Friday, March 28, 2014

78 ways to reduce or stay away from debt

  1. Exercise daily. Medication cost rises at about 15-18 % per annum.
  2. Stay away from tobacco and cigarette. It not only harms your current health but would also cost you more for term insurance. Already into it? Reduce by half then by another half and finally nil. Do not rush, you would lose motivation. Do not stop.
  3. Reduce alcohol consumption. We all know how much a bottle can burn hole in pocket.
  4. Do not buy credit cards.
  5. Already bought credit cards? Answer: Cut it into 4 pieces.
  6. Identify your wants and needs. Read here. Focus on needs.
  7. In your browser, from favorite’s bar, delete book marked shopping site.
  8. Do not spend spontaneously. Think, think, think, spend.
  9. Going for a walk in mall, without any specific need for ‘needed’ items? Forget credit cards, debit cards at home.
  10. Better do not carry wallet.
  11. Stop eating pastries when feeling depressed. That aggregates the problem.
  12. Buy house as big as your needs; not as big as your banker suggests.
  13. City travel in traffic? Dump that Skoda. Go for smaller cars. It saves fuel, money, time and hustle.
  14. Check the tyre pressure in your car regularly. It affects the mileage.
  15. When moving from one room to another in house, switch off the light and fans.
  16. Branded clothes are good to have only if it fits the budget.
  17. By the way, do you have budget? If not, move this item to #2.
  18. Update your bank account passbook regularly. Check if they have cut any amount unnecessarily. Follow up, get it rectified.
  19. Before buying any financial product, do the math.
  20. Upgrading/changing car every 5 years is good……….. but for bank.
  21. Upgrading/changing house every 5 years is good……….. but for bank.
  22. Some communities have a meet twice a year. There they share and exchange clothes, books, gadgets, furniture, etc. Visit them (find out if your community does that).
  23. A Rs.2 pen writes similar to Parker or Pierre Cardin.
  24. Timex shows you the same time as Swatch or Rolex or Omega. May be X company is less accurate in millisecond but hey, do we all work in NASA?
  25. Your laptop’s memory is inadequate? Going for new lappy? How about buying USB HDD and storing the date from lappy to HDD.
  26. Stay away from endowment plans.
  27. Do not mix insurance and investment. Both the things are sub-optimal in such combined plans.
  28. Vacations are good if they were planned and was part of short term goal.
  29. Vacation on Credit Cards? Disaster.
  30. Stop using CC for the sake of points generated in every trade.
  31. Stop subscriptions to magazines that you do not read.
  32. Stop subscriptions to newsletter from business houses if you do not implement what they preach.
  33. Stop eating out twice a week. Once in a month is OK.
  34. Stop keeping up with Jonasses (Is spelling or the surname important in this line?).
  35. If office is 10 mins walking distance from nearest station, why go by cab? Walk. It makes you healthy as well.
  36. If your workplace is connected by public transport system, do you need own vehicle to commute?
  37. Furniture is not shining as bright as when you bought it? Going for replacement? How about little polishing.
  38. Lending money to friends is a noble act but not when you are living paycheck to paycheck or worse paycheck to CC.
  39. Do not convert CC debt into long term equity home loan.
  40. It is absolutely NOT (repeat NOT 3 times) necessary to own every single latest gadget available in the market.
  41. Do not buy 5 pair of jeans because you went in a SALE.
  42. If you are not serious about excising do not renew gym membership.
  43. If you are not into professional body building, you do not need personal physical trainer.
  44. Stop buying a new dress because all your friends are buying. You do not know their wealth.
  45. Family of 4? Two adults and 2 kids? Why 2 cars: 1 for office and 1 for picnics !!
  46. Flying to parent’s/relative’s/friend’s place? Do you need business class?
  47. Don’t throw away our existing usable clothes just because they are old.
  48. What is the point in buying gold plated wrist watch on CC?
  49. Buying a new cricket bat? Your local store has used accessories for half the price. Stop searching only on internet.
  50. Buying new motorcycle gear because Schumacher recommended? Please compare income first.
  51. Stop sticking to low paying jobs because you are lazy to upload resume on portals and study for interviews.
  52. More high speed motorcycle, more is the fuel needed. Good to remember.
  53. Do not simply buy stocks on tips. Do your research after getting tips and then decide.
  54. Planning lavish marriage? Think again. Money goes down the drain. Invest that money for your happiness.
  55. Enrolling your child  with the school in which your neighbor did? Her husband is in 30% tax bracket, how about you?
  56. Remember: if any deal is too good to be true, it is indeed not true.
  57. Not knowing about taxation can cut your take home by good 5%.
  58. Subscribing to a gym or club house where you favorite football star or bollywood star comes is foolishness. Your income is equal to what he spends on his shoes.
  59. Learn to say NO. A close relative may simply offer you the worst investment product on this earth. Say No. Firmly. It helps. The relation may go sour but your cash pattern is not hampered. By saying no, you got another lifeline. Pat on your back.
  60. All airlines do not offer same fares. Compare. Some may offer discount on CC usage. Stay away from them, you never know when that ‘pattern’ may hurt you.
  61. Do you need cricket gloves and pads for playing with tennis ball? Some do.
  62. Stock broker’s business is to generate brokerage. Know it well. You can surely do intraday trading or swing trading. But remember to cut brokerages from profit and then decide.
  63. Do not trade on margin if you do not know what trading is.
  64. Aware of swing trades? If no, do not jump to F&O.
  65. Do not buy cheap quality footwear if you job is to stand and deliver or even field work. The cost incurred on your foot hurt is way beyond your footwear costs.
  66. Bought costliest trekking shoes? Good. Trekking is healthy hobby. But hey, you trek only once in 1-2 years? Give up that shit hobby now.
  67. Watchmaker’s add: our watch can sustain extreme water pressure. You can even go to Atlantic ocean’s middle deep there. You buy!!! Why? Do you even intend to go deep in Alibaug beach? Won’t a timex or titan watch with 100m water resistant property be good enough for perspiration and occasional hand wash?
  68. Somebody lures you into holiday packages saying you pay X amount today and get to enjoy staying in 5 star hotel at 50% discounted rates. Question: do you intend to stay in 5 star hotel on a picnic and enjoy pool / gym or rather go country side, have a tent, cook food and have fun? Your call.
  69. Remember Robert Kiyosaki’s line: Bankers do not lie. They just do not tell you the complete truth. They say – house is an asset. The complete truth is yes, the house is an asset but for bank. Do not trust them blindly.
  70. If banker says – “sir, this product is available only till tomorrow. You need to hurry.” By all means, hurry but not to get the product. Hurry to run away from that banker. 95% of the times, with above line, he would sell you the most pathetic product from their furnace.
  71. Do not ignore the problem. Accept it and the think on solution. If you are in debt, accept it. Think how to get out of it and then work on it.
  72. Installing low power consuming electronic items in house may prove costly at first time. But the meter bill would thank you.
  73. Do no overspend on your child’s marriage. This is sure shot formula for avoiding debt, especially for Indian parents. Your child’s marriage is not your business, your retirement is.
  74. Be aware of your sexual urge. No, do not get wrong. This line is in financial context. If a smart, sexy, hot girl/lady comes from XYZ company and explains you the product. You are ready to buy. Know exactly why are you buying it. You liked the product or you could not say NO to that girl.
  75. Another Robert Kiyosaki’s line: beware of advice that you are getting and from whom you are getting that. A person accumulating money in SB account advising you why X company’s stock can give 50% returns is risky.
  76. Remember Ashal’s line: Amputing a finger today is better than amputing an arm tomorrow. Get rid of all your bad products from your portfolio.
  77. Plunging into a business without a plan is accumulating more debt.
  78. By the way, plunging into a business with plan but without sufficient cash to fall back on is just another recipe for debt collection.


Monday, March 24, 2014

Working women

Last week I read a post on marriage by Subramoney.

Well, it was really touching story of a working women. I mean, paying hefty EMI for a house which is not even on your name is too much. Especially, when you are newlywed and living  in a joint family. If you top it up with harassing in-laws…… you get a hell on earth. No need to die.

There are innumerable examples of men suffering from marriage too. Like 1 reader said that a man sponsored his wife’s higher education. Now I think, this is little incorrect comparison. I guess paying an EMI on a house not in your name and living along with your in-laws (may be harassing too) simply cannot be considered or compared with paying for higher education. If you say so, what is the point in propagating women education.
I know a case where husband asked for hospitalization charges from his in-laws for treatment of his wife. Inhuman, simply inhuman. Is this what we call a marriage? Live-in is then really better than such marriages. At least there are not any huge expectations.
What has happened to today’s men? They are not ready to marry without dowry!! Wife seems to be your competitor. Wife getting more paycheck is taboo. Wife should not wear jeans. Too much.
I do not think, a women will ever ask for her husband’s treatment from his parents. Women are not so narrow minded. Be assured that this case is not a one of the case. I personally know a man who wants his annual rating in his company better than his wife. Are you a kid? What has rating got to do with marriage? Would this rating matter in your 25 years of marriage?

Haven’t we all read a recent story in media about a man asking for divorce citing a reason: wife wearing trouser and shirt and going to tours on office work. Now, there may be other side of story which media has not highlighted to sensationalize the case. We never know.
Apart from this, what about below things that women has to bear, co-operate and not complain:
 
  • Give birth to your child. You cannot do that. Period.
  • There are pre and post maternity complications that a women has to undergo.
  • Cook for you and your family.
  • Simply stop talking to your friend (male friend, off-course) just because hubby does not like him.
  • Husbands ask for complete share in women’s paycheck. As if her parents have tree giving money instead of leaves.
  • Multi-tasking: grow up a child, work in office, do chores at home and manage husband and his moods.
  • Physical abuse by husband.
  • Physical abuse by in-laws.
  • I know a girl from close distance who pays for a car loan of her brother-in-law. Surprise: her brother is in college (PG).
  • Lady migrating from one city to another city leaving behind her own house, friends, sweet-sour memories and off-course her parents.
 
I could think of few more however, 10 are good enough to drive home a point, right?
 
As always, every coin has 2 sides. So, there are husbands suffering from never ending shopping sprees of wives, wife blowing all the money in cosmetics, wife not cooking at home at all, extra marital affairs, so on and so forth. However, the number of instances or ratio could be heavily tilted towards women sufferings.
 
So all the real men, after reading this, please, while going home buy your wife a sweet little rose bouquet. By the way, I would not buy that bouquet. Last time I went there on her birthday, it made my wallet lighter by 250 rupees. Too much costly hain yaar.
 


Thursday, March 20, 2014

New Investor?

Many times on personal finance forums,  I see that people ask: I am new to investments. Please suggest which MF should I invest into. People like me list few MFs from different categories like Large or Mid cap. Some noble souls like Ashal probe them on their goals, time frame, quantum of money. He asks few questions to get clear idea and then suggest them the strategy. Some people give answers to his questions while some get rude to him for asking questions. To me being rude is destructive behaviour. Imagine we going to a doctor for cure on a particular problem. Dr. asks us various questions to know what problems we face and what other symptoms may be. By the answers given, Dr. comes to the conclusion of the disease. Now, if we do not give answers to his question, can Dr. diagnose problem?


Photo credit: Flickr - Kevin Meredith


This post is for all those people who are new investors and eager to get going.
Let us start from the beginning:
  • First thing first: Insurance.
Before you jump to random amount for insurance, wait. Know the difference between term plan and rest other plans. Understand why term plan suits you or why it does not. Calculate your yearly expenses. Multiply that amount by 15 (thumb rule, sorry). You get a figure ‘X’ amount. Now add all your debt to this X amount. You can add anything and everything. But primarily add house and car loan.
Personal loan, unaccounted loan, loan from relatives, credit card outstanding, blah blah blah.. all can (should) be added to that X. Now you get another number ‘Y’. Round that figure to nearest value on higher side, example: if the figure is 78 lakhs, make it as 80 lakhs or 1 crore. This is the insurance amount you need. If you can afford endowment plan’s premium for such huge amount, great. If not, go for online term plans. Again, people ask: Can I buy a term plan which gives my money back at the end of tenure? Answer: yes, you can. However, compare premium amount for basic term plan and such money back term plans. My take: Why complicate things. Keep it simple. Besides, if I calculate average term plan amount, it comes to around 1.75 lakhs (7k*25 years). Now, if you get this 1.75 lakhs after 25 years, would it matter, especially if you pay higher premium for that, today. 7k was the premium for non-smoker male. Money back term plan can cost around 14k per year. Your take.
  • Now that you are sufficiently insured think on emergency funds.
I wrote a small post of emergency funds. Read it here. Initially, I thought it may help some people. However, I got some funny response. Read them too: here. My take: Build emergency fund first and then venture for investment. There is no other better option.
  • Now, analyse how much monthly amount you have for investment.
Redo budget (it is easy to tell you do budgeting but hard to do it, got clue? :( ). Cut down on unnecessary expenses if need be (ha ha ha). Get that figure for monthly investment.
  • Now, decide your equity to debt ratio. Simple? Hell, no.
This is really difficult. The ratio is calculated on the below aspects:
  • Short term goals: More the short term goals, less is the equity component.
  • Your age: More is your age, less is your equity percentage. Note: at every age you would need equity, just the ratio would vary.
  • How much is your loan amount: More the loans, more should be your debt allocation. This can be little tricky. More loans means more money is exhausted in EMIs. So you need more money for long term goals. For that you need to be in equity. However, equity means volatility. It needs good amount of patience and heart to see yourself in huge debts and your investment going down by 50%. If you have patience and heart, this point can be ignored.
  • Risk appetite: Even if you do not have any loan and still cannot withstand market volatility, you should increase your debt allocation.
Once you get the figure, invest some time to understand what investment instruments are there for debt and equity investments. But if you are going to take months to study, start 2 small SIPs. 1 SIP in bank RD and other in large cap equity MF or balanced MF. The SIP amount will vary on the debt to equity allocation ratio.
Once your are done with your homework on debt and equity allocation, just go for it. Start full fledge investments. Some are not comfortable with SIP and can follow manual transactions. Read more here.

Then we have 2 approach. And none of them is right or wrong.
First: Earmark each MF or RD with goal and invest; example: MF from X AMC is for daughter’s marriage after 17 years.
Second: Invest as much as you can in 3-4 MFs or FDs/RDs. As and when you need money, redeem. As and when you got money, invest. Remember about short term capital gains and exit loads. Preferably, do not redeem from MFs before 10-12 years. This gives your money sufficient time to grow.
  • Add PPF account in your portfolio.
This should be part of debt allocation. PPF is suggested not because it is good or great. Reason: it is highly illiquid in nature. You cannot remove money before 7th year. If you forget the just written line, you remove money in 16th year. So you get huge compounding advantage. Read more about PPF here.

  • Direct Equity:
If you are ready to learn more, read about PE ratio, market sentiments, profit statements or annual reports of company plunge into direct equity. Go slowly and start with small amounts. If you are not ready to learn here, do not worry. 3-4 MFs for 15 -20 years would be sufficient for your retirement too.
  • Read about family health insurance.
Take family floater plans. Nothing specific here. This segment is not very complicated and details are easily available. All players are same. All have cap on room rents, non inclusion of some medicines or creams and such funny exclusions. Can’t help here.
Many people are so concerned about tax saving in 80C that they buy ULIPs or NSC at eleventh hour. Remember, you can avail MF with tax benefit too. You have 1 lakh cap on 80C. In this, your PPF, insurance, PF, MFs all are covered. You do not need ULIP for tax saving.
Note: I am not saying ULIPs are bad. I am saying do not buy ULIPs just for tax saving. If you understand its functioning and happy over it, go. Personally, I do not understand much in it and hence I prefer to stay away.
Next question that investors face is: Should I continue my LIC policies? Answer: no direct answer available. Remember why you took it. Is your insurance need covered? If yes continue. If no, calculate if its returns excite you. If still no, surrender. If yes, continue. Read why I surrendered my LIC policies here.
Remember Subra’s advice: if you have all the basic products (like index fund, 3-4 good MFs, term plans, health insurance), you just need to say NO to most investment advisors. He tells us that if we do not understand any product and if RM is pushing you for it, ask questions till you understand completely. Read how I used his advice here.
Finally, if you do not want to go through all these learning, pay someone to do it for you. There are financial planners who can do it for you. But selecting them is another task. If you planner says any of the below things, he is obviously to be left alone:
  • Sir, I am CFP certified and hence I am the best.
  • ULIPs suit you more than endowment plans (or vice versa). Term plans are waste of money.
  • I can manage your MFs effectively. Even if it does not perform for single year, I switch it to some other MFs and give you the best returns.
  • Equity will give you 58% returns in next 3 years.
  • Long term MFs are for 3 years.
  • Lock in for tax saving MFs is for 3 years, now since the lock in period is completed, we need to redeem and invest somewhere.
There could be many but above are sufficient indicators. Read Pattu' latest post here.
FPs should be like Ashal. He will ask you uncomfortable questions and expect honest answers. He forces us to do the homework. This enables us to think and learn. This is priceless. I do not know if he does consultancy but you can connect and ask.
Note: I do not stand to gain anything from Ashal if you connect with him. You can approach any other CFP as well. I just admire Ashal for being such a knowledge database and still being very humble, helpful and noble soul.
Additional points:
Visit Pattu blog.
Read books like JagoInvstor
Visit Jagoinvester site and read as many articles as you can.
Read about creating a will.
Read what is Nike’s slogan.
Huffff … too much for new investor…….
P.S. 1: Above are the ideal steps to be followed. I did not follow them when I started but I want new investors to proceed in proper steps. Again, as usual, your choice.
P.S. 2: Waiting for Ashal’s comment. I hope my post does not qualify to be a financial porn post.

Check out the Part 2 here


Friday, March 14, 2014

Why did I surrender my LIC policies?

Many of my friends ask me why do I hate LIC policy. I am tired of explaining to them that I have never written anywhere that I hate LIC. When I ask them where did they find any such thing written by me, they say that they concluded this because I surrendered my LIC policies.
 
I surrendered my LIC policies because of my personal reasons. However, that does not mean that they are bad or good. It just did not suit my requirements. That is it. If tomorrow I stop my bank RD, would that mean that I am criticizing RD? Absolutely not.
 
So let me list down few points why I surrendered my LIC policies:
 
  1. I bought them for wrong reasons.
  2. I assumed it would give me 9-10% returns. This assumption was based on some charts which were not at all authentic. The charts assumed that I was in 30% bracket and would save my tax by that much amount. This saved amount was then added in my returns section. The bonus was also on some assumption. So there you go: too many assumptions and that too wrong.
  3. I thought 10k per month (Jeevan Tarang) was cool amount to get after my retirement. I did not think that if today my expenses are 20k, I need to extrapolate that amount by inflation, 25 years forward. With that amount calculated, 10k was miniscule. For 10k, 25 years later, I was wasting 20k today. Stupidity? Yes.
  4. I assumed that 5 lakhs was sufficient insurance amount for me. This assumption was shattered when I took 45 lakhs loan.
  5. To save tax. Funny? Yes, because when I bought them, my income was not taxable at all. Now, with 45 lakhs loan, PF, PPF my 80C is full.
  6. After paying EMI and LIC premium, I had practically no money left.
  7. I forgot that ‘I’ in LIC meant insurance and not investment
  8. I needed cash flow in my life.
 
All above reason are sufficient to clear for once and all that I never blamed or criticized LIC. I blame myself for my wrong assumptions. Damage was already done. What could be next  step? I was wondering. Then I came across Ashal’s one liner: Is it better to ampute a finger today or an arm tomorrow? I took my decision.
 
LIC policies are good for those people who are comfortable with paying premium for insurance amount needed by them. It installs discipline as you have to pay premiums or else the policy expires or gets paid up. Moreover, it has 96% of claim settlement ratio (the highest). By the way, can claim settlement ratio of endowment plan be compared with term plan? … matter for some other post…. Probably…….
 


Wednesday, March 12, 2014

The four suspects -- Part 2/2


On listening Mr.Deshmukh's cry, somebody from neighborhood called for police. They told the police all the details except for the reason of the meeting. Police recorded the statements and photographed the body. The murder weapon was a knife.

The finger prints were collected and sent for forensic lab. Police confiscated passport of all the four people. The media as usual was crazy over this case. People were sad because a philanthropist was killed. Media and people suspected Mr.Deshmukh to be the killer as he was with Mr.Kapoor till he was murdered. Unfortunately, for the killer, the area came
under ACP Gokhale. Media ran a re-cap of the case that the ACP had recently solved - the couple story.

ACP ordered a background check on all the five people. As a part of routine for ACP, he conducted a thorough medical checkup of suspects. He took opinion from leading psychiatrist on their state of mind as well. ACP knew that fignerprints could not be of much use as the killer was amongst the 4 people and everybody's prints would be all around. Knife was wiped off after the work. Everyone had a strong alibi, except Mr.Deshmukh.
 
However, after the incident, Mr.Deshmukh was under mental trauma and had to be admitted. Doctors told ACP that he was really shocked by the murder and chances of he being the killer could be almost zero. Soon ACP found the real business of all these people and the four were in jail. He also found that each one of the four suspects had no reason to kill Mr.Kapoor. On interrogation each one of them told their story and vehemently denied killing him.

ACP checked the medical reports. However, medical reports confirmed the story told by four suspects. Mr.Mehta had indeed consumed much alcohol and could have passed out. Mr.Desai's stomach could be upset because of acidity. Mr.Shah's car had marks of forced entry which sent off the alarms. This brought the needle back to Mr.Deshmukh. However, his health deteriorated and he had to be shifted to ICU.

Background check of Mr.Mehta revealed that he was avid drinker and could not have passed out due to the amount of alcohol recovered from his body. So Mr.Mehta was on ACP's radar as he could fake himself as passing out and murder Mr.Kapoor.
Mr.Shah was at his car to close the alarm, so he was not supposed to be suspected. Mr.Desai could kill, inspite of his stomach upset. And Mr.Deshmukh was the main suspect and he could do anything. The knife belonged to Mr.Deshmukh. ACP reasoned that why would a man bring a knife from his own house, be with the victim alone, murder him and still be with the dead body and become prime suspect. So Mr.Deshmukh was out from ACP's radar.

Mr.Mehta's blood sample indicated traces of chemical known to make a man unconscious. So it was clear that his drink was spiked and he too found his way out of ACP's radar.
Now, ACP had to zero in on Mr.Desai and Mr.Shah. ACP found that Mr.Desai had loaned Mr.Kapoor a huge sum of money out of his own savings. So Mr.Desai killing him could mean his own loss and he was not that fool who would loose such a quantum of money by killing the person himself.This zeroed on Mr.Shah. ACP went back to the crime scene to see if any evidence or any link could be found. But no, nothing more was to be found. While leaving Mr.Kapoor's house, ACP saw ATM opposite his house. ATM means guard and guard meant possibility of witness. However, the guard was typical guard and he had slept all the night. Since, the area belonged to rich people, hardly anybody came to withdraw money at night. So he had a good night sleep.

Fortunately, the CCTV of the ATM was working and that nailed the murderer. The CCTV clearly showed Mr.Shah tampering with his own car lock to show that the forced entry triggered alarm. Once the video was with ACP, confession came as smooth as cake walk.

The trouble between Mr.Shah and Mr.Kapoor started some 2 months back. Mr.Shah demanded larger share from profit as he felt that the business existed because of his contacts. However, Mr.Kapoor rejected his claim saying each and every person played important role and no person was above the team. Mr.Shah thought that since Mr.Kapoor only managed the business, he was no longer required as the business would still continue as before without Mr.Kapoor. This would also mean profit getting divided between four people instead of five people.

Mr.Shah brought an remote controlled music system and installed in his car. The speakers were installed in the boot space of the car. The music was similar to the anti-theft devices. The boot was not locked which would enable larger sound. Mr.Shah triggered the sound of music from remote control when he was drinking with Mr.Kapoor and Mr.Deshmukh. Mr.Shah told everyone that his anti-theft alarm was set off and he need to go and inspect the car. While going to the car area, he switched the DP of mains (electricity) to off position. He went outside and tampered with his car to show that his car was really attacked by theives. In the mean time, Mr.Kapoor called Mr.Shah and told him to look at the fuse box. Mr.Shah came into darkness and murdered Mr.Kapoor with Mr.Deshmukh's knife.

It was no coincidence that Mr.Deshmukh was the last person to be seen with Mr.Kapoor. Earlier, Mr.Shah had spiked drinks of Mr.Mehta and Mr.Desai with different chemicals that triggered passing out and stomach upset. Now, the stage was set. For police, the picture would be like everyone except Mr.Deshmukh, everybody was away when the murder took place. Moreover, Mr.Shah used Mr.Deshmukh's knife to make killing evidence. Eliminating Mr.Deshmukh meant increase in the profit share. The bank would continue to loan the money (if required) as the loan officer was corrupt man.
Everything would have worked, had that CCTV not captured Mr.Shah tampering his car.

Mr.Shah was booked for murder and rest three were booked for smuggling and money laundering.

ACP Gokhale was upset that the city lost an extremely talented CA to greed. He wondered, if a gold medalist too commit such a crime for paltry profit share.


Monday, March 10, 2014

The four suspects -- Part 1/2

Disclaimer: If the names of the characters mentioned, matches with anybody, treat it as pure co-incidence. To re-iterate, all the names and the people/places mentioned are purely fictional and bear no resemblance with any person living, dead or to be born in future.....

Mr.Kapoor is the city's well known businessman and philanthropist. People remember the 50 lakhs donation that he gave for the municipal hospital. A new section for skin replacement was opened up in the hospital. Many people who got burns, would be treated here. Two years back he started a school for the people at very competitive rates with world class facilities.

People praise him for the gym and outdoor gaming zone that he built. His image amongst people was of a businessman with ethics and clear conscience. He was in construction business and had built many residential complex in the city. He also had chain of restaurants.

Mr.Kapoor stayed in a 4 Bhk bungalow in city's quite area. The area has small bunglows all over and only rich and affluent stay there. Everybody in the area minded their own business and so did Mr.Kapoor. Except few hi-hellos, people rarely talked with each other.

One fine day, Mr.Kapoor invited 4 of his business partners to his house for dinner. Incidentally, his family had been to his in-laws place and he was alone at home. Such invitations were common in the area. Often deals worth millions were closed on such dinners. Mr.Kapoor was soon to learn that this dinner was not one of the regular dinner parties.

The four people were at Mr.Kapoor's residence at sharp 8pm. These four people were equally famous as Mr.Kapoor.

Mr.Deshmukh was head HR of a leading private bank. He single handedly pulled that bank from oblivion to new fame and glory.
Mr.Shah was CA and an independant practitioner. His clientale belonged to most rich and powerful people in the city.
Mr.Desai owned half of the godowns that existed in the city.
Mr. Mehta was owner of city's leading transport system. 90% of the trucks running on road belonged to him.

After dinner, all five of them sat at Mr.Kapoors private bar at terrace of the bunglow and were enjoying whiskey. They had met today to discuss and finalize when to bring the next consignment of gold in the city.

All the men, in cover of their education and business, ran another business of illegal gold import. Mr.Deshmukh arranged money for buying gold by faking loan applications. Since the gold was in great demand, he always paid back the principle and interest to his own bank through different names and channels. This generated business to bank and hence the board of directors of the bank chose not to ask Mr.Deshmukh who these guys were and why was their loan sanctioned without procedures. Many noticed that the bank loan officer had upgraded his car from alto to skoda in few months.

Mr.Shah used his contacts to sell gold to traders and jewellers without any legal formalities. He also arranged to sell the gold not only in city but outside the state as well.
Mr.Desai's godowns were used for storing grains and vegetables. However, the workers never saw that below the grains and vegetables, there were gold bars and coins.
Mr. Mehta handled all the logistics and transport through his own company.
The entire operation was managed and planned by Mr.Kapoor.

Each day they grew bigger and stronger. They expanded their trade rapidly. However, with every passing day their ego too had grown and each one of them thought that he was the main link and without him the entire business would collapse. Mr.Kapoor knew that each link was crucial and he had kept them all together and did his job well. He was planning to do this for more 5 years. In these 5 years he was planning to accumulate enought wealth and retire. Hence, today's meeting was called by Mr.Kapoor to soothe each and every ego and plan for future action.

However, nothing went as per the plan. Mr.Mehta gulped down more whiskey than he could sustain and passed out. Mr. Desai's stomach suddenly gave up and he had to run to toilet after every 5 minutes. The other three had no option but to talk everything except business.

Suddenly, Mr.Shah's car siren went off indicating some unauthorised entry. Mr.Shah had to run outside for his car.

Electricty went off at next instance. Mr.Kapoor called Mr.Shah and told him to check the fuse while coming. It took 10 minutes for Mr.Shah to locate and trip the fuse back to its position. As soon as the lights glowed, Mr.Deshmukh cried for help. Listening to his cry, Mr.Shah and Mr.Desai ran towards terrace bar. On reaching there, they became cold as ice. They saw Mr.Kapoor in pool of blood and Mr.Deshmukh just 2 feet away with a frightened look. 




Thursday, March 6, 2014

Unbelievable Holiday packages

Two weeks back, I had been to the supermarket near my house for grocery. At the entry, some young guy asked me to fill the form by giving my name and phone number and win a chance to win great holiday package. Partially, out of irritation and out of greed to win, I gave my details.

Next day, I got a call from that company saying that my coupon was selected in lucky draw. All I had to do was go to their office, listen to their presentation for 30 minutes and claim my gift. Condition was to come in couples only. Incidentally, my wife and myself both were free on that day and we went to their office. This company being really well known and 5 minutes walking distance from my home made us to decide quickly.

There we were told that the company representative would give presentation on their holiday packages for 30 minutes as decided. After that we can leave.

The presentation was really nice. He showed us beautiful hotels and cottages with which they had tie-ups. The hotel had nice swimming pool, clubs, bars, gyms, tennis courts, etc.. we were impressed. Then he told us that they offer membership plans for 1.5 lakhs. In this, our stay in these hotels would be free. That too for next 25 years. He showed us that 7 days/year would mean 7*25 i.e. 175 days. Hence, for 1.5 lakhs membership, this would mean 858 per day and that too in 5* hotel.

At point blank range and without palak jhapkao, my wife asked him - whats the catch. He recovered very quickly from the hit and told us that there was no catch. However, we were simply to pay 4700 per year to renew our membership. He showed us the calculation:
4700*25 = 117500
Total = 150000+117500 = 267500
Hence, per day would be 267500/175 = 1528 per day
He told us that these days, staying in 5* hotel would costs us around 5000 per day. We were lucky to get it in 1528 per day.

My wife shooted another question. She asked him why would I visit kerala, goa, lonavla or any other place and swim in their pool or play tennis or do exercises when I am on picnic. I had to control my laughter. The guy was really speechless.

My wife harassed him more by another question - if we happen to skip picnic in a particular year due to work or any personal issue, do we still have to pay the 4700? He replied yes. So my wife said, in that case won't the denomination in the calculation go down and the overall per day cost go up?

The last nail on coffin was from my side. Even if the stay is free, don't you think food expenses in 5* hotel would be costlier to middle class person like me.

He gave us crockery set as a gift after 4 days. Not bad. From the 30 minutes, I got: crockery set, got to see interesting place and conversation (it was for the first time that i visited 5* hotel) and matter for another post in my blog :)

Thank God my wife did not tell him that last time we went for holiday, we stayed in my company's holiday home. I love my wife... especially when she saves money :P


Monday, March 3, 2014

Presentation Skills

After being in corporate world for 5 years, I know for sure that being presentable and presentation skills are of utmost importance.

This is not limited to power point presentation. Presentation skills cover presenting yourself to your team mates, manager, client. It also involves presenting your documents, plans, review comments to the audience.

I learned its importance the hard way :(

Imagine, I was presenting one document to client on projector. This document was prepared jointly by my colleague and myself. Both the parts were independent of each other and we had to present them individually (however, in a single document). Booom.... somehow my colleague was absent on the presentation day and I was supposed to present the entire document. Although, I could explain the contents of my friend, QA session for his section was almost Greek to me. To top it, I was sitting like a potato on the chair and delivering my contents.

I learned 2 things from this episode:
  • You have to be sure in and out of each section of the document that you are presenting
  • You simply cannot give presentation sitting at one place. That was so monotonous and stupid of me
Following are few things which I then eventually learned about presentation. I hope these things help each one of us to be better at presentation

  1. Always make sure you dress as per the occasion. Casuals on Friday on usual day is perfect. However, casuals on Friday when there would be demo or client meeting would be inappropriate. At max, you can wear business casuals like cotton trousers, half shirts, collar tshirts, etc.. Sandals would be strict no in such meetings.
  2. At client location, dress as the clients would do. When in Rome, do as the Romans do.
  3. Be 100% acquainted with the contents of material you would be presenting.
  4. Try to know the rooms, projector and mic arrangements before hand. This would save time and last minute embarrassment
  5. I have to improve on my standing position. I do not stand erect. I tend to shift my weight from one leg to another and back to the first one. Avoid this.
  6. Knowing level of understanding of audience is also good practice. Example: Senior managers would hardly be interested in technical architecture and technical know hows. They are more interested in solution being found.
  7. Ignore designations while presentations. You are presenting and so you are the expert.
  8. Few body language disasters: holding too many things in your hand (like pen, marker, duster, book, laser, etc) and do circus with them. Do not touch belt, nose, hairs, lips unnecessarily.
  9. Finally, open up. Be energetic, sound humorous, praise someone, doubt them and engage them.
Let me know how did you find it and would it make any difference to you.