What Is The Best Investment Of All?

“Mirror, mirror on the wall Who’s the fairest of them all?” The old fairy tale put a relative or comparative measuring tool in the minds of kindergarteners. We grow up with a competitive frame of mind and a desire to outperform. Superior performance is the primary desire of an investor as well even while doing asset allocation, choosing safety of some investments and risk in others. While traditional wisdom, possibly as old as the Snow White story where the Evil Queen asks “Who is the fairest of them all,” says that high risk is linked to high returns. The Guru, Warren Buffet however says, “High returns with low risk is the key.” This is true and applies to most asset classes. The speculative element in us, driving our investments pushes a good part of our investment towards the short-term momentum opportunities, buying when securities have run up, in the expectation that there will be others willing to pay a still higher price. The classic “Greater fool principle” that pops up

Insurance - Buy When You Can, Not When You Need It!

One of the interesting encounters in the Mahabharata is the one between Dharma (Yaksha), the father and Yudhishtara, the son. The encounter is known as the Yaksha Prashna. The meeting happens on the shores of a lake where Yudhishtara finds his brothers lying dead. As Yudhishtrara was about to take water from the lake to perform the last rites of his brothers, Yaksha appears and repeats what he had told all his brothers, “This water belongs to me, and you cannot take this water without my permission. If you want to take water, then you will have to answer all my questions correctly.” And thus began the Yaksha Prashna, full of deep wisdom and philosophy. Yudhishtara successfully answers all the questions and was able to revive all his brothers. One of the questions Yaksha asks Yudhistara is that “What is the most wonderful thing?” To this Yudishtara answers,” Day after day countless creatures die, but those who remain behind believe themselves to be immortal. Nothing can be more wonderfu

Simple & Effective Steps & Ways for Financial Success in your Life

Here is an attempt to present a complex subject (Personal Finance Management in simplest way without compromising on the core of the subject matter. Vast subject condensed to 4 Steps and further represented in one-page picture. Step-1: Create Emergency Fund  and Get Insurance Covers Creating an Emergency Reserve Fund of at least your 3 months Salary / Income is your First Objective, as soon you start earning. Thereafter, it needs to maintained at that level in line with increase in your income. It needs to be recouped as soon as possible, when it gets used up. The reason why you should ever touch this money for spending is strictly  an Emergency Situation (Ex: Medical Emergency, Loss of Job etc). This emergency Fund may be parked in a instrument that is quickly liquidatable; Investing in Bank Fixed Deposits and Mutu Fund Liquid Funds is most appropriate. Insurance is a next sub-step; A well rounded Insurance covers against untimely death (Term Insurance), Accidental Disability (Persona

Simple Steps towards your Financial Well being (for beginners)

Step-1 : Become serious about your finances. Get answers to your basic questions on the internet. Get a very basic info about financial planning and investment options available. 'Discuss' with your elders, seniors and friends (beware: don't take 'ADVICE' from them, just have a discussion to start to get the feeling and views of managing finances. Your father or brother indeed is your well wisher, but may not be a subject matter expert. Everyone can sing a song but not every one is a professional singer, just like not every person who can hit the cricket ball in the street cricket is a professional cricketer). Also ask them if they have some financial advisors. Discuss with financial advisor/s you come across and decide who you feel you most helpful and knowledgeable. Take the next steps in consultation of that advisor. Step-2 : Creating an Emergency Reserve Fund of at least your 3 months Salary is your First Objective, as soon you start earning. This should take no