"True Happiness" With EMIs

I had a chance conversation with a fellow traveller in a train once. He was mentioning that a lot of people go through a lot of pressure in life because they go ahead and buy cars on loans and then have to carry the burden of paying EMIs for years together. This can reduce the money available at home for other expenses that may be necessary, saving for children's future etc.

Look here, we need to be wise about some things. Buy a car only if and when you need one. You have nothing to prove to anyone in society. So there's no need to buy car(s) just to impress anyone. You can put the money you will use to pay EMIs to better use for yourself and your family. Plus a car's value comes down real fast. So monetarily speaking its a poor investment anyway. Then all the expenditure on fuel and maintenance. It's a total waste unless you actually need a car.

I had a car for two years. At the same time my savings were not substantial. They were not enough to protect me if my life went through a rough patch. I  realized I didn't really need the car so I sold it and invested my money in a fixed deposit scheme. I'm still happy with the decision. My money is quietly growing instead of getting wasted.

So if you have car(s) that you don't really need and your financial situation is not strong otherwise, my advice would be to sell and invest the money in a reliable scheme. Play safe when you invest. Don't take unnecessary risks for quick returns. That would be my advice.

Secondly, if you are in a somewhat tight financial situation but do need a car : ask yourself if you really need a new car. A used car that's in good condition may a better option. Again, you save money that you can invest or use for better purposes. Likewise for a whole lot of other stuff: furniture, TVs, sound systems... Unless you're in a great financial condition, if you can get good quality used stuff at a lower cost then I think it makes good economic sense to take that option till you are in a comfortable financial situation and can afford to buy everything new.

It's not that I'm against buying new things. But perhaps its better to do so after you have consolidated your financial situation first. Most certainly you should not go under debt just to own new things. So if you like to buy new stuff either save enough money first or climb high enough in your career and earn enough to be able to afford it. And do so honestly. No point trying to live a "good life" at the expense of your ethics and values. Your economic freedom (i.e. being as debt free as possible), long term financial security (i.e. saving the necessary amount of money for your future needs as well as for your children's education, etc.) and living a life of spotless character are far more important that owning fancy stuff to satisfy short term desires or impressing others. Doing things the right way and at the right time always brings fulfillment. Always. So have patience and work steadily towards your goals.

Same thing for buying houses. I understand that buying a house can be a good investment if the location, etc. is chosen wisely - but don't over stretch. Buy after you have consolidated your financial situation to a good extent. Even after that, if you have to take a house loan : keep it under control. Better to buy a smaller house in a locality where real estate prices are growing and grow slowly instead of taking up too heavy a debt and overburden yourself.

PS: I think we need to stay aware of the possibility that there are entire establishments and advertising industries out there that want to sell us an idea of a good life and what all we need to buy so that we are "truly happy" - all that so that they can get richer. We need to stay sharp and alert. At each step, think carefully: what do I actually want and need? Is it wise to spend money on this or that? We need to stay very intelligent and live sensible lives.

Sunday Evening Introspections

So what's more important:

Which smart phone one owns or what one speaks, which car one drives or whether one stops and helps when needed, whether one lives in a large house or is large hearted, whether one goes to temples often or actually lives a life of sincerity, character, charity and service, whether one sprays on perfumes and colognes or exudes goodness, whether one wears a rolex watch or respects time (oneself's and others'), whether one owns a Parker pen or what one writes...

Sure one can be both in each of the above and as long as one wants that and gets there fair and square I hardly see any problem with it.

But what's your focus on and what does that say about you?