Blog of Susmit.

We should plan our 20s with our 30s in mind. To take that idea further, I put together a blueprint for basic financial independence. For many people it could work as a retirement plan. The number I arrived at is ₹80,64,900.58. That is what you would accumulate by following the plan below for 10 years. Invest ₹25,000 per month in equity, such as index funds and stocks, for the first year. In the second year, invest ₹26,750 per month. The deposit rises 7% each year to offset an assumed 7% annual inflation. Do this for 10 years, assume an average market return of 13%, and the final balance comes to ₹80,64,900.58. At that point you have the amount needed to live off your investments for the rest of your life. Here is how that works. Assume basic expenses of ₹25,000 per month, rising 7% a year to match inflation. From the corpus you could withdraw ₹50,000 per month, or ₹6,00,000 per year, again rising 7% a year to match inflation. If you hold stocks that pay good dividends, you may not need...

Big goals are easy to put off. The size of the thing is the problem: a huge project looks like a wall, so we wait for a better moment that never shows up. Breaking it into small actions gets around this, because one small action is hard to dread. Start by deciding what you actually want. With a clear end goal, each small task has something to point at. Then write out the steps to get there, keeping each one small enough to finish on its own. After that, set aside a fixed amount of time each day. The daily effort looks minor, but it accumulates. Feelings matter here too. If you know why a goal matters to you, and who it would help besides you, you're more likely to keep going when motivation dips. Picturing yourself having reached it, and how that would feel, can help too. When something goes wrong, treat it as information about what to change instead of proof you should quit. Persistence does the rest. Expect setbacks and keep going anyway. Mark the milestones you hit, since notici...