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Why A Recession In 2022 Is A Good Thing? Even if you don’t understand Macroeconomics or Finance, it won’t be a tough task for you to put a finger on the fact that something is majorly wrong with the economy right now. The global debt is at an all time high ($303 trillion dollars in 2021). Government bailouts have been skyrocketing. Money printing has been extremely high. (In the US a humongous amount of money was printed within 22 months, from $4 trillion in January, 2020 to $20 trillion in October, 2021) Why is a recession good for the economy right now? Now, there are 2 ways in which you can wrap your head around the concept of a recession. The classic definition– Slowdown in economic activity (Eg- The 1930s was termed as the ‘Great Depression’, because economic activity had stalled) Such a definition leads us to believe that a recession is an ‘evil thing’. Instead, we can define recession as a period during which fit firms end up surviving. Money flows out to those people who have best use of that capital. Let us understand this better, by looking into the 2 phases of the economy- The boom and bust period of the economy. Reason 1: It streamlines the flow of capital. During the boom phase, there is a large availability of capital in the economy. This consequently results in people clamouring for more growth. Countries start competing against each other in order to accelerate growth. This might lead to something called as artificial growth, and eventually inefficiency in the economy. Inefficiency in the economy = Money flows into companies that aren’t necessarily creating good businesses/working on good ideas. A lot of inefficient businesses end up getting a lot of capital during the boom phase, which is not good for the economy And therefore, the bust phase, also called recession, is very important for the economy.  It streamlines the flow of the capital and it ensures that the capital is reaching the people who have the most productive use for it. Reason 2: It brings an opportunity for structural change. During the Great Depression (1930s), there was a systemic inefficiency in the economy. One of the primary reasons the world moved towards a recession was because people were losing a lot of jobs. This led to people not spending money, which led to underspending. This led to a vicious cycle of- UNEMPLOYMENT > UNDERSPENDING > UNDERPRODUCTION When such a scenario plays out, the economy needs a jolt, so that the cycle breaks. In the 1930s, this jolt was provided by fiat money, i.e.- Government’s ability to print more money. When the government throws money into the system, people start spending more, companies begin to produce more and as a result, they hire more. Hence, the problem goes away. After the 1930s, a lot of countries moved from the gold standard, to the fiat standard. This was a fundamental shift. Another fundamental shift took place in 2008. It was termed as the subprime lending mortgage crisis. In simple words, banks across the US started selling products that they should not have sold. This brought oversight on investment banks into the picture. Since the banks did not act responsibly, it led to a recession and hence restructuring of the banking system What will be the repercussions of the current recession? Excessive money printing is leading to something called as ‘unstable inflation.’ This is something that has not happened in the past. So, what is the implication of this? For this, you need to understand the concept of certainty. Businesses like certainty. If inflation is very high, businesses will take loans, build structures and processes accordingly. If inflation is very low, they will manoeuvre their operations, hiring practices, etc accordingly. Businesses cannot prepare for the kind of uncertainty that comes along with unstable inflation. Unstable inflation > Lot of firms go out of business > Slow growth Points to remember if you want to make money in this market- 1) This will become the age of monopolies. Companies like Amazon, Microsoft, Apple, Hindustan Unilever are much better placed in terms of handling unstable inflation. They will win in the long term. They will pick up the market share that is left by small companies which will fail to survive this recession. 2) Artificial growth will stop for companies for at least half a decade. A lot of companies planning to launch their IPOs will have a very hard time, specially the ones struggling in revenue. 3) Study and understand hard assets. You can watch this video to understand it better. The world will now reward diversified investors. Traders will have a very tough time surviving in this market for the coming few years. But nonetheless, it will be an excellent market for those who can handle volatility. And handling volatility comes only with conviction. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market TL; DR: Recession, often viewed negatively, can have positive aspects. It streamlines capital flow, directing resources to the most productive ventures. Recessions break harmful cycles like unemployment, underspending, and underproduction. Excessive money printing can lead to unstable inflation, causing business uncertainty. Established companies may thrive, smaller ones may struggle, and investors should consider hard assets in this volatile market. To take action towards your goal of Financial Freedom, check out this blog post on HOW TO INVEST YOUR SALARY For Beginners HOW TO INVEST YOUR SALARY For Beginners

Here’s why you should Love Money It is 2022. And currently, the money making opportunity in India is huge. Foreign investors are investing heavily in India. In the last 20 years, NIFTY CAGR was roughly 12.5%  India is growing at a massive rate. With all these positive changes coming in, one can easily grow their wealth at 15% CAGR. Right now, the median age in India is 28 years. If we assume a life expectancy of 70 years, most people have a career of 40 years ahead of them. In these 40 years, you can either choose to be rich or choose to be poor. First, let’s do some basic maths, shall we? If by 30, you’re able to save 1 lakh, by the time you are 35, at 15% CAGR, your 1 lakh will become 2 lakhs. By 40, it will shoot to 4 lakh rupees. And by the time you reach 70, it will sky rocket to 256 lakhs! “But, I don’t bother about making money. It does not interest me. I feel it is a taboo topic.” What you need to understand here is that you become rich or poor in relative terms, not absolute terms. Back in the 1960s India did not have a lot of crorepatis. But now, we do have a decent number of millionaires, and this number is only going to rise in the future. This does not imply that you too must strive to become a multi billionaire, but you should learn about investing, and speak openly about money. If you don’t do so, everyone else will be making money except you, and you will become poorer in relative terms. Let us explore some points, to understand why money making is crucial and how to ease yourself into falling in love with it. 1) Get comfortable with the concept of money-making. It is not uncommon that you hop onto LinkedIn and find several “next gen start-ups” looking to hire interns. When the intern asks how much they’ll be paid, the company just shrugs it off. Do not hesitate to ask to be paid when working for someone else. A lot of YouTubers also play the trumpet saying that they don’t run promotional ads or do sponsorships. They believe that by not making money out of promos, sponsorships or brand endorsements they are being saintly.  But the point is, they do make money out of YouTube in some way or another. They definitely are not working for free. To speak of matters on the other end of the spectrum, even consumers should stop expecting things for free from someone. Would you as an employee want to work for free for your boss, labelling it as ‘passion’? No, you wouldn’t. Both, as a consumer and as an employee you should not be expecting or accepting things for free. Let us understand why exactly is the free economy bad. This can be answered in one simple sentence. In order to generate free stuff, you have to create wealth first.   2) Think of it from a Capitalism and Communist model. In capitalism, by the free market principle, businesses are generating value and becoming richer, without government intervention. On the other hand,  Communism = common ownership of goods. The government decides whom to give what as per their needs. Why do you think Communism fell in the USSR? In order to even run a Communist model, you need to generate wealth first. And to generate that wealth, people need some incentive to learn skills and work harder. So far, only the Capitalism system has been able to generate this sort of incentive. Capitalism is not perfect, but compared to other economic structures, it has worked best until now. Let us take a more tangible example of why Communism does not work. It is called the Tragedy of the Commons. There is a very old, broken bench in the park. Every single day it goes unnoticed. Will you go out of your way to repair it? You obviously will not because there is no direct incentive for you to do so. Unless the Government collects money from the people and gets it fixed, the broken bench will, well, remain broken. 3) Understand the concept of Capitalism better. A lot of people believe capitalism = aggregation of capital. This definition associates capitalism with a lot of negativity. Students hardly speak about money making in school or college. If a youngster has a parallel source of income, people envy it or think of it as hoarding money. Here is a better way to look at it.  In order to make more money, you need to be super skilled. And even after being super-skilled, you constantly have to mould yourself to changing times to continue making money. Hence, capitalism is actually not an aggregation of money, but rather an aggregation of your skills, hard work, efforts and other factors.  Money is just an outcome. If we are more respectful towards people’s hard work, effort and pressure to make money, probably our conversations around money making will be healthier. To summarise: Good Capitalism = Making money by genuinely working hard and adding value to other people’s lives. Bad Capitalism = Tricking people in order to make money/making money in unfair ways. Lastly,   4) Money making is not evil. Quite often when we see someone else make a lot of money, it incites envy in us. This in turn might clout our judgement and will only hurt us more than anyone else. We might miss upon crucial observations like- What kind of business strategies is that person implementing to make money?  How are they so efficient?  What time saving strategies or productivity tricks do they implement? It is important that we simply learn from other people. Learn to extract value from them. By criticising them, or hating them, we won’t be doing any good to ourselves. They will continue minting money, oblivious to our opinions. We are put on this

Why Should You NOT Buy A Credit Card? You are at a bookstore and you take a look at this one book. It costs 550 rupees. Your very first thought would be, “Oh, that is expensive.” This is called first order thinking. It means that our brain drives us to the most obvious conclusion. But reading a book can help you Learn how to communicate better.  Impress your date. Increase your general awareness. So, buying a book and reading it can turn out to be a great investment. This approach is termed as second order thinking. First order thinking in purchasing a credit card. While purchasing a credit card, our brain almost follows a first order approach. Buying a credit card can get one: Free coupons. Discounts on certain products. Free food in airports and access to the lounge. These services induce a dopamine kick in us and we begin to believe that maybe purchasing the credit card was not a bad idea after all. Eventually we start treading the path from being simplistic to materialistic. Our spending habits become unnecessarily high.  We start spending money on things we don’t really need just because we are getting a ‘discount’ on them through our credit card. We spend money on items which are not appreciating assets (things which can help increase one’s cash flow). This eventually leads one into debt. Credit cards promote bad debt. In the US, 7/10 Americans have at least 1 credit card. But, why? The US tries to promote something called consumeristic culture, where people thrive more and more in buying stuff. According to a report in Mint, 55% of working Indians save towards retirement regularly. On the other hand, a 2019 CNBC survey states that only 10% of Americans are confident that they’ll have enough for retirement. This happens because most Indians have grown in an environment where they have seen people save first, and spend later. Now, ask yourself a question. What are the items for which credit card companies usually give you a loan for? Most probably you are taking a loan/paying EMI on durable liabilities.  When you buy a car or a phone, you’re not creating a source of income for yourself but rather cash outflow. This can eventually have grave consequences. Now, a lot of people say that, “I am an effective credit card user. I pay my bills on time.” Again, this article is not a criticism towards people who use credit cards judiciously.  But here is a more systemic question for you, so that you understand the business model of a credit card better-  Who pays for credit card conveniences? There are credit card companies. There are retailers (people who sell you stuff, e.g.- Apple store) And then, there are people. Credit card companies offer conveniences to people and retailers. For retailers, credit card companies help them build marketing awareness. For people, there is the comfort of not carrying cash, you can pay bills by just swiping your card, plus you get customer service as well. Now, credit card companies make a LOT of money. But, how? Who is paying them? It is either the people paying for these conveniences or retailers. Or both, retailers and people. In economics terms, this is called the incidence of cost burden. Let us take an example to understand this better. When cigarette prices increase, who pays for the risen cost? It is mostly people who smoke cigarettes. Sounds obvious, right? This is because it is a habit oriented industry. The retailers can pass on the entire cost burden to the customers, because cigarettes have inelastic demand (price increases, but quantity remains the same). On the other hand let us take the example of an item which has flexible demand, like potatoes. (flexible because people can simply use a different vegetable, if the price of potatoes skyrocket). In this case, if the tax on potatoes increases, the retailers will absorb a certain amount of cost burden and then pass on the rest to the customer. Similarly, the same issue holds for credit card companies. It is the company that is making money, but who is substituting them/making them richer? The people and retailers, because of the innumerable conveniences a credit card provides to them. When we say conveniences, the idea to use a credit card can sound luring, right? But here comes another question.   How amazing are credit cards REALLY? You will have observed that a lot of YouTubers advocate the use of credit cards. A lot of blog articles on the internet also speak of them in a positive light. You will not find a lot of content on the internet which will systematically criticise credit cards, as there is a high chance they will be taken down. Also, quite often people forget that the credit card system varies across nations. In the US, it is not very easy to haggle or bargain. But the bargaining culture is very prevalent in India.  You don’t really need cashbacks or coupons. Now a lot of people will make the argument that big supermarkets accept credit cards and give store discounts. Would you rather buy cheaper vegetables from a regular vendor with no cashback or exorbitantly priced vegetables at supermarkets which are giving you cash backs? So, it is important for you to do this simple analysis and use basic common sense, because at the end of the day Simplicity is the best way to be financially free. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market

6 Life Changing Formulae To Help You Make More Money! Rule 1: The 20-20 Rule This rule simply means that if you are investing Rs. 20,000 per month, for a period of 20 years at a CAGR of 12%, then in that 20 year period, you’re going to have a corpus of 2 crore rupees. Many people might argue that the inflation rate is going high, so what value will the 2 crore rupees have? Also, it is difficult to grow money at 12%. Let us tackle these questions. It is not difficult to grow your money at 12%. This is because the average NIFTY CAGR for the last 20 years has been 12.2%. As far as inflation goes, your principal amount will also increase with inflation (as your salary will also increase.) The objective of this 20-20 formula is to help you become a bit more optimistic about the fact that it is not that difficult to become a crorepati if you have a systematic approach towards Rule 2: Safety-net rule OR 6x-12x rule Many of us want to become entrepreneurs, or want to leave our jobs in a bustling city and go live somewhere more quaint. While taking any kind of risk we need to think of it from a financial point of view and a career point of view. Creating a financial safety net = Having a saving of 6 to 12 times of your monthly expenses. Now, what is a career safety net? Well, if today you are fired from your job, is there something you can begin doing to make money from tomorrow itself? This is what career safety means. You have amped up your skill-sets to such an extent that even if you get fired, you can still do something to start making money immediately. Rule 3: Don’t boil the ocean The only key to attaining financial freedom is to increase your earning potential. To do this, we also need to be a smart consumer of things. What we buy versus what we don’t, how do we build our thought process, how do we make decisions, all comes to this one rule. In today’s world there is a lot of information floating around. You don’t need to consume every piece of information out there to make better decisions. Don’t boil the ocean i.e. don’t try to do a PhD on every single topic. Here you can apply the 80-20 rule, which states that you need to put only 20% of active effort into completing 80% of a task. Rule 4: Time >> Money Theoretically money is infinite, but time is finite. A mistake many people make is that they overvalue money and undervalue time. Let us take an example. Imagine you have to get from point A to point B, but the rickshaw guy is charging 500 rupees. Now you think that 500 rupees is a lot and instead choose to walk an hour to reach your destination, despite having the capacity to pay that amount. You should not be doing that. Saving an hour would be a much smarter choice. Rule 5: 8-8-8 Rule You should divide your day into 3 spheres: 8 hours of work, 8 hours for sleeping and 8 hours for fun. Now it is important for you to understand that incorporating this rule very early in your life might prove to be troublesome too. It is important that you hustle in your early years to reach a certain point where you can curate a life which allows you to enjoy 8 hours of your day. Hence it is important that this rule be aligned with the stage you are at right now in your life. Rule 6: The 2x Rule Many a times people are in a fix whether they should buy a certain item or not. Here you can follow a simple rule- If you cannot buy an item twice, do not even think of buying it once. Let us take the example of buying an iPhone. If you need an iPhone to film videos, or do something with it that could potentially generate money for you, it can be seen as an investment and not an expense. Hence go ahead by all means, and buy it. But if you want it only for entertainment purposes, and cannot afford it twice, you might want to step back and rethink your decision. Even if you incorporate just 3 out of these 6 rules you will soon find yourself living a much more fulfilling and financially free life! If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market

Should You Move To A Tier 2 or Tier 3 City? If you buy a bungalow in Kerala, it will probably cost you anywhere around 60-75 lakh rupees. If you buy the same bungalow in Delhi, it will cost you 4-5 crore rupees easily. In Mumbai, it could even cost you 50 crore rupees. It sounds mind-boggling, but it could always be a possibility. The point is, we often think that we have to work really hard, save a lot and invest a lot of money in order to live a fulfilling life. But if you take a contrarian viewpoint and shift to a tier 2 or tier 3 city, you might not even need to earn that much to begin with, and you could still live very, very comfortably. The above data suggests a very interesting story. It shows the bifurcation of rent and prices of housing across different cities in India. This study is done on properties of an area worth 1000 square feet. You will be shocked to see that a property that costs around 10K (rent) in Indore, costs 4x the amount in Mumbai. Now your obvious response to this would be that the quality of life in a metropolitan city is way better. Well, let us look at another piece of data. Here, you can deduce that in Mumbai and Delhi neither the quality of living is very high, nor the cost of living is very low. Now that you have some perspective, keep reading further to understand: Should you live in a metro or should you move out? A lot of people might raise the argument that although living in metro cities in India is very expensive, the opportunity to make a lot of money here is also high. This phenomenon could be called the Purchasing Power Parity Fallacy. Why the word fallacy? Watch this particular reel to gain a better understanding  When companies like McKinsey, Google or Facebook are giving you salary as per PPP, that PPP data comes from non-metro cities and villages as well. If you are living in Mumbai or Delhi, your daily expenses could easily be 3x the amount you would be spending if you lived in a tier 2/3 city. Now you might be thinking, “Alright, maybe I am not actually making that much money in real terms but opportunities in big cities are massive and how can I give up on them?” Maybe you are looking at this situation from a myopic view point. You need to look at where the trend is heading. This is where the freelance economy comes into picture. India witnessed a 46% increase in new freelancers from Q1 to Q2 in 2020 as many laid off workers took to freelancing to generate a higher income. This is a crazy growth rate. You might say this might just be an anomaly. But it is 2022, and India is the second largest freelancing economy in the world after the US. So the trend is just increasing. By 2027 it is estimated that 51% of the workforce in the US will take to freelancing. The reason we are taking the US into consideration is because every major trend that develops there is soon adapted by most other developing countries. When should you move to a tier 2 or a tier 3 city? You should think of your career in 3 phases. Now this is not a set in stone method to live your life. But it does give you some perspective on how you can plan ahead and set goals for yourself. How should you shift? Here are 3 tips: a) Build a nest- Have an emergency saving(6-12 times of your monthly salary) Funds (18-24 months of your salary)- When you are shifting cities, you might require money to experiment with a few ideas and figure things out for yourself. b) Have transferable skills. Example- Management consulting teaches you a lot of skills (structured thinking, effective communication, problem solving) which can be transferred to various other careers. c) Value freedom Living in a tier 1 city, you might realise there is no end to making money. But sometimes you need to take a leap of faith. Living with freedom might become something you value more deeply. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market

5 Basic Rules You MUST Know Before Investing In The Stock Markets! 1. Your earning potential should be really, really high. This of course is a fairly commonsensical point. If your salary is 1 crore, 2 crore or even 3 crore, you can invest a lot more and make even higher returns. The interesting thing to note here is that your earning potential can be broken down into a mathematical formula, comprising of 2 variables- Earning Potential = [(Skill1 * Time1) + (Skill2 * Time2) + (Skill3 * Time3)…….+ (Skilln * Timen)] The combination of time and skills allows you to make a certain amount of money. If you pick up this formula and further bifurcate it, you can reach the conclusion that- If you have more than 1 skill, and you can invest time into it, then you can create multiple sources of income. 2. Earn more than what you are spending. Here are 3 key tips to bring down your expenses: i. Divide your expenses in terms of a hierarchy. Needs- pay rent, send your kids to school, household expenses. Wants- this could be a hobby you want to invest in (learning an instrument). Desires- discretionary expenses (having subscriptions to 5 OTT platforms). The idea is to cut down spending your money on desires as much as you can. ii. Avoid impulsive purchases. You are in a retail store and you do not have a list of items that you want to buy. You are aimlessly walking around buying random things and end up spending a lot of money. Having a list will help you save both time and money. iii. Be in the position of being a minimalistic person. If you own 30 credit cards, inadvertently you will be using a lot of credit because someday you will be getting cash back on HDFC card, the next day on ICICI card and so on. You will maintain all those cards and undertake a lot of expenses. You might feel like you are saving money but instead you are actually being psychologically programmed to spend more money. You need to put yourself into a position of curated minimalism. 3. Invest. Even if you do not know how to. Here, there are 2 very important mathematical equations that you need to remember: i. Currently, inflation rate >> savings rate. Inflation rate in India currently is around 6.5% and savings interest rate is 2%. If you keep 100 rupees in your bank account this year it will for sure become 96 rupees next year. This situation will continue for a very long time, so if you do not invest, you are practically working towards poverty. ii. There are easy investment instruments you can invest in. There are passive mutual funds you can invest in. You can also consider investing in small cases.  Though you might lose a little bit of money in terms of commissions, you will at least be avoiding the potential decrease in your money due to inflation. 4. You need to start from bottom-up. Bottom-up approach simply means that you can first form a safety net, and whatever money is not part of that safety net, you can go and invest. You need to have an emergency fund which is 6 to 12 times of your monthly income. Whatever money you have left after making an emergency fund and purchasing life and health insurance, you MUST invest. This brings us to the concept of holding power. Many people panic and sell their stocks. This is because they have tied even their emergency funds into the stock market. And when they see the market tanking, they start panicking and sell their stocks to withdraw their money. This situation should not arise. If you have zero holding power in the stock market, you are not going to make money as a retail investor. Hence having a safety net is super, super important. Once you have your emergency fund, health insurance and life insurance sorted, you can go and invest money without any fear. 5. You must have liquid money. Very often young professionals invest in nothing else but only in real estate, and all their money gets tied up to a single asset. In technical terms, this is negative diversification. Your investment portfolio has only one asset and that is real estate and all your money is tied to it. Even the money you will make in the future is tied to it. This is a very bad way of investing because here, your investment is not liquid. In 2020, when COVID hit, a lot of people had to undertake high medical expenses. A lot of people had to do something called distressed sale. Distressed sale means that if you have a house you purchased at 3 crore, you might have to sell it at 1.5 crore just because you have such a massive need for money at that juncture.  This happens to people who have no liquidity. If you do not have liquid money, you will have to sell important assets in your life in a distressed format. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market

Simple Strategies To Earn More By Working Less! We see CEOs of top firms who work extremely hard and make a lot of money. Sure, they are money rich. But at the same time, they work for almost 12-14 hours a day and most of them say that they get very little time for themselves and their family. They are time poor. So, how can one achieve a balance and create a system for themselves where they are both time rich and money rich? Here are 4 things you can do to be both time-rich and money-rich: 1. Build your systems: System building is nothing but picking and making habits. But there are certain critical points along which we need to create our habits. You need to develop habits around areas that impact your life a lot. You should be developing habits around 4 specific areas in your life: i. Work related habits. Quite often, in the initial phase of your career, you will find your boss to ask you to come in early and leave late. You will have multiple requests from your clients at odd hours. This might not resonate with everyone but the best thing to do in such a scenario is to simply do as you are asked. At a junior level you have a lot to learn and do not have much say in the company’s decision making. It is quite inevitable that you have to simply put yourself through the grind. Instead of looking at it as if you are doing a favour to your boss, think of it as a way you are actually helping yourself. When you are working from home, figure out a time period when you can work in an absolutely un-interrupted fashion. ii. Investment related habits. Make sure to invest a part of your salary every month or else inflation will eat up your hard-earned money. iii. Time-efficiency. A simple exercise you can do to figure out how to spend your time more efficiently is: For 7 days, note down in your diary how you are spending your day and how much time you are spending on each activity. Then look for pockets of inefficiency in it. You will realise that there will at least be a 4 hour window in your day everyday wherein you are: a) Not enjoying what you are doing. b) Simply worried about work, but not doing anything. c) Not able to concentrate. d) Whiling away your time. In such a case, you are just being inefficient. A lot of people think that if you are watching Netflix you are wasting your time. No, you are not. You are wasting your time when you are neither enjoying your time nor learning. Naval Ravikanth has put it this way- “If you are not enjoying or if you are not making money, then what is it that you are doing with your time?” Eliminate the pockets of time in your daily routine wherein you are just simply whiling away your time. iv. Health-oriented system. 2 tricks to stay in decent shape without investing much time is: Consume lesser carbs. Atleast get 15 minutes of high intensity exercise every single day. All in all, these are the 4 most important systems you must build, monitor and improve. 2. Know your hourly-rate. If you do not have a number in mind, you will not be able to improve upon it nor know what could be your optimal level. Having an hourly rate will also help you understand if what you are charging is worth the value you are providing. Another key advantage of knowing your hourly rate is that it helps you decide what work you can delegate and what you should be doing on your own. It also helps you understand whom you can hire. 3. System simplification framework. Let us use the example of investing in this scenario. A lot of people avoid investing in mutual funds, stocks and other instruments stating that: They do-not have the time. They find it extremely complex. Let us say person X has 100 rupees and wants to invest it at a certain time when it will be certain that this 100 rupees will turn into 200 rupees. If they do not get that deal, they will not invest. In such a situation, they are trying to be a maximalist. They are creating a highly complicated system for themself. This is exactly what a large chunk of the salaried people end up doing. Your aim should be to simplify the system. You can do an SIP on a set of stocks every month or invest in mutual funds or NIFTY. Create a system that makes sense for you. You cannot be working 8-10 hours a day and also wish to do intraday trading. 4. Valuing time and saying no. In the initial phase of your career you need to say yes to the majority of things since you are being given relatively fewer opportunities. But there will be a transition point in your career and you will have to learn to say no to things. For example, 5-7 years into your career, you will have to say NO to a lot of opportunities. You will also have to figure out to what extent you want to help your juniors. You can not be teaching Excel one on one. Rather you will have to teach it to the juniors in a group. This is one such example. So, these were the 4 key-points to help you move a step closer to being both time and money rich! If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market

5 Amazing strategies to make money 1. Take asymmetric risks in life “My proceeds from the PayPal acquisition were $180 million. I put $100 million in SpaceX, $70m in Tesla and $10m in Solar City. I had to borrow money for rent.” This is a quote by Elon Musk. If we analyse the philosophy of billionaires, they do take such risks and take them quite often. People like us would probably never imagine re-investing such a huge sum into building new companies. But let us first understand what ‘asymmetric risk’ actually means. It simply means that you take a very high risk in a certain aspect of your life, for a very high reward. Now, how can you develop this system? You can do 3 specific things- 1. Take the asymmetric risk approach in a small quantum: If you are investing 10L rupees, you can invest at least 1L rupees in slightly riskier assets.  If you are in the corporate world, you can take a risk, work on the weekends and build a side hustle. 2. By taking these small risks, over-time you will build confidence: Risk-appetite is built over time. 3. Have a plan B: If you go and speak to any person who has built a company or is creative, they are usually brimming with ideas.  They always have 10+ ideas in their heads and always have a plan B, C and even D ready. They are constantly thinking creatively about how they can make their ideas work. They are constantly thinking creatively about how they can make their ideas work. 2. Be comfortable with uncertainty. Many of us are often conditioned to imagine and believe in the worst case scenario. This is not the right way of approaching anything in life, especially in today’s day and age when there are so many options available. Let go of the pessimistic approach. We do live in a world where nothing is guaranteed ever, but how will we know if we don’t even try? Again, here are 3 things you can do to become more comfortable with uncertainty- 1. Develop critical thinking skills :  This simply means you should have the ability to assess an idea- whether it will work or not. For example- Let’s say you want to sell a pen. You know there will be high competition. What will you do to overcome it? What will be the other challenges? You have to think in a logical manner. Critical thinking also means to have the ability to objectively analyse your strengths and weaknesses. If you want to build a company and you know you are not a good marketer, figure out how you will handle that aspect of the business. 2. Be optimistic: Our brain believes whatever we tell it to. If you tell yourself you will never be able to dead-lift 85 kgs, you probably never will. You will probably never even put on your shoes and go and give it a try. But if you allow yourself to simply believe it is achievable, you will gradually move towards your goal. 3. Have a safety net: Once you know you have X amount of money in your bank account, it gives you the freedom to take on greater risks. Now, this X amount obviously differs from person to person. Make sure you always have a fall back plan. 3. Be simple in your living. In India, if you take a look at Ratan Tata, or Narayan Murthy, one common thing you will notice is that they are super simple people. Even Bill Gates and Mark Zuckerburg are not at all flashy. They are super simple people focused on their traits. Being simple allows you to-  Focus on building your skill sets.  Increase your ability to generate wealth.  Work on your traits. One practice you can follow to cut out the fluff in your life is to narrow down the number of decisions you have to take in a day. 4. Be confident and contrarian in life. A classic example here would be that of Mark Cuban, a US based billionaire. He was one of the early folks who got into the cryptocurrency space and started funding a lot of NFT based projects. He is also an investor in the Indian blockchain space Polygon Matic. He teaches concepts around finance to his son and also encourages him to invest in various assets. Due to his contrarian practices he has received a lot of negative reactions from people, but he firmly held his ground. As long as what you are doing is backed by rationality and logic, it is absolutely okay to stand apart from the crowd. 5. Think long-term. When we are in a corporate job, most of the time we are thinking about our next promotion and that is it. We live our career from promotion to promotion. What you can do to think long term is to have 2 simultaneous goals. One big and one small. If you plan to clear IIT entrances and also lose 30 kgs within one year, that is an insane goal. You will not be able to achieve it and get demotivated. Rather what you could do is begin preparing for IIT with full focus (big goal) while cutting down on carbs (small goal). Instead of having 2 bowls of rice, have one. This will not deplete your will-power. Practicing the system of having one big and one small goal allows us to become a more strategic thinker over time. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market To take action towards your goal of Financial Freedom, check out this blog post on HOW TO INVEST YOUR SALARY For Beginners HOW TO INVEST YOUR SALARY For Beginners

5 Practical Strategies That Will Make You Wealthy! 1. Don’t do goal-based investing Many of you might be new to the stock market or to the finance world, so here is a quick and easy explanation on what goal-based investing is- Often people save money in order to make certain expenditures. E.g.- Saving Rs. 5000 every month for 4 months to take a trip to Shimla or they might save R. 5000 every month for a year to buy an iPhone. Now, almost the entire subset of investors are encouraged to do goal-based investing. If you go speak to a mutual fund manager, they will suggest you do goal-based investing. If you go to a random website and they help you generate an investment plan, they will ask you what your goals are. You should not do goal-based investing to begin with. Well, why so? Whenever we do goal-based investing, the majority of us end up picking a wrong goal at the very start. There are essentially 2 types of assets in which goal-based investing is done. a. An appreciating asset An example could be- you doing an MBA from a top tier B-school. Your degree will allow you to earn a lot of money. On the flip-side, if you do it from a random college, your MBA degree will become a liability. b. Depreciating asset This could be investing money into something which has no productive use. “Productive use” here means to be able to make money in a sustainable manner out of that asset. Problem arises when we do goal-based investing in depreciating assets. This is something one must completely, completely avoid. E.g.- Purchasing an iPhone and not doing anything worthwhile with it. The bottomline is, when we start goal-based investing, we get the definition of goal incorrect. 2. Understand and optimise assets. There are 3 types of assets a person has. The first is time. It is a critical asset and is finite.The second is money. You can invest money and make more.The third is skills. If you have skills, you can improve your hourly rate and improve your earning potential or increase your income streams. There is a strong confluence between these 3 assets. Let us understand this sentence with an example. If you are in college, you will have a lot of free time. If you are time-poor in college, it mostly means that you are wasting time. You are time-rich but money-poor in college. You can use the free time to learn a skill like video-editing, graphic designing and make money. Essentially what you did is, you used an asset that you are rich in (time) to make money (an asset in which you were poor). Now, in the corporate world you are money-rich but time-poor. What can you do? You can create systems for yourself to get work done more efficiently. If you understand the time ecosystem, money ecosystem and skill ecosystem well, and create a productive system for yourself, you will eventually attain more confidence and freedom.   3. Don’t invest in get-rich-quick schemes. People want to make money quickly and don’t understand the risk involved with it. Don’t invest your money into any asset, particularly stocks with the intention of getting rich quickly. The most sensible way of getting rich is to Understand business analysis. Understand crypto analysis. Understand stock analysis. And invest only in assets which you understand and have confidence in. 99% cryptos are bad cryptos. In fact, even 80-85% stocks are bad as well. Our job as investors is to invest in good asset classes, stay diversified and even within those asset classes we need to pick the best assets possible.   4. Think long-term, think sustainable. Let us understand this point through the example of a human and an insect. Us humans are capable of doing something called as nexting. Nexting simply means that we have a second layer of thinking available to us.We can think of the future, we can predict things. No other mammal or insect is capable of doing that. We must use this power of thinking long term to our advantage. Whenever you are investing money and time into learning a skill, think about it from a long-term perspective. Doing an MBA, dropping out of college, or maybe NOT dropping out of college, we can make these decisions based on what the long term consequences might be. 5. Generating visual cues. Imagine you are earning 1L per month. Every month that money is put into your bank account.You keep aggregating that money and eventually become complacent and lazy. Investing your money into assets allows you to create a barrier between you and your money. Creating a distance between you and your money gives you more incentive to work. This also applies to spending. Go to a random city, try spending 10K in the form of cash and another 10K in the form of plastic money (credit, debit cards). You will feel a lot more pain spending physical money than plastic money. Spending physical money creates a visual stimulus which allows us to be more cognizant. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market

How to Design a Diversified Portfolio? Diversification is one of the most important rules in finance and is a key principle concept that you absolutely need to understand if you want to succeed in the stock market. 1. What exactly is diversification, and why is it important? Diversification essentially means that your investments should look like a pie. Well, what? Your investments should be bifurcated into different asset classes. You must often hear stories about how people buy a house on EMI, years pass by, they continue to pay 25,000 per month, but are still not given possession of the house. This becomes a back breaking problem, since all your money is invested into a single asset class. 100% of your investment goes into the house. It can become a massive problem if something bad happens to it. You should invest across different asset classes, and you should diversify within each asset class as well. This allows you to hedge your risk. 2. What are the major asset classes across which you can invest? There are 5 major asset classes that you can use to diversify your assets. i. Equity Here, you are buying a business i.e. you are buying ownership in a particular company. E.g.- ITC, HUL, Tata Motors. ii. Debt The government and big companies take loans from people. These are called bonds. You are paid a rate of interest on bonds. It is to be noted that, unlike equity, you don’t become the owner of the company or the government when you buy bonds. You are simply loaning out money. iii. Real estate This would be commercial property or rental property. iv. Commodity These would be gold, silver or oil. Physical delivery of commodities can be a problem. For example, if you buy physical gold, storing and handling it can become a challenge. You should try buying these in digital form. Commodities can give you hedging benefits. When the stock market goes down, gold becomes a safe haven for investors and hence its price goes up. In such a scenario, whatever losses you’ve made in stocks can be compensated by the profits you make in the gold market. v. Cryptocurrencies Currently, the crypto market is way smaller compared to the stock market. But if it grows to become like the stock market in the next 30 years, the returns would be dramatically high. Nonetheless, it would be advisable that you don’t invest more than 5-10% of your portfolio into cryptocurrencies. 3. How should you go about designing your investment portfolio? You need to ask yourself a couple of question- What is your age? Second, what is your risk appetite? If you’re young, you should invest your money for growth. Since you have age by your side, you can withstand the dips. If you are slightly older, invest the majority of your money for monthly withdrawals. You should invest in stable assets, as it will bring you a regular income flow. You should superimpose the aforementioned points with your risk appetite. If you’re a risky investor, you can allocate more of your funds to equity and cryptocurrencies. If you are a risk free investor, debt and fixed deposits would make sense. Let us create 2 profiles and try to outline how each person should design their investment portfolio. We will not consider scenarios on extreme ends. If you are an extremely risky investor, you should probably invest all your money into cryptos. On the other hand, if you are extremely risk averse, you should invest in an FD. Person 1: You are in your 20’s and are a balanced investor (Neither too risky, nor risk averse) Equity- 60-70% Debt- 10% (This depends on the market condition. If the market is stable or in a growth phase, keep very little debt. Invest mostly in equities.) Commodities- 10% (Use commodities purely for hedging, in case the stock market tanks.) Crypto- 10% You might wonder why real estate is missing from the list. This is because the real market in India involves a lot of frictional cost, and hence is not a very viable option. Person 2: You are in your late 40’s/early 50’s and are a balanced investor as well. Debt- 40-50% Equity- 30% (Only large, stable blue chip companies.) Commodity- 10-20% Here, the idea is to reduce volatility. Should you invest in cryptocurrencies? Probably not. The market will take a long time to stabilise, and hence you should invest in only stable sources. 4. Key points to remember: i. If you are a risky investor, cryptocurrencies and equity are a great bet. But, always hedge your risks. Either learn about future and options or invest in commodities. ii. Don’t look at your house as an investment. You buy your house to live in it, so do not look at it as an investment in the traditional sense. iii. If you are a risk free investor, invest a little bit of your money in an FD, and in passive mutual funds. Just make monthly SIPs and you will do well. Hopefully, this article has given you clarity on how you can structure your portfolio. If you are a serious investor and are looking for advanced techniques with a focus on better returns, join my Youtube Community where I give live and timely updates on the Stock Market