When one keeps writing about personal finance and at the same time deal with people about their personal finances, many things come up. The first and foremost is that your financial position is a function of too many things. There are just too many factors that affect a person or family’s finances — where you were born and choose to live, what career path you take, what education you choose to take, how much financial support you receive from family, how your family and friends view money, good luck, how you create your own luck, bad luck, how much money you make, poor choices, hard work or the lack of it, student loans, medical spending, inadequate education or understanding about how to run your own finances, what your lifestyle inflation looks like, what your personal relationship is with money, your parents ability to teach you good things about finances, bad/ good marriage… and the list could go on and on.

However, people who do not deal with money as a profession, think everybody is like them and all they need is some decent knowledge of Finance. Not true at all. Personal finance is more about client reaction to circumstances rather than the circumstance itself. Not everybody who is rich has earned lots of money. I know many, many middle class people – now in the autumn of their lives with net worth of say Rs. 8 crores – thanks to some HUL or Colgate and a brilliant location flat purchase in the 1950s. Having said that the film industry is full of people who earned in crores – and are now so broke that we will feel far more better off than these award winning actors.

Many people have brought ruin by simply saying “I just need a car” or ‘As a doctor can I not afford one foreign trip every 2 years?’. Many of them have no clue how to make their cash last 3 months. Forget how these people will stretch their cash for 30 years in retirement. I know the case of a small businessman who died recently (hence the liberty of writing about him)..It wasn’t a single poor decision that caused his financial issues. He made a series of mistakes which his company did not have the guts to tell him (this is what happens when the ‘Board’ is full of incompetent friends and relatives) overextended himself on his real estate purchases. His business did not require the kind of houses he bought. He bought it because people told him “Now that your company has gone public you must live in a bungalow” and then credit card debt. His wife stopped working once they had kids – anyway she was holding a low end job, so it may not have mattered.  He sent his children to expensive schools. He bought a vehicle to pick him up at Chennai airport to take him to Tirupati – the car would be lying unused for 29 days in a month!! He also failed to communicate the family’s financial issues with his wife as the problems piled up – and to think that this woman was decently educated too.

So really, ask yourself, it is KNOWLEDGE (Saraswati), TEACHER (Hanuman) or WISDOM (Uma aka Parvati) – what creates wealth for you.

The answer is simple – all the 3 with God’s grace !!