Sorry, but I am going to blame women in this article, not just praise them.

What is the problem?

I see too many men spending far more than what they can afford. Difficult to believe?

Look at professionals and businessmen. At least the salaried guys know how much is their take home pay. The professional / businessman does not know.

How do you find out?

Well if you are 45 years of age live in an inherited house, use an inherited (or rented) office, make your balance sheet. Yes, it should be at cost price.

If the balance sheet is showing a NEGATIVE Rs. 1 crore (your liability is more than your assets) it means:

you have earned money and spent Rs. 1 crore more than what you earned and invested. Assuming that your wife earned Rs. 50,000 a month as a school teacher, and your JOINT BALANCE sheet is showing a NEGATIVE Rs. 90,00,000 it means she has been ALLOWED to save / invest only Rs. 10L and that is because the balance has gone to fund lifestyle expenses.

Surprised? Shocked?

Well not me. Sadly it is not the woman who has come to meet me, but the husband. The same alcoholic thinks he can get rid of his alcohol habit in a few months.

What should a woman do?

• force the H to do a sip of say 20k per month for children’s expenses
• force he H to do a sip of X for your own retirement
• refuse to sign guarantee documents for loans
• refuse to part with her jewelry for pawning
• refuse to borrow money for any expense
• refuse to go on vacations UNLESS you know from where the money is coming
• see how the corpus for big major expenses are being built up
• be able to handle peer pressure
• help the husband handle peer pressure/ sibling pressure etc

What all could a H be doing wrong in his business life?

• sell at a price less than cost
• refuse to understand cash flow
• doing business for growing the TOPLINE and not worrying about profits

What all could a H be doing wrong in his personal life?

• buying assets far bigger than what he can afford (peer pressure)
• not bother about forthcoming big expenses
• not worrying about retirement
• borrowing at the drop of a hat

Ok you have reached this messy situation. Now what should you do?

• Sit with your husband and ask him for his truthful list of creditors (Yes it will take a few months before he tells you the full truth). List them according to the cost of the loan – the Most expensive goes to the top…and then they are ranked. Yes personal loans, credit card loans, unsecured credit limits (an nbfc product), car loans, travel loans, honeymoon loans, housing loans,……No. They are not arranged in terms of cost, but yes there are housing top up loans which are at commercial rates.
• Ask your H and his CA to certify that his is complete. No that will not be easy. Will it lead to a divorce? believe me that will be better than insolvency proceedings.
• Give up assets that your husband says you have – a spare house, land, gold – does not matter. If he has bought it, sell it. If it is your father’s keep it in a single name locker. Make him the nominee, not the second holder.
• Live frugally – no vacations, scale down the car from an Opel/ Honda city/ Corolla to a Nano.
• Face it, people with negative income and irregular cash flow travel by public transport
• Involve your children – show them the mirror
• A person with a negative net-worth and negative annual cash flow has to put his children in Municipal school
•  Involve your siblings/ his siblings VERY CAREFULLY, if at all
• Seek parental support if it is available.
• If parents CANNOT support financially, don’t increase their stress
• See if somebody can give you INTEREST FREE loans on a friendly basis
• If you can get friendly LOANS don’t over do it.
• Take 20% of your borrowing as a loan and repay the MOST expensive loans
• If you have relatives who keep money in bank accounts, borrow from them and pay them say 9% int. Repay the 22% loan.
• Take adequate life and medical insurance – for him and for yourself
• Tell your parents that you cannot support them for a few months when you are repaying loans
• Tell the truth

Remember 2 lovely English sayings:

Bankruptcy is what you get into when you SPEND the amounts that you TELL your friends YOU are making.

You cannot tell a lie to the man whose face you see while shaving (this is for men of course!!)