Finances Simplified For NRI ( Non Resident Indian)

When the phrase NRI is referred, the picture which comes to ones mind is HNI ( High net worth individual’. Let’s make it clear NRI is just tax status and nothing to do with HNI. In simple terms not all HNI are NRI and not all NRI are HNI.

For one to achieve HNI status one needs loads of commitment , discipline and frugal living. When one relocates outside India in hope of better income/standard of living and other things, little does one know that every county has its own advantages and disadvantage. Majority of NRI tend to complicate the finances further and loose the opportunity of wealth compounding.

In this write up let me share few basic tips which will help you to organize your finances in better way. Please remember it’s personal finances and no single tip or rule can be generalized to all. But one can few rule of thumb which can help to keep the finances clutter free and simple to manage

Here are simple things you should be doing and avoid complicated investment

• Simply Stick to NRE Fixed deposit in Indian banks for giving stable returns ( also known as Debt asset allocation)
• For Indian Income which is in NRO bank account : Consider investing in Debt Mutual fund / Equity mutual fund ( NRO Fixed deposit are not Tax friendly )
• Invest At least 50% of your monthly saving into Equity : For equity consider Index mutual fund ( Indian Index and overseas index fund ). If you have the expertise and sufficient knowledge and time to dedicate then consider Direct Equity
• Don’t be lured by Dollar investment products and products which offer mixed investment and insurance product
• Have risk cover back home : Term insurance and Health insurance are the only insurance you will need. Buy it when you are healthy

Above investment should be sufficient to diversify and easily maintainable. The logic is simple : Majority of us plan to go back to India one day either for good or kid education. If the investment are based there then it would be helpful

If someone is planning to get kid education overseas then still don’t run around USD based investment unless you are sure of having the kid educated in USA. Keep the finances simple , in long run it be really be helpful and easy to manage.

Happy Investing.

If you have any suggestion , message below.

Craze for USA/International Stock Investment : Should you really rush for it ?

The recent trend in today’s investament is : USA stock investment and international investment. This is FOMO ( fear of missing out ) Look at many of the brokers and mutual fund investment platform , one would see a big display

“invest in USA stocks”

“Zero brokerage “

Etc

Let’s come to the real facts. We need to ask the following questions to ourself

1. Do we need to have international equity exposure in our portfolio ?

2. Are we aware of taxation of international equity ?

3. Are you aware of currency transfer cost ?

Take your own time and decide for it. In spite of the advertisement claiming zero brokerage and fractional investment of stocks I would see the following disadvantages

• The brokerage account may be charging zero commissions here in India , but their counterpart brokerage firm situated in USA would be charging brokerage
• The transfer cost are too much for smaller amount : In a long run one tends to discount it and is never tabulated while calculating returns
• One would be waiting for few days for the money to transferred from Indian bank account to overseas broker bank account. Once the credit happens , then wait for late night transaction to do the investment ( remember it’s night in india when the USA markets open )
• When one redeems the investment and plans to withdraw back to Indian bank account : one more cross currency charges apply ( conversion from USD -INR ) . These invisible charges are high enough in long run and defeats the purpose of direct investment in International broker
• It does not provide Flexibility in investment

Finances are something which cannot be generalised. But one thing that can be generalised is try keeping the finances simple. In my personal opinion if one plan to invest in International equity : The easiest and simplest way is

Invest in International equity through Indian Mutual fund houses. The convenience and ease of investment is something which is very comfortable

All the returns you see is following TER , cross currency charges and other invisible cost. Don’t be bothered about expense ratio, tracking error once you decide the fund. Invest adequately and invest well. Also do have sufficient equity asset allocation to Indian Equity.

Happy Investing

Free Online Consultation for Indian Covid Patients

With the recent surge in Covid cases in India there has been huge hurdle faced by individuals diagnosed by covid-19 , by hospitals and by government. There has been acute shortage of beds, oxygen and other resources. Many individuals who are under home quarantine are not able to access to medical advise and opinion.

We group of Indian doctors would like to extend a helping hand by providing free consultation : By message , calls( audio or video ) absolutely free of cost.

We are available on : Telegram and Facebook , click on the logos below to join us and help lending hand to each other.

https://t.me/indiaagainstcovid21

Medical fraternity and others can come online on this platform and extend helping hand to each other in time of crises. For sure we would be able to tide over crises and defeat the pandemic

LETS WIPE OFF COVID VIRUS FROM OUR PIOUS SOIL

Free Consultation for Indian Covid Patients

Lets Fight it out

With the recent surge in Covid cases in India there has been huge hurdle faced by individuals diagnosed by covid-19 , by hospitals and by government. There has been acute shortage of beds, oxygen and other resources. Many individuals who are under home quarantine are not able to access to medical advise and opinion.

We group of Indian doctors would like to extend a helping hand by providing free consultation : By message , calls( audio or video ) absolutely free of cost.

All you have to do is follow the following steps

1. Install Microsoft Teams on your mobile device

For android phone click on https://play.google.com/store/apps/details?id=com.microsoft.teams

For Iphone users click on https://apps.apple.com/us/app/microsoft-teams/id1113153706

2. Once you have installed and registered on Microsoft Teams , click on the following link and join the India against Covid by click ing this link https://teams.microsoft.com/join/2g2spg7wskpp

3. Check out the list of owner and share your issue just like how you share on WhatsApp , you can even request for call ( audio or video ). The owner list has all the physicians available.

We would do our level best to provide information and sort out any medical issues faced. Also kindly note that this is done in interest of fellow citizens as a gesture of helping the community. None of the doctors will be held responsible for any issues arising out of the advise provided.

Do pass on this post to your family and friends .

LETS COME TOGETHER AND FIGHT IT OUT

I REQUEST THE PHYSICIANS ( Any Branch preferably MBBS, MS/MD, MCH/DM, etc ) to join and send request for being owner. Please identify yourself as physician and please help the fellow brothers and sisters in crises

INDIA AGAINST COVID : LETS WIPE IT OFF FROM OUR PIOUS SOIL

https://t.me/indiaagainstcovid21

https://www.facebook.com/groups/indiaagainstcovid/

SIP in Stocks and why it’s not a good strategy for long term investment

The right terminology used for regular direct equity would be SEP( Systematic equity plan) : A mode of investing regularly at fixed interval in selected portfolio of stocks. 

Before knowing the drawbacks of it, let’s first understand how does one do SEP. Let’s consider Mr Ramu , he plans to invest in his carefully selected bunch of stocks based on his research. To make it simple he selects blue chip stocks carefully selected from the Nifty 50 portfolio of stocks. Let’s consider a random example of a portfolio consisting of just 10 carefully selected stocks 

Name of Stock	Price of 1  Stock
Asian Paints	2400
Bajaj financial service	9400
HDFC Ltd	2500
HDFC Bank	1500
Maruti	7200
Nestle India Ltd	16700
Reliance India Ltd	2100
TCS	3150
Ultra tech cement	6934
Dr Reddy Laboratory	4372
Total amount needed to buy 1 stock each of above 10	56256

Above price are round figure prices for closing price of the above stocks as on 23 rd March 2021. Now Mr Ramu has selected ten good companies out of the Nifty 50 stocks and created his own universe of blue chip companies for systematic investment plan in these stocks. Now when he plans to apply for SEP in the stocks as per his plan. To buy 1 stock each of the above companies for today he will need Rs 55256. Fair enough his first step is done that’s selection of stocks based on his intense criteria. Now comes the execution part of it 

Step 2: Execution : He decides to invest regularly by buying 1 stock each of the above shares everything. So for the month of March he has to invest Rs 56256 to get one share each of the ten good blue chip stocks. 

Easiest way for Mr Ramu to execute this plan in disciplined way would be place a SEP order for execution of buying one stock each on fixed date every month. 

I hope the SEP principle is clear to the reader and how it works. 

Now let’s look at the practical issues associated with this investment principe 

1. Selection Bias : Now the stocks which investor has selected depends on his own research and his bias to certain stocks while selecting.  This is concentration risk of having exposure to just ten stocks. Now one may argue that the returns are more with concentrated portfolio , it may ore may not be true but the fact is risk of investment significantly increases 
2. Variable amount of investment every month : Now if we look at above example the amount needed to get 1 stock each for ten stocks selected is Rs 56256 as of 23^rd March 2021. If the next SEP is scheduled on 23^rd March 2021 then the amount needed to buy the same quantity of stocks will not be 56256 Rs. Even if we consider the above stocks have low volatility the amount of investment can vary +/- 5% . Individual volatility may differ but let’s assume the aggregate or average volatility of the whole portfolio. So what does it mean ? It just means the amount needed next month could be either 52000 Rs to 58000 in this range. So every month this difference can keep increasing. After few years the amount needed would be extremely large to buy single share of each of this ( to make it simple let’s assume every stock selected will perform well and will be in uptrend : practically we don’t see such scenario )  We all have fixed income and if you are okay with such variable investment every month then go ahead !!!!  Imagine if your Home EMI was so fluctuating every month , would you comfortable ? 
3. Buy right , sit tight and forget it is not the right strategy for direct equity investment : Every stock has its right time of entry and right time of exit too. For direct equity investment we need to have a fair price of entry , after investing if a stock falls below the average buying price and keeps falling then we cannot keep averaging it. Remember the saying “ Do not try to catch falling knife”.  Every stock needs to have Stop loss criteria too , intent of investment is not just more returns but also reducing the losses systematically.   To make it more simple let’s consider direct equity investing like doing agriculture. Let’s say farmer has planted sugarcane , he has to sow it at time of the year , water it well and also harvest it right time. Now if there is failure of crop of some reason , it would be futile watering the crop ( in case of stocks , use stop loss and exit off the scripts in losses ) instead the farmer will accept defeat and use alternative crop Like raggi. 
4. Direct equity systematic investment does not just mean keep investing in the selected stocks. One also needs to regularly analyze the performance of each stock. Exit when the target is reached or stop loss is hit. In simple word it’s a extremely active process which requires periodic review and assessment. 

Ideal investment should have the following criteria 

1. Simplistic 
2. Easily reproducible of majority of us 
3. Requires least intervention or complicated assessment 
4. Should be flexible : both in amount and frequency of investing 
5. Preferably have no lock in 

Many would be too enthusiastic and try to start up with SEP on the pretext to have more returns and reduce the cost. It could work for some , but for majority it would just cause fatigue and bias to certain stocks.  For that no investment is perfect , what’s more important is making investment journey as less tiring as possible. 

Would you be interested if I say that you can have exposure to above stocks even if you have just 1000 Rs to invest and you don’t need to do intense research for stock selection and portfolio analysis ? If yes then message in the comment section and I would definitely write in the next post on how to have a simple easily manageable portfolio. 

Share to Care 

Together we Progress 

Trick to Download Youtube/Facebook Videos

Many of the time we may need to download Youtube/Facebook videos for our own use or forward a really interesting video to family and friends. In normal circumstance, Youtube /Facebook does not allow it.

Here is a trick on how to download Youtube /Facebook/Instagram or any video with a link

Trick for Android device

For android device its very simple

1. Open any Browser
2. Click on https://en.savefrom.net/
3. Paste the link of video you want to download and click download : The video will be download in the file of the android device ( you can select the resolution and type of file too )

Extremely simple and straightforward

Trick for Iphone/Ipad

Following are the steps to do it in iOS devices

1. Go to App Store and install Documents app : https://apps.apple.com/in/app/documents-files-pdf-browser/id364901807
2. Click on web browser symbol present at right bottom side of the Documents app ( Safari browser logo )

3. Enter the following address in the browser window and save it as bookmark ( for easy access next time ) . Enter this addresshttps://en.savefrom.net/

4. Paste the address of YouTube /Facebook or any video you would want to download in the window and click download

Paste the link in the enter the URL box and download the video

The video will automatically be saved in download folder of Documents app

I hope this information would be helpful to you.

Together we Progress

Finances for Kids

Start it from young age

Major breaking and happy news in couple’s life

The moment a couple come to know they are expecting , happiness knows no bonds and they are on cloud nine!!!!

Once the baby is born, parents get involved in parenting which usually is quite stressful as they are going through the experience first time. Once they are comfortable with parenting , if it’s girl child many parents tend to accumulate gold for marriage of kids. Some end up buying kids plan / child education plan. All this mainly because of emotional factors associated with being parents

In this post I shall suggest a simple approach on how to manage finances from the aspect of kids. There is nothing like right or wrong. Many of the things in life can be kept simple.

Following are some of the recommendations

• Never invest in name of kids : Logic is there is advantage in it. Infact it complicates finances. Keep is simple: simply invest for their future goals from your own account
• Teach the value of money right from childhood
• You do not have to fulfil all their wishes : you need to know when to say NO
• Do not apply for PAN Card in name of kids : Even if you apply , when the kid attains 18 the PAN has to be re-designated as Major
• Enrol the kid in family floater health insurance

Here comes the most important management especially when the child is going to be 18 years : Legal age to vote and be a responsible citizen !!l Following are some of the recommendations

• Apply for PAN Card : Once your kid is 18+ apply for PAN under his / her name. It can be done online using aadhar based online application
• Apply for Bank account : Select Bank with good internet banking facilities
• Apply for PPF : One can open PPF account online and link it to Bank account and start investing in name of kid. Once he / she starts earning they can increase their investment
• Get Health Insurance for child ( even if the child is 18+ for parents he/she will be kid for rest of life ) : If the kid is in existing family floater health insurance , remove kid from the policy and get a new individual policy for her !
• Get PAN KYC Compliant and start investing in Equity Mutual fund : Introduce your kid to investing from your age itself. They can be motivated to invest from their pocket money. Once they start earning they can increase their investment
• Demat account : Demat account can be opened online for child and motivate them to invest in good quality stocks

Guide them and let them learn the things on their own. Let them make mistake and learn things. If they start early , by the time they are in late 20 , they would have developed their own investment style and be more matured.

Let me also point towards harsh reality. Our educational system is more theoretic and many branches , kids have no internet exposure to finance. Many don’t take it seriously. Being parents it’s our responsibility to guide them.

You can write to me if you need any further information

Together we progress

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Strongest Finger First : Vote can bring in the changes you would want

• 

Many of us have been busy warriors online, where we fight, quarrel and show our point to be right. No doubt it gives us the much needed pleasure when we prove our point.

Such social media wars would take us nowhere. If we want to be heard and things to work the way we would like to then there is only one way

VOTE : Vote for the candidate of your choice. Be it state election or general elections

Many of us face the following issues

1. NRI : Non Resident Indians who have been residing outside , would not be having Election card either never applied or forgotten
2. Election Card number not found in data base : EPIC or Electors Photo identity card is election number which is specific for a given individual. Some individuals could find their number deleted from data-base
3. Change in residence : Migration happens a lot in present society. Individuals keep changing their place of residence majorly due to change in workplace or occupation. Such individuals usually do not exercise their voting rights , as their present location could possibly be far away.

As citizens of India its our responsibility to ensure that our voter id is active and is registered in the constituency where we currently reside.

Everyone of us can spend few minutes to check it. All you have to do is click on

https://nvsp.in and check whether your EPIC ( voter id ) is active. Also you can find out your EPIC if you do not know.

Alternatively you can download Voter id app from android playstore https://play.google.com/store/apps/details?id=com.eci.citizen

Iphone users can download the app from App Store by clicking on below link https://apps.apple.com/np/app/voter-helpline/id1456535004

It will provide all the following functionalities and majority of changes, new applications can be done online from the above app or the link provided

Voting is your right . Exercise your power by showing the strongest finger. Strongest finger is the index finger and not the one which we use on social media.

Lets Progress together

Saptarshis Of Investment

Saptarishi refers to seven great sages of Ancient India ( Sapta : meaning 7 and Rishi: sages). Investment and personal finances are easier managed if we apply few basic principles and stick on to them for our investment requirement.

Finances consist of two main aspect

1. Investment

2.Risk Management ( Pure Insurance )

Keep Investment and Insurance separate. Do not mix them !!

Each of the seven sages were unique and there is no replacement for them, either within themselves or anyone else. On similar note, it’s important to keep the investment in simple way and stick on to it based on the needs: understanding the fact that each one is unique and cannot replace the other. So understanding the basic concept of each and using it for its intended purpose is very much needed. One need not think of any other investment other than these seven Saptarishi of investment: Keep the life and financial life simple. 

Lets get to the point of enumerating the

Saptarishis1. Bank accounts: Stick on to Saving Bank account, Recurring deposit and Fixed deposit (Commonly referred to SB, RD and FD). Use no other banking products. Each has its own specific purpose. SB for storing money which is intended for use in near purpose, RD for accumulating money for some goal ( Example saving for child school fees due next year, saving for purchasing gadget etc) , FD used for parking lump sum money which one does not intend to use for more than a year.

2. Government Small Saving Scheme: There are many and one needs to stick to two schmes only. Public Provident fund ( PPF ) and SukanyaSamrudhi Yojna ( applicable to girl child ). These are the two best Small saving schemes backed up by Government of India. One can accumulate good wealth with least risk

3. Equity Investment: mainly through the route of Equity Mutual fund and small exposure to Direct equities. Investing through Equity mutual fund with good analysis drastically reduces risk of equity. It is very important to understand that its important to have adequate investment in equities for long term goal , so that one is able to beat inflation.

4. Employees Provident Fund : Those who are eligible for it , it can be a good investment tool and one can accumulate great wealth over long term

5. Arbitrage Mutual Fund: Taxation wise they are taxed similar to Equity mutual fund but the risk is very less. It gives average returns with less risk

6. Liquid Mutual fund/ Debt : They are mutual fund which invest in money Market and securities with low duration maturity and give average returns and less risk

7. Real Estate : It suffices to requirement of shelter and if one has additional corpus one can consider investment in it without altering asset allocation. Easier way of Investing in real estate is REIT

Many investors keep seeking new investment and alternative investment, sticking to basic investment and keeping finances simplified has created more wealth . Each Saptarishi is unique and cannot be replacement for another. Also one cannot be compared with another. It’s-important to analyse the returns, risk, framework and use it for intended purpose. Seek no other investment and stick to basic Saptirishi and enjoy the wealth and fulfil your goals.

Remember the following 1. There is no replacement of unique financial product : Every Saptarishi is unique2. Don’t Chase the returns, chase your goals instead 3. Don’t complicate your financial life , keep it extremely simple 

In the coming post, we shall be discussing each of the Saptarishis Separately and how best to use them and how to simplify our complicated financial life

Together we Progress

We have done our part of showing the care by sharing little we know from our experience

It’s your turn 

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Kasturi Deer and Investing : Analogue

Analogue between investing and Kasturi Mirga
🦌

Kasturi” is the Divine Perfume that has the most intoxicating scent possible. It is embedded inside the navel of a deer called “Kasturi-Mriga” (“Mriga” stands for “deer”). Since it is embedded inside the navel, it is not visible to the naked eye. However, the scent of Kasturi comes out of the deer’s navel and spreads in the surroundings.

Kasturi deer

The scent is very very addictive and exciting. The deer, of course, smells it and becomes totally attached. So much so that the deer wants to smell Kasturi all the time. However, it has no idea that the scent is coming from within its own body. Therefore, it starts searching for the scent in its surroundings.

When it does not find the source of scent anywhere, it goes wild. It starts running from here to there and from pillar to post. It forgets to eat, it forgets to drink. It runs faster for the fear it may never find Kasturi.

The Mriga gets tired. But the scent comes unabated. It keeps permeating its surroundings, driving it crazy and provoking it to start the mad search again. The Mriga gets up yet again, starts pushing its old and worn out legs in search and eventually drops to the ground due to sheer exhaustion and dies!

This was all about Kasturi Mirga( Deer ) 🦌

When it comes to investing it’s the same thing. We keep looking for best funds and best stocks.

The best funds are the ones you are already investing. We keep hunting for stocks which can outperform others based on our own presumption and speculation.

Infact if we are mutual fund investors : possibility is that we would already have been investing in stocks which can cause disruption of the sectors.

In the lockdown period : when online web conferencing became a norm : Share prices of Zoom / Cisco webex sky rocketed 🚀

Investors of S & P 500 already had it in their kitty ( as the index is diversified and any other sector undergoing such disruption can benefit from it ).

Many investors jumped into zoom stock based on speculation. Remember speculation don’t alwYs work.

What works is diversification and strategy. If your portfolio is well diversified, possibility is you will definitely benefit from any future disruption.

We may assume that vehicles working on fossil fuel ⛽️ ( petrol and diesel ) could be banned or reduced in numbers when EV ( electric vehicles ) become more popular and efficient and affordable.!! —> So we tend to look out for stocks dealing with EV 🚗

But if we sit back and relax : If we have been investing in Diversified Mutual fund – possibility is high that the kitty bag 💼 of fund will already be having such stocks.

So stop being like the Kasturi Mirga : looking out restlessly for such stocks and funds.

Keep your portfolio diversified and invest in it. Many of the stocks you would already have which could cause such future disruption.

It’s just not about one sector but many sectors. Even payment system shifted to electronic payment and the sector underwent disruption too.

Investment is all about being happy with your existing investment which are goal based and keep investing.

Stop looking out for fresh investment option which is a never ending journey!!
When you already have a diversified portfolio: Just stick to it

Keep investing
Stay Safe

Regards
Dr DK