_*Circle of Money, in Life*_

Everything starts with *Earning* (unless, money falls into your lap, just that way)

The *Circle of Money, in Life* is such that, what we earn has to end up in _giving it away_ to someone (Inheritance or, for the benefit of larger society). 

_Money has to keep flowing, else, it might just start to stink_

_Surely, on the Money front, we come empty handed & we leave empty handed_

*Get the happiness of giving away, whatever you can afford to, during your lifetime or after*

_*Learning, Earning, Retiring, but Money Lessons?*_

_*Learning & Preparing*_ , the first 25 years of my life

_*Working & Earning*_ , the next 40 years of my life

_*Retiring & Introspecting*_, the last 15 / 20 years of my life

The one variable without which I can't survive in this world is *Money*, but _none prepares me to handle it at any of my life stage_ 

_Handling Money issues... remained, remains & will remain a challenge to the majority of the population_

_*Assets, Variables & Mix Match*_

_4 main Asset Classes_

_4 critical Impact Variables_

Our entire _Investing Life_ depends on the way we handle these 8 parameters .... _Individually or in a Combination_

But, What decides this mix / proportions?

_*Our NEED in Life*_

_*Assets & Pains*_

*Real Estate* is a _*Real Pain*_ (procedurally to buy, hold or sell)

*Equity* is an _*Emotional Pain*_ (daily volatility)

*Fixed Income* is a _*Fixed Pain*_ (we'll never see growth in purchasing power)

*Gold* is a _*Goldilocks Pain*_ (the price / return sits between a bull & a bear)

But, if we need to avoid the critical long term _*Money Life Pain*_ ....there is no other way than to embrace the above 4 pains, in whatever bearable proportions 😀

_*Risk, Cash Inflow & Outflow*_

_*Risk*_ is best managed when it syncs completely with my _cash inflow & outflow needs_

Liquidity, Risk & Returns - Is this Possible?

An Investment Product with Reasonable Liquidity + Low / Medium Risk + Maximum Returns ---- Is this Possible?

_*Asset Allocation & Needs*_

 _Asset Allocation_  - text book definition.....   an investment strategy that aims to balance risk and reward by apportioning a portfolio's assets according to an individual's goals, risk tolerance, and investment horizon.

Wow...that looks seriously tough for a common man to understand

In simpler terms.... 

*_Asset Allocation_ is nothing but, _investing money in a common sensical way_*

That's just allocating money into the 4 avenues.....

Equities

Fixed Income

Real Estate

Gold / Commodities etc.

_*The ratio of allocation among these 4 asset classes is based on ONE'S NEED (short, medium & long term)*_

_RETURNS_ are immaterial here, but the _RISK_ is quite material.

_*DOES IT SUIT MY NEEDS IN THE SHORT & LONG TERM OR NOT?*_

_Nothing else matters_ 😀

_*Insurance Purchase, Taxation & Need*_

This year's Budget proposals on the various  _exemptions & dedictions_ getting phased out sooner than later, I've only seen the below headlines in every article / clipping / video, that I've come across

*It's NEGATIVE for Health Insurance sector*

*It's NEGATIVE for Life Insurance sector*

It's NEGATIVE

It's NEGATIVE

🤦🏼‍♂

_*The primary purpose of  adding / buying a LIFE or a HEALTH Insurance plan to one's Money Life is not to claim a tax exemption or a tax deduction*_

It's supposed to be for *Risk Mitigation* in our lives.

All these decades, the selling point for the majority of agents / brokers / distributors in the Insurance Industry was on claiming a *tax benefit*; & the *Money Illiterate population* has been lapping up their talk for decades 🤦🏼‍♂🤦🏼‍♂🤦🏼‍♂

*INSURANCE* is for covering our _financial, health or life risks_

*INSURANCE* is _NOT_ for claiming tax benefits

_Whether Tax Exemptions / Deductions are available or not - One has to be Insured for Health, Life & Any other Needed Insurance_

_*INSURANCE IS A LIFE NEED, NOT A TAX NEED*_

_*Water, Work Time & Money*_

Approx 72% of our body consists of *Water*

Approx 72% of our waking time is spent on *Earning Money* (directly or indirectly).

The majority neither focus on the *impact of water* on the human body, nor do they focus on the impact of *earning More (up-skilling)*

🤷🏼‍♂

_*Line Items & Portfolio Tracking*_

In _tough times_, we focus specifically on the *possible bad* line items in a portfolio.....(a product / asset / scheme's performance)

In _good times_, we focus specifically all the *possible good* line times in the portfolio.....(a product / asset / scheme's performance)

In bad times, we shouldn't calculate the absolute amount of INR lost 

In good times, we shouldn't calculate the absolute amount of INR gained

_Both are notional figures.....until we've actually realised the loss or gain, by selling_

Yes.....we need to keep a track & keep reviewing on the specifics.

But.....the golden rule is

In _good or bad times_, we should focus only on the *Overall Portfolio Returns Vs the Asset Allocation we've chosen*

_We cant keep changing the way of evaluating a portfolio performance based on systemic & unsystemic variables which keep cropping up_