Advantages of being financially free and my real life story-

Being financially free can be defined as, the financial state in which your passive income (i.e. income from your investments which come without any effort on your side) exceeds your expenses.

For example, you have share of a good company who pays double the amount of money you require yearly as divident, so that you spend what you need and reinvest the rest thereby increasing your next years divident.

This is a simple example to illustrate, in practice there are many kind of such sources like rental property or a business etc.

So suppose you are retired (financially free), what will you do?

You can do a hell lot of things, first, if you don't like your current job then you can quit. If you like to start a business you can start. You can give more time to your family. You can watch your children grow. You can teach them how to be financially free. You can go on a holiday of your dreams. You can relocate to wherever you want. Or if you are the lucky one who loves your job then you can continue doing it. But this time your value to the organization you are working for will be far more than ever because as you are financially independent and love your job, you will not be afraid of doing any changes for the good in your organization and that will grow your organization and you will become highly sought after and respected employee of your organization.

Wheeww....  Enough now.... I am just feeling tired to type all those advantages you get when you become financially free, because numerous are coming to my mind. But hey, you can have your own great reasons..

The biggest advantage of financially free is a piecefull life. Life without tension (well one will definitely have positive tension to achieve their dreams). You don't have to worry about your job security, pay hike, lay offs or get up early for work or burn midnight oil and complete projects and presentations unless you enjoy doing it.

So I assume that it is foolish to ask you whether you want to be financially free. If you were not then why would have you been still reading?

Well I am so enthusiastic about it because I was financially free once.

My real life story-

First I came to know about the concept of financial freedom through Robert Kiyosaki's book- The Rich Dad Poor Dad. The book is awesome, a must read. A friend gave it to me when I was 20, quickly I got enfluenced by the concept. I was so much motivated because of the young age that I achieved the freedom before coming out of the college by following extreme frugality.

I also rejected the highest paying job of my college batch, every friend and professor were like "Are you crazy?? You have got the highest paying job in the college, what others just dream of and you are rejecting it?"  The company was astonished, asking 'what's wrong with our offer? Do you have any better offer?'

Life was going very smooth for 2 yrs and then I started drifting from my course, it was too late until I realised it, many huge expences came by, some expected some unexpected to which I was not prepared. And I lost my freedom.

When I thought about it, it became appearant that I was doing all the preparation myself for loosing my financial freedom. I was blowing out money more and more, my reinvestment started declining, they even got in to negative territory, but it was slow. Habit of over spending was slowly infecting me and I was too busy to give any attention. I was distracted by society, slowly accepting the show off kind of mentality. Because of earning pressure I did some investments mistakes. It all resulted in, you guessed it right!! loss of financial freedom.

The good thing is that it took about a month to figure this out. I quickly assessed my situation and came to the conclusion that I need to do a job to increase my income and investments. So after 3 years from completng the college a friend of mine used his enfluence to atleast give me a chance for interview(not a single employer was even ready to shortlist me for recrutment round because of 3yrs of gap after the college). I cracked the interview and the interviewers were impressed and I landed in my first job. I got salary more than what my friend expected, who helped me to get to the interview (the salary was still less than half of my least earning college batchmate, to be true, I felt really bad but atleast I had a job :-) ).

I was able to crack the interview because I always cultivated curiosity and always liked to learn new thing.

One more thing I learned from this experience that knowledge and common sense never go waste.

At the same time I also got married in a traditional wedding ceremony which reduced my assets to ZERO.

I never lost hope and continued to save and invest as much as possible. Invented more ways to save money. Its been 2 years since I have been married, I have a 1 year old son. Despite the outrageous expenses of child birth, his vaccination, purchase of a motorbike, my minimum expenses are 8 to 10 times more than when I was single. I am saving at a decent rate and will able to achieve my goal which I stated in previous post.

This time I am being carefull with my calculation. Added a lot of margine of safety.

We will discuss about my plan for freedom and how you can also prepare a plan for your financial freedom in another post.

Till then read my signature... ;-)

Sumit
The POWER is when,
you use ODDS
to get EVEN..

The concept of MONEY and How people earn money?

Are you done with the previous post of How to become happy??

Well, you must be wondering where I am taking you through this blog? Once I say happiness is a state of mind, then what is the use of money?

Let us understand what the money is?

In ancient days, at the start of civilisation, when there was no currency people used to follow barter transactions. That is people used to exchange one thing for the other. And later on someone invented a common medium of exchange, like gold pieces or precious stones etc. And slowly it got evolved in to the present currency system.

Is short money is the medium of exchange.

Money is a necessity, to live with dignity in todays society. We need money to full-fill our basic needs of food, clothing and shelter. We get these things in exchange for money and similarly we get money in exchange of something. This something ranges from services, ideas to knowledge and even time etc etc. You name anything and there is someone ready to pay for it. You just have to find who is ready to pay for what you wanted to exchange. And this also works conversely i.e. if you have money you can buy almost anything.

Then there comes wide variety of people, some possess and earn very little and some in such a huge amounts that they can feed a little nation.

Why is this difference? Why someone is rich and other is poor? Do they have some biological difference? Mostly there is no biological difference, both have more or less the same organs, the same amount of time per day, per week, per year etc. The same amount of natural resources. Then what is the reason?
Does one chooses to be poor or rich?
Appearantly no one chooses to be poor or want to be poor. But when we observe these two kind of people we will start getting there differences. The differences are not biological or the environmental, the differences are in how they use their brain.

One thing is sure that,
"Human brain is the only thing which makes humans the dominant species on earth."

If you observe people who are poor, you will find mostly they are trading their physical strength (labourers or construction workers) or time (watchmen or security guards). They use those abilities which are limited in nature. And still they work in exchange for very small amount of money. They do not want to think, they just follow someone else and do what requires almost no use of brain. Someone else make the decisions for them.

Secondly if you observe the middle class employees-

they seldom use their physical strengths. They use their brain capacity and time to do some chores like functions or do the work for their employer. They get paid according to the knowledge they possess and for how much time they use their knowledge.
Thirdly there are self employed who do the same thing as the employed people do, but they work directly for their customer and they are thier own boss.

Then there is the most interesting fourth type of people. The RICH people. If you observe those, they do not do what the above people do.
"They use their brain the most and most effectively."

They only do those things which can easily be magnified. These are the businessman or the investors. They make use of other peoples money and time. For example the owner of the company you are working for. They are giving you the opportunity to use your knowledge and time in exchange for money and in the exchange they are keeping some part of the profit earned by the company because of you. And there are billions of employed people in the world working for the rich people.

To understand this distinction is necessary to be rich.

Everyone wants to be RICH. But many do not know how to become rich or are afraid to try.

I am here to be with you in your journey to be rich. I am on the same journey. I am doing all the hard work to know how to stay on course in our journey. I like reading books on the Rich and successfull people. I like becoming wiser every day.

This is the platform for me to condense my knowledge and thoughts to share with you, get your perspective. Stimulate your brain to think. So we are together on this journey.

We will understand more about money in subsequest posts. It is necessary to know how this system works to use this system to our advantage.

We will meet soon till then, Think, why you want to be rich?

Sumit
The POWER is when,
you use ODDS
to get EVEN..

How can I double my money in one month?

How or where can I double my money in one month? Which stock is gonna double in a month? These are the top two FAQs(Frequently Asked Question) by clients when I was a channel partner of a stock broking firm.

The name of this blog is Samanya Buddhi (Samanya means common, Buddhi means sense) which means common sense, which points towards logical thinking.

So lets do the logical thinking on the above FAQs.

How much money do you have in your wallet right now? What is the minimum amount of that money you can spare for investment? Don't worry, it can be anything, may be a quarter of a dollar or euro or rupee or any other currency.

So suppose you ask me that quastion and I recomend a company who's share will double in a month and you invest that quarter. The quarter gets doubled at the end of the month so you book your profit and ask me the same question again. And the same process is repeated again. Now you have a dollar or euro or rupee or any other currency you first invested.

Now suppose we go on like this, say 64 times, without taking out any money and in 64 monthes your money gets doubled 64 times. (64 months is only the period of 5 yrs and 4 months)

Now believe me, that amount will be more than all the currencies available on the earth.

Another thing is me too have the quarter to invest. ;-) So why didn't I do it myself?

This is the reasoning I used to to tell my clients. And they were like, "WHAT...???!!!! I thought you are a broker of this reputed firm.."

This happens because of Authority bias we have in our head. In simple terms we look for traits which point towards knowledge and intelligence and let that authority do the thinking for us which freed up our brain for other tasks. This trait was usefull in encient days when our ancestors used to stay in jungle. But now it is most of the time irrelavant. People were considering me as authority and asking me such question without doing their own thinking.

Watch out for it. Smart people like marketing person or advertisers take advantage of this fact for their own profit. (Ever seen any actor on TV dressed in doctors attire recommending some toothpaste??)

But the basic question still remains how to grow our investment and how much growth can we expect?

We will get to that in further posts. No hurry for now..

Sumit
The POWER is when,
you use ODDS
to get EVEN..