Personal Finance by Tuhin Chakraborty

-Tuhin Chakraborty  The rule of 72 It tells, the number of years it will take to double your money is given by dividing your expected rate of return by 72. For example at 10% return, your money will double in 72/10 = 7.2 years. Rule of 70 This rule gives us an idea about how inflation is eating away our money. Dividing 70 by the average rate of inflation gives the time during which the value of your money will be half after considering inflation. For example, at 5% average inflation rate your money shrinks to half from its initial value in inflation adjusted terms in 70/5 = 14 years. Asset Allocation The best rule of thumb for asset allocation, considering the effect of your age is. 100 - your age rule. This tells us the aforesaid quantity in percentage terms you should invest in equity securities. Rest in debt securities. If your age is 40, then you should invest 100-40 = 60% of your portfolio in equity securities and the rest in debt securities. Reasonable Expectation...

-Tuhin Chakraborty  Widely considered as the definitive book of value investing. This is also the book which taught the legendary Warren Buffett about investing.  Investing vs speculating: In Graham's words, "An investment operation is one which, upon thorough analysis promises safety of principal and an adequate return. Operations not meeting these requirements are speculative." So, even before thinking of investment one must develop the mindset of investing and understand the differences between these two. To be a successful investor one should follow the story of his investment and then connect it to the numbers supporting the story. Inflation : it's the fancy economic term for advances in prices of goods or in other words, it's the shrinkage of purchasing power of our money in real terms. In a growing emerging market economy like India, the average historical inflation rate has always been in the moderate to high range. And our popular investment v...

A small savings each month, if invested properly for a long period of time can accumulate a significant amount of wealth . Sounds simple. Isn't it? So let's break this sentence, so that you can apply this principle in your life with whatever little or huge amount of money you have (or, more precisely, you manage to save). 1. Discipline and importance of savings: Almost all of us know the importance of savings but only a few of us have the required courage to save by delaying our 'instant gratification' by spending in useless things. So building a strong habit of saving is important as saving enables you to have the required capital to start investing.  Now, the question arises-How to save and how much to save? Let's consider, you are earning, let's say I rupees per month( if you are earning more than great) and your total expenses of the month is E so you have (I-E) saved. Now, what you should do with saved money is to build an emergency fund of at l...