How to be successful by being a GIVER?

In recent decades, the world has witnessed Jews dominating America's top 10 billionaire list. Surprisingly, Jews constitute just less than 5% of the American population. I wonder how they could be so successful in life. Their success mantra is to give back to society indefinitely by adhering to their holy book, which preaches the art of giving.

The common belief is that we live in dog-eat-dog world, where only greed, hate and selfishness can lead to success. On the other hand, there are certain communities, such as Jews, that are the most generous people in American society, contributing a minimum of 10% of their income to philanthropic causes.

Why do rich, successful rich people donate their wealth to noble causes?
I happened to check the various attributes that contributed to the success of the rich people. They all share one common trait: they give back to society, a highly noble activity. "The more you give, the more you move towards reaching the level of stratospheric success."

Citing the quote of Warren Buffet, "If you are in the luckiest 1 percent of humanity, you owe it to the rest of humanity to think about the other 99 percent."

As a philanthropist, Warren Buffet donated millions to various institutions. Take the case of D. Rockfeller, the founder of national oil, considered the wealthiest American of all time, highly influenced by a meeting in 1893 with Swami Vivekananda, who enlightened him on the virtue of helping the needy. As his wealth grew, so too his giving, primarily to education and health causes. In India, we are fortunate to have the magnificent Tata dynasty, generation after generation, contributing their wealth to the philanthropic cause.

Surprising but true, these philanthropist's fortunes were neither sapped nor slumped for giving to a noble cause; rather, they were far more richer through the karma earned from giving.

Larry King, one of the greatest interviewers of all time, who interviewed many powerful and successful people, was once asked a question: Are your guests as genuinely nice as they seem to be ? His remarkable answer was, "The bigger they are, the nicer they are." Nicer, in the sense that they give more value to others.

How on earth can the common man be a giver and successful at the same time?
Ingrained into our memory, to give others, you need to be financially stable and successful. No wonder too many people think "be a giver" means writing a cheque to provide financial assistance to charities. This is one specific facet of giving. There are other ways of giving—one who gives thought, gives attention, gives care, gives time, and gives value to others.

Most of us laugh when we hear that the secret to success is giving, but it's the hard truth. To receive the benefits from someone, "be a giver" first. When you are the ones who focus only on receiving and shy away from giving, then typically, the harder you work to achieve your goal, the further away it seems to be. Your income is determined by how many people you serve and how well you serve them.

Remembering the famous quote from Deepak Chopra, " When you want something, give it".

In his early stages of his career, when Rockfeller worked as a small clerk, he used to donate 10% of his income to charity. The rule of thumb for giving is to donate at least 5–10% of your income to some good cause.

Bob Burg and John David Mann, authors of "The Go-Giver", mentioned in their book, there are 3 universal laws for man - "Survive, Save and Serve". Survive - to meet your basic needs. Save - to go beyond your basic needs and expand your life. Service - make a contribution to the world around you. Unfortunately, most people spend their lives focusing on the first, while a smaller number focus on the second. But those rare few who are successful-not just financially, but successful in all aspects of their life-keep their focus squarely on the third.

Conclusion
Giving doesn't sabotage your wealth. I was brought up with the belief that one could not be rich and do good at the same time. To contradict the belief, there are countless examples of eminent rich people who added greater value to the world around them.

Mahatma Gandhi, once said, "To give pleasure to a single heart by a single act is better than a thousand heads bowing in prayer".

Thank you for your precious time spent over reading the article.

Reference:
"The GO - GIVER" - Bob Burg and John David Mann
"The JOYS of Compounding" - Gautam Baid

How to make ends meet during job loss?

A wakeup call to all salaried individuals, nevertheless working harder and getting affluent pay checks, concerned about the job Security. 

Did you realize, over the years, there is a spike in your financial pay checks, yet you find it hard to run the family without a month's salary? Why do we find it hard to run the family without a pay check? Right from the stone age, humans had the ritual focus squarely on saving what was best for their future. In this sense, saving experts should live a comfortable life free of financial concerns. On the contrary, they worry more about the financial matters that threaten their livelihood.

 

Paychecks help you meet your daily expenses, but far more of your salary money is spent on paying EMIs (Debts owned due to property purchase, usage of credit cards, and so on). EMIs are a headache for the salaried population, which cannot be laughed off. Properties are not bought from our pockets but rather with loans the bank provides.  Working out of fear to pay off debts causes us to rarely work for passion or glory. Inflation, job losses keep haunting us over the uncertain future.

 

Are you the one who is helpless without a month salary?

When you are too dependent on your salary, you are trapped in a dog eat dog world, not having an amicable relationship with co-workers, using others as a stepping stone to reach your goal and being untrustworthy.

 

Without further ado, a simple solution for making ends meet in the absence of a pay check for a few months : Start to invest in an emergency fund—a non-investment fund, used solely for emergency purposes in the case of job loss or medical emergencies. 

 

Let me illustrate with an example. Bala is earning 1 lakh/month. Bala concerned over job security, decides to start an emergency fund (a new bank account dedicated solely for emergency). Each month, he invests some amount into the emergency account. Once the emergency fund accrues reaches the cap limit [Here, Bala threshold limit is 5 months of his salary (Salary * 5 months) (100000*5 = Rs.5 Lakhs) ], he stops investing further into the emergency fund. Bala owns a debt and pays an EMI of Rs.30000.  Imagine this, Bala loses his job after a certain period of time. Jobless Bala won't panic, as he can manage his living costs as well as pay his EMIs through his emergency fund. When looking for a new job, he maintains a positive attitude and takes his time to negotiate the best deal. However, imagine Bala without an emergency fund. He would be in a state of despair, desperate to get into a new company to avoid defaulting on the next EMI.

 

Can I expect my emergency fund to be a hedge against inflation?

The emergency fund is not going to earn you any good returns, but rather it will stay idle in the bank account. Your emergency fund won't fight against rising inflation. However, this is your only fund that could be used for emergency purposes because of its liquidity. Your properties, plots are non-liquid assets which can’t be used in emergency cases. Please, keep in mind that having an emergency account with five times your salary earns you a healthy and safe lifestyle.

 

Do you remember the childhood story about the ant and the grasshopper? Of course, you are blessed with a stratospheric memory. Ants store food for the rainy season to manage food scarcity during the rain. Grasshoppers have no worries about the food catastrophe during the rainy season. Instead, it enjoys the moment and fails to save its food. During rainy times, Grasshopper faces harsh rain effects.

 

In a similar manner, associate ants with you and rain effects with job loss. As an ant stores food in its nest, you save your money in an emergency fund.

 

Conclusion

We work for the money. It should be the opposite, Money should work for us,  or else it is deemed worthless. You are the master of your money. I hope this piece of advice helps you during this financial crisis. 

 

If you need your emergency fund to fight inflation to some extent and also to be in a liquid state, go for a Flexi FD plan with no lock-in period. guaranteed minimal returns.

 

Trust me, emergency funds are bliss to salaried individuals in the case of emergencies.

 

Thanks for your precious time spent reading the article.

 

Reference: Let's Talk Money by Monica Halan

 

 

How to spot the good(and bad) billionaire?

 The headline news over the past two weeks, Gautam Adani, climbing up the Forbes billionaire lists, to become the 2nd richest person in the world. Indeed, a moment of pride in India, the presence of Indian dominating the Forbes List. Perhaps, the impact of mixed emotions among the masses, Indian economy will be on the radar for next several months. The oppositions rattle that Adani holds Lion's share and these Super riches are widening the inequality gap, needs to be validated. In hindsight, over the mushrooming of billionaires, the public could backlash over the widening inequality gap.

The first line of argument, Which kind of billionaires are productive to the economy? Will productive billionaires make an impact over the economy to move in the upward trend in the upcoming years.

Well, First, Lets understand the billionaires across the world. Take the American billionaires from the 21st century, out of which majority of them are from Service and innovation industry. Back in the baby boomer era, the hey days for the manufacturing and mining sectors, Billionaires were mainly from Commodities - Mining of Gold, steel, aluminium and other precious metal and energy resources. Back then, Manufacturing & Mining Sectors contributed major share in the America's GDP. Well, the Americans didn't leave any stone unturned. The Paradigm shift happened and the big dogs of 20th century were replaced, from the late 20th century and early 21st century witnessed the emergence of the new faces from Technology and innovation sectors. Averaging the present GDP shares, the Service industry contributes to nearly 60% of the GDP. At the height of the dotcom boom period, the techie billionaires outnumbered the billionaires from commodities sectors, however, the dotcom bust flipped the balance.


Good and Bad Business
How do even figure out which is Good business and which one is Bad business. Good business - Business that are productive in nature and contribute its share in the growth of the economy and don't need cronies (political friends and their support) to run its business. Service Sector industries - Pharmacy, Finance, Manufacturing, Technology & Innovations fall under the Good business.
Bad Business are "Rent Seeking Industries" - Industries include Construction, real estate, mining, gas and other commodity industries that mainly involve digging natural resources out of ground. The billionaires win the regulation and politicians by milking the political situation, bribe the concerned people to get the deal done and exploit the resources as much as possible. Unfortunately, exploitation in the mining sector don't have the strict rules to deter over exploitation of the resources. Well, in the sense, these sectors are more prone to corruption than service sector and don't contribute much to GDP of the country.

Billionaires that fall under Good business are Good Billionaires and those who do bad business are Bad Billionaires.
Common misconception, the masses backlash against the all wealthy billionaires over the doubts of wealth accumulated. Falsify statement, We adore Ratan Tata of Tata & Sons, Mark Zuckerberg of Facebook, Jeff buzz of Amazon and so on, they are treated as universal Heroes by us. The reason these billionaires are celebrated as heroes, because people understand their business are productive in nature, generate jobs, chain creates consumers and eventually contributes to the growth of the economy. So, people don't find something fishy over their fortune, considered them to be Self-made billionaires . On the other hand, Bad billionaires, from the viewpoint of the public, felt they build their fortune through crony capitalism, corruption and settling things by illegit means. Business seems non productive in nature and through the political support get loans from Govt banks - Indeed, Loan not repaid is regular ritual of these Bad billionaires and ultimately economy lands in trouble. Hence, people seldom considered these billionaires worthy to earn the fortune and in the sense, they conclude their fortune will not contribute to spike the economy.

Did a Quick scan on the recent Forbes top 10 Billionaires list, and surprisingly found out that Gautam Adani is the only billionaire who comes from a non-service industry background. Elon musk - SpaceX & Tesla, Warren Buffet - Finance, Jeff Bozz - Ecommerce and Techie guys - Bill Gates, the Larry's , Sergio were all representatives from Service Sector. Mukesh Ambani does share common business traits with Adani, but Ambani had his business spread across various sectors, So lets keep him aside and just focus on Adani, the topic of the day. He builds most of his fortunes through mining, energy and construction sectors. His fortune increased five fold over the last 2 years, which resembles the Larger than life scenes - Rajini with no capital, and by a blink of eye becomes millionaire, those unrealistic scenes but well crafted goose bump moments

So, the second line of argument, is Adani bloated billionaire and where does he fall into the kind of billionaire (Good/Bad)?
What's your take on this argument? Where does he fit in. Remember, Service Industry contributes 65% share to the Indian GDP and Mining & Gas industry contribute less than 20% to Indian GDP. 

My future prediction is there will be rising Indian economy through fortunes accrued by the billionaires from the Service industry. I foresee more new faces emerging from the dominating service sector.

Thanks for spending your precious time to read article.

Reference: The Rise and Fall of Nations - Ruchir Sharma