Thursday, October 19, 2017

Wish you a Happy Diwali ...


Diwali, the festival of light, is when Hindus perform a Laxmi pooja. What are we asking for when we pray to Goddess Laxmi? We ask for prosperity, not just money. There is a difference between the two. In order to understand the same, let us look at the photo of the goddess we use for the pooja.

One of my favourite Diwali posters is one that shows Goddesses Laxmi and Saraswati along with Lord Ganesh. It is not for no reason that these three are shown together.  
While we all need blessings of Goddess Laxmi to be successful in life and grow, she must come in our life flanked by Goddess Saraswati – the goddess of knowledge and Lord Ganesh – the god of wisdom. If Laxmi comes along with these two, it stays and brings bliss in life. And that is true wealth – not mere financial wealth.
Trying to earn more and more money without proper knowledge and wisdom can lead to ruins. Money may come but that would not bring bliss in life.
The difference between “knowledge” and “wisdom” also must be understood at this juncture. “Knowledge” is to know something – to be aware of something – to understand and being able to explain it. “Wisdom” is intelligence – it is about being able to judge – to use discretion – being able to separate the good from the bad – the right from the wrong.
First, let us address the knowledge part. It is critical to know what one is doing. “Look before you leap” is not just a proverb; it’s a great advice. Whether it is income, expenses, loans or investments, it is important to know.
Questions on income:
·       How sustainable is the income?
·       How stable is the source of income? This is especially critical for self-employed persons and small business owners. However, in the present times, even jobs are also not guaranteed.
·       Do you understand the taxes on the income?
Questions on expenses:
·       Know the monthly budget – the expenses you incur
·       How much of the monthly budget is spent on necessities and how much on luxuries? Which of the luxuries can you cut down?
·       Is it possible to reduce some expenses through finding alternatives?
·       Have you kept provision for these expenses in case there is an emergency, e.g. health issue or loss of job?
Questions on loan:
·       Have you understood the terms of the loan?
·       What is the interest rate on the loan? Is it too high or too low? If it is too low, is there a catch?
·       What are the various penalty clauses?
·       What are the flexibilities?
·       Can you terminate the loan earlier without any penalty, in case you get funds suddenly?
·       What is the security required by the lender?
Questions on investments:
·       Have you understood the terms of the investment?
·       What is the (expected) rate of return?
·       Is it too high or too low? If it is too high, is there a catch?
·       Is the risk too high? Understand the risk involved. If you do not understand the risk, please avoid the investment. Every investment carries some risk.
·       Is there a lock-in or is the investment liquid?
·       At what rate would the earning be taxed?
This is not an exhaustive list, but only an indicative one.
Discretion is required both while earning as well as spending. Is the money coming in through the right means or are you taking some actions, which may be incorrect ethically or morally? Are you spending too much money for luxuries than fulfilling your responsibilities?
Wisdom and discretion must be applied to the assets and liabilities, too. Are you borrowing wisely? Is it really required? Is it a good loan? Are you investing smart? Or are you acting on tips without understanding the risks? There have been many instances when one has asked “Is it safe?” or “I hope there are no risks” in stead of asking “Please tell me about the risks present. And how do we manage those”.
So, this Diwali, make sure to pray for Laxmi to arrive at your place – but the right type and through the correct means. Pray to Goddess Laxmi to stay in your life forever. Make sure your life is worth for her to stay forever.
-        Amit Trivedi
The author runs Karmayog Knowledge Academy. Recently, Amit has authored a book titled “Riding the Roller Coaster – Lessons from Financial Market Cycles We Repeatedly Forget”. The views expressed are his personal opinions.


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