From a young age, I was confused with the value provided by the money. When I was 7-8 years old I remember buying a 5 rupees dairy milk chocolate. As the time passed the chocolate I bought started becoming smaller & smaller. I am no way happy with the size of the chocolate and the thought in my mind was haunting me I gave the same 5 rupees and now the size of chocolate is half the size I bought first time. That’s when I got introduced to the term INFLATON.
Reading LET’S TALK MONEY reminded younger me who was fighting to find the answer the value money carries as the time pass. Monika halan has very well explained the term inflation as the biggest enemy to the money. As the inflation rises the value of money is degraded.
The motive of the book is to give the mindset one needs to get financially better for present and for future.
Key takeways from the book:
- Segregate your money flow system with money inflow account (i.e. salary account), spend it account (for monthly expenses), savings account (for making your money to thrive).
- Make sure you own a health insurance other than the insurance provided by the company to face the medical emergencies which can even cover the situation of untimely job loss.
- Have an emergency fund to face the job loss. If you are the only income source for your family save 12 times of your monthly income. if your spouse also works 6 times of your monthly income would be good as emergency fund. Make sure to put this emergency fund in risk free financial products to redeem them in short notice.
- Do not get into the products like endowment plans, do not mix insurance & investment. Get a term insurance by verifying the successful claims.
- As now the savings account is with the money we need for investing. Let’s see what are our options to invest
- Fixed deposits: This is a risk free way to invest your money in. But the reuturns are very poor considering ROI (rate of interest) as 5 percent offered by the banks.
- Real estate: Firstly investing in real estate needs a huge lumpsum or you need to opt for a loan which costs you additional money to pay away the loan. In many cases the average annual return real estate can offer is 15 percent but this needs efforts from the investor as the asset is in physical form.
- Gold: Investing in jewellery is never an ideal way of gold investment. And the fluctuation of gold prices doesn’t give me the confidence to store money in the form of gold. Having very limited amount of investment in the form of soverign gold bonds offered by the central government is better way to invest in gold if investing in gold is considered as an option.
- Mutual funds: I personally feel mutual funds are investments designed for individuals of the current generation. Don’t get scared by thinking the stock market behind mutual funds as a gamble or very risky. Picking the right mutual funds gives you good returns which can surpass the inflation + the considerable returns.
- As an software employee I get to save money every month and I need a way to invest for short-term, long-term & for my retirement every month rather holding it to be an triple comma figure for investment. After exploring the wide range of mutual funds offered & designed considering one’s priorities gives me the confidence that choosing the right mutual funds will definitely help me to achive my financial goals.
- The word Financially free is definitely catchy and gives me a thought “When can I say the phrase I’m financially free?” Definitely, I have a very long way to go to achieve this :) . Retirement is getting financially free and everyone of us should plan for it. Having an investment plan specifically for retirement from the early stage of career would make life post-retirement easy.
- Redo the investments once in a while i.e once in six months or once in a year. To adopt the changes in the market and to make sure the products you picked are performing as expected or to invest in better money making products that you discovered in recent times.
- Have a clear distinction between need and want. Make sure to spend money after evaluating the need of every purchase you make this puts the money box in healthier state, failing to do so will kill your money box with repeated money burning expenses.
After all Monika Halan tries to explain us the mindset one need’s to make money grow to meet the future financial goals.
I definitely enjoyed reading this book it was insightful and the entire book narration felt like a friend teaching the pro’s and con’s on making different financial decisions and also this book helps in getting financially free by the time you retire by following the practices shared.
Thanks Monika Halan for such an amazing book and for putting all your thoughts and experiences throughout your life into this book.