What is our relationship
with Money?
Learn to use it, not get used by it!
Mudit Khetan
Value Investor, Learner, Reader – In reverse order!
What are Relationships?
• What do we associate with a relationship?
• What controls our relationships?
• How can we control (manage) our relationships?
• How is it relevant to our relationship with money?
What emotions DO YOU associate
with money?
• Do you fear it? • Or fear losing it?
• Do you love it? • Or love what you can do with it?
• Do you desire it? • Or fulfil your desires with it?
• Do you not care about it? • Or you don’t have it, so it doesn’t
matter?
What emotions SHOULD YOU associate
with Money?
• Pride – When against all odds Deepa Karmakar shone bright at 2014 CWG.
• Relief – When a loved one comes home recovered after an illness.
• Accomplishment – When a teacher gets published and acknowledged.
• Achievement – When a student earns her/his degree.
• Joy – When you finally get to meet friends after 10+ months of separation!
Can you associate any of these emotions with a printed number!
How we See
Paisa!
How else we
See Paisa!
How money manipulates our emotions?
• Awe or Amazement – Paisa Khuda to nahin, par Khuda se kam bhi nahi!
• Apathy or Indifference – Papa kar lenge!
• Antipathy or Aversion – Mujhe koi fark nahi padta!
• Regret – Pehle kyu / kyu-nahi becha ya kharida!
• 4 Fs – Fear, Freeze, Flight, Fight
• 3 Gs – Gather, Greed, Guilt (shame)
What’s the Fix!
Detachment
• Not having aversion to it
• Not shunning it altogether
• Not running after it either
• It’s a tool – like a pen, screwdriver, or a pair of scissors. You need it for
specific purposes, can’t run from it.
Can’t live with (only) it, can’t live without!
How to Fix?
• Do not avoid money matters, learn about them
• Avoid innumeracy - unfamiliar with mathematical concepts and methods;
unable to use mathematics; not numerate.
• 3 things are certain – Death, Taxes, & Inflation. You cannot avoid them, but
can manage the last two
• Change the money equation from: Income – Expenses = Savings
to Income – Savings = Expenses
Remember
• Savings ≠ Investments:
Savings are like still water, they smell (lose value) after some time
Investments are running streams, they can dry, but can turn into rivers
• Insurance ≠ Investments
Insurance helps when you face an emergency or eventuality
Investment is used when you are free from all worries
• Gold, Bank FDs, Property are SAFE (relatively)
But so is staying at home. To reach somewhere you’ll have to walk out of the
comfort zone
• Never put all eggs in one Basket
You never know when / who / what / how your basket may rock, and all eggs
break!
Credit
• Must be taken by those:
• Who don’t need it
• Who invest in safe but interest-charge + margin ventures
• Who are investing in themselves – education, health
• Must avoid for:
• Chai / latte at babu bhai or CCD
• Those new ________ are killing!
• Depreciating assets, if they are not used for earning incomes
Golden Rules
RULE #1: NEVER LOOSE MONEY
RULE#2: NEVER FORGET RULE #1
You can lose money simply by keeping it
DEMONatization, Taxes, Theft, Inflation,
Relatives, Impulse buying
