This year the annual update of Mint50, the curated list of 50 investment-worthy mutual funds got a six-month delay. We usually release the list in January of the year with a list of funds that have moved out and those that have moved in. But this year was different because capital market regulator Securities and Exchange Board of India (Sebi) changed the rules of the game, making a big change in the industry. The changes needed to play out before we could do our research ahead of the new list. The new list is now out and our big change is that we have shrunk the 50 mutual fund list to 30.
What was this change and why is it important? Sebi did two things. One, it divided up the industry into 36 categories of funds, allowing every fund house to have one scheme in the category to reduce the clutter in the industry. Read this column where I had suggested that this is the way to go forward to bring order in the industry in 2015. It took two years for Sebi to finally push funds into doing this. Sebi has left the door open for new innovations that will get their own categories as markets mature further. Mutual fund companies were launching too many schemes that replicated the older schemes causing investor confusion. By defining categories and being very generous with the number of categories, Sebi has left plenty of elbow room for the fund houses to place their funds in a category they think the scheme serves.
Let’s talk money. When was the last time you said this to anybody other than while finalizing a deal? But money, and our relationship with it—our fears, greed, insecurities and over-confidence—define who we are and what we do. Paradoxically, talking about money has been frowned upon as gross in families and social situations. The rich are called “filthy rich”. “Being above money” has been an aspirational moral position for most of middle India.
Much of this attitude has roots in a deeply poor country with limited avenues for honest wealth creation. The Bollywood smuggler of the 1970s had his bungla, gaadi and daulat, but not his mum. Today, the mum has her own life along with her own bungalow, car and wealth. And no, she does not want to play nanny to your leaking kids.
When we think of a book on money and its management, we think of pie charts and bar charts. We think of boring jargon-filled text. Let’s Talk Moneytries to smash all these notions and brings the reader a book that is a slice of their lives. It aims to help the reader build financial security without the usual fear-mongering or guilt-tripping about enjoying a Starbucks at work every day. Edited excerpts:
As the security woman at the entrance to a multiplex turns my hand bag inside out giving competition to an airline security check, she gleefully hits pay dirt. Not a small grenade, she’s found my bottle of gum and my tiny jar of dry fruit. No food allowed. But this is not food, it is something I carry in my bag all the time. An argument ensues and the movie experience is reduced. Once inside the complex, I find myself unwilling to pay exorbitant prices for average quality food that is pushed hard by ushers-turned-waiters who come in the way of movie watching.
What food costs inside a multiplex is suddenly part of the urban middle class discourse at dining tables, at social events, on social media, with the humble popcorn itself at the core of this debate. Popcorn in a multiplex costs about 500% more than what you get outside in the mall. Pop them at home, and the mark-up is more than a 1000%. While there is other food and drink being sold that is more expensive than retail prices outside, the price point of popcorn shows the highest mark-up. To force sales, multiplexes prohibit outside food from entering their premises, making for a captive consumer group who is out to have a good time and is in a mood to eat, drink and be entertained.
Super review by R Jagannathan in Swarajya magazine.
“This may be an overstatement, but it is probably true that most Indians are bad at managing their personal finances. And one is not talking only about people who use their credit cards as if there is no tomorrow, go for inappropriate insurance policies, invest in real estate or gold for the wrong reasons, buy stocks on the basis of inside information, or people who generally don’t save for their retirement till it is almost too late.
The truth is, even the financially literate, people who dabble in money day in and day out, can sometimes make huge mistakes based on ego – I know what I am doing; after all, I give others advice on where to put their money. I know, for I was one of them. I invested large sums regularly in the National Pension Scheme (NPS) on the assumption that no law would be daft enough to tax 100 per cent of withdrawals on maturity (usually at age 60, but which can be extended); I assumed that the tax, at best, would be on the gains made on my investment. Well, I was wrong, and ended up losing money on the NPS a year ahead of the time when taxation on withdrawals was made more rational.”
Menaka Doshi, editor Bloomberg Quint wishes she had not read my book Let’s Talk Money.
Find out why
“Well it wasn’t a pleasant experience for me. Nothing wrong with the book. To the contrary, it’s an excellent read – riding on the author’s characteristic candour and domain expertise that equips her to explain financial concepts and instruments in the simplest manner without talking down to her audience.
But Monika Halan’s “Let’s Talk Money” left me filled with regret. For all the time and effort I had not spent on managing my money better. Well, managing it at all.
At this point you’re thinking – right, business journalist for decades and she’s a money dummy?!? No I’m not. I just never got around to it. For reasons that when said aloud seem stupid. No time. Other priorities. Too complex.
There are millions like me, the book says. “The scale of the problem freezes us.”
Halan, consulting editor at the Mint newspaper and a certified financial planner, puts the aversion to financial planning down to a few common shortcomings and fears…”
A long time ago when I was in my first job as a trainee researcher in a magazine, I would take the chartered bus (a working people’s school bus that collects people from a residential area and drops them in an office hub) from home to office. The art of eavesdropping on conversations must be ingrained because I still remember some of the chatter around. One particular conversation thread was between two women in their 40s. They looked like junior bank staff. The women were discussing how their friends who married men who could support them financially made a better deal. “We now have two jobs—at work and at home.” Indian men, it seems, get so tired at work that they have no strength for housework in a double income home.
“Delighted to share about this wonderful book of personal finance by none other than Monika Halan, the consultant editor at Mint with tons of experience in the area and a great heart that wanted to share her precious insights.
I am halfway through Let’s talk money and felt it would be criminal not to spread the word about such an empowering book. Shall review the book in detail a bit later. Check out the blurb below :”