Kavitha Menon's Blog

For a large number of Mumbaikars owning a property in the city has become a distant dream . A quick search on a couple of real estate portals reveals that median prices for two BHK apartments is Rs. 1.5 crore in the western suburbs . Buying properties involve a  black component the percentage  of which  can be as high as 60% to a reasonable 30%. A mere  30 % black component in a deal of  1.5 crore  equals 50 lakhs . This becomes part of the money that  a home buyer funds from his savings . The real bummer is that  the bank will provide loan only on the white component . Which means it will fund only 80% of the 1 crore white component in our example . Thus over and above the 50 lakhs( black) , our home buyers will have to fund a further 20 lakhs from pocket . (No wonder  home loans are the safest assets for bankers !!) Isn’t it wonderful that such a large number of Mumbaikars seem to have this kind of money to buy homes?. Reality is that it is small number of investors who

You haven’t heard this one before!- Contrary to what you would have heard from every TV channel and investment advisor – financial planners included about how important it is to invest in equities to achieve long term goals.  Here is why you should not invest in equities. Its lucrative because it looks complicated – Not lucrative for you but for an assortment of TV channels that offer running minute to minute commentaries on stock markets, stock brokers who make intelligent predictions on the next market movement and of course fund managers who are in the asset collection business. All the above would like you to believe that without equity you are going to be poorer than your neighbor  Not necessarily true. Most people will get rich because of higher income & higher savings relative to expenses. Don’t understand it , don’t invest   -The word ‘Equities’ is  generic and encompasses all kinds of companies with no real grading . Do you know how to pick the right kind? .No