Everything about debt for Indian babies and children. #debt #business #investing

Category – business

Reading time – 6 minutes

Babies don’t need to study economics. They don’t need to know about debt. They don’t need to calculate interest rates and returns on investment.

But their fathers need to know all this. They need to earn money and then grow it slowly to fight inflation and uncertainty.

Babies and children in turn need this knowledge for their daddy or mamma; who are in-charge of money, which babies will own one day.

Don’t you think they want a wiser dad or mom, so that they can get lot more more money, than a passive parent may provide.

So this blog is to understand basics about debt or loan.

Debt is a loan which is to be repaid in fixed time and is given on particular rate of interest ( extra money other than principal amount ).

It is a way to raise money for businesses.

It can be classified into various types like business loan, personal loan, housing loan, car loan etc.

It can be secured or unsecured. secured loans have attached asset like property, machinary or FD; equivalent to the amount of loan, which can be forfeited in case of inability to return the loan.

What are bonds?

Bonds are one type of debt instruments. They are used by businesses to raise money.

Bond is a standard piece of aggrement, that fixes term of the loan like interest rate and tenure.

Company has to pay interest irrespective of the revenues. Hence, for investors bonds are relatively safer option to invest their money. As fixed returns are guaranteed beforehand. But, as risk is reduced in these compared to shares, returns on investment in bonds is also lower.

Government also takes loan from people for building infrastructure and other works.

Bonds are issued by government. This type of loan is called sovereign debt. Govt gives assured retuns on these investments.

Various debt instruments.

1. Bonds which we have discussed above.



2. Debentures – It is a debt instrument that is not secured by collaterals and generally has tenure longer than 10 years. Hence it is given to creditworthy organizations.


3. Corporate deposits –

It is company version of fixed deposit. It is for fixed duration and has fixed interest rate. It is provided by banks and non banking financial institutions.

4. Fixed deposit ( FD) – It is favourite thing of Indian masses. It preserves money with very low returns.

5. Public provident fund ( PPF) –

It provides for reasonable returns and tax and saving benefits. It has limit of 1.5 lakhs. Lately it’s returns have also been curtailed.

6. National savings certificate ( NSC) –

These are issued by government of India as small savings instruments. It is provided by India post.

7. Debt mutual funds

These are mutual funds that invest primarily in bonds. Hence they have lower returns as compared to shares but are safer.

Main aim of all these is capital protection.

Capital gains is secondary.

As you age, it is better to invest more in bonds and debt instruments.

As you near your retirement or big expanse, you can take out money from equity and park it into a debt instrument for capital protection.

Inspiration – many personal finance books.

Few things about home loan.

It is given by bank or non banking financial company.

Down payment is initial payment for the home. It is generally 20% of the home value.

Before construction you have to give pre EMI. In first year 99% loan is disbursed.

After registration of the property remaining 10% is disbursed and registration documents lie with bank as collateral.

After, registration EMI starts.

Tenure is time period in which loan is to be repaid.

EMi is decided based on rate of interest and tenure.

There are other charges like processing fee, notarization, conversion charges etc.

Overdraft facility –

It is a way to reduce tenure and EMI of your loan.

Bank creates a savings account linked to your home loan account. It is called overdraft account.

Any additional amount of money in this account; over and above your EMI is taken as pre payment towards the loan. This reduces loan principal and hence reduces EMI.

Added advantage is that you can withdraw money from this account anytime.

For example; if you took 25 lakh loan with overdraft account. And you added 5 lakhs to this account. Interest rate of your loan will be calculated on 25-5 = 20 lakhs in place of 25 lakhs. Hence you get reduced EMI.

Why is it so.

Because interest rate of such loan is higher by 0.25-5% as compared to routine loan.

But inspite of this it is a useful way to save money.

You will be happy that you know it.

Inspiration – Mistakes in personal finance, that I have made.

Difference between attitude and approach. #personalgrowth #attitude #psycholgy

Reading time – one minute
Category – psychology

Attitude is the way of thinking about someone or something.

Approach is the way of dealing with a situation or a challenge.

Let’s see the difference by reading a short event about real life.

Ramesh and suresh both are friends. They have final exams. Ramesh misses last question due to shortage of time. He is sad and full of remorse.

Suresh misses the exam as alarm didn’t ring. He is happy that he will be better prepared in repeat exam and thankful that no body has died due to this omission.

They both have different Attitude towards circumstances.

.

Now Suresh and Ramesh join jobs.

They both need to prepare presentation before weekend.

Ramesh is stressed, about to bite any one distracting him and cancels planned birthday party of his friend.

Suresh gets in touch with his senior and gets his presentation on same themes presented last year. He quickly modifies it for current year. He stays late in party and enjoys the bash.

Boss finds no difference in their presentation and also they were not related to critical aspect of the business.

This shows difference in their approach.

Inspiration – Ashwin Sanghi’s nonfiction works.

Things that mentally strong people do. #motivation #selfdevelopment #business

Category – Business

Reading time – 1 minute

1. They avoid self pity. It solves nothing and clouds consciousness. Instead strong people practice graditute.

2. They don’t give key of their happiness to external source. They avoid people pleasing or expecting things from people. They observe and avoid judging .

3. They take calculated risks. They do rational rule breaking. They try to cross little beyond their comfort zones, where progress usually begins.

4. They don’t fear change. They know change is rule of the life. They try to embrace it with open heart and mind.

5. They don’t dwell in the past. They learn from it and move on.

6. They try to never repeat the same mistake twice.

7. They know that it cannot always stay good and smooth. They accept and face difficulties.

8. They take full responsibility of their life and actions.

9. They see long term and have broad perspective.

10. They know that journey makes 99% of any endeavour and they try to savour it.

11. They know no defeat is final and no win is eternal.

12. They see problem in the situation, not in people.

13. They stick to their paths, even if everything falls apart. Grit is rare talent that mentally strong people posses and it is their most formidable tool.

Inspiration – Many books

18 lessons for your personal finance! #money #business #psycology

Category – Business. Reading time – 5 minutes

Personal finance is such a sticky thing. After you grow out if childhood, you come to know about this money thing. Now your dad stops fulfilling your unreasonable demands and starts to expect, that you are going to earn some money now.

Eighteen years of pizza, burgers and your TV recharges needs to be billed to you from that moment.

You were sent to school to learn how to earn. And you scratch your head that school completely forgot to teach you, how to earn money.

You wonder how will arithmetic and algebra and mediveal history, will get food on your plate.

You see towards your friends and they too are under axe of their parents, to earn their living.

In this post let’s discuss few basic concepts, that help in managing personal finance in current scenario.

And that’s the time when one needs to learn about personal finance. Earlier you start, better it is for your lazy body.

Let’s get this stuff.

1. Don’t compare with others. Everyone is running different race with different rules and different rewards. Choose your race correctly, that suits your mindset, skills and personality.

2. Nothing is free. Yes, that free voucher, with that costly phone is indirectly to be paid by you. And, you must also understand that your time and attention are also a form of capital that Marketing people are in pursuit.

3. People, beliefs and culture change with time. So don’t keep your ideas rigid. It was risky to board in car of a stranger, but now it’s fashionable due to UBER.

4. Always leave some room for errors, unexpected events and unknown forces. Don’t be a overconfident. Don’t board Titanic without lifeboats.

5. Past cannot predict future. Experts cannot predict future. No one predicted 2008 or 9/11 or covid.

6. Negatively gets more focus and attention. Try to go beyond all those negative vibes floating in sea of social media.

7. Personal finance is a relatively untouched part of the conventional knowledge. So, start learning about it.

8. Set ceiling of your satisfaction. Don’t keep running. Rest, relax and enjoy. Afterall, that’s why you work.

9. Use power of the compounding. And be aware that it takes time. There are millions of articles and videos that explain compounding to you.

10. Getting rich is easier than staying rich. All those sports stars who retired young can easily slip into poverty.

11. You can do average things and fail multiple times, but you can still become rich.

12. Financial freedom is the biggest success possible.

13. Be rich. Don’t focus on looking rich. Be humble and save money.

14. Dollors saved are equal to dollors earned in value.

15. Go for cash flow instead of capital gains. If you can generate positive cashflow other things will take care of themselves.

16. Try to build assets which put money in your pocket, even when you are not working. That elusive thing is called passive income.

17. Whenever you calculate your gains always keep inflation in mind. It reduces purchasing value of your money. This 100 rupee note will be less useful five years from now.

18. Don’t try to be cheap. Try to be useful to others. Don’t die fighting for pennies. Keep your heart big and vision broad. Don’t be 11 th fruit seller in a row on roadside. Enter business with substantial returns for your efforts.

Why employees come before customer? #infinitegame #business#startup

Category – Business

Reading time – 2 minutes

A business owner has one thing in his mind- profits. That is where is eyes are. After Friedman’s theories took deep roots in society, it was ok to work for investors only.

It was easy to forget employees. Afterall unemployment will never end and you could always get new person to take place of the last one.

This finite mindset makes companies to lay off people, on slightest jolts in their business.

But they miss the reality. They don’t see the hidden costs.

1. A employee who loves company is an asset.

2. Customers are also humans like employees. You should be able to keep all humans happy.

3. Trained and old staff keeps customers coming back.

4. Training and retaining new staff is also a money consuming process.

5. If nobody stays for long how will teams form and coalesce.

So love your staff.

So that they love your business.

And due to that customers also love it.

Inspiration – The infinite game by Simon Sinek.

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Illusion that all businesses create! #infinitegame #workstress#newbusiness #simonsinek

Category – Business. Reading time – 5 minutes.

A lot of things are infinite. They continue. Waiting for their end, leads to early obituaries. Eyes dry out, before comprehending corners of these things.

There is no end to a few things. There is no permanent winner or looser. Only finite moments of disturbances followed by a continuous flow of the time. Flow; that is continuous.

Life is such a thing. A little part of infinite flow of time. It ends and no body notices after sometime. Then new biomass loaded with consciousness, wriggles on earth and this flow continues unabated.

Life is part of an infinite stream that continues; come what may. Life ends but game of the life continues. Till last living cell is destroyed, it will continue and even after that; there is always a chance of resurrection of biology.

So why do we want finite durations?

Why we want business quarters?

Why we want annual reports?

We know business continues till owners live , so why is focus on the short term? Long term things should have long term strategy.

So, for a brand to last for decades; we need infinite mindset.

Infinite mindset means – That business is an infinite game; that is to be played with long-term targets in vision.

For example, USA thought Vietnam war was a finite game but after loss of life and big fortune; they realised that it was an infinite game, if they continued to play it.

Microsoft wanted to defeat Apple, which was a finite game mindset. Apple focused on satisfying the customer and recently on the privacy of customers. Hence Apple was clearly playing infinite game right from the start.

Lego wants game to continue. Hence it has been around for so long.

Even if Apple knew that iPhone will kill the ipod, they went ahead with it.

Similarly gym to gain fitness is an infinite game. If you stop following diet and excercise schedule after few months, you endup regaining all the weight you shed with so much effort.

So take life as an infinite game.

Qurters, annual revenues, flowcharts- all are artificial constructs to keep shirt term goals in perspective, but too much focus on them may jeopardize long term prospects of the business.

Infinite game is positive and inclusive.

It needs reselience and it has a just cause.

It avoids too much focus on the short term results, as long as long term progress is positive.

Hence next time you see an CEO too much submerged in three monthly results, assume that he has got a finite mindset.

Inspiration – The infinite game by Simon Sinek
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How to finish almost everything that you start! #personalgrowth #habits#psychology

Category – Business
Reading time – 5 minutes

Starting is easy. Every year millions of people start things. They take resolutions. They start journaling. They even start evening walks and blogs.

Many more testosterone filled souls start revolutions. But it is both frightening and disheartening that 92% of the revolutions fail. Especially violent revolutions.

Non violence has better chance of succeding, as it stays for longer duration and gets more moral support. So we humans are excellent starters but very poor finishers.

Projects, books, loveletters, charities, homeworks, commitments, most of businesses in long term don’t finish well.

So, finishing a thing is an extremely rare skill, that is must for every restless entrepreneur.

What can you do. Here are few things

1. Don’t aim for perfection.

Nobody was perfect and nobody will be. Do best whatever you can do. And just don’t mess up voluntarily. Accept that you are normal ape, that is not perfect.

2. Divide and rule –

Divide big work into small tasks. It frightens less. It remains manageable. It keeps your brain away from panic and chaos. If you want to write a book try to write a page first.

3. Make things fun –

Attach some reward or pleasurable activity with your work. Listen to music. Go out while drinking your coffee if you should. Watch a cricket match on reaching home.

4. Remove noble hurdles –

They represent part of perfectionism. Things like, ” If I do this, then I will… need to be avoided.

5. Measure progress –

You will get idea about how much have you accomplished.

6. Find your space –

Identify time and place, where you are generally most productive. I know you count bathroom in, and it’s ok, if you are creative there.

These things will help you finish a lot more thing. A half done work is not useful to anybody.

Inspiration – Finish by Jon Scuff
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How to save a talent from wilting away? #personalgrowth #motivation #sucess

Category – Business

Reading time – 5 minutes

Talent is a peculiar thing. It is so abundant sometimes; that you see it everywhere. It is more accurate description of social media personas, we encounter daily.

With acceptability of self boasting as a new normal trend, we see people floating their talents on social media.

Talent has multiplied many folds. With no judge or critic, people produce things ( posts), using their talents and push it down the throats of other similarly talented people, in exchange of ever elusive likes and shares.

It’s like apes scratching each other. If Socrates or epictetus somehow visited instagram pages prevelent in present times, they would be bewildered to see infinite sea of talented people on the planet earth.

They might like to take a wordpress SEO tutorial, for their teachings to beat average blogger followership.

That was the idiotic babble at the start of the article.

Now let’s see few basic concepts, that help in keeping talented person afloat.

1. Practice till your subconscious accepts the skill and you could make an omlette, while doing that work.

2. Find a mentor. Yes that one person who dies lesser number of mistakes as compared to his younger self. And who wants you to be a success.

3. Get inspiration. If not enough steal ideas. But give credit to the original creator.

4. Learn both hard skills like plumbing and softskills like boardskating, writing etc.

5. Don’t try to label yourself as child prodigy, as most of them fail as they grow into the adulthood.

6. Learn from mistake. Don’t burn the toast each time. Also don’t burn the toaster.

7. Increase difficulty level during practice time. On field things will appear easier, if you have done more difficult things.

8. To learn a new move, exaggerate it like the helicopter shot of mahander Singh Dhoni.

9. Take notes and also remember to read them before throwing them into the trash.

10. Practice immediately after the performance. That is the time when muscles are hot and motivation engine is running.

11. Visualise your performance or better watch your performance video.

12. Keep you big hairy audacious goals secret from the world.


Motivationa – The talent code by Daniel Coyle

https://www.amazon.in/dp/0099519852/ref=cm_sw_r_cp_apa_fabc_Z8YNFB3MBA08AYZY0ZC9

Negotiation basics in 5 minutes! #negotiation #chrisvoss #persuation #psychology

Category – Psychology

Reading time – 5 minutes

Whenever a baby is born, everyone wants this baby to cry. That’s all right. They need to learn to cry, before they can earn their laughs. Who wants to be at a place; where everyday is pelted with difficult negotiations.

Negotiations mean, a mutual discussion in an effort to reach an agreement, which both parties find appropriate.

Humans are partially illogical. You got to negotiate with a lots of them daily.

Every life is a series of negotiations. Every day is string of negotiations to get a better place in resource limited biosphere.

So guys, it is of utmost importance that we know what’s up with this negotiations thing.

Neither you can stand there like a banana tree, nor you can punch people in faces. You got to be diplomatic, when it comes to dealing with breathing people.

So, let’s discuss some basics of negotiations.

Disclaimer – These might not work with your wife, but they may help you to tackle little less complicated situations.

Things to be kept in mind –

1. People are irrational. They work at emotional level, especially in difficult situations.

2. People want to be understood.

3. People want to be in control of the situation.

4. Seperate people from the situation. People are not the problem. Situation is.

5. People want things to be fair according to their own definition.

6. Keep your voice as calm as possible to keep emotions under control, so that brain can work.

Now let’s dig deeper.

Dont shout or exchange names or open your lid, kept on adrenaline and cortisol. Try to control tone of your voice. Take pauses. Be slow. Don’t overexplain. Try to listen.

It can be done, if you seperate yourself and person from the situation and see situation as the problem.

It takes yoga, mindfulness and meditation. Those are difficult things.

Then what is the next thing that you need to do.

Once you control your primal instincts and get hold of your emotions.

Then listen complaints and try to make out meaning of demands.

Then comes your next two big tools.

1. Tactical empathy –

It means understanding their position. Labelling it. Telling in calm voice, whatever you could understand about their situation. Vocalising it. Without judging at this point.

Like saying to an angry customer that,” I understand your discomfort”. “If I was in your situation, I will feel the same.”

  It calms the person in front and gives them feeling of control. ( Which they crave for)

2. Open end questions –

Ask a question that leaves opportunity for multiple possible answers from the person in front. Ask it and then throw a pause.

Let the person in front complete it or answer it.

This will give person in front, a feeling of control. It will give them chance to vocalise their concern. And it may bring out facts, which may help you in finding a solution.

Sometimes, even repeating what the person in front has said; followed by a tactical pause, can bring out a lot of facts about the reason why that person is upset.

After you have stopped surge of anger with tactical empathy and found more facts by open ended questions, then keep that voice calm like Morgan freeman and try to reach a solution which is win -win for both parties.

These are time tested skills practised by best real world negotiators. So they are going to be useful in normal life scenarios.

Things that help.

1. Instead of saying No, ask open ended question starting with how.

Like if you don’t want your rent to increase. Ask, “How I am going to afford this increased rent?” Throw a pause and hence make this problem, a problem of the landowner.

He has to tell this solution, how you can afford or tell alternative possible solutions. Saying, ‘No’ would not lead to any such results.

2. Watch your body language. 50% of the message is conveyed by your body language. Show concern about opposite party.

3. Give surprise gifts or non monetary benefits in a business deal.

4. Don’t fear,’ No ‘. No is starting point of a negotiation. Welcome a, ‘No’ from opposite party and start negotiations from new set point.

5. Create deadlines or urgency. Like limited time deals. Limited time offers.

So these are few good things that will always help you in difficult talks.

And don’t mind if you fail sometimes. Afterall failing is all too human.

Inspiration – Never split the difference by Chris Voss
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Mummy with golden tongue. Mystery. #archaeology #mummies #afterlife #taposirismagna

Category – Science

Reading time – 2 minutes

If you are dead. You are almost free from wordly affairs. You can lie silently and rot by yourself. No morning alarms or killer deadlines. No bills to pay.

But that is not applicable if you were a king. And a king of Egypt. You need to surrender yourself to delicate hands of people in business of making mummies.

They will make you follow the myths you lived with even after you have stopped consuming oxygen.

Courtesy – Egyptian antiquities ministry

And they love to put gold everywhere around you. So that you stay rich and inflation free.

A mummy wass discovered recently in Egyptian archaeological site. It was lying silent with open month and in that month there was a golden tongue.

Mummy was discovered by scientists at evacuation site of Taposoris magna and mummy is believed to be 2000 years old.

What was the purpose of golden tongue is not clear and question is open for all sorts of speculations. Experts will guess weird things and lots of stories willbe made. Top news sites will copy paste from each other. Many eyeballs will soak the news with wonder for seconds, before some other attention catching photo or video clouds the attention again.

And our endeavour to make meaning of our current state by digging out remains of the past continues and strange ape called man still keeps amazing us with its wonderful and sometimes weird deeds.

Source – Egyptian antiquities ministry.

https://egymonuments.gov.eg/