55 lakhs! You get joining bonus for 2 years? -Yes. -Wow! You took a few big purchase decisions. Yes, I knew I would get the pay jump, so I took it before I got the jump. In your case, it looks like you are just securing your future. But your present is getting compromised. Hello and welcome
to a new episode of Fix Your Finance powered by CRED. Today we are in Bangalore to meet a 26 year old tech bro. His name is Sumanth and he recently shifted to Bangalore from Hyderabad. He is
working with a big startup. How’s it going? I go to the office on Monday and Tuesday, rest of the days I work from home. On the weekends, I go out for dinners and spend time with my friends. What was your role in your previous company? I was working as an SDE 1 in the previous company. Here,
I am SDE 2. Software Engineer 2. It’s a level up. How long have you been working for? I completed by B. Tech in 2017. I worked for a company for a year. It was a big company, but it didn’t pay well. I did my masters from IIIT Allahabad. Then, I landed up with Amazon. At Amazon, I was
get 19 lakhs per year in-hand. After Amazon, I joined my current company. Currently, what is your total compensation, pre-tax? Total compensation is around 55 lakhs. -55 lakhs! -Yes. -Wow!. -I have a lot of money. Amazon was a tech giant. That gave me more leverage in negotiating offers with
companies. -Of course, the brand name worked really well for you. -Right. This total compensation of 55 lakhs, can you help me with the breakdown? So, 37 lakh is base. You get 4 lakh yearly as variable pay. On top of that, 6 lakh is my joining bonus. So first year it’s 6, second year
it’s 6. You get a joining bonus for 2 years? -Yes, one is joining, second is retention. -Oh, wow. Then, there is an ESOP for 8 lakhs. And after all the deductions, what is your in-hand monthly salary? I get 2.3 lakhs in-hand monthly. Now that you have seen a big jump and are making a good
amount for the past 3-4 years, I want to know your relationship with money. Most of the time, I could not get things that I wanted from my family. So, I decided that if I make money, I’ll make it big. I didn’t want to work for a meagre amount. That was the plan since childhood. When you
were staying with your parents, how much do you think was the monthly expense? -I think 4-5k. -Wow. And how much rent do you pay for this house? I’m paying 17k for this house. That has been a big jump in your life, man. So rent is 17k. How do you manage your food? I have a cook who comes and
cooks for me twice a day. She charges me 4k per month. And how much do you spend on groceries? I spend 4k on groceries. I pay Rs. 1500 to a maid who washes dishes and keeps the house clean. Travelling is an expense too. Do you have to go to the office everyday, or is it a remote situation? Mostly
remote. I go to the office twice a week. My office is close by, just 1km from where I stay. I just walk or drive my car. -Okay, so you have a car? -Yes. -When did you buy it? -1st January, 2022. -How much did it cost? -It costed me 10.5 lakhs on road. 10.5 lakhs on road. Did you href="https://cashnews.co/finance" style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finance
-Quite a good rate. What is the tenure? -7 years. If you are taking a Loan, restrict the duration to 4-5 years, going forward. 7 years is a long tenure. What is the EMI? -Around 16k per month. -16k. Apart from this, do you have any other Loans? Yeah. I purchased a
home in Hyderabad. I can see that after the big pay jump, you took a few big purchase decisions. I knew I would get the pay jump, so I took it before that. How did you know that you’d get such a big pay jump? I knew what the pay was like in the market. Either I would get promoted and get the
same amount at my previous workplace, so make the same money in a new workplace. -Your parents live there? -Yes. The Loan amount is 43 lakhs. The EMI is 33k per month. What is the interest rate and duration? It was 6.8 when I took it. RBI increased the interest rate, so now
it’s 8.2. His interest rate increased suddenly because he took a floating rate home Loan. The bank sets an external lending rate as their benchmark, and then based on your CIBIL score and Credit rating, they give you a kicker. The riskier you are, the higher
the interest rate. In most cases, the EBLR is the Repo Rate. To control Inflation, RBI recently has increased the repo rate. That’s why his home Loan interest rate has also increased. Since the interest rate has increased, so has the duration. It has become
29 years from 20 years. EMI is same, but the duration increased. I wanted to know if I should pay off the home Loan, since it has only been a year, or if I should invest, for higher returns in the market. Of course, you’ll get higher returns in the market, while you continue
your home Loan. But 29 years is a very big tenure. Your Loan will keep going on until you’re 55. Do you want to work throughout, or you want to retire early? I want to be financially free so that I can take the decision accordingly. -The first major step is
to have lower Liabilities. -Got it. 29 years is a big duration for anyone. You said that you get a joining bonus, a variable bonus, and you can also exercise your ESOPs. You should work on reducing your principle amount in your initial years. This way, your duration will reduce.
These are your basic expenses and Liabilities. What are your variable expenses? How much do your spend on your car’s maintenance and fuel? -10k per month. -10k per month. Do you go for long drives over the weekend? It costs 6-7k per trip, whether I’m going to Hyderabad
or any other place. -Do you have Credit cards? -Yes, I own 3 Credit cards. For what purposes? Why do you have three cards? Mostly for cashbacks from multiple websites like Myntra, Flipkart, Amazon. If you are buying Credit cards for cashbacks and
offers, I would recommend you to sign up with CRED. CRED has a feature where as soon as you add your card, it tells you about the different offers and rewards detected. This way whenever you are shopping or spending money, you will always get the best deal. So please download CRED right away, the
link is in the bio. How much do you end up spending in a month, inclusive of all your expenses and Loans? I think around 85-90k. So even after all your expenses, you are left with a lot of Savings. How do you manage your money? I put 1 lakh in
Equity. I know that I’m dumb, so I don’t get into stock picking. I learnt this from you. Mid-cap index, small-cap index, Nifty index and tech index. I invest in these 4. Apart from this, I invest 10k in chit funds. It’s not about being dumb. Everyone has topics
that they know about, and don’t know about. If you are aware that you don’t know things about some topics, and if you outsource that to an expert, that is the smartest move ever. If you are taking index funds, check out the AUM, and the tracking error. Tracking error is basically that
if the index is at Rs. 100, and the mid-cap index fund is at 99, then the error is 1%. -Right. -So, the smaller the error, the better. -Do you have an emergency fund? -Not a fund, but I purchased gold for my mom. I think of it as an emergency fund. In case something bad happens, I’ll take the
gold and either sell it off, or get a gold Loan at a cheaper interest rate. Ideally, you should not be taking a Loan against gold. I would recommend for sometime, try to at least have 1-2 lakhs in your bank account, because you have Liabilities,
and the economic conditions are also not the best. So if for some time, you can reduce your SIP amount and keep a Savings, be it anywhere. -Do you have a health Insurance? -I have a health Insurance. It has a top-up of 10 lakhs, and a super top-up
policy of 90 lakhs. -What about a term Insurance? -I wanted to ask you, how do I come up with the right amount? How much should I spend on my term Insurance? It is tricky to figure out the cover amount, as there are many variables. I feel it should roughly be 15-20
times your annual expenses, plus Liabilities. You are investing about 50% every month. Are you holding yourself back in some areas of life? I feel like I should spend, but I can’t because I have a target in my mind that I need to reach this number by the end of 2023. I even
postponed a vacation for this reason. My family wanted to go to Jaipur, and they asked my to join. But I told them that we’ll go later because I have to hit this certain number in my mind. One distinctive feature about targets is that the finishing will keep moving. When you do hit that
amount at the end of the year, your life is not going to change drastically. The next step would be the next target. This is beating the purpose of money. Money is an enabler. It gives you the freedom to spend more time with your family, to have better experiences in life, and to also secure your
future. It looks like you are just securing your future. But your present is getting compromised. I think I will start spending on experiences going forward. I will not compromise, I will take that vacation. Probably be a bit kinder to myself and spend on myself. You said you want to be financially
free early in life. What amount do you think is enough to take it easy? Right now, about 3.5-4 crores. Next is, if you had an unlimited budget, what would you gift your parents? A world tour. How much do you think you’ll spend on your wedding? I’ve not thought about it, but going by my
friends’ experiences, I think 10-15 lakhs. The last question is, if money was out of consideration, what would you do for a living? I’d teach coding to other people. I really life teaching, so I’d do that. Very nice. That basically tells you that you are not very unhappy with what
you are currently doing. -You are very satisfied. -Right. On that note, we are towards the end of the show. Thank you so much, man. And thank you all for watching till the end. If you want me to come to your home, check out the link in the description. Fill up the form, and we will get in touch
with you. If you liked this CashNews.co, hit the like button, and also subscribe to the channel if you are new. Goodbye.
CashNews, your go-to portal for financial news and insights.
He is from my college IIIT ALLAHABAD congrats sir 🎉
Itna saara expections hain , ki pata nahi maan kar raha hain saab kuchh chhor ke kahin isolation me chale jayen. Tumlogo ka expectaion ,meri family ka expections,mera apna expections. Tum logo khud enjoy kaar rahi hon mujhe slavery me dhakel ke
36 lakhs+ 4 lakhs + 6 lakhs😮
A known guy on street is making 3lakhs per month with chole bhature stall..
Thing of joining him really soon😂
myntra uses bit bucket , that can also be seen easily 🙂
myntra , can be seen on laptop , please blur it 🙂
One request plz make videos from lower middle class family or else village people ( under 5 lakh ctc)
These videos are only helpful for 5% people of india
95% people are earning under 5 lpa , it would be a great learning for india🎉😊
This guy is actually auditioning for marriage proposals 😂😂😂
Age 27
Ambitious, career oriented guy
55 lakhs package
Own house
Own car
Me who earns 19k pm in bangalore :
Amma behen pe aa jaunga me tumhari
Pr bro iska gold wala emergency fund sun kr Acha idea hai ye bhi
😂 i don't even count joining bonus and ESOP as my salary
Why does a bachelor guy with 2.3 lac per month salary needs fixing the finance.
He got laid off from his job now he is earning 20 LPA
I would never ever takes loan.. 😢😢😢😢
Hehe. I am 21 and my base salary is 36 and ctc is 44. You should have me on your podcast
You earn 40L, in hand is 2.3L
You earn 55L, in hand is 2.5L
Esop, variable, joining bonus is a must to know. They should remain in the co. Till retention bonus is given and then move on
Why we dont want to work as vegetable vendor, painter, barber, singer, car driver, car washing, tailor, plumber, electricians, furniture,wood work, bakery, gym, street vendors,labourers,cook, maid, tiles, sofa repairing, sugarcane juice, fruits, fruit juice, uber driver, ola driver, zomato delivery and dairy business. Minorities are taking over the businesses and Sanatan are not allowed to run shop and work. Outside every society they have planted their people name Mahadev Hotel owner real name Shahrookh Khan and people are buying cigarettes and enjoying food. Hum Sanatani ye kaam kyu nahi karna chahte kya problem he isme. Koi bhi kaam chota bada nahi hota. Bas Karm par dhyaan do jaise Shree Krishna bolte he. Hum sab coders aur IAS banege kya. Upar jitne kaam bataye he sabme bahut paisa he. Aur unke 10-10 bache he wo lakho kama rahe he aur tum coding karke 30000-50000 aur samajh rahe ho ki hum bahut ameer he. DIMAAG LAGAYO APNA India is hub for business and services.
what is the bgm used during 2nd minute of video, the piano one
Lappu sa Sachin bhi Aaj kal itna kama raha hai
Bhai 26 me 2lakh per month… bhai sahab! Amazing.
Want to understand how 4 Cr at late twenties be enough to retire?
Ever Heard Atlaissian , Apple and Google ( Product Based Companies) for Freshers at Higher ends 😊
When you have big base, you have to invest as much as possible in the beginning.
My friends taunt me asking you earn double than us where does your money go
1. Invest 50%
2. Pay for all expenses of home
3. Pay your personal bill
4. Insurances
Then you will be left with some 20-30k (if your base is 25-27 lpa)
Bro, you are doing correct. Don't listen to him.
In bglore every one is not in this pay range. Only 5 to 10% of peoples are lying in this pay range.
With a Bcom degree and ZERO LPA why the heck am I even watching this??
Itni salary wale log h kaha pe 😂
I am 36 and my package is just 26 lakh with a loan of 30 lakh and zeo emergency fund. Kya life hai meri😢😢
I GUESS FOR THAT PAY HE ASLO DOES CLAENING AND LAUNDRY FOR THE COMANPANY