Why 40s & 50s Will Be Your BEST Financial Decade?

The first product I put in my excel sheet was public provident fund and I remember the impact it had like you know they said you can become a Cory with ppf. Just saying this, being

financial

ly independent doesn't mean you stop working, which is what we're talking about. Financial independence and the main question that anyone talks about is what is the number, so by the age of 40 you should have three times

your

annual income who manages the money in

your

family and the answer is very simple. I do it. I used to be a

financial

coward. Money is not an ego trip, your masculinity is not directly proportional to the amount of money you manage.

If you know anything about personal finance, you know Monica Halen, India's first personal finance journalist,

best

-selling author and Sebbi's investor protection advisor. are some of the few things that make her the personal finance guru and today she is ready to talk money with us, so today, of course, we are here with someone who, at least to our viewers, needs no introduction. The first thing you would like to know is In terms of her career path, how did her journey start there and where is she now? Do you know what that trip was like? The first income is a business.

Today I joined as a trained researcher fresh out of Delhi School of Economics, something like, Rs 1,650, you know, a small salary, so I started my career as a business journalist and then I was at the economic Times and that was the moment when I transitioned into something called personal finance. This is 1997. Personal finance didn't exist back then 91 the reforms had just happened that the market had just opened and I remember the first product, so I knew my math well. I am well versed in Excel sheets, so the first product I put in my Excel sheet was public provident fund.

I just made the mats with 5,000 rupees a month. for 15 20 30 years it would lead to a compound interest product m and I remember the impact it had on the whole building like you know they were saying you can become a Cory with ppf just by putting this in so no one had done the math until then so It's how I realized the power of really using my training as an economist, being familiar with numbers, putting them through the prism of retail products to tell people what it means to you in terms of the markets that exist today.

Worldwide. How many years so far? What kind of evolution have you seen in the way personal finances are viewed? Do you think there has been a change? If yes, is it there at a level that you think is ideal now, at least in the Indian markets? is a good question because when I started there used to be FD Insurance gold real estate investor right and there used to be people who bet on the stock market, IPO and the right type of investment SATA, Penny Stock Investing and I started some television shows at that time one with television very early the questions that would come were very typical short term questions.

I have 50,000 rupees, what should I do with it? The biggest reform in India in the financial sector has been carried out by Sebbi, where today we have markets that are, in terms of the world, I think, the most efficient. I have to talk about the work done in the mutual fund space. It was in 2009 that Mr. CB B, who was the then Chairman of Sebi, took a very difficult decision. then there was miss selling all over the mutual fund space, they were agitating investors, he removed the front-end commission, so not many people know that mutual funds were allowed to charge 7% of your investment as front-end commission. one stroke of the pen, he took that.

It immediately made India one of the first markets in the world where SP mutual funds are zero-load and zero-load and because I was closely associated with this entire decision, people called me and said congratulations, it has killed the industry. Wow, that policy really transformed. In the market in 2009, of course, India is a big country, there

will

be all kinds of people, but I think a significant portion of the people who have been investing have realized that a structured, goal-based path to empowerment financial is really the

best

way. and I think right now in personal finance the most popular word we hear is fire, entitlement, financial independence, early retirement, what do you think is the right time to start working towards this goal of financial independence?

And one more thing I would like to comment on. Ask something most people would normally want to know: Am I too late to start? Is there such a thing as too late to start? So actually you start off well the day you start working in the organized sector because you have something called Provident Fund Deductions so you are already doing something and usually what happens is you have between 20 and 30 years, is a time of big spending, the ability to make big savings for your retirement does not exist, so even if you can make another 5% on top of the PF you are making, this is not bad at all for the initial years you you mention because you don't have elbow room, look, it doesn't make sense, again, for all the young people listening, you know that you are You

will

be between 20 and 30 years old only once, of course, it's okay, you will get older and these are the

decade

s in which you know that you enjoy your life, you are young, you can do things and also what your generation needs to remember. is that the 50s will be the

decade

with the highest income, so your ability to save in the 50s is very high.

Families save 40 50 60% of what they earn at home. Your risk in your 50s is being replaced by someone who is 30 because you are a very high-cost right resource for the company, so you have to really understand that when you are 50 you have to have a skill set that makes the company company retains it and I believe that, ma'am, we are. talking about financial independence and the main question that anyone talks about is what is the number, so all I can share is that the fire goal of course was successfully achieved and the current income that is coming is available to spend.

Oh how nice! He thinks that there is an ideal Copus per se. You see that retirement is one of the most difficult problems to solve because you don't know what the inflation levels will be, you don't know what the economy will be like, you don't know how long it will last. You'll work, you know, there are so many moving parts that you can only get a ball pack figure, so one way is to look at your expenses in ag60 and do a multiplier, so I'll tell you the method I use. Take whatever you want. you are spending a year today and you extrapolate it to 860, you use an inflation calculator and then some very good calculators on the seev site, you multiply that number by 26 so that it arrives at cres H, which is the number that will allow you not to eat your Capital leave a being to your own devices and eat maybe half of your Capital if you plan to eat your entire Corpus then multiply by 18 if you want to leave your entire corus to your own devices then multiply by 35 I have taken 26 because when you multiply by 35 it is a number very, very big, and there's a second way of doing it where you're hitting milestones based on your age, so at age 40 you should have three times your annual income at age 50, six times. of your annual income is fine and AG 60 eight times your annual income so there is a difference in the correct annual income and annual expense figures so those are the milestones you should look at to see if you are well prepared or not for your retirement and these two numbers, when you do the math, are within a ballpark of each other.

My personal opinion is just that being financially independent doesn't mean you stop working, which is why many studies show that money is a number. three in terms of the things that give you satisfaction in life, what gives you the most satisfaction is the meaning of life, so your desire for that Financial Corpus is valid, you should do it but also remember to have something to do, that's why it's financial stability is important. Independence is very important, equally important, thinking about the rest of your 35 40 years of your life as to what you're going to do, so ma'am, we've been discussing about how your first 4A in personal finance was this calculator. correct ppf and how the composition surprised everyone today with these multiple investment options available for everyone to invest what are your opinions on traditional instruments, um, that exist today NPS ppf EPF EPF ppf according to me, they form the core of their long-term investment portfolio for people who can invest more than the required one and a half lakh.

The NPS is meant for people who do not have EPF NPS is a great product, it is structured in a way that, uh, Miss Selling is Not possible, my only problem with the NPS is that at the time of retirement the Age 60, when you get your money back at the vesting stage, you get 60% of the Corpus and that's tax free, which is great, but you have to compulsorily buy an annuity with 40.% of your retirement money that sell annuities insurance companies insurance companies in India have not covered themselves in glory in terms of being fair to investors I don't see the point of handing over 40% of my money to an insurance company to buy an annuity of them, especially at an age where I can't earn fresh money, so that's still my problem with NPS if NPS gave me back 100% of my money at retirement, without asking absolutely any questions, except this 40% that is delivered. to an insurance company, I have a big problem, ma'am, uh, key question, who manages the money in your family?

I think this is something everyone would want to know and the answer is very simple. Now it has been converted. one participant and now we manage it together, but for many years I was the person who managed all the finances, all the taxes, all the decisions, the actual realization, the bailout, the investment, we do exactly what I write in my books, all our assets are in mutual. funds, no, neither of us own a single H share and we both believe in not owning too many properties, it's a messy and clumsy asset, so one house we live in is it, so this house we actually bought about 3 Years ago, the first house we bought was in 2009, when we sold that one and bought this one, the rest, the entire set of assets are mutual funds, the allocation is 70% equity, 30% debt, this is what the assignment.

I don't recommend this to people my age. but I think we're both finance people, we know what we're doing to other 50-year-olds. I would recommend a lower equity allocation, but that's where we are. I think there is a factor that you already know and that I have seen in different conversations. Colleagues, you know, female participation in the markets, our general control of finances or the management of finances, what is your opinion in terms of how women's participation in finance exists today and has that changed? in the past, you know? 20 The 30 years you have been in the market are changing, but very slowly, more slowly than I would like and there are many non-financial reasons why girls are usually not educated to take care of money and that is what they see in their In the houses, the mother takes care of the household expenses.

The investments are made by the father, it is not very nice to say it, but you want to prevent the girl from knowing how many assets there are so that she does not ask for her share because the assets go through the mail line, so they kind of stay out of those asset decisions and that translates into the way women view money. I have to tell them that if I go somewhere, if it's a social evening or something like that, and they ask me what you do and I say financial education the women's response nine times out of 10 is oh I don't know anything about it and we hurt ourselves we take a knife and we stick it in ourselves because money is power and you are giving that power away.

Have you seen a change at least to some extent today compared to 10 years ago? It is very slow. There is a little change, but it is very slow, so all the women work inside the house and some women also work outside the house. The woman who also earns is so busy managing both that she simply doesn't have time to take care of them. There is one more thing to do and that is the only job, not doing laundry or taking care of children, that is the only job the man is happy to take on. money to make decisions.

I'm not saying she gets cheated on, but there are investment stories where the woman's money is only made in the man's name, so especially for women listening to this, you should put her money in. oxygen mask share well share the work in some other part of your life but at least start participating in where the money goes you can ask simple questions what assets we have in whose name they are where the paperwork is what I have in my name I think You shouldn't be ashamed to ask these questions because countless divorced women I've spoken to have told me that we had no idea we had nothing to our name.

Wow, because India does not have what is called community propertyconjugal right, meaning that assets built during the period of a marriage, should it end, are split 50/50. That is what it means that India does not have it, the asset belongs to the person in whose name that asset is, so if it is the woman's salary. you have been managing the house and the man's salary savings have created an asset and there is a divorce he leaves with the assets and you have the dry cleaning bills that is what you have so be careful and make sure you have assets in his name.

See the documentation. It's ultimately your life, so ma'am, this habit of knowing that saving or learning about personal finance is something that I think at least maybe should be instilled a little bit earlier. I mean, at least for me personally, I wasn't that aware, but when I started making money, my brother immediately made me invest, do you think instilling these kinds of habits and awareness? Knowing during a stage of being a child will help in the future . Absolutely trip. I mean, the more money conscious they are in terms of growing up, it's just a life skill that you teach them and the kids will do what you do.

Won't they do what you say? So they'll look at your spending habits, they'll look at your investing habits, and they'll learn from that. So if you want your children to not spend foolishly, then one thing you must do is stop spending foolishly. What we do is tell you the impact of elections, that elections have consequences and I will share a little personal story with you. Our daughter was very small. I think she would have been seven or eight years old. Mhm and we were buying books. There was an old bookstore where they sold used books and there was a new bookstore so I think it was about 200 rupees and I said you can buy books, if you buy old books you will buy three if you buy one. new book you're going to get one I don't remember she remembers it very clearly I wasn't trying to make any moral judgments I think I spent time explaining that uh you know this is your choice there's merit in having one brilliant new book book there's merit in having three books and she remembers listening to me because I had two because I had decided that, in any case, three is better than one, okay, so that's the kind of decisions you can help them make. at a very young age, right, touching something within your family, right, um, were the people in your family always receptive to you?

Financial advice comes from you, as the largest group, and that has changed over the years. Very interesting question. There is a saying in Hindi. Dia and her family are almost the last to join, apart from, of course, my husband. The extended family took some time. I think the biggest transition was in my father, who also used to be an economics professor, but you know, he was part of that generation that lost money in unit 64 and said subscam, but I think it was just 10 years ago, ago. 15 years old, I made the complete transition to mutual funds, so it took me some time which I want to share with you and all the other people who see this. is that it is very important to document your financial life well, so I started this journey many years ago.

I have a spiral diary where I started writing down, you know, basic things like Adar pan's bank account details in this diary and sorry, it's a bit difficult. love, I'll call it if I die before you apply, okay, if I die before you, there's a whole list of things, right, all the financial relationships, the names of the planner, the name of the lawyers, the platforms to through which you invest, all those details. they're there in that document and I have to tell you there's a book coming out soon, lovely, the title is coming out soon and it's going to help people record these things.

It will be a log book that you can keep to use today and If anything happens to you it will be the road map for your family so this is a document that I have used personally and I will bring it for everyone else to use as well and ma'am , in terms of your expenses. You have done good in your life. I need to ask you if there are any expenses that you have regretted. Know? Anything you've said? Maybe I shouldn't have bought this, so before there was no money for this and when the money came, the wishes were not so many.

I think the way we spend reflects deep feelings within ourselves, so if you feel insecure about something, that brand name product might help you feel better, so I think it's important for us to figure out why I want to buy true and , in fact, I read this interesting anecdote where you know someone was asking who a rich person really is and the person responded, you know, it's that guy who walks in with absolutely normal clothes, like he's walking around in a sweatshirt. at three Michelin stars and he leaves a 50% tip for the person you know who serves them just because he can.

The way I look at money is how you earn it and what you do with it. It's true, how you earn it is a reflection of who. You are how you spend it as a reflection of who you are so money is good, earn it in a way that gives dignity to yourself and others and spend it in a way that absolutely helps you so I used to be a financial coward who didn't could accept. The risk, the family background was such, we were middle class, we entered the lower middle class and then we moved up and the idea that by taking what is known as risk we could lose everything, I freeze, so the risk has to do with the mind, but the risk.

It's equally about your emotions on a vital level and I think my vital took over my mind and for a long time I couldn't move and luckily she was there. I told him: you know what you take all the money, just put it in, don't say it. I don't I don't want to know I don't need to know now of course it's a joint participatory effort but for a long time I just invested the money and didn't tell him where the money was going not an ego trip, your masculinity is not directly proportional to the amount of money that you manage, then whoever is the smartest person who gives the money, money is a good thing, it is good to have and it smoothes out many problems in life, it is not. the only thing, but it smoothes out a lot of things in life so keep your ego aside and let the best person manage the money and if you can't hire a financial planner, thank you for watching and supporting our channel if you like the stories that This is your chance to be part of this.

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