200 OK SwatantrAI

You are well paid, well off, have a good lifestyle. But can you afford to stop working? If your answer is ‘No’, then you are just financially stable – as long as you get your monthly cheque – but far from being financially independent. You’re also not alone – a large number of people retire without being financially independent.

Financial independence is a state where you are free from all liabilities and have created sufficient wealth that can generate a constant stream of income that allows you to maintain your lifestyle without having to work them. Getting there requires meticulous planning and disciplined investment.

It also means revisiting your portfolio and investment strategy to ensure that your plan is not getting derailed by external factors like market forces and interest rate variables. Swatantra Kumar, 33, who works with a multinational firm in New Delhi, is a perfect example of a man moving towards attaining financial independence. Married to Shelly who also works, Kumar feels that he would need Rs 75 lakh for his three-year-old son, Lakshit’s higher education, marriage and their own retirement. Swatantra invests Rs 24,000 per month in a disciplined manner in mutual funds, Public Provident Fund and National Savings Certificate to meet these goals.

To be financially independent you need just six simple steps – finding out how much money you have today, knowing how much you need for tomorrow, getting adequate life cover (through a pure term plan only, do not buy any other insurance product), investing the surplus as per your risk taking ability, and writing a Will.

Home buying tops the priority list of all individuals and also is one of the most important asset that one builds. Also, with the availability of loan, which offers tax benefits, it becomes more beneficial.

While experts advise not to take loan for a depreciating asset, they say that individuals should careful while taking a home loan and not over-leverage in a bid to build the asset.

“One should not stretch to buy the house, buy only when the income is sufficient to support the purchase and keep headroom to meet increase in EMI (equated monthly installment),” said Amar Pandit, a Mumbai-based financial planner. The EMI should be such that it offers room for saving. “Ensure that you save 10-30 per cent of your income after you have paid your EMIs as it will act as a cushion in rainy days and you will be able to pay the EMI from the corpus built,” said Lovaii Navlakhi, managing director of the Bengaluru-based financial planning firm International Money Matters.

Once basic needs are covered, it is time to plan for wealth creation. Simple projections show that you do not need millions to make millions. All you need to do is begin investing – and begin early. An investment of Rs 5,000 per month started at age 25 can become Rs 1.6 crore by the age of 50 if invested in an instrument that returns an annual rate of 15 per cent.

“While equity and debt investment will differ individually, as a thumb rule one can allocate 100 minus your age in equity and the rest in debt,” said Surya Bhatia, principal consultant at the Delhi-based financial planning firm, Asset Managers. “Gold can also form a part and one can invest 5-10 per cent in it.”

'Coz sharing is caring

Thanks to Windows 7, a lot of people have purchased new computers or are
planning to. And that leaves them with one of life’s more pleasant problems:
what to do with the old machine.

With prices for used computers so low, reselling an older PC is often more
trouble than its worth, and you can actually get more value out of your old
machine by keeping it and using it for another purpose. Here are some ideas to
get you started.

Data Backup Machine: If your old computer is a desktop with a
    decent amount of storage or the capability to hold more storage (hard
    drives) than it currently has, it’s a good candidate for duty as a Windows
    Home Server.

    Buy an OEM copy of Windows Home Server on a site like Newegg, install it on
    your old machine, hook the computer up to your in-home network, and you’ll
    never again have to be embarrassed when someone asks you whether you back up
    your data. The answer will be ‘yes, every night.’

Test Bed: How many times have you installed an application –
    only to regret it later when it causes your computer to become slower or,
    even worse, to crash?

    Put your old computer to use as a ‘test‘ machine, and you can say
    goodbye to nightmare installations of new software. Install them first on
    the old machine and see how they work, then you can decide to install them
    on your main machine or to just forget the whole affair.

Test another Flavor: Windows isn’t the only operating system out
    there. In fact, many would argue that a lot of the action these days is in OpenSource
    Operating Systems. What better way to test all of this out than on an
    old machine?

    The Ubuntu operating system (http://www.ubuntu.com/GetUbuntu/download) is
    the hands-down favourite among those who want to get their first exposure to
    Linux- based computing.

    Ubuntu is easy to install, as it recognises plenty of hardware
    automatically, just as Windows does. Once installed, you’ll feel pretty much
    at home if you’re familiar with Windows, since Ubuntu follows many of the
    interface conventions to which Windows users are accustomed.

Gaming Zone: If you’re into computer games, you already know that multi-player
    action is where the fun begins. But without multiple computers in your
    house, there’s no multi-player action. A spare computer clears up that
    problem.

    If you’re not a gamer but you’ve always wondered how much fun it would be to
    play multiplayer games (lots), then put that old machine to work on your
    game of choice.

Dismantle It: When you hear people talk about hard drives,
    memory, video cards, or motherboards, do you secretly want to run away? Lose
    the fear by taking your old PC apart and seeing what’s in it. A Philips-head
    screwdriver is pretty much the only tool you’ll need.

    Find a tutorial online that helps you identify the parts you see
    inside of your computer, and you’ll no longer be at a loss to understand how
    hard drives, graphics cards, memory, and other components are attached.

    Plus, when you need to replace or upgrade one of these parts in the future,
    you’ll have a clue about how to do it yourself.

Donate It: Your old computer might not be up to the
    task of running Windows 7, but there are people who won’t care and will be
    happy to take it.

    Start by surveying members of your family. If your old computer is a
    notebook, chances are good that someone in your clan will love it, even if
    Windows XP Home is the only thing it can run with any degree of success.

    If your old computer is a desktop, perhaps a member of your family who needs
    a computer primarily to surf the web or play the occasional game of
    solitaire will be just thrilled to have it. Check around. It’s probably
    worth more in good feelings of being generous than any resale would be.

It’s always a “Win-Win” situation for you. So don’t panic,
enjoy this.

'Coz sharing is caring