Was talking to a cousin of mine about his investing. He said he had some ‘mutual fund investments’. When I saw it – it was appalling. He is very close but was not too forthcoming about why he had chosen such an array of funds. However he earns very well and spends almost nothing (comparatively) which means he can pretty much do whatever he wants with his money and still not worry about retirement funds.

Another cousin started a SIP which actually got stopped for some technical reason. However by the time the second debit should have come he had already made a fixed deposit with the balance money. Again a case of earning in crores (I did debate with the word millions, then corrected myself) but spending in ‘000s allows all investments to be in bank fixed deposits without too many worries.

Lessons:

1. Most people are employed far beyond the economic need for a job.

2. An office to go to every morning is a social, family and a self created need.

3. Most people will continue to be employed beyond the need for money, because they do not KNOW what to do.

4. Most people will continue to be ’employed’ even if the salary is cut in half post retirement.

5. One person was willing to come to office if apart from ‘coming to office costs’ he earned Rs. 5000 a month. His last drawn salary? Rs. 54,000 p.m.

6. When it comes to managing money, MEN do not ask for directions. WOMEN think their husbands (unless they have learnt it the hard way) are managing their money well.

7. Most people do not set FINANCIAL goals. This leads to a lot of money being friterred away on things which they may not need.

More random thoughts:

Recently saw some very poorly written personal finance articles in Hindu Business Line. Respect for that group is still very, very high. Hopefully they will correct it soon. Surely personal finance does not have such a shortage of writers, Mr. Ram.

Is SEBI pushing through mutual funds dematerialisation to create revenue for NSDL or for the DPs? Clients have no benefit in holding the units in a demat mode (you cannot sell, transfer, pledge, gift….- it can only be redeemed), and the statement has no commercial value (if you lose it, get another one, NORMALLY FREE). Not sure….

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  1. Interesting read ! More random thoughts :
    # Many people set financial goals and never implement it.
    # Many people will pay the premium for a fat ULIP but not pay a financial planner.
    # People sit on huge bank accounts because they think its safe.
    # I wonder whether there are many personal finance writers in India – I can’t put a figure but I want to cover that in an article myself. Any leads ?

  2. You blog is a cocktail of observations, commonsense and personal finance wisdom. That’s why people are hooked!

  3. sir

    i like the random thought but i can’t understand “Clients have no benefit in holding the units in a demat mode (you cannot sell, transfer, pledge, gift….- it can only be redeemed), and the statement has no commercial value (if you lose it, get another one, NORMALLY FREE). Not sure….”

    My question is _mutual fund investment through d-mat is beneficial
    or not? Is there any risk for long term investor?Which way of investing is safe- thru D mat or thru broker (traditional way)

    thanks

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