the number of lies that we as parents tell children is helping some industries do well….and hurting our kids..

1. Buy a home as soon as you can
2. Buy a home as big as you can – after all you buy a house once in a while, not everyday
3. Do not buy a used car – one of the worst pieces of advice by parents to a generation who is expected to use the car for only 2-4 years unlike our generation who used it for 8-11 years! Used cars are no longer a problem – the auto technology has come a long way. Your second hand car will run just as smooth. No, the car will not stall in the middle of a traffic jam. Or worse in an incline. Just go ahead and buy a second hand car. Let the fools buy a new car and see it depreciate 40% in a year’s time.
4. Never take a loan: if your parent is biased against loans, they put the fear of loans among the children. Actually a student loan is not a bad idea at all. However do consider the ROI before you invest in education too. This is all the more important if you are investing in a degree from a foreign university and you are investing more than 4-5 million rupees.
5. Repay your home loan as soon as possible: the same parent who pushes for you to take a loan pushes you to repay as fast as possible. For a 54 year old wanting to repay loans MAKES NO SENSE at all..you might as well keep more money in your provident fund and earn tax free 8% interest rather than repay a 7.6% fixed rate EMI. This advice is always to be taken with some token of salt. Each person needs to do the math before they do repay. If you are a 28 year old with a 30 year mortgage and are willing to invest in shares, you can surely repay less and invest more. Over a 30 year period even an index fund will give better return. When you retire if you still have a loan, use your provident fund balance to repay the loan

Sadly we are passing on our biases to our children. The strategies that we used in the 1990s may not be relevant at all for the kids born in the new millennium. It is almost like taking a sword to a battle where you know that the opposition has guns.

The 1990s saw high inflation – so it meant that you should not have repaid your loans for a long time. Our generation also saw long term job contracts. This gen will not. Marriages are lasting less. Many of these kids are undecided about having a family. I saw a young couple spend 6 month ctc (of the wife) to go to a foreign country to watch a match. Sure they combined a vacation, but not too many people over 55 will spend that kinda money EVEN WHEN THEY HAVE IT AS A KNOWN SURPLUS….