The economic turmoil

The recent crashes of very big firms which were looking so solid just few days ago should be a wake up call for all of us to just time off and do a introspection, whatever industry you are in and what ever post you hold. But why?
Nothing happens suddenly, it is just the frog in the water being boiled syndrome, where till the last minute the frog doesn't realise that it is in hot water since it is in its comfort zone, it lives happily and when it is too late only, it realizes that its life is coming to an end.
Same way, most of us are getting into a comfort zone and and never bother to understand the dangerous time we are in and it becomes too late for many of us. Take for eg all the layoff that's is happening. How many of them would have saved money for the rainy day, I believe it will be very few. While people in IT industry get a good salary, way beyond what many of their peers get when they are in other industries, these people spend all their money or should I say splurge the money. I very strongly believe that we should always see an intrinsic value in all our purchases and shouldn't go only with brand value. For eg, a top branded shirt will cost you heaven, but at the same time, there may be a non branded shirt which will and can have the same quality. So, go for the brand once in a while, for your normal use go for the value based purchases. This will save a lot of money for you. A brand make money for the brand owner, but makes a hole for you. Remember this always. Please get me right, I don't say comprise on Quality. I only say look at the value of any purchase.
One other thing I see with the IT industry is that whatever they earn isn't enough. Many of the people are in financial strain despite earning better than their peers. But remember the IT industry is always subject to uncertainty. So my advice is always draw a line about your spending, contain within a certain limits even though your salary increases substantially year on year. Also spend a little on your professional upgradation all the time.
For those with children, remember a child gets happiness even with little things. For a child the money value of toys or gifts don't matter, but the pleasure and joy of getting a gift from you matters more. Yes your children are your darlings and whatever you earn is for them, but don't madly go all out and spend on huge sums on their toys and amusements. A child learns the lesson about his or her life from the parents. Teach them the value of money by prudent spending.
Always ask yourself a question whether you can continue to live in the same comfort as you are in today, even if you don't have a job for the next 6 months, 12 months. if yes, then go ahead with the same pattern of spending, otherwise sit down and rework your spending.
In conclusion, tough times are ahead so take stock and buckle up.

Comments

Umasree said…
Sarada akka, I would like to add one more thing here. People especially in IT are the main reason why we see the sky rocketing prices of real estate in India today, because there was purchasing power of the middle class and also because of the lucratives offers made by banks and real estate companies. Today I find atleast 8 out of 10 collegues paying EMI's for their homes, cars and lot many sunk deep in credit cards. Where as investment in housing can be considered fruitful, what scares is the credit card expenses all the people are making these days. People should not forget to live within their means. Lets us not leave behind big properties and riches to our children, atleast not let them regret that they have to shoulder our debts in future and also our expenses because 90% of people do not give importance to insurance and retirement planning.
September 25, 2008 at 1:09:00 PM PDT
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