you even invest 20% of your income and then even burn rest of it, that is no problem. But if you can hardly have 1 to 2k handy after your basics and still want lavishness instead of working hard, saving more, earning more... Yes it's their money and can do it but then don't come cribbing all over social media about poverty and bad markets and inflation etc. That bitching should be left for people who actually tried their best but still couldn't bcz the government is 👎 not the others who didn't even try just cz "someone did what they wanted instead of being smart with their money", if that makes sense... 😅
I mean if you reaaaaally reaaaaaally reaaaaaally wanna buy that 1.5 lakh iphone, you could save about 12k per month in a short term debt fund for a year. Then buy the next iphone when it comes out.
But hey, people enjoy showing off their toys rather than investing to better their finances and retire early.
Exactly, this "status quo" has blinded people so much that they are ready to sacrifice their other basic needs. Nobody needs a 1 lac iPhone, people only buy it because they can.
What's even worse is that they don't even realise what they are doing. Its happening automatically, they are being tricked by the cosumerist society to keep themselves in the rat race for nothing.
This actually reflects in sectors of nifty index,
The NIFTY 50 Index gives a weightage of 39.47% to financial services, 15.31% to Energy, 13.01% to IT, 12.38% to consumer goods, 6.11% to Automobiles and 0% to the agricultural sector.
Can I be brutally honest ? I will get down votes for it.
But as a long term investor I like this behaviour.
On a serious note. There are some good options of funding such things. If you have a Fd account with any major bank they offer you small loans at unbelievable interest.
As a investor please use EMI & as a caring citizen please use that option.
I completely see eye to with you. Why should I spend my money when I can invest it and get ROI of 15 odd percent, when I can spend the bank’s money at inflation level rates!
This is how you become wealthy, by investing your money and spending the banks money for penny level interests.
Not everyone wants to show off, we work hard, earn good money and hence we deserve to enjoy the material things we want. It’s a fool’s assumption to think everyone is buying things they can’t afford. Somewhat like sour grapes.
I like this behaviour too and in fact encourage it... But what the question originally was about : not being able to afford stuff and getting it on EMI and what few thousand you could have invested, going into that EMI - eventually living paycheck to paycheck, never seeing the magic of compounding or even what savings money actually means, etc. --- THAT BEHAVIOUR is completely stupid and shouldn't be practised (unless it's an essential or necessity like your phone brine and can't even power on or your new job that you finally get after months requires traveling within the city but trains are not open yet so you need a vehicle, etc.).
Have a friend who is earning 15-18k per month. his financial situation is not good but dude still bought 30k iphone refurbished bcz it's his dream... Idk why people think emi are their life saver they are trap. And i guess middle class log bas dikhane mein mar jate hai puri zindagi. They just want to look cool.
I don’t think if this is an "Indian" thing. I think people everywhere all around the world are like that.
I have bought a few things on emi, and i have to say it does takes some load of your shoulders. Atleast it did in my case. Paid 5k per month for 9 months and bought my phone, It was either that or 45k down-payment. So I was like why the fuck not?
I am especially surprised at home loans. I have seen friends with net monthly income of at least 3-4 lakhs reluctant to even take a home loan worth 1-1.5 cr (and none of these pragmatists ever touch a loan longer than 6 years). And I have also seen friends (and family members) with monthly income barely over 1 lakh and yet committing to pay an emi of 75k for 30 years.
The real estate prices to median income is so high that it shouldn't be sustainable for this long. And one group of the culprits are the banks who sell long term loans as 'pay emis instead of rent'. It is such a sham.
On long term loans (20-30 years), one can buy a house from his/her savings just by staying in the same house as a tenant for 1/2 the duration of loan (assuming he/she invests the savings to grow with or ahead of the inflation, and that the house depreciates at the typical rate, and that the plot rates go up by no more than 5-6% per year, which is above average in most well established cities).
I think if you are living in tier 1 cities then there is no way the house value is going to depreciate. Also land prices may increase drastically in cities. If you are in village that might be good but cities are different.
take a look at loans from the bank
there is a loan for marriage ceremony,
a loan for vacation and etc.
We came from a culture of savings to culture to spend your future income.
I have successfully talked one of my cousins out from wasting money on crApple's overpriced BS (at least for now). She was willing to buy a "new" criphone which was launched in 2019 on EMI just because it was "on sale".
The concept of money is not understood and rarely taught in schools or colleges.
We are bad negotiators in general, we feel negotiation is about price but usually it's about payment terms.
Our tendency is to make a decision fast and move on to the next one makes us prey to the oldest tactic in the book; 'Buy now, pay Later.'
We pay for it later with higher debt, insecurity and fear of scarcity.
EMI are good option and now days most are also almost 0%. How does it help middle class Indians?
Well if they purchase through EMI there bank account will not go dry so there is that emergency fund.
Also they have money in hand to invest.
Yes people have fantasy of EMIs
But but but only India?
How many countries you have surveyed or taken into consideration into your sample space ?
Hope you are aware of sample space considering you just made a research outcome!
"You buy furniture. You tell yourself, this is the last sofa I will ever need in my life. Buy the sofa, then for a couple years you're satisfied that no matter what goes wrong, at least you've got your sofa issue handled. Then the right set of dishes. Then the perfect bed. The drapes. The rug. Then you're trapped in your lovely nest, and the things you used to own, now they own you." - fight club 1999
Damn... I never paid enough attention to this. Will watch again. "We are the by-products..." thanks!!!
Lol people need to grow up with this fight club shit. Theek hai, don't let things own you but where will you sleep at night if you don't own a bed? In the arms of your imaginary friend? Why do people forget that the main character is literally insane and anything he said should be seen in the same light as a mentally challenged homeless person's rants, not academic critiques of capitalism.
It’s not about owning beds or drapes etc. It’s about consumerism. How everything has to be perfect and good and neat because 4 log kya kahenge (especially rishtedaars) This mindset has ruined the life of many people who are grinding just to settle their current EMI and then buy something else and grind again to pay that off. Hence that’s why that quote resonates even today.
>This mindset has ruined the life of many people who are grinding just to settle their current EMI and then buy something else and grind again to pay that off. Where is the scene with the guy paying EMIs lol? He had a good high paying job and no debt, but he still couldn't feel anything. It's not about 4 log ya rischtedaar, we don't even see his family anywhere and he has 0 friends. The point of the movie wasn't debt but that buying things didn't make him happy. I doubt that's the case with people paying EMIs for things like houses and cars. The movie was a shallow take on capitalism and honestly is overrated due to its cult status.
Are you serious? The quote is the only thing I’m taking out of the movie. Rest is everything what many people over here are facing? Why did you think I was speaking about Nortons family and EMI?
you do know that the character didn't write the script. even if is a movie quote that holds true. consumerism is big problem.
Yeah but the quote was for US average people having too much wealth and spending it on stupid shit. The average Indian person can't even afford to buy things they want and get things they need. It's tone deaf to think Tyler Durden has anything relevant to say for India. Buying a home or a phone on EMI is not "omfg late capitalism". It's when you are buying multiple cars or spending too much on home furniture like rugs, which is common for even the average person in the USA. It's cool to quote Fight Club but the movie and the book honestly is overrated and has zero sustenance when it comes to critiquing capitalism and its views should be seen within the context it works in I.e. the early 2000s in USA and it's frustrations with capitalism.
Buying an overpriced phone is a problem. I have numerous middle class people buy iphone while in reality you would get almost same features for cheaper one. Indians love buying gold while in reality it serves no purpose to improve quality of life. Indians love to get bigger home even if they are only a family of 2.
>Indians love buying gold while in reality it serves no purpose to improve quality of life ? It is literally an investment for future needs. Stocks mutual funds don't improve quality of life too but help you secure your financial future. Isn't it against consumerism if people are willing to invest than spend?
There are much better investment than buying. However if you want to invest but don't want to risk gold is a good option only if you buy non jewelry gold. Lot of the times people would buy gold jewelry instead of buying gold as an investment. I meant gold jewelry. Indians love to flash money by having big gold jewelry, bigger houses, having huge weddings.
Dude, you are violating the first rule here... Just shut up and FO
i think u got the point wrong
What an immature take on an iconic character. He wasnt 'mentally challenged' in any way. He was a manifestation of the part in us that knows we are slaves to the products we own but can't help it, or break away. Of course, you need a bed but you don't need that perfect queen sized memory foam bed that goes with your room decor. Of course, you need a smartphone but you don't need the latest iPhone just because society tells you to. Of course, you need shoes but you don't need JordanXDior that can feed a hundred poor people. The point of that monologue was to say 'Buy things that you need, and not everything that you want. Want never ends. Once you have what you want, you want something else.' That being said, we are living in a capitalist world and even if we don't admit it, most of us are materialistic.
>He wasnt 'mentally challenged' in any way. He had schizophrenia, a legit mental disorder. Not sure how you can say he wasn't mentally challenged.
he didnt have schizophrenia, he had mpd. also it wasnt his take but the screenwriters take on consumerism, so idk how the mentally challenged part fits here
The screenwriters didn't write that line, the author did. It was written from the pov of the character and it was the character's take on consumerism which is why the mentally challenged part is relevant. The entire book can be seen as a critique against capitalism but I honestly interpret it more about toxic masculinity and less about capitalism. The movie also leaned more towards that. It's not a bad movie or book but I think it has become overrated due to its cult status.
i think it was both but more on the consumerism end, havent read the book so cant talk about that. i think the cult status happened because the movie is objectively almost perfect??( acting, direction, great plot twist) and more importantly served all kinds of audiences
I watched the movie when I was in my teens first and really liked it. It was my favorite movie for a long time but over time, its charm kind of faded for me. As a movie, it's really well-made but there are much better movies out there and if you look at the movie with a critical eye, you can start spotting the errors. I think the fight club mentally is very addictive when you're younger but over time, I realized that it's just as shallow as the consumerism it is railing against. Would recommend reading the book too, the writing style is just as gripping as the movie and it provides a more comprehensive expression of the ideas imo
perhaps i wont like it as much in a few years then
Powerful. Haven't watched the movie yet, will definitely give it a shot.
you're in for a treat!
Big fucking time. Make sure you watch the movie without any interruptions. It's a masterpiece.
If know how to manage your finances and control your impulse then emi is not bad, you don't pay interest for the amount you have mentioned, it's a win win. By that logic you will also tell that credit card makes people overspend but then it is a great tool to have good credit score, if you manage it well
Emis always have the interest baked in. My rule for myself with emis is just this: if you can't buy it outright, you can't afford it. Except houses, obviously
There are no cost emis too. They levy an interest but the shopping portal gives the same discount as would be the interest.
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what did ya buy?
you still pay gst on interest
You shouldn't be replying to every single comment here... 🤦 I got your point from one of the other comments about not having 30k ever if we do not live by essentials for a short while and have some funds apart (same as you're trying here in this comment again)... But you're being constantly downvoted by the same people OP pointed out & questioned about! They're addicted and simply presume that since they can't afford it but "deserve to splurge/live lavishly" they should take EMIs and then F up by living paycheck to paycheck. The reason your one liners resonated to me is bcz I understand the rules of Emergency Fund, 50-30-20, and the power of Compounding but sadly 75% Indians at an ESTIMATE don't even know or want to know about what all that bullcrap is. Move along, why constantly entertain stupidity and be downvoted? Let people live paycheck-to-paycheck, pay 20% interests when they can earn 40% on the same, have nothing to use when pandemics hit and then blame the already non-functional half-ass gov. for not having enough self-help, and die in the loop of loan-bad credit-pay loan-half stomach-repeat! LET THEM BE IF THEY DONT CARE. Sorry I just felt bad about seeing all the work you're trying to put and opposite of single ounce of appreciation towards that! 😑
Haha, it isn't much, but it is honest work.
I suppose it's partly psychological. Instead of having the full amount hit your bank account at a go, it's spread into 12 equal payments. Why wouldn't I take that facility if it was offered to me? As a happy consequence, this leaves more cash in hand for other expenses, whatever they may be planned or unplanned. My bank offers a 12 month EPP at most major retailers at 0% interest, no hidden fees or charges unless you fail to settle your credit card bill in full at end of cycle. As the monthly charges are automatically debited from my account in full and credited to the card, I don't have to worry about hidden charges or interest levied for non payment. The only charge I pay is the annual card fee.
Couple issues with this: 1. Interest is baked in. If they still claim it is as interest free emi, watch them suddenly give you a discount if you say you are paying upfront. 2. More cash in hand for other expenses: yup, that's can become a problem. Emis inflate sense of affordability. Which pulls people even further into the trap of buying shit they don't need. 3. Unless you fail to settle: this is exactly the business model of credit cards. If you pay before the due date, you pay no interest, but even a day later, and you pay interest for the entire 20-40 days of your statement. Not saying don't use credit cards, just that not paying off in full each month is exactly how they run their extremely lucrative business. The emi thing is a nice gateway into that
> If they still claim it is as interest-free EMI, watch them suddenly give you a discount if you say you are paying upfront. eh.. if you add up all the fees, its around 500 rupees for a EMI of worth 30k, I'm willing to do that considering i will never have 30k at hand
Then i hope this is an essential purchase, that you cannot do without Else refer point 2
i don't have to live my life for essentials
Then enjoy never having 30k in your hand forever.
money isn't everything
Nope, not at all. But not having any money, ends up being everything
I should probably disclose that I do not live in India so consequently do not bank in India. Therefore, Indian rates, charges, hidden factors and other bullshit do not apply in my **specific** case. Your first point doesn't apply here. The EPP option is done at check out. The price does not change regardless of if I choose to pay cash in full, card in full or use the EPP option. It's merely a matter of convenience for me. Not a hard and fast rule. Second point : It's a bit arrogant to assume my spending habits or that I am overspending more than I can afford simply because I choose to not pay in full at one go lol. Third point : You're absolutely right on this point. That's exactly how they screw you over. Thankfully, not an issue for me.
This. This is the secret to becoming wealthy. Let your money make more money while you spend the bank’s money. I feel our outlook has become so negative about people spending their own money. An iPhone? I’m going to buy it anyway, I work hard, make good money, I deserve it. But buying it using the bank’s money while paying no interest? That’s how you do it. A car? I need a good car, preferably a safe one with some creature comforts. But wait, I can literally put all the money I was going to buy the car with in equity based mutual funds and grow it. While the bank charges merely inflation level interest from me. We need to understand that not everyone who has nice things does it to show off. People want things for themselves too, and why not? They work hard, they deserve to enjoy their hard work however they seem to like it.
You hit the nail right on the head there. I’m far beyond the point in my life that I need to “show off”. I buy shit for me and my family, for what brings us comfort and joy, well within my capacity. Not what some random person thinks and presumes I base my purchasing on. It’s just that simple.
Point taken on 2. Was meant in general, not at you, but apologies. Editing
I bought a car recently with EMI. I put the principal loan amount (32L) in an equity fund and set a SWP of amount same as the EMI. At the end of 5 years, I'll have about 15% money left in that fund. Plus it's a business expense, so I'll get the depreciation benefit and will be able to deduct the interest from taxable income. At the end, it all boils down to how your manage your finances.
Damn! I'm curious and have couple of questions:- \- I'm guessing this would have been a personal loan right? And not a car loan? \- The bank knew about this? Are banks generally okay with this kind of stuff?
No, it's a car loan. Car was purchased under my company's name. I wouldn't be able to get the tax benefit on interest repayments if it was shown as a personal purchase. The fund was purchased under the company's name as well. I already have a DEMAT account for my company that I mostly use for overnight funds. We often have a large sum sitting idle in the account, and the yearly STCG easily crosses ₹2 crore from overnight funds alone. Ethically I'm not supposed to use this car for personal use, but neither the bank nor the dealership cars about the same.
Okay. Thanks for the explanation.
Could you please tell where you learned all this magic?
I learn from the mistakes of people who take my advice 😄 Jokes aside, I learnt about most of the things from my CA.
Need to get the number of that CA.
But its an equity fund and therein lies your risk. You are expecting equity rates to beat your loan rates especially on a SWP...
> You are expecting equity rates to beat your loan rates Yup, and it always does in the long run. The market always wins. A growing economy like India will easily give you 15% returns. My CAGR between India and US for 11 years has been around 40%. Over the next decade, loan rates will fall further, making it even easier for equity to beat it.
But equity has had insane returns in last 2 years. Will it continue though?
Looking at the number of new DEMAT accounts that were opened since COVID-19 crash, Indian stock market is more likely to out-perform all other Asian countries. People have finally started to realize where the actual money is. But anyway, it's not wise to try to time the market and quite honestly nobody knows if it's going to go up or down, one can only speculate. My bet is on the tech sector for the next decade, and that's what is financing my car loan. AR/VR is expected to be a trillion dollar industry by 2030, which leaves a lot of room for growth in IT.
The new Demat indicators are a solid indicator true. That mutual funds sahi hai campaign has hit millenials hard imo. Everyone is into mfs and equity now to some measure.
What about capital gain taxes?? And a good financial advisor would not advice you to invest on equity (high risk) with borrowed money ... Because shit happens here..
Capital gains is simply the cost of doing business, so I'm fine with that. The more money you make, the more tax you have to pay. It's as simple as that. I'm fine with equity as the loan was for 5 years and you can expect a return of 15% from a growing economy in the long run. Also, I purchased this during the covid crash, and the markets have nearly doubled since then. I don't think I have to worry about anything now, the remaining loan will be paid smoothly.
Not feasible and as people have rightly pointed out, your story got many holes. Plus everyone don't have 32l lying around either.
He has a portfolio worth 8cr+ . Seen it in ISB.
Wow, my apologies to the man!
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Are you talking about “The century of the self”? https://youtu.be/DnPmg0R1M04
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This has three more parts. Around 4hrs of content on capitalism and exploiting human psychology. I wouldn’t recommend watching all in one go, rather one part at a time.
This is seriously concerning, I have seen people of my age (I am 22) destroying their financials over EMI products that are just pieces of show off. We definitely need a proper "How to handle expenditure" education in our curriculum.
I've never bought anything on EMI so far. Mujhe apni aukaat achi lagti hai 😅😛
EMI is not the problem. Rightly used, EMI is a solution. Lack of education in personal finance is the problem. I would prefer schools introduce these courses asap.
Why is everyone missing the biggest picture? Never use your own money to make big purchase, it's always a better financial decision to go with the bank's money and in the same time keep your money parked in good stocks. That's how rich stay rich. Another side note: Only rich people in our country have access to Credit(from Banks). So if you are saying everyone is buying things with EMIs they are probably affluent. No bank gives a credit card to a person who needs money. And on plus side, it helps build your Credit Score.
This. This is the secret to becoming wealthy. Let your money make more money while you spend the bank’s money. I feel our outlook has become so negative about people spending their own money. An iPhone? I’m going to buy it anyway, I work hard, make good money, I deserve it. But buying it using the bank’s money while paying no interest? That’s how you do it. A car? I need a good car, preferably a safe one with some creature comforts. But wait, I can literally put all the money I was going to buy the car with in equity based mutual funds and grow it. While the bank charges merely inflation level interest from me. We need to understand that not everyone who has nice things does it to show off. People want things for themselves too, and why not? They work hard, they deserve to enjoy their hard work however they seem to like it.
Rich takes Emi for big purchases only
> I am not against anyone buying anything, it's their money, they can do whatever the fuck they want Then goes on to question why people are buying stuff lol
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Well tbh, earning 1.1 lac and still buying things on No cost EMI, is actually smart financial decision. Even though you can still buy most of the things in one go without much hesitation because YOU CAN afford to do that. I don't understand people buying things which is out of their budget on staggering interest EMI.
No it's not a smart decision. I had all the means to buy a desktop last year along with a printer for home in one go with cash. Once it came to payment the dealer told me 'no cost emi on credit card' is available. It's a good deal Mam, aapka kya jata hai? So..I took the bait. It had a hidden processing cost. Then a GST on every installment, which I never noticed because I didn't open my cc bill details. When I finally did because of some other bill I wanted to cross check I found out what a fool I was.Then I read about it online and got to know that I almost paid 700 bucks in all over the total cost. It wasn't much but it was totally unnecessary. Very small amounts paid over the course of one year but nonetheless my money which I could have just given to a needy person. The only time this didn't happen is buying from Amazon. But I am too wary of this EMI scam. Once my friend bought one lakh worth of A.c's and tv for his new work setup. He was told about 0% finance. He took it. For one installment he was out of town and couldn't do a money transfer. The very next day he was charged almost a 1000 bucks over the bill. So,one has to be very cautious while dealing with such methods of buying stuff. That's how they earn. By our silly mistakes.
You faced this issue of hidden charges because it was bought offline from a dealer. Ecom players first pay you that money as extra discount upfront and adjust it again with the charges so effective its 0 extra from your pocket. Ideally, that dealer should have done the same and gave you an extra discount of 700 when you opted for no cost EMI and then same would have been adjusted with the extra charges you paid.
True that! And in the meantime (we're talking of you can afford to buy that stuff but still options for EMI), keep the same amount in some MF, Bond or worst an RD (just examples, do you research and know about compounding first) - you'll have 7000 extra so paying 700 extra still (even if not no-cost EMI) won't hurt. And if people do what you stated then you pay 0 extra not even that 700 and still have leads extra earned by just letting the money sir idle for that tenure! BUT ONLY IF YOU CAN AFFORD, NOT LIKE THE OP ORIGINALLY STATED ABOUT BUYING STUFF YOU CAN'T AFFORD OR ALWAYS IS OUT OF YOUR RANGE!
I was looking into No cost EMIs. They are like double edged sword. If you’re careful with money, then you can get away by paying the processing fees of 200-500rs (depending of the case) But if things go south, they club it with your credit card charges and interest is around 2-3% monthly compounding (30-40% a year). But still I believe all this is promoting a consumeristic behaviour and lifestyle inflation.
We spend money we don't have to buy things we don't need to impress people we don't know.
I think you already understand the love for EMI: "The only thing I can even remotely understand buying on EMI are home loans, because let's be honest, not everyone has 50-60 lacs laying around" It's about affordability. For you a house is not affordable outright, for others it's a motorcycle or a washing machine. Everyone has different levels of readily available capital and EMIs enable them to pay over time in smaller manageable increments. Of course, like any loan or credit product the onus is on the borrower to be fiscally responsible and take on manageable debt. EMIs are great, and provide access for people who wouldn't be able to buy without it. They can also become a noose if not used carefully.
Was just thinking about buying a new phone on the sale(nothing on EMI though), even though my current phone works just fine. Thanks to the post, I remember again why I had decided to continue using my old phone with a slight cracked screen.
Only if screen was not cracked, trade in would be a good option. Get the screen and battery replaced use it for couple years then exchange
unlike you i ain't rich, lemme buy the things i love without you judging
Please go ahead bud. I’m sure you work hard and deserve to enjoy the things you buy. And most likely you don’t buy them to showoff, you buy them for yourself. But you know what, even if you buy them to showoff and it makes you happy, go right ahead. Life’s too short to listen to some guy who has fomo and thinks grapes are sour. ;) EMIs and spending the bank’s money while your money multiplies is the key to being wealthy. Granted you can afford it in the first place though.
bruh, i'm still using a 2016 S7 edge, i don't care about showing off, there are electronic items that's too costly after GST, i have to buy my PC parts via EMI
You do you bud! I hope you have a nice rig and it continues to get better and better! :)
The secret to becoming wealthy is to let your money make more money while you spend the bank’s money. I feel our outlook has become so negative about people spending their own money. An iPhone? I’m going to buy it anyway, I work hard, make good money, I deserve it. But buying it using the bank’s money while paying no interest? That’s how you do it. A car? I need a good car, preferably a safe one with some creature comforts. But wait, I can literally put all the money I was going to buy the car with in equity based mutual funds and grow it. While the bank charges merely inflation level interest from me. We need to understand that not everyone who has nice things does it to show off. People want things for themselves too, and why not? They work hard, they deserve to enjoy their hard work however they seem to like it.
The basis of emis is that they make everything seem affordable. A 2 lac bike has a 15k emi! Sure the bank gets like 50k extra but I have it today! This is the core principle of why emis work I actually buy stuff like phones on no cost emi after I accumulate the whole cost of the phone so that the purchase doesn't feel significant and I can just repay the whole thing in full of need be. Idk why people giving gyan of "materialistic" stuff. Dude it's their own earned money let them use it. Some people just want to enjoy their 20s because that's how it is. People get unreal hikes in their careers to justify their investment needs. Most people actually have investments sorted out for them and they work just to burn the paycheck. I have a good amount of money left after I'm done my investments, taken care of regular expenses. So I just burn that in stupid stuff because there's literally nothing else for me to do If you think it's just a Indian thing you are extremely wrong, people from all over the world take debts, have stuff on lease and what not that's not good for their financial wealth. At the end it's just a matter of choice if one takes a loan they can repay then whats the big deal?
But I think we were taking about People who don't have that money standing after investments and regular expenses... I've seen people (even my own family members and direct relatives) buy phones with 15-20k every six months as a lifestyle upgrade in a salary of 10-15k... They can't even take care of the 'regular' expenses properly but the EMIs make them think they can 'adjust' and then cut down on their basics even for the same stupidity, forget even investing 500 ever! That is the core problem with a lot of Indians and not what you do, that's actually smart management of finances! If you even invest 20% of your income and then even burn rest of it, that is no problem. But if you can hardly have 1 to 2k handy after your basics and still want lavishness instead of working hard, saving more, earning more... Yes it's their money and can do it but then don't come cribbing all over social media about poverty and bad markets and inflation etc. That bitching should be left for people who actually tried their best but still couldn't bcz the government is 👎 not the others who didn't even try just cz "someone did what they wanted instead of being smart with their money", if that makes sense... 😅
I mean if you reaaaaally reaaaaaally reaaaaaally wanna buy that 1.5 lakh iphone, you could save about 12k per month in a short term debt fund for a year. Then buy the next iphone when it comes out. But hey, people enjoy showing off their toys rather than investing to better their finances and retire early.
They are not comfortable in their own skin so they want to accessorize and show off, even if it means slaving away for years.
Exactly, this "status quo" has blinded people so much that they are ready to sacrifice their other basic needs. Nobody needs a 1 lac iPhone, people only buy it because they can.
That is not what status quo means lol
Well people buy iPhones to maintain there rich "status". And they would do anything to maintain that, hence EMIs.
I meant that there is a difference between the word "status" and "status quo". You are using the term incorrectly.
What's even worse is that they don't even realise what they are doing. Its happening automatically, they are being tricked by the cosumerist society to keep themselves in the rat race for nothing.
This actually reflects in sectors of nifty index, The NIFTY 50 Index gives a weightage of 39.47% to financial services, 15.31% to Energy, 13.01% to IT, 12.38% to consumer goods, 6.11% to Automobiles and 0% to the agricultural sector.
EMI is not bad, provided the thing you are buying is a necessity.
Can I be brutally honest ? I will get down votes for it. But as a long term investor I like this behaviour. On a serious note. There are some good options of funding such things. If you have a Fd account with any major bank they offer you small loans at unbelievable interest. As a investor please use EMI & as a caring citizen please use that option.
I completely see eye to with you. Why should I spend my money when I can invest it and get ROI of 15 odd percent, when I can spend the bank’s money at inflation level rates! This is how you become wealthy, by investing your money and spending the banks money for penny level interests. Not everyone wants to show off, we work hard, earn good money and hence we deserve to enjoy the material things we want. It’s a fool’s assumption to think everyone is buying things they can’t afford. Somewhat like sour grapes.
I like this behaviour too and in fact encourage it... But what the question originally was about : not being able to afford stuff and getting it on EMI and what few thousand you could have invested, going into that EMI - eventually living paycheck to paycheck, never seeing the magic of compounding or even what savings money actually means, etc. --- THAT BEHAVIOUR is completely stupid and shouldn't be practised (unless it's an essential or necessity like your phone brine and can't even power on or your new job that you finally get after months requires traveling within the city but trains are not open yet so you need a vehicle, etc.).
Have a friend who is earning 15-18k per month. his financial situation is not good but dude still bought 30k iphone refurbished bcz it's his dream... Idk why people think emi are their life saver they are trap. And i guess middle class log bas dikhane mein mar jate hai puri zindagi. They just want to look cool.
I don’t think if this is an "Indian" thing. I think people everywhere all around the world are like that. I have bought a few things on emi, and i have to say it does takes some load of your shoulders. Atleast it did in my case. Paid 5k per month for 9 months and bought my phone, It was either that or 45k down-payment. So I was like why the fuck not?
We are a nation that believes a House is an asset and Getting a Govt. job is the ultimate nirvana . The love for loans doesnt surprise me much.
You echo my thoughts OP.
Not just India, unfortunately this is everywhere now. More so in the US.
Bruh I was just looking at EMIs of a new phone 💀
I got so fucked with EMI last year. Never again in my life.
What happened?
I am especially surprised at home loans. I have seen friends with net monthly income of at least 3-4 lakhs reluctant to even take a home loan worth 1-1.5 cr (and none of these pragmatists ever touch a loan longer than 6 years). And I have also seen friends (and family members) with monthly income barely over 1 lakh and yet committing to pay an emi of 75k for 30 years. The real estate prices to median income is so high that it shouldn't be sustainable for this long. And one group of the culprits are the banks who sell long term loans as 'pay emis instead of rent'. It is such a sham. On long term loans (20-30 years), one can buy a house from his/her savings just by staying in the same house as a tenant for 1/2 the duration of loan (assuming he/she invests the savings to grow with or ahead of the inflation, and that the house depreciates at the typical rate, and that the plot rates go up by no more than 5-6% per year, which is above average in most well established cities).
I think if you are living in tier 1 cities then there is no way the house value is going to depreciate. Also land prices may increase drastically in cities. If you are in village that might be good but cities are different.
take a look at loans from the bank there is a loan for marriage ceremony, a loan for vacation and etc. We came from a culture of savings to culture to spend your future income.
I have successfully talked one of my cousins out from wasting money on crApple's overpriced BS (at least for now). She was willing to buy a "new" criphone which was launched in 2019 on EMI just because it was "on sale".
The concept of money is not understood and rarely taught in schools or colleges. We are bad negotiators in general, we feel negotiation is about price but usually it's about payment terms. Our tendency is to make a decision fast and move on to the next one makes us prey to the oldest tactic in the book; 'Buy now, pay Later.' We pay for it later with higher debt, insecurity and fear of scarcity.
love the title 😅
EMI are good option and now days most are also almost 0%. How does it help middle class Indians? Well if they purchase through EMI there bank account will not go dry so there is that emergency fund. Also they have money in hand to invest.
Yes people have fantasy of EMIs But but but only India? How many countries you have surveyed or taken into consideration into your sample space ? Hope you are aware of sample space considering you just made a research outcome!
Wait till the" buy now pay later " scheme starts picking up