Personal Finance Workshops: The 6 modules

I told Sundar in the interview that I was planning some modules for a personal finance workshop. These workshops/ seminars will be focused towards heads of households hoping to make better financial decisions and avoiding financial mistakes in the future. Here are the details and I would love to hear suggestions.

Mission

To empower people, through financial principles and practical help, make successful financial decisions and becoming financially independent.

Workshop Content:

Module 1: Money and Family: Understanding yourself

• Money and Family,
• Financial IQ and risk profiling
• Financial Goals
• Budgeting

Module 2: Living Within Your Means

• Maximizing Income
• Savings and Smart Spending
• The Cost of Consumer Credit, and Other Financial Traps
• Debt Elimination

Module 3: Saving and Investing: The Road to Freedom

• Principles of investing
• Starting Early and the magic of compounding
• Rupee Cost Averaging
• Bonds, Stocks, ETFs, Real Estate and Mutual Funds
• Asset Allocation Strategies and Pitfalls

Module 4: Emergencies, Credit and Home Ownership

• Emergency Funds
• Building Credit
• Rent vs. Buy Decisions
• Borrowing Capacity, Mortgage Options and Down Payments

Module 5: Insurance: Your Security Cover

• Principles of Insurance
• Term, Endowment, Money back, ULIPs
• Insurance on You, Your Spouse: Life, Disability and Health
• Insurance on What You Own: Home and Auto

Module 6: Taxes, Educational & Retirement Planning

• Understanding Tax Terms, Tax exemptions for Education, Retirement Savings, Home loans, Child and Dependent Care
• Tax Deductions, Retirement Tax Planning

Waiting for your suggestions and questions .

Only Borrow Money to pay for things that increase in Value

This is the one line personal finance advice from Seth Godin.
Here's the full post
India's first online weekly on personal finance

Coffee with Google's Engineer and IIMB Select: Sundar Rajan

I am pretty excited about this and want to tell the whole world.

Sundar Rajan is a Google Software Engineer and has been selected for IIM Bangalore PGP. He has a wonderful blog where he has interviewed some very famous people. I'm honoured to be asked for having Coffee with Sundar

Here's the link to my interview:

http://coffeewithsundar.com/coffee-with-ranjan-varma-on-personal-finance/
Thanks Sundar.

Do let me know what you think at Sundar's blog.

Gold should be a significant chunk of one’s portfolio

V. Anantha Nageswaran is head, Investment Research, Bank Julius Baer & Co. Ltd in Singapore and writes a weekly column in Mint , which I love.

Today's article recommending Gold as an important asset for investment is a very insightful read.

Excerpts:

...the return of inflation is the biggest scourge of paper money and the biggest argument in favour of gold. Therefore, to look back at history and discredit gold is not very rigorous since, I believe, inflation resurgence makes the case now for gold, if it did not do so earlier.

Equities are denominated in paper money and when paper money loses its sheen, so would paper-backed assets. At least partially, that anxiety drives the campaign to discredit gold as a potential alternative asset for investors.

India's first online weekly on personal finance

The fundamentals of Money Market in India

RBI announced its annual Monetary Policy yesterday. There's a lot of talk on CRR, repo rates, reverse repo rates, market stabilization schemes, Dollar buying, etc. I have been trying to make sense out of the jargons and thought it a good idea to understand the framework in which all these jargons are used.

I made 23 slides on the fundamentals of Money Market in India which I'm uploading below.

A few things :

• CRR (Cash Reserve Ratio) is the amount of cash that commercial Banks have to keep with the RBI. This has been raised by over 175 basis points over the year. The idea is to drain excess liquidity. This in turn should work to contain inflation.
• Reverse repo rate(6%) is the rate at which RBI absorbs liquidity and the repo rate(7.75%) is the rate at which it injects liquidity.
• The call money market should theoretically operate between these two rates.
• The other ways of soaking liquidity from the market is Market Stabilization scheme (MSS) and buying Dollars.