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Mad Money Journey
A Financial Adventure.
Mehrabs latest book is a sweeping tale of mystery and adventure, with deep revelations on the nature of man and money.
Tired of his energy-and money-draining middle-class life, Dr. John Pinto decides to end it all by walking into oncoming traffic. But Life has other plans from him! Through a quirky twist of fate, John finds himself saved and launched into a financial pilgrimage across the world. Through a whirligig of exotic, shocking and sometimes dangerous encounters, he learns what it means to be financially independent.
The school of Life introduces him to people who have learned the 10 commandments of financial freedom the hard way. From Afghani terrorists to Kenyan marathon runners, from Bangkok prostitutes to Chinese mystics and many more. Each soul on this incredible journey holds a key insight into the relationship between man and money. To achieve true freedom, he will have to face it all-a turbulent odyssey of hair-raising adventure, unexpected teachers, monetary rewards and an overarching mission.
A dazzling novel, written with wit, compassion, intelligence and deep humanity, travel with John Pinto to unearth the secrets of a rich life.
Mehrabs latest book is a sweeping tale of mystery and adventure, with deep revelations on the nature of man and money.
Tired of his energy-and money-draining middle-class life, Dr. John Pinto decides to end it all by walking into oncoming traffic. But Life has other plans from him! Through a quirky twist of fate, John finds himself saved and launched into a financial pilgrimage across the world. Through a whirligig of exotic, shocking and sometimes dangerous encounters, he learns what it means to be financially independent.
The school of Life introduces him to people who have learned the 10 commandments of financial freedom the hard way. From Afghani terrorists to Kenyan marathon runners, from Bangkok prostitutes to Chinese mystics and many more. Each soul on this incredible journey holds a key insight into the relationship between man and money. To achieve true freedom, he will have to face it all-a turbulent odyssey of hair-raising adventure, unexpected teachers, monetary rewards and an overarching mission.
A dazzling novel, written with wit, compassion, intelligence and deep humanity, travel with John Pinto to unearth the secrets of a rich life.
219 pages, Paperback
First published August 25, 2014
50 people are currently reading
317 people want to read
About the author
Mehrab Irani
4 books15 followersMehrab Irani is General Manager, Investments, at Tata Investment Corporation, Mumbai. He has diverse experience in both equity and fixed income markets, including research, dealing and portfolio management. Mehrab is fired by an almost missionary zeal for spreading financial knowledge among investors. His ability to connect abstract concepts to real life situations using his powerful imagination and plethora of skills reverberates through all his work. He is a prolific writer for newspapers, websites and his blog - www.intelligentmoney.blogspot.com. He is also to be seen on CNBC, ET Now, NDTV Profit and Bloomerg.
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Displaying 1 - 25 of 25 reviews
November 18, 2018
Strange that this book is not among bestsellers, certainly it has to be.
Indian version of “Rich Dad Poor Dad” mixed up with “Tuesdays with Morrie” style Fiction for readers to learn and deal with their Personal Finances in very detail. A must read! Highly recommend
Indian version of “Rich Dad Poor Dad” mixed up with “Tuesdays with Morrie” style Fiction for readers to learn and deal with their Personal Finances in very detail. A must read! Highly recommend
August 27, 2020
This book was gifted to me by my Dad's friend 5 years ago. Wonder if my life would've been different had I read it then. I think it's a good book to cover the entire gamut of personal finance for a beginner especially if they're not from a finance background. It would also be useful to refresh some topics for a person experienced in the field. The book also has some nuggets on life sprinkled throughout. A decent read.
September 28, 2014
http://pebbleinthestillwaters.blogspo...
Book Review: Mad Money Journey by Mehrab Irani: Excellent Insight In Finance Fundas
Mad Money Journey: A Financial Adventure by Mehrab Irani is a superb insight on managing your money in a best possible manner, told in a quite interesting manner. The book has been published by Jaico Books under the genre Business/ Fiction. Mehrab Irani is a well know author for his earlier book 10 Commandments for Financial Freedom.
Money has a different meaning for different persons. Even in the business world different industrialists look at money management part in their own style. But in reality there is so much about money and so little known. This business adventure in fiction story form has John Pinto who is a successful doctor residing in Mumbai. Another prominent character in Mad Money Journey: A Financial Adventure by Mehrab Irani is Vijay Desai, who is a childhood friend of John Pinto and appears to help him whenever life puts him into dire straits. Both studied in the same school but had their own perception about education, learning and knowledge. On one hand Pinto had one straight mission during his school days - to get excellent marks in tests and examinations. On the other hand Desai's vision about studies was different. He was least bothered about marks. His motto was to get real life learning from education. Gradually Desai leaves his house due to a rift with his father on not getting good marks in studies.
Gradually on the basis of excellent marks and being a topper, Pinto gets admission in one of the top medical schools and comes out in bright colors after completing his medical studies and thus becomes a successful doctor, opening his own clinic. He gets married, earns money, owns his own apartment in one of the posh colonies, acquires a good car and becomes successful in his life. But gradually he finds himself as unsuccessful in his professional and personal life by mismanaging his financials and money and finally getting into a huge debt. That is where the story in Mad Money Journey: A Financial Adventure by Mehrab Irani takes a steep turn.
Pinto decides to end his life and goes for suicide. That is when, once more in his life, the two old childhood friends meet again. Pinto is brought to hospital by none other than Desai when he got collapsed on the road. And that is when a new journey of life begins for Pinto when Desai, who has become a most successful international industrialist and mentor, coach, guide to many of his peers. Desai meets Pinto in the hospital while he was undergoing treatment to recover, and gets to know the crux of pains of his life. He understands that Pinto has not been able to manage his money and thus has reached to this state of his life even after being so successful. Overall the story of Mad Money Journey: A Financial Adventure by Mehrab Irani is very interesting.
The fact of life is that the guy who always topped in school, reached to the dead end of his life and the guy for whom marks were never a priority becomes a billionaire and successful entrepreneur. On finding the real problem of Pinto, Desai sponsors a world tour for him where he would be going to different nations, meeting various people belonging to various streams of life and learning a unique lesson about money from each of them. Each of the assigned person in each country, has been selected and planned by Desai.
Overall an interesting learning about money and financials during roaming around different corners of the world and meeting various people who became learned from the lessons from life.
Book Review: Mad Money Journey by Mehrab Irani: Excellent Insight In Finance Fundas
Mad Money Journey: A Financial Adventure by Mehrab Irani is a superb insight on managing your money in a best possible manner, told in a quite interesting manner. The book has been published by Jaico Books under the genre Business/ Fiction. Mehrab Irani is a well know author for his earlier book 10 Commandments for Financial Freedom.
Money has a different meaning for different persons. Even in the business world different industrialists look at money management part in their own style. But in reality there is so much about money and so little known. This business adventure in fiction story form has John Pinto who is a successful doctor residing in Mumbai. Another prominent character in Mad Money Journey: A Financial Adventure by Mehrab Irani is Vijay Desai, who is a childhood friend of John Pinto and appears to help him whenever life puts him into dire straits. Both studied in the same school but had their own perception about education, learning and knowledge. On one hand Pinto had one straight mission during his school days - to get excellent marks in tests and examinations. On the other hand Desai's vision about studies was different. He was least bothered about marks. His motto was to get real life learning from education. Gradually Desai leaves his house due to a rift with his father on not getting good marks in studies.
Gradually on the basis of excellent marks and being a topper, Pinto gets admission in one of the top medical schools and comes out in bright colors after completing his medical studies and thus becomes a successful doctor, opening his own clinic. He gets married, earns money, owns his own apartment in one of the posh colonies, acquires a good car and becomes successful in his life. But gradually he finds himself as unsuccessful in his professional and personal life by mismanaging his financials and money and finally getting into a huge debt. That is where the story in Mad Money Journey: A Financial Adventure by Mehrab Irani takes a steep turn.
Pinto decides to end his life and goes for suicide. That is when, once more in his life, the two old childhood friends meet again. Pinto is brought to hospital by none other than Desai when he got collapsed on the road. And that is when a new journey of life begins for Pinto when Desai, who has become a most successful international industrialist and mentor, coach, guide to many of his peers. Desai meets Pinto in the hospital while he was undergoing treatment to recover, and gets to know the crux of pains of his life. He understands that Pinto has not been able to manage his money and thus has reached to this state of his life even after being so successful. Overall the story of Mad Money Journey: A Financial Adventure by Mehrab Irani is very interesting.
The fact of life is that the guy who always topped in school, reached to the dead end of his life and the guy for whom marks were never a priority becomes a billionaire and successful entrepreneur. On finding the real problem of Pinto, Desai sponsors a world tour for him where he would be going to different nations, meeting various people belonging to various streams of life and learning a unique lesson about money from each of them. Each of the assigned person in each country, has been selected and planned by Desai.
Overall an interesting learning about money and financials during roaming around different corners of the world and meeting various people who became learned from the lessons from life.
December 28, 2016
A brief and excellent story. Surprised to see mistakes I made in life accounted in the book. Must read for every one in middle of social and financial circles.
March 17, 2019
I had seen this book so many times at the airport bookstores, but never got to pick it up. Bad cover page, with a not so interesting title made it seem like a fiction book which I generally despise. Such a mistake. I should have read this book long back, and I would have been richer. Better late than never. I read this in December 2018, during my trip to Bali where I stumbled upon this in the kindle unlimited section and instantly started reading it.
The book claims itself as a financial adventure, and helps explains the concepts of personal finance through a good fictional adventure format ranging from the Afghanistan terrorists to Bangkok prostitutes. This one is going to be a long review, as I want to summarize each and everything for those who would not be able to read this book, and for myself to review this often to be on track on my journey to attain financial freedom.
Financial freedom is when my money works for me, and I get regular income form my investments.
The book is classified into clear chapters, and I would summarize as per that.
1. A fortuitous meeting
Common financial mistakes - mental accounting, loss avoidance, decision paralysis and selective thinking among others
The only thing available in abundance in this world is money. Never work for money, but make your money work for you (guaranteed, passive and portfolio income).
2. Common Mistakes – Bangkok
Don’t throw good money after bad money, because money lost is money gone.
Don’t compartmentalize losses and gains. Always consider money received from all sources as equally sacred.
Not making a decision is also a decision in itself that has consequences.
3. Insurance - Afghanistan
Various categories of Insurance - family protection, personal insurance, disability protection, third party insurance, vehicle insurance, loss of profit protection and credit insurance.
The major categories of financial insurance include family protection, disability protection, asset protection, loss of profit protection, personal insurance and medical insurance.
There are other categories that protect one’s wealth from money predators. These include legal insurance (protection against legal rogues), tax insurance (protection against the government taxmen), competitor protection (to be able to remain in the business in which one is today), love protection (those who pretend to love for selfish ulterior motives) and portfolio insurance (to protect one’s assets against unexpected large losses). Look for details in your life to know which policy suits you best.
You are throwing away valuable hours of your own life if you have a terrible habit of getting up late in the morning. Similarly, you are robbing yourself of your own money when you delay taking the appropriate insurance policy for yourself.
4. Mystics and Money Creation - Shanghai
Leverage - A simple concept that basically says money in your hands is worth more than money in your neighbor’s hands. Leverage simply puts your neighbor’s money into your hands. And once it comes into your hands, you can invest with that money. So, you earn on money that you originally did not own
The biggest leverage that all human beings possess is financial knowledge.
Gruesome capital assets would mean those assets that produce negative income or empty your pocket, such as a car, beach house, etc. Bad capital assets would include those assets that don’t give you any income, such as a self-occupied house. Unnecessary revenue expenditure would mean foreign trips, costly dinners and the like, that will just loot you.
Your money should go into buying only investment assets and not liabilities in the form of accounting assets,
Financial wisdom was not just about money and how to get rich, it was a permanent medicine for elevating one’s soul to the highest level.
Never fear taking risks in life. Staying in one’s comfort zone is the biggest risk of all, since it is the most dangerous and uncertain place on this planet.
Remember that every time you do what you fear, including taking positive leverage, you take back the power that fear has stolen from you and reclaim the powerful strength lying within you.
You should never leverage for portfolio income (capital gains), but only for passive income (regular income in the form of rent, dividend, interest, etc).
5. Where did my pie go? - Sydney
Wake up early, and don’t rob time from my own life
In general, mid- and small-cap stocks are more risky than large-cap ones. Therefore, small-cap stocks might need more dilution from bonds than large-cap ones.
Sustenance and long-term wealth accumulation is a boring, mechanical process called asset allocation.
The aim of optimal asset allocation is not to invest only in safe assets, but to invest in a combination of safe and risky assets whose combined risk is much lower than that of the individual constituents and, at the same time, offers higher returns.
6. Budgeting for a marathon - Nairobi
The main problem with human beings is that they want to eat everything today out of their present and future money, creating a budget deficit for themselves.
A budget deficit doesn’t necessarily mean living below your means. It simply means expanding your means so that your expenses fit into it, leaving you with a surplus.
Budgeting is nothing but paying your own self.’
First build your investment asset and then enjoy the fruits of it.
A person with highest degree of financial literacy invests not only his own earned income in productive assets, but also borrows, leverages and invests the borrowed funds in productive assets.
Luck is where skill meets persistence.
7. Not even widows like to speculate – Johannesburg
For any asset to pass the litmus test of an investment asset, it must generate positive cash flow in the form of running income.
There is no running income from land. On the contrary, there are running expenses on it such as property tax, maintenance, keeper’s wages, utility bills, etc. When you buy land, you are buying it for asset income, to flip it and sell it to a buyer at a higher price. So, land isn’t an investment asset, but a speculative item.
Exercise is an insurance policy you have taken for your health and each day you pay a premium by going to the gym. Good health is a medal on the neck of a healthy person that only a sick person will notice,
Invest in assets that produce running income and let asset income just flow as a by-product of it.
8. Equities, your share of profits – New York
The five major factors that affect the price of equities (or any freely tradable instrument, such as bonds and gold) are macroeconomic, monetary, fundamental, technical and psychological factors.
High interest rates are one of the biggest enemies of equities because they are likely to result in a fall in corporate earnings through increased interest costs, reduction in equity valuations like the P/E multiple through an increase in the discount rate, and by making available less investor surplus for equities as it makes debt attractive.
Buy the stocks of companies that have shown consistent growth in earnings and make those goods and services that people cannot do without.
Never invest or trade more than you can reasonably afford to lose.
Put your stop loss at a logical, not convenient, place and always adhere to it.
Cut losses and let profits run.
Don’t let a profit get converted into loss.
Tips are for waiters and not investors.
When in doubt, stay out.
Don’t invest on the basis of hope and never be sentimental about your stock.”
Identify the determinations of stock returns – dividend yield, growth in earnings and change in P/E valuations.
9. Looking to your own house - London
Your own house is a bad capital asset and not an investment asset. It takes money from your pocket in the form of property tax, maintenance, society charges, utility bills and mortgage payments.
Don’t forget that your house on mortgage is actually an investment asset of the bank, as it puts money into its pocket in the form of the mortgage installments that you pay to it.”
Bear in mind that every one of your expenses is someone else’s income, and each one of your liabilities is someone else’s asset.
Always recognize the difference between real and perceived wealth, and never fall into the wealth effect trap.
You can buy the best value-for-money property at the foreclosures’ office. Just spend a few pounds on its renovation and the value of it almost immediately rises by around 20% as does the potential rent from it. The trick is to buy the right property at the right place at the right price in the right foreclosures auction.
You should also be on the lookout for good distress sale of properties by those facing a cash crunch.
Recession is too important an event, never just let it pass; instead use it to build your wealth. The best of bargains are had at the worst of times.
One should not forget that owning a house entails two types of costs – property tax, maintenance, utility bills and other property-related charges, as also the opportunity cost of the same funds not being utilized for actual investment assets.
Get your house financed by the bank, which will shell out the lion’s share of the house cost at the lowest possible rate of interest and then the taxman will grant you all kinds of deductions and exemptions with respect to interest and capital payments.
You should go in for a floating rate when there has already been a substantial hike in central bank-controlled interest rates over a period of time. On the other hand, you should settle for a fixed rate mortgage loan when there has already been a substantial fall in central bank-controlled interest rates over a period of time.
A corporate structure protects you from many legal financial predators, such as the government, taxman, blackmailers and legal eagles, who use the law to rob you of your possessions, as well as helps with succession planning, which happens automatically with a corporate structure because it has its own separate legal entity with perpetual succession.
Interest plus the property tax and the other maintenance costs when you buy your house, and then compare it with the rent which you would be paying on a rented house. See which turns out to be cheaper and go in for that option. The point at which they are equal is the break-even because I am not asking you to buy real estate in expectation of an increase in its value, so that you can flip it at a higher price for capital gains. That is never the right premise to buy any asset, including real estate.
No one should abandon his goals in life simply because the path to it is full of thorns.
Just as God showers wealth on His devotees, so must the real estate you own put money into your pocket.
Your house is like a temple which you should aim to own for self occupation, keeping in mind the hard truth that it is a bad capital asset purchased to save on the unnecessary revenue expenditure in the form of rent.
A house owned by your company protects it from legal financial predators, including the government and the taxman, as well as aids in proper succession planning.
Aim to make rental real estate with positive net cash flow after tax one of your investment assets because that will put hard cash into your pocket, in perpetuity.
10. What is protected is what is kept – Nashik
While dealing with your money, you should listen to what the government is saying and save yourself some tax – legally.
There are distinct advantages, for earning, investing and holding, of an institutional structure over an individual.
The five investment thieves, which include inflation, income tax, interest rates, market volatility and incorrect asset allocation.
As an individual you first pay tax to the government, while as an institution you first pay yourself and then to the government via taxes from the money left
11. The most important lesson – Delhi
once one’s investment assets start working and generating income, financial freedom is achieved
Be the master of money; don’t ever be afraid of it and never run after it. Money is not the solution to our problems, financial knowledge is.
Never fear taking risks in life. Remaining in one’s comfort zone is the biggest risk of all, since it’s the most dangerous and uncertain zone on this planet.
Don’t feel embarrassed when you are rewarded. Be humble, but enjoy the reward, because you deserve it.
Plan your time properly, because failing to plan is, in fact, planning to fail.
Every time you say yes to something that is unimportant, you are unknowingly saying no to something that is important.
Reputation is that which people think you are, your character is that which you actually are.
always take calculated risks.
They don’t have the courage to live their own dreams and that is why they hide behind their work.
Success does not mean winning every battle, but it means winning the final war.
Nothing fails like success, because when you are at the top, it’s so easy to stop doing the very things that took you there.
Never - To earn without protecting, to spend without budgeting, to save without investing, to invest without learning, to grow money without leveraging, to work without insuring, to die without living
Death is like life’s shadow, it follows man everywhere. Life is like one’s teacher, and death only makes it possible to begin all over again.
People lack the courage to follow their convictions. Strive to achieve greatness while you are still alive.
12. The Final letter – Mumbai
Convert earned income into passive and portfolio income, generating life long cash flow for you with minimum or no taxation, the importance of paying yourself first via the creation of your budget surplus, protecting yourself from financial predators, the difference between saving and investing, safeguarding the value of your money against the monster of inflation, spending to get rich, the true place of speculative assets and the invincibility of financial insurance.
Eternal truths
A job is not an asset. You can neither own a job, nor pass it on to your children
A home is not an asset as it takes money out of your pocket
Money is not an asset. It is a debt and is rapidly being devalued with more national debt.
A retirement plan is not an asset but an unfunded liability
Workers’ savings are a source of cash for the true capitalists
The government relentlessly prints money, robbing you of your own money via inflation
Government taxes you indiscriminately, transferring money from consumers to capitalists
Employees are only too happy to have their money deducted from their salary, thinking they are investing for their retirement while, in fact, they are funding the unfunded liability of the government
When they lose their jobs to younger, more efficient people, they go back to school to earn higher degrees, falling into the same cycle without any real chance of winning.
There are three kinds of people –
Those who look at the obstacles and don’t start the journey,
Those who start the journey, but stop when confronted with the obstacles, and
Those who start the journey bravely facing and conquering each obstacle on their way to ultimate victory.
Read more about the author at - www.intelligentmoney.blogspot.com or www.mehrabirani.com
It was a long review, but I look at it more like a summary of the book.
Overall, This should be compulsory reading for everyone entering the workforce and thinking of making any serious money and wealth to attain financial freedom. I so wish I had read this 10 years back when I had started working.
The book claims itself as a financial adventure, and helps explains the concepts of personal finance through a good fictional adventure format ranging from the Afghanistan terrorists to Bangkok prostitutes. This one is going to be a long review, as I want to summarize each and everything for those who would not be able to read this book, and for myself to review this often to be on track on my journey to attain financial freedom.
Financial freedom is when my money works for me, and I get regular income form my investments.
The book is classified into clear chapters, and I would summarize as per that.
1. A fortuitous meeting
Common financial mistakes - mental accounting, loss avoidance, decision paralysis and selective thinking among others
The only thing available in abundance in this world is money. Never work for money, but make your money work for you (guaranteed, passive and portfolio income).
2. Common Mistakes – Bangkok
Don’t throw good money after bad money, because money lost is money gone.
Don’t compartmentalize losses and gains. Always consider money received from all sources as equally sacred.
Not making a decision is also a decision in itself that has consequences.
3. Insurance - Afghanistan
Various categories of Insurance - family protection, personal insurance, disability protection, third party insurance, vehicle insurance, loss of profit protection and credit insurance.
The major categories of financial insurance include family protection, disability protection, asset protection, loss of profit protection, personal insurance and medical insurance.
There are other categories that protect one’s wealth from money predators. These include legal insurance (protection against legal rogues), tax insurance (protection against the government taxmen), competitor protection (to be able to remain in the business in which one is today), love protection (those who pretend to love for selfish ulterior motives) and portfolio insurance (to protect one’s assets against unexpected large losses). Look for details in your life to know which policy suits you best.
You are throwing away valuable hours of your own life if you have a terrible habit of getting up late in the morning. Similarly, you are robbing yourself of your own money when you delay taking the appropriate insurance policy for yourself.
4. Mystics and Money Creation - Shanghai
Leverage - A simple concept that basically says money in your hands is worth more than money in your neighbor’s hands. Leverage simply puts your neighbor’s money into your hands. And once it comes into your hands, you can invest with that money. So, you earn on money that you originally did not own
The biggest leverage that all human beings possess is financial knowledge.
Gruesome capital assets would mean those assets that produce negative income or empty your pocket, such as a car, beach house, etc. Bad capital assets would include those assets that don’t give you any income, such as a self-occupied house. Unnecessary revenue expenditure would mean foreign trips, costly dinners and the like, that will just loot you.
Your money should go into buying only investment assets and not liabilities in the form of accounting assets,
Financial wisdom was not just about money and how to get rich, it was a permanent medicine for elevating one’s soul to the highest level.
Never fear taking risks in life. Staying in one’s comfort zone is the biggest risk of all, since it is the most dangerous and uncertain place on this planet.
Remember that every time you do what you fear, including taking positive leverage, you take back the power that fear has stolen from you and reclaim the powerful strength lying within you.
You should never leverage for portfolio income (capital gains), but only for passive income (regular income in the form of rent, dividend, interest, etc).
5. Where did my pie go? - Sydney
Wake up early, and don’t rob time from my own life
In general, mid- and small-cap stocks are more risky than large-cap ones. Therefore, small-cap stocks might need more dilution from bonds than large-cap ones.
Sustenance and long-term wealth accumulation is a boring, mechanical process called asset allocation.
The aim of optimal asset allocation is not to invest only in safe assets, but to invest in a combination of safe and risky assets whose combined risk is much lower than that of the individual constituents and, at the same time, offers higher returns.
6. Budgeting for a marathon - Nairobi
The main problem with human beings is that they want to eat everything today out of their present and future money, creating a budget deficit for themselves.
A budget deficit doesn’t necessarily mean living below your means. It simply means expanding your means so that your expenses fit into it, leaving you with a surplus.
Budgeting is nothing but paying your own self.’
First build your investment asset and then enjoy the fruits of it.
A person with highest degree of financial literacy invests not only his own earned income in productive assets, but also borrows, leverages and invests the borrowed funds in productive assets.
Luck is where skill meets persistence.
7. Not even widows like to speculate – Johannesburg
For any asset to pass the litmus test of an investment asset, it must generate positive cash flow in the form of running income.
There is no running income from land. On the contrary, there are running expenses on it such as property tax, maintenance, keeper’s wages, utility bills, etc. When you buy land, you are buying it for asset income, to flip it and sell it to a buyer at a higher price. So, land isn’t an investment asset, but a speculative item.
Exercise is an insurance policy you have taken for your health and each day you pay a premium by going to the gym. Good health is a medal on the neck of a healthy person that only a sick person will notice,
Invest in assets that produce running income and let asset income just flow as a by-product of it.
8. Equities, your share of profits – New York
The five major factors that affect the price of equities (or any freely tradable instrument, such as bonds and gold) are macroeconomic, monetary, fundamental, technical and psychological factors.
High interest rates are one of the biggest enemies of equities because they are likely to result in a fall in corporate earnings through increased interest costs, reduction in equity valuations like the P/E multiple through an increase in the discount rate, and by making available less investor surplus for equities as it makes debt attractive.
Buy the stocks of companies that have shown consistent growth in earnings and make those goods and services that people cannot do without.
Never invest or trade more than you can reasonably afford to lose.
Put your stop loss at a logical, not convenient, place and always adhere to it.
Cut losses and let profits run.
Don’t let a profit get converted into loss.
Tips are for waiters and not investors.
When in doubt, stay out.
Don’t invest on the basis of hope and never be sentimental about your stock.”
Identify the determinations of stock returns – dividend yield, growth in earnings and change in P/E valuations.
9. Looking to your own house - London
Your own house is a bad capital asset and not an investment asset. It takes money from your pocket in the form of property tax, maintenance, society charges, utility bills and mortgage payments.
Don’t forget that your house on mortgage is actually an investment asset of the bank, as it puts money into its pocket in the form of the mortgage installments that you pay to it.”
Bear in mind that every one of your expenses is someone else’s income, and each one of your liabilities is someone else’s asset.
Always recognize the difference between real and perceived wealth, and never fall into the wealth effect trap.
You can buy the best value-for-money property at the foreclosures’ office. Just spend a few pounds on its renovation and the value of it almost immediately rises by around 20% as does the potential rent from it. The trick is to buy the right property at the right place at the right price in the right foreclosures auction.
You should also be on the lookout for good distress sale of properties by those facing a cash crunch.
Recession is too important an event, never just let it pass; instead use it to build your wealth. The best of bargains are had at the worst of times.
One should not forget that owning a house entails two types of costs – property tax, maintenance, utility bills and other property-related charges, as also the opportunity cost of the same funds not being utilized for actual investment assets.
Get your house financed by the bank, which will shell out the lion’s share of the house cost at the lowest possible rate of interest and then the taxman will grant you all kinds of deductions and exemptions with respect to interest and capital payments.
You should go in for a floating rate when there has already been a substantial hike in central bank-controlled interest rates over a period of time. On the other hand, you should settle for a fixed rate mortgage loan when there has already been a substantial fall in central bank-controlled interest rates over a period of time.
A corporate structure protects you from many legal financial predators, such as the government, taxman, blackmailers and legal eagles, who use the law to rob you of your possessions, as well as helps with succession planning, which happens automatically with a corporate structure because it has its own separate legal entity with perpetual succession.
Interest plus the property tax and the other maintenance costs when you buy your house, and then compare it with the rent which you would be paying on a rented house. See which turns out to be cheaper and go in for that option. The point at which they are equal is the break-even because I am not asking you to buy real estate in expectation of an increase in its value, so that you can flip it at a higher price for capital gains. That is never the right premise to buy any asset, including real estate.
No one should abandon his goals in life simply because the path to it is full of thorns.
Just as God showers wealth on His devotees, so must the real estate you own put money into your pocket.
Your house is like a temple which you should aim to own for self occupation, keeping in mind the hard truth that it is a bad capital asset purchased to save on the unnecessary revenue expenditure in the form of rent.
A house owned by your company protects it from legal financial predators, including the government and the taxman, as well as aids in proper succession planning.
Aim to make rental real estate with positive net cash flow after tax one of your investment assets because that will put hard cash into your pocket, in perpetuity.
10. What is protected is what is kept – Nashik
While dealing with your money, you should listen to what the government is saying and save yourself some tax – legally.
There are distinct advantages, for earning, investing and holding, of an institutional structure over an individual.
The five investment thieves, which include inflation, income tax, interest rates, market volatility and incorrect asset allocation.
As an individual you first pay tax to the government, while as an institution you first pay yourself and then to the government via taxes from the money left
11. The most important lesson – Delhi
once one’s investment assets start working and generating income, financial freedom is achieved
Be the master of money; don’t ever be afraid of it and never run after it. Money is not the solution to our problems, financial knowledge is.
Never fear taking risks in life. Remaining in one’s comfort zone is the biggest risk of all, since it’s the most dangerous and uncertain zone on this planet.
Don’t feel embarrassed when you are rewarded. Be humble, but enjoy the reward, because you deserve it.
Plan your time properly, because failing to plan is, in fact, planning to fail.
Every time you say yes to something that is unimportant, you are unknowingly saying no to something that is important.
Reputation is that which people think you are, your character is that which you actually are.
always take calculated risks.
They don’t have the courage to live their own dreams and that is why they hide behind their work.
Success does not mean winning every battle, but it means winning the final war.
Nothing fails like success, because when you are at the top, it’s so easy to stop doing the very things that took you there.
Never - To earn without protecting, to spend without budgeting, to save without investing, to invest without learning, to grow money without leveraging, to work without insuring, to die without living
Death is like life’s shadow, it follows man everywhere. Life is like one’s teacher, and death only makes it possible to begin all over again.
People lack the courage to follow their convictions. Strive to achieve greatness while you are still alive.
12. The Final letter – Mumbai
Convert earned income into passive and portfolio income, generating life long cash flow for you with minimum or no taxation, the importance of paying yourself first via the creation of your budget surplus, protecting yourself from financial predators, the difference between saving and investing, safeguarding the value of your money against the monster of inflation, spending to get rich, the true place of speculative assets and the invincibility of financial insurance.
Eternal truths
A job is not an asset. You can neither own a job, nor pass it on to your children
A home is not an asset as it takes money out of your pocket
Money is not an asset. It is a debt and is rapidly being devalued with more national debt.
A retirement plan is not an asset but an unfunded liability
Workers’ savings are a source of cash for the true capitalists
The government relentlessly prints money, robbing you of your own money via inflation
Government taxes you indiscriminately, transferring money from consumers to capitalists
Employees are only too happy to have their money deducted from their salary, thinking they are investing for their retirement while, in fact, they are funding the unfunded liability of the government
When they lose their jobs to younger, more efficient people, they go back to school to earn higher degrees, falling into the same cycle without any real chance of winning.
There are three kinds of people –
Those who look at the obstacles and don’t start the journey,
Those who start the journey, but stop when confronted with the obstacles, and
Those who start the journey bravely facing and conquering each obstacle on their way to ultimate victory.
Read more about the author at - www.intelligentmoney.blogspot.com or www.mehrabirani.com
It was a long review, but I look at it more like a summary of the book.
Overall, This should be compulsory reading for everyone entering the workforce and thinking of making any serious money and wealth to attain financial freedom. I so wish I had read this 10 years back when I had started working.
May 9, 2020
The book doesn't have effective story telling and is rather a drag. There is no literary sense in the book. The story is merely a guise that the author has employed to cover some financial knowledge. Although, he probably has tried to cover areas in terms of personal finance, he keeps away from delving a little deeper.
Also it is basically 5% financial knowledge in this 100% of the book. The story is repetitive (if I can call it a story). There are futile details that are to no avail.
Maybe the point he is trying to make(his intent) is the only saving grace. But the ideas seem haywire and very scattered because the plot is distracting with the details of places and food items which are of no use to readers and won't even settle down in their memory to increase awareness (If that is what the author intends lol)
Over all I felt like I wasted a couple of hours to get hardly an hour of knowledge which is kinda revolting specially since the author says time is of utmost importance.
Also it is basically 5% financial knowledge in this 100% of the book. The story is repetitive (if I can call it a story). There are futile details that are to no avail.
Maybe the point he is trying to make(his intent) is the only saving grace. But the ideas seem haywire and very scattered because the plot is distracting with the details of places and food items which are of no use to readers and won't even settle down in their memory to increase awareness (If that is what the author intends lol)
Over all I felt like I wasted a couple of hours to get hardly an hour of knowledge which is kinda revolting specially since the author says time is of utmost importance.
July 14, 2017
Interesting concept to communicate simple personal financial rules to common man. Writer lacked the storytelling part but the core of the message is delivered in a right fashion. Must read for people looking to save and invest.
February 27, 2018
This book may not be the best endowed in grammar and literary devices but in its own subtle way, it could be a mini bible in money management.
September 2, 2018
A beautiful book on personal money management.
October 8, 2018
Great book for beginners who wants to understand about money and finances
May 28, 2020
Amazing book by Mr Mehrab Irani. Teaches amazing financial lessons without letting you get bored.
August 9, 2020
Best book on financial journey.
November 8, 2024
Best financial fiction I have ever read, loved the story.
January 4, 2021
This novel is a much essential session on managing Finances structured in the form of a story to make it easier for a layman to understand. The author, Mehrab Irani is a learned man and he pours all his brains, all his experience, all hai teachings from his Financial Independence sessions into this fictional tale. In order to not make his seminars redundant though, we only get a glimpse of What To Do and now so much as How To Do, obviously.
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Our lead character meets various people around the world who each teach him about certain aspects of Financial Freedom. The story sticks to the same template for each new meeting which starts getting pretty predictable, and a tad bit irritating.
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I am from a Science and Engineering background and have only limited knowledge and exposure into the world of investments. This book made me realise why I took Science and not Commerce in +2 (high school). :D
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Go for it for a crash course on how to manage your personal finances in an effective way.
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Our lead character meets various people around the world who each teach him about certain aspects of Financial Freedom. The story sticks to the same template for each new meeting which starts getting pretty predictable, and a tad bit irritating.
.
.
I am from a Science and Engineering background and have only limited knowledge and exposure into the world of investments. This book made me realise why I took Science and not Commerce in +2 (high school). :D
.
.
Go for it for a crash course on how to manage your personal finances in an effective way.
March 6, 2015
https://etherealjinxed.wordpress.com/...
The book by Mehrab Irani is a well documented book on financial planning, particularly making us learn about the financial world with innumerable available options and instruments. It describes the value of money and how to deal with the money, how the investments are to be made very lucidly without causing any irritation by giving real life situations through beautiful stories and happenings. Mehtab binds and involves the reader throughout the book till the end.
Travelling round the world, meeting interesting personalities, one finds money advice in the least expected way, be it about insurance, budgeting, speculative investments or financial leverage. The book succeeds in imparting these lessons in a simple way understandable to a non-financial person, like me.
...More at my blog
The book by Mehrab Irani is a well documented book on financial planning, particularly making us learn about the financial world with innumerable available options and instruments. It describes the value of money and how to deal with the money, how the investments are to be made very lucidly without causing any irritation by giving real life situations through beautiful stories and happenings. Mehtab binds and involves the reader throughout the book till the end.
Travelling round the world, meeting interesting personalities, one finds money advice in the least expected way, be it about insurance, budgeting, speculative investments or financial leverage. The book succeeds in imparting these lessons in a simple way understandable to a non-financial person, like me.
...More at my blog
September 3, 2016
First of its kind (i have read). I knew somewhere in life, i was going wrong (financially). This book has made me stop and analyse! Would suggest to everyone who wants to lead a financially independent life! Warning: This book contains financial jargons! But they are good for your help and you should know them!
December 30, 2019
This book is what it would have been if a student mixed notes from Rich Dad, Poor Dad and Tuesdays with Morrie.
While I admit financial advices are on point, the storyline is too weak to uphold it and at times it feels like I'm reading a Bollywood script.
While I admit financial advices are on point, the storyline is too weak to uphold it and at times it feels like I'm reading a Bollywood script.
November 10, 2014
An amazing book in the lines of Robin Sharma's inspirational books.
This will teach you how to manage money and will clear the cobwebs of financial illiteracy from yout mind.
This will teach you how to manage money and will clear the cobwebs of financial illiteracy from yout mind.
December 27, 2014
Could have been less dramatic. But a good read nonetheless.
June 20, 2015
After reading this. I feel like its the digest of Rich Dad Poor Dad, Buffettology and The Secret books in tale format.
Nice try Mr.Irani, you need more individuality
Nice try Mr.Irani, you need more individuality
October 23, 2015
Book explores certain important financial aspects which are non visual to lay man. Author's lexicon is up to the mark.
April 7, 2016
A good read. This book gives insight of money management. A very basic introduction to so called 'Enemies of our Income'.One should read this. Fiction + Finance is always a great combination ...
Read
December 10, 2014i would like to read this book.
August 16, 2017
What an eye opener! This book is a must read for young investors. While a lot of the savvy investors may be already doing a lot of things mentioned in this book, some of the facts in this book were truly a revelation. I have surely come out a better investor after reading this book. And a big plus - it combines fact with fiction!
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