Life and Money!

My father used to say:

The real blood in your veins is the currency notes in your pocket. Without money, you are dead and doomed off.

It may sound exaggeration but take a look around at real poor. A person with no asset, no home and worse with no job force to find something from trash. Any how, we can not all work 8-12 hours every day. We may start with that and then we accumulate surplus and lean on surplus to earn for ourselves as we struggle with our aging bodies, to maintain quality of life. If you have never thought in these terms it is time to do so, now.

How to achieve consistent return on investments?

This is a daily worry of a vast majority of people. Losing money on stock, commodity or currency is everyday routine talk. Rarely one would find a person who would be able to tell what to do with investments. Actually India has highest rate of interest on money kept in bank deposits but it rarely adds up. It is worse in the west. The position can be summed up like this:

With FD rates tumbling to 7% range from 9% range in just two years, everybody is talking about making long-term investments to protect your investments from further rate cuts (experts are predicting another rate cut by RBI in coming policy meeting on April 5, 2016. But one may wonder where to invest for long-term as interest rates are revised every year for PPF, NSC, KVP, Post Office deposits, senior citizen schemes etc.

In case of FDs, the present taxable rate of around 7.3% becomes very unattractive for higher tax payers as the post-tax return falls to 5.11% for 30% tax payers, 5.84% for 20% tax payers. So, even 6% tax-free return in long run now becomes very attractive.

But the worst is inflation. Presently around 6% it had risen to 16% in past few years this eroding the return altogether. While earning from salary or professional income it may not hurt much but once in retirement or otherwise disabled, it hurts very much.

There are three modes of investments:

Never keep all eggs in one basket. spread your eggs around.

1. Real Estate or Immovable Property:

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