November 2002 - I boarded the train from Mumbai to Pune to take up my first job. Net income was Rs 15,000/- We were working in one of the top IT service companies and quite excited. I used to meticulously write my expenses on daily basis. Very soon, I had made some good friends. I was eating out regularly. There was one late night movie every week, parties during the week. I stopped writing my expenses. Every Friday there was a Sumo ready to take us back to Mumbai and every dreadful Monday, there was one to take us back to office. By the time I left my first job and moved to the second one, I had Rs 4000/- in my bank account (2 years of saving).

One of the risks that recently have been talk of the town are geographical risks . Despite the world which is so interconnected now and any event has repercussions across the world, there are still inherent geographical risks which are local .

Mutual funds can be categorized into two types of funds :

Active Funds

In active funds , we have an experienced fund manager and a management team to make decisions on the amount collected from investors. For example,

1. Mirae Asset Large Cap Fund - Fund Manager - Gaurav Misra & Harshad Borawake
2. Parag Parikh Long Term Equity Fund - Fund Manager - Rajeev Thakkar & Raj Mehta

Passive Funds

In passive funds, they follow a market index and do not have a fund manager who actively manages the portfolio. For example,

1. SBI ETF Nifty 50 - Largest ETF in India with an overall AUM of 75,000 crores and this fund tracks the Nifty 50 . Expense ratio is 0.07%

When we buy a house loan from bank,

1. Bank provides us money
2. We need to return the money after fixed number of years
3. Bank charges a fixed interest rate for the money that it has lent

However, we also lend money to banks. In case of a fixed deposit, we lend money to the bank.

PPF Benefits

1. Loan against PPF

1. If you take a loan against your PPF, this is 1% above the interest that you get in your PPF account. This has been reduced from 2% to 1%.