Personal finance and my goal with this website:
When I started this blog in 2020, I thought that I would help my peers and anyone else who would care to listen or read with their personal finance. Little did I know that I would need help with my finances, despite being an MBA in Finance, and a lawyer. (Should’ve studied CA instead, for real.)
However, what I’ve learned through experience is that it is much easier to preach about following rules of thumb and guidelines than actually following them.
Personal finance seems simple, once you understand the basics, and it probably even is.
But you also have to follow the basics.
Personal Finance 101: Spend less than you earn…
I’ve failed at the first step of personal finance, that is to spend less than you earn. I’ve even gotten myself into a debt trap. Trying to pay off loan EMIs by liquidating long-term investments in shares, deposits and mutual funds.
I’ve taken loans to ease the burden on other people who weren’t eligible for loans through the banking system due to poor credit, low income and other risk factors. And the funny part was that I’ve interacted with these people only through social media like Instagram and WhatsApp.
The significance of emotions in financial decisions:
The lending was mostly an emotional decision because I couldn’t bear to see the other person under debt from local moneylenders who were charging them 60% per year as interest, which is more than any credit card. It was a noble thing of me to do, but it was not fiscally prudent. Not one bit.
The people who owe me money, however, seem to have taken it lightly and have defaulted on payments in a year citing reasons like their employers not paying them on time, other liabilities and stuck payments from those who were supposed to pay them and various other reasons. It’s been about 2 years since I first lent them a small sum of money, which later increased in amount and frequency.
Freelancing and solopreneurship:
Mind you, I could do this only because I had the backing of my parents whose savings I have been living off. I’ve had a few freelance gigs here and there which are helpful, but my last substantial income was in the end of 2020, when I was working for Amazon as a full time employee, and then once in August 2021, which is one month when I thought that I would make it as a freelancer. But I haven’t pursued it with all my might, and that’s something which I need to work on.
It’s been 3 years and 8 months since I started freelancing full time, and I still don’t want to give it up for a full time in-office role, even though in moments of weakness and peer pressure/parental pressure have appeared for job interviews for full time roles, cleared them and later decided not to join. Maybe I haven’t really found the right employer yet, or maybe I still feel like I need to give this freelancing/solopreneurship thing a good shot. I also draft legal agreements and contracts from time to time, which is a nice fun thing to do as well.
Concluding remarks:
What I want to say to everyone is to always have some financial backup before you try something as unpredictable as freelancing or entrepreneurship for an extended period of time. And think a hundred times before you take loans for anyone else who has a history of defaulting or a tendency to default. If a bank isn’t lending to them, there probably is a good business reason for that.