Investing - Chapter 1

Having a home, a great family and earning a regular income is the goal for many. Most believe that getting a better job, a promotion with higher salary will help achieve financial safety. Sure it does help a little, but you get used the money quickly.

Lets take Ram, 23 yrs old and fresh out with a professional degree. He is smart and has a got a job with Rs 20,000 monthly salary. He is young, carefree and likes to have fun even if it means big spending.

At 27, still young, he is earning Rs 50,000/month. In these years, he has switched jobs. His tastes now includes IPhone, Samsung, Citibank, Nike & Toyota. He has some tax saving investments but nothing other than that. He has 4 credit cards which gives him discount from gas to groceries. He has been planning to buy an apartment which will cost Rs 5,000,000 (50 lacs). It looks a like a steep price.

At 29, he is married to Lakshmi. Both work and bring in little more than Rs 100,000/month. They are newly wed and have DINK (Dual Income, No Kids). They have bought an apartment for Rs 7,000,000 (70 lacs) with a 20 year mortgage of Rs 6,500,000 (65 lacs). One of their salary goes in paying for home mortgage and the other is used for home maintenance. They decide have child 4 yrs later, as they would like to reduce their mortgage before having the kid.

At 31, they have a beautiful daughter Arthi. Lakshmi wants to focus more on Arthi, naturally. Her focus on work goes down and they both accepts it. The interest rate on mortgage increases. The rice, wheat & sugar prices have doubled in the last 2 yrs and they are bringing in the same income of around Rs 100,000/month.

At 33, Ram's family expenses for a month is given below.

This is tipping point, the income-expense is in a balance. Any further expense will create major problems. But further expenses are on the way. Baby Arthi is 3 yrs old and they will need send her to school. They want Arthi to go to the best school in the town.

At 35, there is a big recession and Lakshmi looses her job. Its been predicted by economists that in life span of 70 yrs, there will be three recessions and one depression that you will face. Still, Ram holds steady and brings in Rs 75,000/ month. But the expense is more than income and they still have 14 yrs of mortgage to pay.

This is when Ram breaks down. He sells his house unable to pay mortgage. Tensions in the family peak and there are frequent arguments. He fails more often at work. From a star performer he becomes average. His life stagnates. This is called 'Mid Life Crisis', it happens so fast that Ram did not see it coming.

What went wrong here? Ram was bright, handsome and full of energy. How did he get into this hole? We will look at another story of Ashwin in the next blog and compare it.

Family - The Secure Base

What is common with peak performers, great leaders and innovators? "Happy childhood". And what is common with psychopaths, sociopaths and sadists? "Bad childhood". Lets take an example of two people Gandhi and Hitler - the epitome of good and evil.





Gandhi as a child was well cared by his family. He was brought up in a big family and received love and affection. He was very close to his parents. Gandhi owed much of his vast knowledge of religion to his mother Putlibai. The religious teachings of his mother essentially came to influence Gandhi's ideas right from his childhood. It is evident in his philosophy that the old moral and religious beliefs formed the basis for belief in truth and non-violence.


Adolf Hitler was the 4th child of Klara Hitler and Alois Schickelgruber. As a child, Adolf Hitler had a troubled childhood. Alois Hitler, Adolf’s Father, worked as a civil servant and the family lived a middle class existence. Klara, Hitler’s Mother, was unable to defend her children against her husband who was pompous, status proud, strict, humorless, frugal and pedantically punctual. His temper would flare up unpredictably both at home and work. His father left a deep impression of violence on Hitler.


Now lets talk about the science behind this. A newborn child's brain weighs 400 grams. A 5 year old's brain weight about 1000 grams and a full grown brain weighs 1400 grams. This means the baby's learning curve is sharpest in the initial years. A child will  absorb emotions and imitate them from birth. Children are very vulnerable to the surroundings. Parents act as a natural shield protecting them. When parents are not available or ignore to protect and nurture them, serious damage is done to the child's mental abilities. This means the child will grow with emotional imbalance, leading a turbulent life.


Question: Why didn't Hitler's siblings become a tyrant or why didn't Gandhi's siblings become a great soul? I leave it to the readers to answer.

What we stand for and why we exist?

One day, I saw a squirrel eating apple. I realized that the apple tree exists for providing fruit and shelter to others. Squirrel exists for dispersing the seeds and thereby creating more trees. And finally the earth exists for providing enough for all.

Then I asked myself "What I stand for and why I exist?". I could not find an answer. I was better a squirrel with a purpose than a human being without any. I could not believe that I had lived half my life without any real purpose. I was just surviving, not living.

Months passed by, I still had no answer. One rainy evening, I saw a small bird hopping. It was not able to fly. In the past I have ignored these situation. I would turn other side because it was not my problem. But this time it was different. I realized that my purpose of life then was to nurse that bird. I took the bird, it was a little one which has been trying to fly high. It was raining and hence the young wet wings was not able to flap.

I dried its wings and held it near a fan. In a few minutes, the little one soared again in the sky. I was very happy and satisfied. I found the purpose in life then. I wrote down,

My purpose in life is to serve.

When you chase things they run away

It was Jan 2003. I was doing my final semester. I was getting nervous about job after college. I could speak a little bit of English and did not find any other skill that will get me a job. The first company to come to our college was a Call Center company. Even though I did want to be a calling agent, I attended the interview. During the discussion the interviewer said I was looking desperate. I did not understand what he meant then & was rejected.

Later realized that the I was my problem. I wanted a job badly which was causing trouble. One of my friend came to me and asked "What will happen if you don't get a job while in college? You will definitely get one later. But if you feel this way, you might never get one!" It was then I decided to do my part and not think about the outcome.

The moment you get too attached to things, people, money, your job you invariably screw it up! The challenge of life is to appreciate everything and attach yourself to nothing. When you chase things too hard they run away. Did you ever need to sell something, desperately? A car, a house, who wanted it? Nobody! So you dropped the price. Who cared? Nobody! The principle? When you are desperate, nothing happens!

Desperation pulls you into a descending spiral – and the more your worry, the less people you attract! Detachment is major reason rich people get richer. They do not care so much, they are not desperate.

On the mental and physical level, we are dealing with natural laws. Nature does not understand desperation! Nature seeks balance and you cannot be desperate and balanced. Life does not have to be an endless struggle. Let things flow. It is not indifference, it is neither forcing things.


Finally, I had 2 excellent jobs to choose. More importantly I realized, life is like a butterfly which will sit on your shoulders if you don't run for it.