Target audiences:
If you are among those middle class suckers who are satisfied with 9-6 "safe jobs" don't waste your time reading this blog. This is not for you. Go away right now!!! This is for people who have nerve to do something different...people who dare to dream...
Thought Process:
Some years back I was reading a book that changed my outlook towards finances completely. It taught me about "Financial Independence". Most of us are caught in a rat race. Get a job..take a loan of 30 lacs or so...buy a house...and keep paying EMI of 30k for twenty years...Get married..need a car...crib for salary hike....changed job for higher salary...bought a car...start paying car EMI...have kids...more expenses...crib again...job changed...kids school..crib again...job changed...kids college...crib again...job changed...retired paying loans...no money left...die peacefully n penniless or at the most being a middle class insect :) isn't it true for most of us who belong to middle/poor class families?
Is there a way out of this rat race? Is there a way I don't have to worry @ finances when I am older? Can I be "Financially Independent"?
In search of answers two terms coined:
Asset: Something that brings money to my pocket .
Liability: Something that takes money out of my pocket.
[Asset-Liability] is measure of one's financial independence.The higher the difference the more financially independent person is. One should never let Liability take over Asset. As soon as Liabilities exceeds Assets a new rat is put into rat race.
Like I took a house loan of 27 lacs resulting into 27k EMI...my monthly liability:27k.If my monthly expenses are 15k,my total monthly liability will be [27+15]=42k .Say my salary is 50k(by d way i earn a lot more than that ha ha) so this is my Asset. What's my net financial independence:[(Asset)50-(Liabilities)42]=8k per month. To increase this difference I rented out my new house for 11k.Even though ppl were attaching lot of emotions saying how can u rent new house? I ignored such emotions because finances don't run on emotions. I would rather save my emotions for my future wife :) So the gap increased to [11+8]=19k per month. This is the amount which I can use to enjoy luxuries in life. Bigger the amount more will be luxuries in my life....Good enough for now :) but not enough for future. So what do i do? crib and change my job like all other rats? will it solve the problem or will it put me into rat race? will it be long term vision or short term sight? Then what is longer,deeper and persistent vision? Somehow i need to generate a mechanism that will keep nourishing my Assets so that it keeps growing at a faster pace than my Liabilities and I have to chain down my Liabilities so that they don't grow faster.The more difference I can create wealthier I will be.
What do rich people do differently? Do they earn money for themselves or do they make money,people, resources earn money for them? Does Steve Jobs[Apple CEO- am big fan of him] keep writting software programme to generate money? If he were, would he be THE Steve Jobs or would he be JUST Steve Jobs?
Pointer:
Everyone has 24 hours in a day.Poor or average people earn for themselves while rich people makes a system so that system generates money for them so that they can enjoy luxuries in life....
So key to financial independence is to "Build Assets"-something that brings money to my pocket and keep feeding them. Assets can be investments in fixed deposits,mutual funds,high return bonds or a self made system that generates money.
My Dream:
I want to be financially independent by the time I am 40 so that I can take long vacations go to different parts of the world with my partner and experience different shades of life.Doesn't mean I will stop enjoying life today...life is a precious gift and each moment should be lived to the fullest...live as if it is the last moment of life...its just that gradually and consistently I will keep building my Assets too...I don't want to be that stupid rat and keep working till my 60s and in that process I don't experience better things in life.I want to build a system...put right people and right process into it. Building a system is always painful...Entrepreneurs are not made easy are they? But once system is build it will start generating money for me and I will be enjoying beaches in SanDiego or in Australia :)
I do hv some plans in my mind of what I want to build...waiting for some of the things to happen in life...once those things are done I will be on my way to be financially independent. Want to join me in this journey or do u want to keep continue in dat non sense rat race? oh come on u middle class mind :) come wid me or if you cant then join my system and generate money for me :) i will make a system where I will be providing a race track for some of the rats...wanna run...track is all free for you......till then.....
Sayonara,
Abhay Shukla
Thoughts abt financial freedom r really outstanding.Ppl who r interested in fulfil there dreams rather than compromising wid dreams must read this and follow this.And should see lots of dream to get them true :)
ReplyDeleteHere is an interesting thought. instead of acumulating wealth at 40 so you can take long vacations, why not continue enjoying life, keep taking vacations and keep working till 60.
ReplyDeleteKeep one thing in mind, the moment you stop working, you brain (actuallly the whole system) goes in retirement mode, waiting for the end of life. I plan to keep working till I die. But it doesn't have to be a race of any kind.
Are you planning to become professional blogger? That's how you wanted to become financially independent :)
ReplyDeleteAgree with sarry
ReplyDelete'If only the people who worry about their liabilities would think about the riches they do possess, they would stop worrying'....having said that i also add that you have made a beginning and that too a gud one!
ReplyDeleteThank you vivek sir for the feedback. Inputs taken..blog updated and thoughts updated too :) I would prefer to work as per my ease when i m older and not be "forced" to work because of financial committments...
ReplyDeleteSarry atleast this shows that you think that my blog is somewhat closer to professional bloggers :) Thanks for the hidden compliments. Thanks Slayer but I cud not get who are you.
Sameeksha thanks for encouraging me...next blog will soon be at your door.
you r planning for life its too good but happiness is not comes with financial freedom otherwise all rich ppl have happiest life .its not a principal it is what i feel .i was happier when i have lots of aims .i will be restless when my life will have satisfaction .
ReplyDeletechallenges and problems they have real excitement
Life is beautiful,its ur perception what happiness means to you!If you wanna be a part of rat race but it still matter how u win the race.To accomplish great things, we must not only act, but also dream; not only plan, but also believe.So you have plan,dream n believe..
ReplyDeleteso wishing you may all this bcum ur act soon.
Nice thoughts buddy...Lets not waste time and start building that system for others to play Rat race for us ;)
ReplyDeleteSohini:
ReplyDeleteAgain an amazing write up…and one of the reality issues…Financial Independence….
Too immature to comment on this… but yes, agree completely that each of us shud be financially independent…and probably only after that we’ll be living our lives, otherwise will be just running that so called Stupid Rat Race….
Really liked the dreams u have…actually brought a smile on my face…lolz
Nice work…
hi abhay
ReplyDeletenice to read and no more about u... get to no u better.. lol
Need your new mail adress - Like your post
ReplyDeleteI am from pune and share a same thinking -