sahari blog

  Why I Chose Not to Buy a Car on Loan – and Why You Might Consider the Same Many friends have asked me when I plan to buy a car. From the beginning, I've made it clear: I’m not against buying a car , but I prefer not to buy one using a loan. Here's why. Before rushing into a car loan, it's important to understand three key reasons why buying a car on credit may not be financially wise: 1. A Car is a Depreciating Asset Unlike property or investments, a car loses its value over time. The moment you drive it out of the showroom, its resale value drops—and continues to decline year after year. 2. Loans Bring an Extra Financial Burden When you take a car loan, you're not just paying for the car—you’re also paying interest. That’s money going out of your pocket without adding any value. 3. Insurance and Maintenance Costs Add Up Even after buying the car, ongoing costs like insurance, servicing, repairs, and fuel put a continuous strain on your finances—especially if ...

  When investing in financial markets, a common question that often arises is: "How long will it take for my investment to double?" The Rule of 72 provides a simple and effective method for answering this question. The rule states that you can estimate the time it takes for your capital to double by dividing 72 by the annual rate of return (expressed as a percentage). How Does It Work? To use the Rule of 72, simply divide the number 72 by the rate of return you expect from your investment. The result will give you an approximate number of years it will take for your initial investment to double. Example 1: If you’re earning an 8% annual return on your investment, divide 72 by 8: 72 ÷ 8 = 9 years. So, at an 8% rate of return, your investment will double in approximately 9 years. Example 2: If your rate of return is 7.2%, divide 72 by 7.2: 72 ÷ 7.2 = 10 years. Therefore, at a 7.2% return, it will take about 10 years f...

  When compared to direct investments in shares, mutual funds offer a relatively safer and more diversified approach. Mutual funds are categorized based on market capitalization into three types: Large-Cap Funds : Invest in well-established companies with lower risk and steady returns. Mid-Cap Funds : Invest in medium-sized companies and carry moderate risk with the potential for higher returns. Small-Cap Funds : Invest in smaller, emerging companies and are high-risk but can offer significantly higher returns over the long term. Choosing the Right Fund Based on Risk Tolerance Your choice among large-cap, mid-cap, or small-cap funds should depend on your risk appetite and investment horizon . If you're aiming for long-term wealth and are comfortable with volatility, small-cap funds can deliver substantial returns — often averaging around 12% compounded annually from their inception. Additionally, Direct Growth Plans are generally better...

  In my last article, I spoke about shares and their profitability. To give you more background — I was actively involved in share trading until 2023. I started my journey as a retail investor, but over time, I transitioned into a full-time stock and options trader . However, due to some personal reasons, I decided to step away from active trading. Trading vs Investing: A Clear Difference It's important to understand that investing and trading are not the same . Investing is typically long-term, rooted in patience, and can yield significant returns over time. Trading, on the other hand, involves short-term speculation , high tension , and high risk . I was not an investor in the traditional sense — I was a trader . The Highs and Lows of Trading Trading — particularly options trading — can be highly profitable, but also extremely risky. In fact, I would go as far as to say that options trading without a strong foundation in market fundamentals is almost suicidal . Here’s a glimpse...

 In our previous article, we recommended saving at least 20% of your monthly salary to gradually build a corpus fund for important life goals such as housing, education, travel, and retirement . While this is a great starting point, let’s be realistic — saving alone will not be sufficient in the long run. With the rising cost of living and growing inflation, the amount required for quality education, healthcare, retirement, and property has increased significantly. In today’s financial climate, simply setting aside 20% of your income in a savings account or fixed deposit will not generate enough wealth to comfortably meet these major expenses. Why Saving Alone Isn't Enough Consider this: traditional bank savings or fixed deposits offer an average return of 6–7% per annum . When adjusted for inflation (which can range from 5–6%), the real return is negligible — or even negative. This means your money is not really growing in value, and over time, it loses purchasing power. To...

  Friendship is one of the greatest treasures in life. It makes a person truly rich—not in material terms, but in joy, emotional support, and a sense of belonging. Without friends, life would lack the color and happiness that come from shared experiences and genuine connections. One day, one of my colleagues asked me, "How many friends do you have?" I smiled and replied, "It’s not possible to count." He then shared a personal story: after he met with an accident, he posted about it on social media. He has nearly 200 followers and friends online. Many of them sent kind messages and well wishes, but only 5 or 6 people visited him in person. That moment made him realize the difference between online connections and true, close friendships. This reminds me of a well-known theory by British anthropologist Robin Dunbar. According to his research, every individual can maintain stable relationships at varying levels: ·          5 to 10 people ...

  In my previous article, I mentioned that consistently saving just 20% of your income can make you wealthy over time. However, it's not just about saving— where you put that money matters. Savings generally fall into two broad categories: Depreciating Assets Appreciating Assets Let’s break this down. 1. Depreciating Assets – These Won’t Make You Rich Depreciating assets are things that lose value over time . They may satisfy your ego or offer short-term comfort, but they do not contribute to long-term wealth creation. A common example is buying a car . I’ve seen many families make this mistake—buying a car not out of necessity, but to keep up appearances, often without understanding the financial impact. While owning a car might offer convenience and social satisfaction, it can actually make you poorer in the long run, especially if it's not used wisely. Consider the hidden costs: EMI (loan repayment) Annual insurance premiums Regular maintenance and ...

  Every individual has their own unique lifestyle and preferences. However, some middle-class individuals often try to imitate the lifestyle of the wealthy — wearing top-brand clothes, expensive shoes, designer sunglasses, luxury watches, driving high-end vehicles, and frequently dining at premium restaurants. While there's nothing wrong with aspiring for a better life, it’s important to understand the difference between needs and wants , and to manage expenses within one's financial limits. The 50-30-20 Rule of Budgeting A disciplined approach to managing personal finances begins with a balanced budget . A widely recommended method is the 50-30-20 rule , which divides your net monthly salary into three categories: 1. 50% — Essentials (Needs) This portion of your income should be allocated to basic necessities such as: Food Clothing Accommodation (rent or home loan EMI) Basic transportation Utilities You should aim to keep your monthly essenti...

  A simple and disciplined financial plan can make anyone financially successful — even government employees like us. With the right habits and consistent planning from an early age, we can live a life free from financial stress and burdens. The first and most important step is to follow the 50:30:20 rule , which is widely recommended by financial experts. Here's how it works: ·          50% of your income should be allocated to needs and essential wants — things like groceries, utilities, transport, and some entertainment. ·          30% should go toward financial commitments , such as housing, credit card bills, and vehicle loans . ·          The remaining 20% must be set aside for savings . If you follow this rule from the moment you receive your very first salary, you set yourself on a path toward early financial freedom . In my view, saving 20...

  In my previous article, I mentioned that the prime duty of parents is to provide a good education for their children and to earn for their well-being, education, and other life comforts. Among these responsibilities, financial matters play a crucial role in guiding children towards financial independence. Saving money is, in essence, another form of earning. Kautilya, in his book Arthashastra , advised that children should be treated with discipline up to the age of 18—almost like servants—in the sense that they should not be indulged with excessive luxuries, nor should they be overburdened with responsibilities. After the age of 18, however, they should be treated as friends. His perspective emphasizes the importance of discipline during formative years, which lays the foundation for a better future. Therefore, from an early age, children should be taught about financial matters and given age-appropriate responsibilities. This will help them grow into responsible, independen...