What do you buy during Dhanteras ? 

When you read about Dhanteras and favourite stories you realize one thing.

Indians love their gold!

“Have a little extra money ?Don’t forget to buy gold” .Advice we have all received sometime or the other.

My 3 Money Rules

• Increase your earning But don’t forget savings.
• Money saved is money earned!To earn and keep is important.
• Diversify assets. Always balance your financial basket

In India we are conservative in our investments .

Savings,equity,gold,land  all are important for your wealth basket.But the percentage of each is what makes you win or loose.

In India Gold has always been popular.From ancient times gold has been the number one precious metal.

Primary reason maybe it’s beautiful warm ,yellow colour which reminds us of the life sustaining sun.It’s also linked to many popular Indian stories .Gold also signifies the blessing of Goddess Laxmi.It’s association with prosperity and affluence makes gold buying symbolic.

Being a noble element makes it less likely to cause skin irritations and react with atmospheric elements.Makes it perfect for wearing and keeping for long time .

Gold jewellery  makes most Indian woman happy.So it’s a must wear for weddings and auspicious  ceremonies.

 Gold has been consistently the only happy metal for Indians.Not surprisingly India  is the number one gold buyer in the world !

We are typically  conservative investors. So we like safety and security  over anything else.

This is why physical gold wins any day. Atleast with most women.

What are the different methods out can invest in Gold ?

This article in jagoinvestor will help you decide.

But before stockpiling Gold ,physical or otherwise you must know a few things.

Gold prices over the years have been consistently  up.So it should be great to buy Gold right ?Depends .

It depends on what you want out of that investment . If its meant for securing the amount,not necessarily growth .Then gold is not too bad.

I love Gold but I love after knowing all its negatives.

Read about gold price movements in India before buying.

Interestingly Gold is considered the purest international currency.You might be able to buy stuff with gold  but not with Indian currency in places outside India.

So while it’s better than having money in your savings account,it has not always kept it’s promise as an inflation adjusted investment 

Warren Buffet – “We live in a world where 80 years out of 100 will be good. But we don’t know which 20 will be bad.”

So what should be on your investment plate this Diwali?

The best way to learn is from the greats.

My favourite 3 Quotes from the book

Poor Charlie’s Almanack: The Wit and Wisdom of Charles T. Munger(affiliate link),Warren Buffet’s reticent but equally brilliant friend.

#Value investing principle 1

Measure risk

Everything in life depend’s on having a good judgement . Assessing risks and benefits are mortar before choosing any investment .

• Safety  margins need to be adequate.
• Avoid dealing with shady people.
• Avoid big mistakes . Shun major capital losses.

 

#Value investing principle 2

Be Independent 

Only in fairy tales are emperors told they are naked

 

• Have independance of thought .
• Be objective and rational.
• People agree or disagree doesn’t matter.

What matters is correctness of your analysis and judgement.

#Value investing principle 3

Have patience

Compound interest is the Eighth wonder of the world (Einstein )

DON’T interrupt it unnecessarily

So before you buy Gold today remember Asset allocation.Don’t put all your eggs in one basket.

Are you a value investor?

Whats your plan for investing Dhanteras and otherwise?

This is a part of UBC #Daily chatter day 28  with @Blogchatter

(Disclaimer:I am not an investment specialist.Kindly consult a professional before making any investment )

You earn money.

Keep it in the bank.

It gets stolen.Bank pays you back .

Right ?

Wrong! 

Very very wrong.

If what RBI says sticks, (which it will probably  )if you lose your money from the bank ,digitally or physically you are liable to get a maximum of 1 lakh rupees only.Even that has a millions of subclauses! 

Doesn’t matter how much money you had  in the bank.

This covers everything. 

For your lockers it’s even worse.

Don’t believe me?

Read on.

The recent spate of debit card fraud has opened most people’s eye to the threat of digital fraud.

In India where people don’t even

 know what to do in case of stolen debit cards this is worrying.

With  Aadhar data collected  by third parties  ,who have  all your information and bank account details.

You are the perfect sitting duck for data thefts  and major frauds.

 

The user data which was stolen this time, was apparently  related to  Malware detection   .You are at risk every time  you use card at any retail shops ,restaurants,ATMs

Anywhere they use that machine where you slide your card in.That’s a point -of sale machine.This is probably where the malware was inserted.But investigation  is pending.The full story will be disclosed after RBIs investigation  is complete.

 

Solution:Carry cash during shopping. 

Shop less

Bad for shop owners.Great for you.You will not only save money but protect yourself from unscrupulous  people.

 

Online shopping using debit card?

Use cash on delivery

I rarely use amazon even though it has the best deals .Because sometimes it doesn’t give me COD.

 

Avoid using Nonbank ATMs

Difficult but must do.This is the excuse that banks are giving now.

 

Keep your phone number updated with bank .Check online account info only from home Internet with secure connection .

Use strong passwords for all accounts

NEVER from a public PC . There are softwares which can be used to save all transaction details.

How do ATM frauds  in India occur?

Did you know ATM s are controlled by third party.

These ATM providers have insurance for theft of money from ATMs. 

But in this case appararently the people were at home while money was withdrawn using their card details in USA and China .

IMAGINE the extent and depth of the fraud.

SHOCKINGLY no one is giving us the truth.

Not the bank ,not the government

6.5 million is not a small number if debit card.We don’t know the total amount stolen.

It’s  like the money just disappeared and it happened at the same time in a well orchestrated way.

A payment gateway called Hitachi Payment services which has ATM and point -of -sale machines

 

These third parties manning the ATM have insurance for theft from ATM

In this case it’s  a tricky point.Who is responsible .

 

 

 

How safe is your money in the bank?

 

Did you know bank is not liable to protect you in case  of theft from lockers?

That’s because banks don’t have any way of knowing what exactly was in your locker.

It could be a pile of junk for all that they know. They just rent the space.

What makes bank lockers attractive  is the amount of security  you have which is not possible  at home.

 

 

As per the RBI: “The bank will, in no way, be responsible/liable for the contents kept in the locker by the hirer. In case of theft, burglary or similar unforeseen events, action will be initiated as per law.”

 

In case a customer opts for a locker from a bank, it is more of a proprietor and a tenant relationship: banks provide on rent, a secured facility to safeguard your previous processions, and nothing more than

3  RBI RULES you must know

 What is the maximum deposit amount insured by the DICGC?

Each depositor in a bank is insured upto a maximum of Rs.1,00,000 (Rupees One Lakh) for both principal and interest amount held by him in the same capacity and same right as on the date of liquidation/cancellation of bank’s licence or the date on which the scheme of amalgamation/merger/reconstruction comes into force?

 

 

What is the ceiling on amount of Insured deposits kept by one person in different branches of a bank?

 

The deposits kept in different branches of a bank are aggregated for the purpose of insurance cover and a maximum amount upto Rupees one lakh is paid.

 

Does the DICGC insure just the principal on an account or both principal and accrued interest?

The DICGC insures principal and interest upto a maximum amount of Rs. One lakh. For example, if an individual had an account with a principal amount of Rs.95,000 plus accrued interest of Rs.4,000, the total amount insured by the DICGC would be Rs.99,000. If, however, the principal amount in that account was Rs. One lakh, the accrued interest would not be insured, not because it was interest but because that was the amount over the insurance limit.

 

 

So what exactly is safe?

(Do let me know if you find resources to support consumers from frauds like this.)

 

 Comment below to let me know.

 I am linking to Ultimate blogging challenge with Blogchatter #DailyChatter #UBC Day 26

Disclaimer :I am not a legal or insurance expert .The information I have provided comes from RBI website .

The links provided will guide you to the relevant  articles.

Kindly take all actions after following legal  advice.