We recently received an interesting email, which is reproduced below with the author’s permission.
“I have come across your work in the field of saving/investing for financial independence very recently. I come from a family of marginal farmers. Both my parents toil in the fields. For more than 30 years, they used to borrow money from private lenders in agri-markets and put it to cultivate crops”.
“After that, they started to borrow money from Banks at much cheaper rates to save their land from being taken away. They are paddy cultivators. From time to time, however, they grow horticultural crops—chillies or tomatoes — in an acre of land.
Year after year, they lose money because the prices of these vegetables fall drastically as they grow, when everyone is growing the same”.
“Sometimes they just leave the field for animals to graze, as hiring labour to pick is more than what they get from selling (tomatoes). We are five sons to my parents as they wanted a girl child, but it didn’t happen”.
“The life of Dr B.R. Ambedkar inspired my father by coming from the same untouchable community background. My father saw that Education is the only way to escape from poverty and community-based exploitation in rural areas. Even though my parents didn’t have formal education, they left the village for a nearby town to get us educated in English-medium schools. Later, they sent us to get educated at the best universities. They never asked us to stop our education and look for a job”.
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“They borrowed money to send three of my brothers abroad and repaid most of the loans borrowed from relatives or moneylenders in the town, as my brothers sent money every month while doing part-time jobs. The Bank loans are still there.
With all this, they have been unable to build a house for themselves”.
“We have not all taken Telugu society’s usual routes, even though three of us brothers took sciences till class twelve. None of us brothers did engineering. Two of us are in liberal arts, and one brother is a pilot. He funded half of my other brothers to go abroad”.
“With no awareness of financial planning or how to save, firstly, marginal farming can only support sustenance. Hence, there was no culture or practice of even saving in FDs or RDs”.
“Then, due to my worldview that the social welfare of people is the state’s responsibility, I was not prudent enough to save even though I got UGC JRF. Most of the money was spent on books and food. Didn’t save a bit. I am around 40 years old now. I left the PhD in sociology without submitting my thesis ten years ago from JNU and did odd research jobs”.
“I work as a researcher, and my friends have told me about financial literacy, etc. All I did was send money to my dad every month to pay the house rent, and he saved in a chit fund that was Rs 10,000 a month for 6 years. The rest, I spent on rent and food in Delhi, where I was living”.
“I shifted to Chennai a few months back to rework on my PhD, as there is no distraction of activism around here. I saw that people are investing for the future, looking to purchase a house, etc. In this new awareness, I came across your interview on YouTube and then started to read your writings on the freefincal website.
“The dilemma I am facing as a socialist is whether it is okay to invest in equity to secure my financial well-being for the future. I know it’s silly to have written to you, but I wanted to get it off my chest”.
“I am sure thousands read your website regularly and feel that their story is not reflected in your writings, making it difficult for them to imbibe the wisdom.
So, I request you to write an article on how families from rural backgrounds should learn to invest/save whenever time permits”.
“P.S. After coming across your writings, I am exploring a fee-only financial planner to seek her/his advice on saving”.
The following is my response. Most of my freefincal readers are from big cities and are usually salaried. I have very few rural readers.
You need money after handling expenses and debts to plan for future goals. If this is not available in a family, whether from a rural or urban setting, they will have to work on that first. Which is what your parents have done for you. So, naturally, most of what I write will not appeal to those in such a circumstance. I cannot help that.
Saving or investing is not a priority for such families. They will have to focus on reducing debt and creating an emergency fund. This can take years, decades, or even generations. This is the grim reality.
It is not the government’s responsibility to save you. You will have to do that yourself. I would rather aim to be rich and generously contribute to changing other people’s lives than be poor in the name of political/economic philosophies. Also see, The govt is not going to help us or save us! We have to do that ourselves!
Please be practical and plan/invest for your family. I am glad you wish to seek the advice of a fee-only financial planner. Please follow through on that asap.
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Dr M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter(X), Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
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