How does Fiscal Discipline and Prudence help in Generation of Wealth – Finance tube

This video is a continuation of the series where Mentor Capitalist G.Ramachandran continues to share his valuable insights on the varied topics of finance. This time he gives a clear approach on how should someone use fiscal discipline and prudence to generate wealth. He has suggested to have a short term goal and a long term goal. Before deciding to invest in anything, he has advised considering the risk-reward ratio. He proposes to have our regular earnings determined well with a focus on what shall be the surplus. And then decide to have diversified investment, primarily into real estate, debt funds and equity funds + SIPs.

Ladies and gentlemen boys and girls welcome back to finance tube since the last two three episodes i am seeing that the energy levels and the engagement levels of the channel has improved just because not just my company and all of you but our channel has got a new mentor and i have requested him to continue with us for at least two more episodes because there’s

A lot of demand that is coming up and friends giving respect to your suggestions and demand we again have gr sir here today and i have this very pertinent question which i don’t remember where i got it from i think one of the comments said that vikon gr sir tell us more about fiscal discipline and prudence how it results in to wealth creation sir so this time no

Formality straight to the question people are very eager and been waiting for this answer so why don’t you tell us sir that how does fiscal discipline and prudence help in generation of we’re first and foremost fish shark this is a very very critical question and i would love to tell the viewers here that wealth creation is done as easy job first and foremost

When we want to create wealth we need to know what are our goals our goals are going to be very clearly defined in that sense you need to have a short term goal and a lot of cool you need to say that these are the assets in which we will be investing and these are the reasonable returns that we are expecting there is something known as a risk reward ratio higher

See also  Early Retirement Can Make You Rich and Alone

The risk here the return lower the risk lower the return that doesn’t mean that we put all our eggs in one basket and go for a high risk high return methodology or we go into a low risk low return methodology we have to have a fine balance between the two for this what do we do we need to first be saying that we earned so much and we need so much of a money on

A monthly basis for our normal day-to-day comfortable living after that we have something which is known as a surplus which is there in the system and this surplus has to be invested judiciously and with prudence what do we mean by saying it should be judiciously done we cannot be saying that the surplus will be invested into some instrument which will give you

Returns of say 30 percent per annum the moment you cure someone say that i’ll give you 2.5 percent per month the where that’s not wealth creation the kiss that is a very very high risk and almost zero return that comes in your way so please don’t get into that those are the ones which are done in the film industry and where the stakes are high the failures are high

And there is every chance that your money will never come back ting so avoid that what are we supposed to do we are supposed to look at different types of investments divide it into three categories one should be investments in the real estate second should be investments into your debt funds and the third should be investment into equity funds and assignments now

See also  Investing Ep. 3: Efficient Markets are not Efficient | BeatTheBush

If you were to make a judicious division i would suggest that you should put 40 30 30 40 person you can put in real estate in a small way 30% 30% the rest to because you need to be having some real estate in your system like start with a smaller house which is a roof over your head and if you don’t even want to live in that house you can give it on rent which

Gives you a year on your return with an automatic escalation attached to it so you’re getting the inflation adjusted return every year on the rental income that one second when you’re investing in debt funds you’re going to get a tax-free dividend in the form of debt funds returns that’s very useful you don’t have to pay tax and the third one what you need to

Do is you have the equities and the si b’s which give you that extra return but with not a disproportionate rise in the risk in terms of what you take as a risk in the system your risk appetite has been actually taken cognizance off and then you’ve gone about investing it now if you look at this pie chart it’ll be very interesting to see that you are slowly into

Creating wealth through movable and immovable assets the immobile assets obviously is a realistic and the moogle assets is the debt funds which can have capital appreciation and equity funds which obviously are for capital appreciation less what evidence more for capital appreciation more for wealth creation and if the wealth is to be created the right way around

We have to go for winners in the equity funds where the fund managers are critical you need to see whether they are doing value investment or momentum trading so that part of the research you have to do it as for as the debt funds and the equity funds are concerned and as far as a real estate is concerned one caution never go for under construction even if you

See also  GM cuts jobs in face of bleak outlook

Play a little bit of a premium go for one which is merely completion so that you’d know that the asset is going to come in your hands soon and it could be earning an income sooner than later so according to me fiscal prudence and financial discipline can really really insure that you are into a well creation mode and the habit of saving creating a surplus will

Automatically infuse a sense of discipline and you will be creating wealth unconsciously automatically for you for your family and for the well-being of everybody near and yogi thank you so much i think that step by step pertinent solution is what all my viewers were looking at thank you so much gr for gracing us with your time and we are really delighted to

Have you here a lot of my friends in fact after the last episode called me and said that this is going very well why don’t you continue doing it i said asha it’s a pleasure with shaft thank you so much any time i’m there anyway am there for counter trials a mentor i’m around here to help you in this journey of yours in the garage thank you so much thank you so

Much thank you so much friends for tuning into today’s episode and if you haven’t subscribed to our channel please do subscribe and i’m going to take a sneak peek on one or two more episodes which sir because he has gracefully accepted it so subscribe to our channel today our channel finance you

Transcribed from video
How does Fiscal Discipline and Prudence help in Generation of Wealth – Finance tube By Finance Tube

Scroll to top