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Bonuses are in, people are flush with cash. Would love to hear how you manage your money, investments and taxes.
Just drop your tips and gyan. Or here is a indicative format
PA at xyz
Annual savings:
Pro Investment/Tax Saving methods I use:
[I know the year has been a rainfall year for equity, let's focus on what you have been doing over 2+ years and not just because of the bull run]
Buy your first Omega/Rolex when that A4 Bonus hits
Assuming you're buying a watch instead of just inheriting one.
For the other kids, stop the watch hate. Tissot is nowhere near what Partners should be wearing (if you mean to impress). Of course you can wear what you like, if the goal is not to impress but to enjoy your watch.
Omega is good - get the moonwatch. Others you can think of are: Grand Seiko, IWC and Tudor. If you are rolling in the moolah, may be you can think of AP, Patek, JLC, A. Lange & Sohne, VC and other such pieces.
I'll go back to enjoying my Seiko now.
0.1% are confused
My smartest friend retired recently after putting together 4 cr
But he felt sacrifices to get there were not worth it
One parent expired with whom he could spend only little time. Work got in way of good relationships. He is separated.
He admits he is not overall happy
Would it matter if he reached his milestone 5 or 10 years later?
He may have been better off
Invest in happiness
May be spend 10% of your bonus and put 90% into the following:
Equity - 50% of which large cap 20%, flexi cap 10%, NASDAQ fund 20%. Avoid sectoral/thematic funds.
Debt - 30%. AAA/ SOV only with modified duration < 18 m-24 months
Cash - 10%
Gold - 5%
Bitcoin - 5%
1. Save minimum 30% of your fix monthly payout
2. Investments-
a. MFs (SIP)
b. ELSS (SIP) (Tax saving) (1.5 lacs since PPF pays peanuts as against 14-18% CAGR of ELSS)
c. NPS (50k annually)
d. Health Insurance (1st parents, 2nd your self and 3rd spouse- if applicable) (children in case you have them)
e. Equity (Stocks) since I invest a monthly sum every month. I see it as an EMI
f. Small stacks of cash- 20k-30k each month into FDs (emergency funds)
g. Bonus payouts (50%- invested into stocks, 30%- lumpsum MF, 20%- FD or household yearly maintenance expense)
3. Try and remain debt free. Cash is the king and makes you take financial and life decisions with relative ease.
4. Do not spend more than 1/3rd limit of your credit card. Helps you maintain a healthy credit score for larger financial goals in life.
5. Prefer to live like a poor and stack up your investments which will surprisingly start compounding after 3-5 years.
6. Try not to take EMIs and treat your monthly disciplined investments as EMIs.
7. Barring HRA/ LICs/ Home Loans- lawyers can easily save 2.5lacs/ year with basic investments. DO NOT INVEST ANY LESS. Its your money. Use it wisely and buy peace.
8. Play for next FY on 1st April and not 1st Jan of the next year. Buy mental peace and discipline.
FACT is many people die before reaching that savings milestone. Or are old and tired past their best years by then.
Live a little. It is okay to spend on living a good happy life.
Save 50% of your salary (50k).
Do not spend more than 20% for Rent (20k). 10% for travel (10k). 10% for Food and party (10k). Remaining 10% for utilities, bills, etc.
By the time you become an S.A., you would have saved up at least 30-40 lakhs.
With that kind of money, you should quit, go to Andaman and open a small restaurant. Maybe even travel across South America and settle down someplace nice.
And yes, I think the tech behind crypto has its uses: cryotocurrencies OTOH have no intrinsic value and are not a repository of value. This mania is a classic "greater fool" mania.
The other risks to consider which are India specific:
1. Cryptocurrencies are proposed to be banned by the Government: https://www.prsindia.org/theprsblog/ban-cryptocurrencies-understanding-proposed-legislation
2. If you're a firm lawyer, just ask yourself, why wouldn't the Government ban cryptos? The FEMA checks and balances are bypassed by cryptos and in a country which doesn't allow full capital convertability, it makes no sense to "invest" in cryptos.
If you want to do a YOLO WSB style speculation in cryptos, then atleast understand that it's a YOLO speculation.
And don't tell me how much you've already made: bad decisions don't equate to bad returns in the short term.
Fait currency doesn't need to have underlying value because it is a repository of value by legal fiction. The RBI Governor actually says that he promises to pay the bearer the amount mentioned in the note.
The "whole fuss about value is ignorant gibberish": this is the view of Buffet and Munger as well and other major value investors.
The technology has its uses - they're no denying that. But there is no underlying value of bitcoins or other cryptos.
The defining characteristic of a mania is that no one (or most) cannot predict it or do not believe it's a mania until it's too late. So, any example of MS or GS entering cryptos is a red herring - you would have said, in 2007, that the sub prime mortgage market was safe because "Lehman couldn't be crazy betting on it". Also, let's see when these IBs start prop trades - not selling cryptos to their clients without any fiduciary duty to them.
See I'm all for everyone investing where they want to invest. But this is a YOLO speculation but maybe I'm a conservative investor.
While I believe in crypto, the arguments made here by crypto skeptics are very 2017esque. The ecosystem is much different now. Rather than investing I would ask you to read about crypto projects which have a real life use, some examples just one example is BAT.
Like it is surprising no one has mentioned Defi (decentralised finance) and NFTs in this debate. All NFTs are somehow connected to Ethereum, my understanding is most rely on MATIC, which by the way is an Indian crypto project with USD 4bn+ market cap.
As far as what is the value of crypto is concerned sI would ask people to read about the Proof of Work v Proof of Stake debate, ETH follows Proof of Stake, which basically means if you hold ETH and Stake it with a node for allowing the blockchain to function you get a small portion of the transaction fees from people who use the ethereum blockchain. So as long as there is a use of crypto based products Ethereum has value. Let's not delve into the deflationary pressure created by the recent Eth proposal adoption.
PS: I consider myself to be a complete noob when It comes to crypto, and have only recently started reading about it.
I wonder if the fund had a high water mark fee structure without annual management fees. That would mean that the manager really believes in cryptocurrency on a long term basis. I would also be interested in reading the risks highlighted in thier PPM.
Hi,
My discord is XATG1#4981, in case you want to connect.
I don't know how the Government intends to do this - but this is an interesting development.
The only good decision I made was to not get a gym membership (like everyone in office) because I literally did not have time for much else besides work.
This is not hyperbole.
Sometimes you just have shitty luck and end up in a team that has no chill.
I assume you are already feeling rich with that wfh bank balance ballooning and don't want to part with that excellent bit of compounding that you might have witnessed if you had SIP'd in any of the funds (or lost out on).
As you pack your backs and think about the life in Bombay, here are the key items that save money, while living relatively well (India terms):
On Living Arrangements
Share a 'good' house: Yes, find a good friend and share your room at least for next two years. Compromise with sharing only though. You want to have a fully furnished house (preferably a big hall to host parties and set up a projector), ensure access to good cook/maid is available, as well as decent cafe's around. Anything within 30 mins by road, which is spacious and airy is good - spend time because, contrary to common opinion, such flats exist in Mumbai.
The sharing will ensure that your mental nerves in a gruelling week is calmed by your mates (if non-law, even better) + you save big expenses. You also save money by having a decent home to host friends instead of going out day in and day out - which is this expensive in the city + getting the good cook to prepare the best meals (most of which you might not get to eat).
Living wise, I got lucky to be working in BKC, as Santa Cruz, Vile Parle, Andheri are home to huge flats + easy access to Western Express Highway makes commute to office comfortable [Pro tip: Avoid the roundtrip 300/day fare by getting your own vehicle or car pooling].
Invest in yourself
Good living arrangement of about 20K/m, will cut down almost all your major expenses. Add 10K for ration/electric/data + 6K commute + 6K drinks/group outing budget + 8K fitness (gym/football teams) + 10K clothing/random buying (Netflix etc) . That's 60K/month in toto.
Don't spend more than that (and cut costs in the above where possible - I have given you outer limits. Since I lived in Vile Parle, I was able to cover all of the above in around 35K month), save the rest.
In addition if possible, start putting out 1 lakh as education/networking budget to join relevant clubs, meeting people, networking with strangers. Carve out another 1 lakh for travel and gifting.
You may of course look at the above and see excessive expenditure. That is not the case, you can cut costs on fitness (and not be healthy), networking/education budget (and miss out on growing in life), drinks/outing budget (and miss our on sharing life stories over drunken banter) and travel budget (why are you even earning? Please tell me?)
For people who make less: Do all of the above. Cut the allocation if you earn less. Spend less on travel and use locals/buses, party at home, purchase a fitness kit instead of getting a trainer - but do all of the above. Don't focus on saving everything and loose sight of your life. Take spa breaks, treat yourself, catch a drama at Prithvi or the NCPA.
The beauty of legal profession, and any practice area in legal, whether litigation or corp, if you are able to maintain a clear head, your work will become easier and your chances of sticking around too. You are in any case going to earn in crores down the line in 10 years. Money is going to be the least of your problems.
Hope you are doing well.
Buying a car is rarely a financially sound decision in any city with a good public transport system and / or reasonably priced Ola / Uber. Mumbai has both. It makes even lesser financial sense when you count in the following:
- your client will end up footing the taxi bill 90% of the times (yay working late hours!);
- the insurance and annual maintenance alone will be more than 15K a year and the petrol bill will be north of 30K (a very conservative back of the envelope estimate, assuming a 10km one-way distance and a decent mileage);
- when you buy a car, you also have to get an apartment which has a parking slot, and I don't know about you, but that's not that an easy task in many parts of Mumbai, especially if you want to actually stay 30 minutes from your work place and work in 90% of the firms (so, 30min from Nariman Point, Fort, Ballard Estate, or the shit hole of Lower Parel); and
- in many firms and offices, there isn't enough free parking space and so you have to spend on parking your car each day. That sum can be as high as INR 100 a day!
Buy a car if: (a) you enjoy driving; (b) you see the convenience of owning a car as exceeding the financial imprudence of buying one - this is rarely the case when you start out; or (c) if there is a benefit of staying significantly far away from work (because you stay at home with your parents or it makes sense for your spouse / children, etc.) and in your specific situation a car works out cheaper.
Watch this youtube channel: https://www.youtube.com/c/TwoCentsPBS/videos. While its US centric, it will give you a great deal of food for thought and its easily digestible, which most personal finance forums and websites are not.
It may have been naive on my part to assume many of the A0's of today might already have a ride.