Checklist for buyers before booking a flat The real estate sector was in a slowdown for the past 4-5 years, but its problems got aggravated in 2019 following the liquidity crisis triggered by the collapse of IL&FS. Two months ago, the government announced a Rs.25,000 crore bailout package to revive the stalled real estate projects. Checklist Under-construction flats are more complicated and riskier; here’s a checklist for buyers. One should get it right before booking in a new project.

Concerns: The investment community woke up to a rude shock last Friday. The capital market regulator, SEBI, banned Karvy Stock Broking (KSB). SEBI found that Karvy Stock Broking had fraudulently pledged the shares of some of its clients – after transferring the shares from their Demat accounts without informing them – and raised funds, which were transferred to one of its sister firms, Karvy Realty Pvt Ltd. The PMC Bank has been put under restrictions by the RBI since September after an alleged Rs4,355 crore scam, following which the deposit withdrawal was initially capped at Rs1,000/- causing panic and distress […]

It is quite normal in the family to discuss about budget and expenses; Husbands focus on reducing grocery bills whereas wife’s obsession is with expensive wasteful expenditure on restaurants and husband’s alcohol. Health-conscious wife advises her husband to join the Gym after seeing her husband’s growing belly.   The family’s budget had been blown by a princely sum of ₹5,000, 10% of their monthly routine expenses. But they have conveniently overlooked some items which have overshoot their expenses. Rent has increased by 30%, Credit card has nearly doubled their average monthly spend. The Singapore vacation overshot the budget by 40%. […]

The quarterly GDP growth has been published and is at 5%; it has also indicated slowdown in manufacturing and industrial activities. There are apprehensions that the economy will face difficult times ahead. The Finance Minister and RBI have come out with measures to counter this slow down. Economic changes are cyclical and so also equity market. It moves upward over a long term. Now the opinion is divided between optimism and pessimism. But at individual level we can focus on what is in our control and accordingly make/revisit our plans. We suggest some actionable;

Delayed gratification is making sacrifices now to enjoy the benefits later. Delayed gratification is worth discussing in an age where instant gratification is the norm, not the exception. Delayed gratification feeds into the ability to manage your finances in a better way. It can control the gambling instinct, the decision to persist with your savings strategy when the market is collapsing, the resolve not to compete with the neighbours or social circle, the discipline to save for your retirement. It can yield tremendous returns if you can exercise self-control and tolerance for waiting. David Laibson, an economist at Harvard University, […]

Maslow’s fourth level need on esteem indicates the need for recognition on wealth, position and power. In fact, these needs are double edged swords and act like salt in a curry. Excess of it brings unhappiness rather than happiness. I got its validation at a Satsang; “The loser in an undesirable ego battle is happier than the winner”. This has been my secret in being happy in the housing society I live. Social comparison is an innate human tendency. On the one hand, it can fuel motivation and on the other it can bring jealously. The assessments are not evaluated […]

Investment author Jonathan Burton puts forth the Golden Rule of Investing” Don’t be overconfident.  Every investment mistake is rooted in overconfidence”.  In his book Thinking Fast and Slow, Nobel laureate Daniel Kahneman called overconfidence “the most significant of the cognitive biases.” He also holds the view that the most damaging of biases that plague an investor is overconfidence. He said “it is the bias he would most like to eliminate if he had a magic wand. But it is built so deeply into the structure of the mind that you couldn’t change it without changing many other things”. It has been described […]

Creating and managing a portfolio by the investor requires investment decisions to be made on which asset classes to invest in, how to invest, timing of entry & exits and review & rebalancing the portfolio. These decisions have to be based on the analysis of available information so that they reflect the expected performance and risks associated with the investment. Very often the decisions are influenced by behavioral biases, which lead to less than optimal choices being made. Some of the well documented biases that are observed in decision making are;  Greed and Fear These are the most common biases […]

Traditionally women are better at managing family’s budget and are more concerned about children’s education and marriage. We find women groups take to streets when prices of vegetables and other essential items increase beyond tolerable levels. Nowadays increasing number of women are opting for career in regular jobs. It provides them opportunity for financial independence. It is high time for women to take control of their finance for the following reasons; (1)   Increasing divorce rates – India is witnessing a surge in divorce rates and therefore entrusting the spouse with financial matters can create money crunch. It is prudent to keep a […]

Asset Classes There are four major asset classes; Real Estate & Gold under physical assets and Equity & Debt under financial assets. The trend of physical assets providing higher return is now reversing. Real Estate: Real estate investment is indivisible and illiquid. It carries liquidity risk. It may take longer time to find a buyer for selling the property and hence one must invest in real estate only if one wants to remain invested for longer period. Further real estate prices are correcting and may not provide the higher return it has generated in the past. Gold: Investing in physical gold and ornaments depresses return due to making […]