Guest Post: Money talks

This time around my favorite guest author takes on an all time favorite topic that all of us like to talk about but can do absolutely nothing about : inflation


After hearing about my Idiot’s guide series of blog posts, my wife wanted me to clarify whether it was written by an idiot or whether it was meant for idiots. For some reason, nothing I do impresses my wife any more. You can be a hero to the world, but to your wife you are always the bloke who needs help buttoning his shirt. Right from my banking days, perhaps due to my influence, my wife maintains a book of accounts listing our household expenses. Despite job hops, increments and promotions in between, the sad truth is income continues to lag behind inflation.

inflation002If you are one of those (like me) who counts days to the next paycheck, you are a part of the large & growing ‘Middle Class’. Today only the innocent aspire to be a part of the ‘Upper Class’. These days, even ‘Upper Class’ folks have to work to grow and protect their wealth, they face work-life balance issues and are generally as frustrated as we are. The truly smart folks aspire to be part of the ‘Leisure Class’. The ‘Leisure Class’ folks have so much money that they can blow as much as they want and still leave enough for the next generation. I doubt whether anyone belonging to this class will be commuting to Siruseri, Hinjewadi or Bantala that the rest of us cattle have to commute to for our daily bread!

How fast does your money vanish from your salary account? Does it go into living expenses (food, rent), education, healthcare, entertainment or EMIs? Is it being used to extinguish liabilities (loans) or to build assets (a house or shares)? Every one of us must prepare a funds flow statement that shows our source and use of funds. Knowing where we are is the first step in determining where we want to go.

inflation003Economists talk about something called ‘Velocity of Money’. Simply put, it is the rate at which currency changes hands in an economy. Have you seen the Axis Bank ‘Badhti ka naam zindagi’ ad? When one person spends money, it is income for another. Then the second person spends money and it becomes income for the third and so on. So, the more we spend, the more it is good for the wider economy. However, when do we spend money? We spend money only when we get value for money and we spend money only if we are confident of keeping a job and getting the next month’s pay check in time! How much we spend and how much we save is thus a function of our reading of our career prospects and health of the economy.

If money simply whizzes past our salary account and gets down to very low levels by end of month, it is good for the economy, but not necessarily good for us! Knowing when to spend and when to save is something that all of us have to consciously learn. I wish our Academy coaches the young campus hires how to handle money before they teach Coding and Software Testing. If they do that, they will be doing the youngsters a great deal of good.

I know I have given you some food for thought. do you know that Ashirvad Atta is packed with love & care? You should definitely try out Classmate range of products for your kids. They will love it. Fiama Di Wills is awesome and may be just the beauty treatment that you need. Mangaldeep agarbati is enchanting! Given that you have decided to blow away money, at least buy ITC range of products. I have bought some ITC shares recently and I definitely need you all to buy ITC products for the share price to move up to decent levels. 🙂

PS : As I drop my younger one in school this morning, two boys flee upon seeing her. She grabs the bags from me and takes off after them. Truly, certain moments are priceless. 🙂

14 thoughts on “Guest Post: Money talks

  1. Very nice post 🙂 Loved it all the more for the random mentions of Siruseri, Hinjewadi, Bantala and Academy 🙂
    Btw that Axis Bank Ad, I love… one of the only ads around which truly gives a true picture of how things work.

    • @Seeta, you would be glad to know that this Guest Post was from a person who used to be my ex-manager and still works for the same company as well, hence the mentions of Siruseri, Hinjewadi, Bantala and the Academy 🙂

  2. Value for money is something many of our generation and the next generation are not aware of. And that is exactly the reason for many a failures in life. Our parents didn’t have the luxury of getting home loans, vehicle loans or personal loans and had to borrow money from others to fulfill their basic dreams like a one-bedroom flat or a two-wheeler. But they still succeeded in it and also managed to provide us quality education. Whereas we stumble upon the smallest of disturbances in the family income. Why? Because we ourselves have increased our standard of living for no particular reason and end up spending much more than what is necessary for a decent life. A very thought-provoking post.

    • @Rekha, so true, one of my friends always tells me that expenditure has a way of expanding to accommodate for incomes, when in my opinion it should be the other way around, shouldn’t it 🙂

  3. then looks like I am helping the economy by maintaining least balance in my account by end of the month.. In spite of knowing so much about saving and investment, i am never able to do it.. now it has become a dream to maintain at least 3 months salary in the account . 😛

  4. Love the post. I am bad at savings but m looking for the next job to start saving for a better future..When I was working, the time calendar hits 20th i was in a fix…lol..I tried Fiama Di Willis and totally love it.
    Great post

    • @Vishal, I shall convey the fact that you liked the post to the Guest Author. I am sure he will be happy to know that you like Fiama Di Wills as well 😀

  5. I have read your friend’s previous post as well!
    As a mark of appreciation for this post, I shall be buying a couple of bars of Fiama this evening. I do want your friend’s ITC stock portfolio to do well!

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