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Everything about personal finance. Financial Literacy Matters!

6 easy ways to get broke

Haha.. We have all discussed ways to make Money, how to save Money. secure your future, and live with Financial Independence.

While we continue to grow, and spread Financial Literacy, todays topic is off the grid, stating 6 easy ways to get broke, so you can avoid them all. 😉 If you wish.

1 . Getting Involved in a Get Rich Quick Scheme

Yes, while your intentions might not be wrong, creating wealth is not an overnight game, not for most! Being part of a Ponzi or Pyramid scheme, where you get money if you recruit people can be your way towards not just wasting away your life savings money, but also the time & effort. Not to mention the legal repercussions that one might face. Want to read more about them click here.

2 . Winning a Lottery

Though it sounds great, those happy hormones ain’t gonna last long. Yes you heard us correct, according to a study more than 50% of Lottery winners end up broke within five years. So next time you play that game, remember its just a game with rules not in your favor. Wanna read more, this is an interesting read I found.

3 . Addiction

Whether its an Addiction to Drugs, or Video Game; Addiction can leave a pretty deep hole in your pocket. Take the Cocaine addiction for example, people start small but with time they end up buying several grams a day, doing that for just a year if you have an average household Income can leave you broke, and not to mention the side effects of it on Health. If you thought, drugs were worse, then gaming addiction is even worst, gamers often neglect aspects of real life, including their finances and job. From being late on a job, to spending recklessly on virtual artifacts like skin, coin, life etc, to getting fired from a job, gamer may lose it all for their virtual life & pleasure.

4 . Buying on Credit Card

If left unnoticed, excessive buying on Credit Card with no full payment by end of every month, can definitely leave you in debt trap. People can easily get from 1 to 5 credit cards, with a limit of around 5000 dollars, thinking they have enough money to buy that extra refrigerator, or that big TV on sale, without realizing the Interest they would be charged if they don’t pay back their credit. Well, gradually this Interest piles up (not to mention some credit cards can charge you up to 25%) leaving you broke!

Now I am not saying its not good to have Credit Card, off course credit card has some great perks but you have to know how to use it. If you want to know more about some benefits read here.

5 . Investing in Penny Stocks

Now you might be wondering, but Salrite you say Invest, Invest, Invest!, well I do!, but not in just random penny stock…

Investing has risk, and in Penny stocks the risk is akin to gambling. With no proper financials to check, not so transparent Business practices, no proper corporate governance, Penny stocks can lead you broke in just few months!

6 . Look Good, Feel Good

All that Glitter is not Gold, all that Plastic Surgery is not worth. Well, its one thing to be in shape, and take good care of your body, and completely other thing to have a cosmetic surgery just to appeal to the larger audience!, or buy that Lambo, designer clothes, that Gucci scarf, those shoes, that no one except you care about! The complete show off.

Thank you for reading. If you want to know What the Rich way truly is, check out – The Rich Way. Have a great day.

7 Ways to Save More

They say the only way to Financial Freedom is Investment, starting with Investing in one-self. But how do you Invest if you don’t have enough? The answer is ‘Save‘, Save more to keep calm, to raise capital, to spend more.

So, lets discuss how to save more –

1. Stop using Credit Card

Debt on credit card is one of the worst to accumulate with Interest up to whooping 25%. So throw away your credit card, or if you can control yourself pay only the amount you have in your bank account with your credit card, and pay your credit card bill fully every month.

2. Sell Unnecessary TV

One not so obvious way to save, can be selling out what you don’t need, or maybe just flipping some items. You sell that extra refrigerator that you never use, or maybe that furniture that is depreciating its value, and later put the money you got into Savings.

3. Avoid Impulsive Purchases

  • Don’t shop when you are hungry.
  • Wait for 7 to 30 days before purchasing a luxury or an expensive item.
  • Think before you make the purchase if you really need it, or you just think you need it.
  • Stick to your Shopping list. (No Extra Cheese)

4. Keep your Emergency Fund Separate

Always keep your Emergency Fund in a Separate account, so that you can make sure not to mess with it, with any impulsive behavior or mistake. This is your most import savings, and is a must!

5. Use Budgeting Apps

You may like to use, budget apps like PocketGuard, Mint to help budget well your expenditure, so that you can save a little more in the end of every month! Here is a list of 7 budgeting apps that you may like to look.

6. Start Piggy banking

Well, every penny counts. In case you are really short on Saving, than Piggy Bank may not be the bad idea at all. You can also use it to develop the habit of saving in the younger ones.

7. Subscription Cancelled!

Change is permanent, and with your changing lifestyle you may no longer need that Netflix, Prime or that Music Subscription. Chances are you maybe subscribed to some services that you may not even remember. Perhaps that Gym membership or that magazine may not be required anymore. So go ahead cancel it and add that to your monthly Savings, unless you are using it!

Bonus : Automate thy Savings

yes! you need to Automate this. As they say out of sight is out of mind, every 1st of month or whenever your Income gets credited Automate a recurring deposit to another account that you can’t / won’t access for your expenses. Even if its just 10% of your Income, over time it can grow to a substantial amount which you can later Invest. Remember Save first spend later.

Also remember there is no certain specific amount that you need to need to save, it can be as little as few hundred dollars or few thousand rupees to as much as a million. It really depends on your goal, see what you desire, plan and then stick to it.

Thanks for reading. Come back for more. Have a nice weekend!

Investment Lessons from poker

Instead of gambling away all money in Poker, we can learn Investment from it. Don’t trust me, hop on..

1 – ALL IN

Poker tells you to bet as much as you can if the odds are extremely in your favor (remember never to bet your life savings, and to keep some buffer for emergency).

If you come across an Investment which totally completely makes sense to be the next big thing, based on the information you have and the potential it holds (or what you perceive it holds), and you are convinced; then you should probably Invest as much as you can to see that small cap, Crypto or whatever it is, turn Multi-bagger! (remember only Invest the amount you won’t regret if you lose)

2 – Preserving Wealth is difficult than Accumulating it!

Seriously, I have found it very difficult to preserve my balance in Poker, and very easy to lose it all. Well, I know these games are designed this way, nevertheless it teaches us how difficult it can be to stop your urge to spend that extra buck in real life, or to throw that shit loads of money on your next luxury (not saying you should not do it, but be watchful) .

3 – Greater the risk higher the reward >

In Poker the more chips you stake in, the bigger the pot you can win! Well this may not be true everywhere in Life, but it sure is true for some Investments of your life.

Look at the Cryptocurrency in its early years, it sure was risk (well it still is risky but not as much as it used to be), market adoption was low, real use cases or utility was hard to be found, but nevertheless it gave huge returns to those who took the risk or say understood its power. Same applies to some small cap stock which later goes onto become multi-bagger and star of your portfolio.

4 – It feels good when you have a little extra

I don’t know about you, but it feels good to me every time I see my poker chips soaring in value. I hate depleting capital! even if its just a video game.

5 – Money makes money

The more you have, the more you can stake, the higher you can win. Same thing applies to every Investment, the higher you can stake in, the more the ROI (Return on Investment). But be careful remember #2, it is easier to lose wealth than to accumulate.

6 – Kindness

You maybe thinking what does kindness has to do with Poker, or Investment. Well, remember the last time you won a big pot of say some million dollars, have you not given it as tip to the dealer, and as weird as it may sound, have you not felt good giving it away? Answer is you probably did! And it applies more to real Life than Poker, the more you give the happier you get!

So, if you want to just take one thing out of it than let it be ‘Kindness’, why not? Happiness > Money.

Thank you for reading. ‘Leaves with a Poker Face’…

Psychology for Money

Today lets discuss the behavior & the thinking that will not just make you rich but also help keep you rich!

1. Compounding is confusing

Compounding can make a small amount of money to start with, a huge sum defying all the logics. Good Investing isn’t just about high rate of return, its more so about time. The earlier you invest the better the compounding works for you later in the life.

2. Enough is never enough

There is no reason to risk all you have for what you don’t have! Don’t put all eggs in one basket. Always keep some emergency cash, always have enough to survive while you try to thrive!

3. Staying wealthy is harder than getting wealthy

There are thousand ways to be wealthy but to stay wealthy you will need a bit of fear, and a lot of money management skills to not risk what you for what you don’t. As warren buffet says – “Rule No. 1: Never lose money. Rule No. 2: Never forget rule No.”. To remain wealthy you just not need to make money you need to know how to preserve your capital. In order to make more money you need to be more comfortable to have it, hold it and not just spend it.

4. Wealth is what you don’t see

Spending money to show people, on things you buy for show-off is the fastest way to lose wealth! Wealth is made of your financial assets that may not be easily visible to the outer world.

5. Be Happy

To be wealthy, we need to feel good about other people being prosperous. If you have a deep seated idea that rich people are not nice, you are never gonna make it!

That’s all folks, want to know more? I recommend Reading two of the great books that helped me create this post.

Why I Invest?

I Invest, because,

————————————————

I have Extra cash

I believe in power of Compounding

I don’t like to Spend

I don’t like to Save

I love Investing

I like the way Money grows Money

Uncle Sam told me

My Dad used to do it

I love Assets

For Financial Independence

For my Future

For my Kids

For my Livelihood

For Retirement

Just to grow Wealth

——————————————

While I can go on and on, the point is there are plenty of reasons to Invest! And the earlier you Invest the better it is!

So, In case you have not yet, Invest Now!

Further articles that you can read –

Thank you for reading 🙂

5 rEASON TO iNVEST IN cRYPTO

Hellow Riters, Hope you are healthy, hope you are doing great! Today lets discuss about those Adas and Doges’, I mean Cryptocurrency. So, lets dive in.

Token to Freedom

Cryptocurrency is your token to freedom, You and only you are its owner. You have full control over where to spend it when & how, no Government or Bank can control it, no Govt. can block or freeze it. Demonetization, hyper-inflation and other risk factors due to the Central System are not present.

Safe Money

Probably the best reason to own a Cryptocurrency is the Cryptography behind it. It can’t be forged or attacked, also your identity is hidden, encrypted and safe. Blockachain technology ensures secure digital transactions through encryption and “smart contracts” that make the entity virtually unhackable and void of fraud.

Accessibility

Anybody with access to Internet can access the crypto, and use it. Even the people who don’t have rights to use to traditional exchange systems can access it.

Higher returns

Even though Cryptocurrency prices are volatile the returns has been way higher than the traditional Stock markets. Also several organizations like Blockfi provide you Interest over your Crypto assets. And the high liquidity of this asset makes it worth investing at least a little portion of your portfolio

Instant Settlement

With Blockchain, all you need is an internet connection and a smart device to instantly become your own bank making payments and money transfers. Also coins like Ripple (XRP) empower cross-border settlement and currency exchange in real-time by allowing banks & money-transfer institutions to join their distributed ledger network.

Bonus – The other unique reason to own a Cryptocurrency is the uniqueness it brings on the table. Each coin is separate in its functionality and usuability, like Ripple is used for cross-border settlement, Bitcoin can be used as Gold to store wealth, Ada (Cardano) can be used to build smart contracts and in turn create decentralized applications.

To Know more about Cryptocurrency do read our Beginners’ guide to Crypto!

Thank you for reading.

unusual Investments

You would have heard a lot about Investing in Stocks, Real Estate and Gold. But have you ever heard about the not so common Investments, the Investments that not everyone knows about? Perhaps, they are worth exploring too, lets peak into some.

1 . MLPs

Master Limited Partnerships (MLP) is a unique Investment that combines the tax benefits of a limited Partnership with the liquidity of a publicly traded stock. MLPs may be a business pertaining to natural resources (like petroleum), commodities or real estate enterprises. Read more here.

2 . Wine

Wine bought at a fair discounted price and kept to age, can give good returns as Vintage Wine down the line provide you have a climate control space and enough will power not to drink your Investment. But to Invest in, it only makes sense if you are a connoisseur of wine.

3 . Classic Cars

Cars, OMG!, You are saying a liability can be an Asset? Cars are an Investment? Don’t they depreciate in value?, well hold on, pause, breathe…

Buy a Car and let it rot, well not exactly, if you are into Cars, buy a Vintage Ford, Ferrari or a Car which will potentially be replaced by a better variant while the Old becomes Gold. Down the line find a crazy car lover like you who will appreciate it for its uniqueness & antiquity.

4 . Fine Art

Probably not so uncommon, if you have an eye for Art, hodl onto it for generations and generations, well its never worth its value or is it?

Buying & selling famous paintings has been the domain of the ultra-wealthy in past, but today there are ways that the average Joe can get in the game. You can checkout Companies like Masterworks which pool people’s money and purchase blue-chip artwork. You can make up to 10% or more on your investment per year through it.

5. Music Royalties

Go to sites like SongVest.com and TheRoyaltyExchange.com and purchase a share of the song at auction. You will continue to receive royalties for up to 95 years after the Artist’s death!

Do you remember the Theme Song from the Monkees? Hey, hey, we’re the Monkees. That song still produces on average $10,000 a year. Read more about some of the weird unusual Investments here.

Looking for some popular, easy, conventional ways to Invest, read where to Invest your Money by riteFinance.

7 Luxuries of the wealth

Today lets discuss the Top 7 Luxuries owned by the richest of richest 1% in this world.

1. Super Cars

Elon Musk and his $1 Million worth Lotus Esprit submarine car, James bond style super car. Zuckerberg Pagani, Bill Gates Porsche 959 are some of the super cars owned by Billionaires. Not to mention they own multiples of them.

2. Artworks

Now some can call it Investment, others can call it a passion, a hobby or just a leisure, the eye for paintings or rare artifacts is a thing Billionaires love to have. But this Mexican Telecom Magnate took it to another level, Carlos Slim, owning museum of Artworks worth $800 Million which hosts around 66,000 collections from around 30 centuries.

3. Mansion

Here the list can grow huge, but we would like to mention the expensive of the most. Antilia, Mumbai, owned by Business Tycoon, India’s richest man Mukesh Ambani, worth more than a Billion this 27 Story Property have six underground parking and requires 600 staffs to maintain it! Want to read more checkout the site here.

Antilia, Mumbai, India

4. Island

Many Billionaires own Private Island for holiday retreat, to destress or rejuvenate themselves. To mention a few; Larry Ellison, Chairman, CTO, Co-founder of Oracle Software Giant, owns Hawaiian island of Lanai for around $300 Million. Richard Branson, founder of Virgin Group own Nector Island, British Virgin Islands! To check more click here.

5. Yacht

Just like Super Car, Super Yachts is treasured by many Billionaires. It is rightly said that being amidst the vast ocean, soothes & relaxes your mind, and this so called ‘Blue Mind Phenomena’ is the reason why many Billionaires & Millionaires park some of their cash in this Luxury!

Owned by Rober Kuok, History Supreme is one of the most expensive Yacht, priced at around $4.8 Billion, this super yacht have 68kg of solid Gold Aquarium and rare 18.5 carat liquor diamond bottle. Read here for more expensive yachts.

6. Private Jets

Billionaires can afford a lavish lifestyle and luxuries beyond our imagination. Airbus A380 owned by Prince Al-Waleed bin Talal for around $500 million is probably the most expensive Jet owned by an Individual. And here is your list to further explore including Donald Trump who owns a Boeing 757.

Boeing Business Jet 2 , owned by Ambani

7. Sports Team

Not Just Sports Car, Billionaires also like to own a Team! Steve Ballmer Microsoft’s co-founder spent around $2 billion acquiring NBA team Los Angeles Clippers.

We hope our beloved Millionaire Gary Vaynerchuck gets to get Jets soon 😉

Thank you for Reading, Let us know in comments below what is your to buy thing if you get a Billion dollar! Follow us for more, and Get Money Smart.

investing for Gen-Z

Born between 1997 to 2012, oldest Gen Z today would be 24 years old, read carefully, what we are going to tell you may decide your financial future in years to come.

If you have just started to earn or going to be soon, and you might have some plans for life, well, you may know by now, life doesn’t go as planned, always. Covid 19 and the stock market crash of 2020 is the most recent and vivid memory with many of us.

So, How should we take care of our Finances? What should we do to avoid black swan events like Covid from affecting our finances in future? How can we make sure that we are self sufficient!

Well the short answer is INVEST, Invest now!

Note- how early you invest matters more than the amount you Invest, because Compounding works best later down the time.

Lets discuss how to Invest when you are in your 20s:

  1. You must first save some portion of your money, in-fact one thing that we all get to learn from Covid is we should have an emergency fund (3 to 6 months of our expenses saved) before investing, so that we can rely on it incase of any unfortunate event. Read more about Emergency Fund here.
  2. Divide your Income into 3 Brackets, Save, Invest and Spend. A rule of thumb to start with is Save 20 bucks, Invest 30 bucks and Spend 50 bucks of your monthly income (more better approach would be 50, 20, 30; but consistency matter more than the amount you Invest)
  3. Spend low, live below your means, or expand your means. Yes I get that you may be fresh out of college and in your prime youth, thinking to party like crazy. While no body is saying, don’t party at all, but limit it as much as you can, the earlier you get into saving and investing rather than spending the better your quality of life will be. so shush the Party Animal within or just tone it down a bit. I know its hard to digest, But think do you want to live like king as you grow or you want to cut on your expenses and go take some huge loan to maintain all that family expenses that are inevitable at an older age. Somewhere down the line, I assume you would like to have your own house, a car and what not, so better you start investing now & be frugal, for more peace later in life.
  4. Do Invest in Stocks, own them as your own Business! Don’t stress too much on getting it right, everybody makes mistake and so will you.

Do you need to be conservative or do you need to go wild, all in?

I would suggest a balance approach, now that you have 30% of your Monthly Income to Invest, I would suggest you to divide it further into different assets like Crypto, Gold and Stocks (now if the money is very less to even divide you can alternate the asset class every month).

  1. 10% (of Investing Income) -> Cryptocurrency, where in further you should divide in Bitcoin & Etherum or at least a few coins to be safe and not miss the opportunity at the same time. What I would do would be to have 50% of my Money (of this 10%) in Bitcoin, 40% in Ethereum and 10% in Others (like Zcash, Dash, etc). You may like to read more about Cryptocurrency here.
  2. 5% (of Income) -> In Sovereign Gold Bond or some form of Gold at least, if the amount is too small you may consider something like ‘ICICIGOLD’ ETF which is currently priced at 44 rupees a share.
  3. Left with 85% of your Investing Income, you can go into Stocks directly. (In case that 85% of your income is exceptional, you are richie rich, I am glad you came here, you can further divide the amount into real estate and stocks!)
    • 10 – 50% in Broad Market ETF that tracks the index like ICICINIFTY, HDFC Sensex Plan for India or VTI, VOO for US Markets. You can make your portfolio 50% of this in case you not at all care about markets and don’t have time even look at your portfolio once a month. As a matter of fact, the legendary Investor Warren Buffet himself suggest a low cost ETF for all Passive Investor. Read more about Index fund here.
    • 25% in Momentum stocks, these are basically risky Mid & Small cap stocks, and since you have time in your hand you can take some risk. You can use smallcase for this. Click here to know more.
    • 10% on long term trend/idea you like for example Electric Vehicles, or The Great Indian Middle class, whatever you believe will be huge with time.
    • 0 – 40% in Direct Stock picks, now seriously I want you to take some risk, look around buy stocks of brands you own, you consume like that ITC cookies you eat, or Hindustan Uniliver Soap you use or Bajaj Bike you Vroom vroom… (Disclaimer – we are not suggesting / advising any pick). Now this can be most volatile part of whole portfolio, but it can be most rewarding if the research is done right, also with time you get better in this. Always always avoid buying on someone’s advice do your own due diligence. If you are someone who believes more in the promise of blockchain & cryptocurrency than you may like to flip the percentages 10% here and 40% there 😉

To Recap, put numbers in to perspective, lets say you have 30,000 as the salary than 30% would be 9000, Put 900 of it in Crypto (450 BTC, 360 ETH, 90 other Coins), 450 in Gold, 7650 in Stocks!

Remember – If you can’t achieve the percentages listed above, let it be, a bit up or down here and there won’t matter.

The Idea is to Diversify, Invest Early and Be consistent. Time is your best friend.

CAGR

To Read about the Common Mistakes that every Investor make, and to avoid them, click here.

Looking for some Earning Opportunity, click here.

Some TO DOs’ of Investing (recommended reading)

Thank You for Reading, We wish you loads of Happiness, Success & Wealth in Life. ~Team RiteFinance.

is 2021 the year of the bull?

My Outlook for 2021

Stock Market – While we are in good Bull rally so far in terms of Market in US, India and most of the parts of the world, we may see some rotation or correction going forward. By Rotation I mean we may see a flip or the Investments flowing more into the sectors of the market like Metals, Auto, Banks that was ignored in 2020 away from the stars IT, Pharma. Also there is nevertheless a chance of double digit correction in 2021, and this is where we need to be cautious and hold for long, not panic sell like most of us did in 2020. (If you are new to stock market you can open an account with Zerodha here)

Bitcoin/Cryptocurrency – Cryptocurrency specifically Bitcoin may see a slight correction going into 2021, but nevertheless the concept of Cryptocurrency is promising and it looks like it is here to stay for long at least unless an alternative is found. So I would like to be Vigilant here and Invest in dips. Remember always do your own due diligence before investing. To know more about Crypto click here.

Gold/Precious metal – I think Gold still holds value, and can surpass its 2020 high by 2021 end. Given the volatility in Market, and monetary policies of Govt., Bitcoin & Gold both can shine together for most part of this decade. Also this looks like the asset where Smart money will keep on flowing for most part of 2021. (Sovereign Gold Bonds is one good option if you are looking to invest in Gold in India, and best place to buy SGB is in open market using demat account like zerodha as the prices there are usually lower than current market price).

Real Estate – Now this is something I am totally unsure of, while Commercial real estate looks to be in decline, residentials and real estate in general may see some positive growth in 2021. I am expecting more growth in tier 2 & 3 cities compared to tier 1 in India.

NoteWhile above is my Outlook for 2021, By No Means I am here to encourage or influence you to make your Investment. Always do your own due diligence before Investing.

Read More here –

Thank you for reading. I wish you loads of Happiness, Health & Wealth in 2021. Happy New Year!