Ideas on Personal Finance
What is Financial Independence (FI), and why should I care? I had this question when I first heard about FI. Below is my take on the benefits of Financial Independence. The first three sections provide an overview of Financial Independence (FI). To skip to the FI benefits, go to the section: ‘Benefits of Financial Independence’. … Read more
Many people are talented at managing money and are trying to hit the traditional target of earning money and retiring in their 60s. There is nothing wrong with that. But people on the FI journey are aiming for a target that others do not see. The FI people look at retirement differently – not something … Read more
It is important to start somewhere. I started my Financial Independence (FI) journey a good ten years after starting my professional life. I wish I had started saving and investing properly right when I started my first job. I would have reached FI a lot sooner that way! But, I am happy I at least … Read more
This is one of my favorite quotes on Planning (the other being – ‘In preparing for battle, I have found that plans are useless, but planning indispensable.’ by Eisenhower). Long before I had a plan for Financial Independence (FI) / Early Retirement, I had a wish to retire early. I spend many years doing nothing … Read more
Compounding worked wonders for my Financial Independence (FI) journey. However, the key attribute to make compounding work is patience. And in this world of instant gratification, it is difficult to have patience. When I started my FI journey, the initial investments were relatively small. Watching them grow was like watching paint dry. At that time, … Read more
A short but sweet quote that reminds us not to get into debt. Not all debt is bad, though. For example – I have a mortgage (home loan) with less than a 2% fixed interest rate. I am okay with that. It is better to invest the money to make more than 2% rather than … Read more
Small and recurring expenses can be a significant drag on savings. We used to pay many monthly bills without even thinking twice about them – for example, magazines, subscriptions, mobile plans, etc. Over time, we either eliminated or cut back on our monthly expenses. I also severely cut back on small impulse shopping that I … Read more
We make hundreds of choices every day, from small choices like what to eat for breakfast to big ones like where to invest our money. Easy choices are fun. Like spending money shopping. Or buying the latest gadget. Hard choices are not fun. Like saving money. Or eating healthy food. Or going to the gym. … Read more
One of the things that surprise me when I hear people talk about their investments is – ‘Our biggest investment is our house!’. A house that you live in, by definition, cannot be your investment. An investment is something that you can sell. If you sell your house, you will have to pay rent or … Read more
The simple difference between working for money and having money work for you can be the difference between being poor or becoming wealthy! In the first case (working for money), people work to earn money every month. But after earning money, they proceed to summarily spend it by the end of the month. So they … Read more