By: Tarun Prakash Srivastava, Sr. Executive Editor-ICN Group
Let us once again examine a Financial Map and study the financial depiction of Saksham’s life for example. You know the Saksham with whom we met at the last halt who is of the age of 35 years, got married, has a three-year-old daughter, and he earns Rs 30,000/- per month while doing the job:
| Financial Map of Saksham’s Life | |||
| Liabilities | Tentative year | Estimated amount | Plan for required fund |
| Own Bank Balance | After five years | Rs. 5 lac only | ? |
| Higher education of the daughter | After thirteen years | Rs.10 lac only | ? |
| To start own business | After fifteen years | Rs.10 lac only | ? |
| A big and comfortable house | After twenty years | Rs. 40 lac only | ? |
| Daughter’s marriage | After twenty two years | Rs. 20 lac only | ? |
| Retirement | After thirty years | Rs.100 lac only | ? |
| Health | Uncertain/any time | Rs.10 lac only | ? |
Now, pay attention to the column for the arrangement in which the liability question is marked with each obligation. Although the circumstances of each person vary, but only if we try to answer every question of instant Financial Map with the purpose of understanding, there may be the following options:
Five years later – own bank balance – the requirement is about Rs 5 Lac :
The first goal for Wealth Journey of Saksham is his bank balance of five Lac rupees in five years from now onwards. This is a future goal, and we have to achieve this goal not only by marking the destination (bookmark), but we also have to create a path for it.
Please try to understand the building of the first financial road to achieve his first economic goal in the first five years:
FIRST FINANCIAL GOAL OF SAKSHAM
| Possibility of income from the fist year to five years for Saksham | |||||||
| Annual saving | Interest earned | Total saving | Immovable property | ||||
| First Year | |||||||
| On investment of Rs. 7000/- per month saved on the basis of principal of ‘First Payment to Self’ through ‘fixed deposit’ or ‘Recurring deposit with benefit of an additional installments as interest’ | |||||||
| Rs. 84,000/- | Rs. 7,000/- | Rs. 91,000/- | |||||
| Second Year | |||||||
| Deposit of first year | Rs. 91,000/- | ||||||
| On investment of Rs. 8000/- per month saved on the basis of principal of ‘First Payment to Self’ through ‘fixed deposit’ or ‘Recurring deposit with benefit of an additional installments as interest’ | |||||||
| Rs. 96,000/- | Rs. 8000/- | Rs. 1,04,000/- | |||||
| Total | Rs. 91,000/- (First year saving)
+ Rs. 1,04,1000/- Total : 1,95,000/- |
||||||
| Third Year | |||||||
| Consolidated deposit of first and second years | Rs. 1,95,000/- | ||||||
| Interest @7% on consolidated amount of first and second years | Rs. 13,650/- | ||||||
| On investment of Rs. 9000/- per month saved on the basis of principal of ‘First Payment to Self’ through ‘fixed deposit’ or ‘Recurring deposit with benefit of an additional installments as interest’ | |||||||
| Rs. 1,08,000/- | Rs. 9,000/- | Rs. 1,17,000/- | |||||
| Total | Rs. 1,95,000/- (First & second year saving) + Rs. 1,17,000/-
Total : Rs. 3,25,650/- |
||||||
| Fourth Year | |||||||
| Purchased a plot of land/made an appropriate investment | Rs. 3,25,650/- | ||||||
| Rs. 1,20,000/- | Rs. 10,000/- | Rs. 1,30,000/- | |||||
| Fifth year | |||||||
| Saving of fourth year | Rs. 1,30,000/- | ||||||
| Interest @7% on saving of fourth year | Rs. 9,100/- | ||||||
| Rs. 1,33,000/- | Rs. 11,000/- | Rs. 1,44,000/- | |||||
| Sale of plot of land with 40% profit/profit on appropriate invest already made | Rs. 4,55,910/- | ||||||
| Grass income | Rs. 7,39,010/- | ||||||
| First Goal (Bank balance of Rs. 5,00,000/- | |||||||
| Total earned asset | Rs. 7,39,010/- | ||||||
| Success rate | 147.80% | ||||||
Keep in mind that Saksham is doing a job with a salary of thirty thousand rupees per month only, and in every job, there is also a salary increase of about five percent to ten percent per annum. One thing we must keep in mind is that Saksham is offering only eight to ten hours per day in his job and if necessary, by doing additional work as per his qualification for two to four hours a day or ten to twelve hours per week, in addition to the income earned from his job, he can add up to five thousand rupees and thus he will receive about seven thousand rupees from the first month.
Tarun Prakash Srivastava
From my book ‘Science of Money’ available on Amazon.com in English at http://bit.ly/Science-Of-Money and in Hindi at http://bit.ly
