The worksheet used by Dr. Uma Shashikant during her workshop on strategic personal finance is presented in this post. The sheet allows a user to review present and future (projected) cash flow and can be summarized with a flow chart. I have modified the sheet so that a user can easily input the following. …
Continue reading →This post describes how one can calculate returns from stock investments including the declared dividends. There is a lot of confusion about this calculation with regard to how the dividend should be treated. In this post, return refers to XIRR, that is the personal rate of return. See this for more details: What is XIRR?…
Continue reading →Here is an e-book based on a (nearly) unabridged collection of 20 posts written earlier. I have not bothered to connect the chapters. I hope that will not spoil your experience too much. Perhaps only a reader who is used to my style and intent might find this collection useful. This is an experiment. Please let…
Continue reading →After reading well-spun yarn like ‘Rich Dad, Poor Dad’, many start talking about the importance of financial independence and passive income. There is no free lunch in the universe and there is no such thing called ‘passive’ income. A look at some well-known passive income ‘streams’ and what it takes to make them count. Income…
Continue reading →A look at “How do I reduce clutter in my mutual fund portfolio so that it can tracked and reviewed easily?”. Typically mutual fund investors with few to several years of experience are interested in this exercise. The first step is to recognise clutter. I hold 8 funds. If I posted just that information at AIFW…
Continue reading →A look at ‘how much’ or ‘what is the corpus required for early retirement in India?’. I had earlier written a detailed post on this subject and the common misconceptions youngsters seeking financial freedom form after reading blogs like ERE and MMM. The central message of that post was, early retirement is possible, but one…
Continue reading →Type ‘comfort zone’ in Google and you only find articles that tell you to step out of it. So why am I asking you to step into it?! If financial literacy was a course, it would have an extremely small syllabus: 1) Understand the impact of inflation and design a way to combat it. 2)…
Continue reading →XIRR or extended internal rate of return is a measure of return used when multiple investments (at different points in time) are made in a financial instrument. A look at what XIRR represents and how it is different from CAGR. What is CAGR? First, we need to answer a much simpler question. If I invest Rs….
Continue reading →This post is meant for financial advisors, who care to take me seriously, considering my diatribes here and at FB group Asan Ideas For Wealth. I would request investors to read and comment on this important issue. Why am I writing about this? Becuase over the years a few CFPs have asked me, “how do…
Continue reading →In an interview to Wealthforumezine, Shankaran Naren, CIO, ICICI Pru AMC, suggested that buying low and selling high using the price to book value (PB) is better than the price to earnings (PE) model. Since I have earlier shown that there is absolutely no merit for long term investors to buy at low PE and sell at…
Continue reading →Here is how I visualize the growth of an equity portfolio as a tilted pendulum. It is a simple ‘mental model’ that might* aide a new investor with regard to what he/she should expect from equity investments. (*) might because, it makes sense to me, but I am not sure if it will to you….
Continue reading →So many people have told me, one should assume that expenses will decrease after retirement due to a change in lifestyle, that I am now convinced that it is a cognitive response to avoid pain. The pain associated with staring at the results of a retirement calculation made with meaningful inputs. It is abject cluelessness when a…
Continue reading →Living in a hotel after retirement has been my fantasy for long. Let us calculate how much it would cost to live in a hotel after retirement. Yes, this is a fantasy post and I will never be able to pull it off, but it is intriguing to calculate the costs and consider the benefits of…
Continue reading →Do not assume that your insurer will hand out your life insurance amount (term, endowment, ulip etc.) on a platter to your nominee! Deepak Shenoy of capital mind posted about how ICICI Pru Life bitterly fought a claim settlement and delayed it by about 7 years. http://capitalmind.in/2015/07/has-icici-prudential-life-taken-to-fake-doctors-prescriptions-to-avoid-paying-out-claims/ This led to the swift clamour that one should not…
Continue reading →Here are some charts from yesterday’s post: Should gold be part of your long-term investment portfolio? Franklin Indian Blue Chip is chosen as representative of equity Franklin Indian Income fund as representative as debt. Per gram price data obtained from indexmudi is used to represent gold investment Data range is June 1997 to June 2014 (quite small…
Continue reading →