Dear Readers,
FC 98 on Good Money After Bad Money was well received, and I thank you all for taking time out to read and share your comments and observations with me.
Tarun never fails to comment and this time he has this to say: “To me, the dumbest form of ‘putting good money behind bad’ is doing such a cheap deal that it proves costly! Value for money is wise, cheap can be expensive!”
Arjun Chettur is perhaps the youngest among all my readers. From Brisbane, he sent me this comment: “I think you had some fascinating examples. I liked the bit about the Maharaja.”
Shahji Jacob says: “FC 98 was indeed a great and interesting read. I doubt if you feel nervous like a cricketer when he is on 98. You will surely get to the century edition. The stage story related by Ashvini Ranjan was indeed hilarious, but not so, I agree, for those in the midst of it all. Your advice to desist from going to court if it can be avoided is quite pragmatic and level-headed. My father-in-law’s father who was a lawyer himself at a local court (in those times) had the same advice for most. The initial euphoria of taking someone to court will soon wear out when faced with the recurring costs and the endless time involved in having the matter settled through court.”
Dear Shahji, In 2007 Sachin was run out at 99. I have not run out of ideas and will live up to your expectation of completing 100.
Dr.Naina shares this excellent real-life experience: “When my son was 5 years old, he quizzed me as to how the son of our neighbour (who happened to be a Dy SP police) had all the exotic toys at home whilst he had just the bare minimum? I told him ‘son, some of us have only good money, but some others have both good and bad money, but hoarding bad money has ominous consequences.’ A year or two passed by and my words did come true as the police officer, in a major case of extortion, was trapped, suspended, and eventually dismissed from service, and he had to flee with his family to his native place in ignominy and shame. All my son knew was bad money led to their disappearance from our neighbourhood and now as an Engineer and working for Infosys he never stops thanking me for the values inculcated in him and in my daughter as both can clearly distinguish what is working hard and earning good money is vis-à-vis possessing bad money and inviting misery.”
🌧 Saving It for a Rainy Day
It is not very clear where and when this idiom was first used and who actually coined it. However, the expression ‘rainy day’ has been used by authors as early as the 16th century to signify hard times. A rainy day is also symbolic of unexpected occurrences or unforeseen circumstances.
Ironically, a rainy day could well be a dry season. Imagine what can happen if there’s a failure of monsoon and crops are destroyed. If the granary has some reserve stocks, one can get by.
As opposed to saving up or conserving something for a future requirement, saving for a rainy day is with a view to being able to meet a contingency not in one’s contemplation.
Some people buy gold and stash it away with a feeling of comfort that they can encash it on a rainy day. Just as an umbrella is meant to shield you from the rain, so would the gold come to your aid when faced with unexpected situations. Speaking of umbrellas, it is said that keeping them in public places is a true case of saving someone from a rainy day.
One must save for the rainy day. As one gets older, it becomes harder to get a health insurance policy comprehensive enough to take care of every situation. This is even more important if the children are unable or unwilling to support you in difficult times.
Life’s savings are invariably meant to provide you security so that if you encounter a rainy day, aka hard times, you don’t have to pass the hat around. Constant contemplation of a rainy day event prompts you to take the best possible measures to conserve your resources.
Contingency funds are best suited to come to your aid. Troubles no longer come in pairs. They come in rapid succession. These troubles are not just physiological, but also could be psychological. How does one ensure that one has such a contingency fund? Money in the savings bank is never a reliable recourse for contingencies. Provident fund, PPF, and other such ‘touch me not’ kinds of deposits are a great help in these situations. Never touch these. Some helplessly do liquidate these resources for a wedding or some other event. To be able to balance competing demands on these funds, one should learn to draw a line.
Maintaining one’s lifestyle after retirement as revenues deplete is a challenging proposition. Here’s where certain annuity policies come in handy. These are intended to ensure that your lifestyle does not dramatically change after you stop earning. Therefore, the question is not at what age you want to retire, it's at what income. The cost of living is forever on the rise. One may have to manage one’s finances and tweak the lifestyle a bit.
The other day I was speaking to a senior citizen and I casually asked him as to how he manages his finances. He said that he has no credit or debit card, but goes to the bank once a month to draw money enough to meet his monthly requirements. According to him, if you want something left for a rainy day, you should deny yourself easy access to money. He added, “swiping the cards and later wiping tears is not the way to live. One should live within one’s means.” I thought of mentioning what Oscar Wilde said: “Anyone who lives within their means suffers from a lack of imagination.”
‘Salt away’ is a synonym for saving for a rainy day. Salt is used as a preservative, and hence to put away cash and other tangibles as a fallback for future needs is to salt them away. I am not sure how many of you are aware that our ancestors used to salt away money for emergencies in those days when keeping money in a bank was unknown. They used to either keep the money in the steel trunk or hide it in one of the spice tins if the amount was small.
This takes me to the piggy bank. Though it is meant to encourage children to save money, it is essentially a form of saving for a rainy day. A kid could save to buy a game or a toy or some other thing. There have been instances of kids giving away their piggy money to charitable causes. This imparts a sense of social responsibility in them and a certain degree of sacrifice or selflessness. It is in a way saving for someone else’s rainy day. This pun is for kids who enjoy saving:
What happened when the cat swallowed a coin?
There was money in the kitty.
If one hasn’t saved for a rainy day, one could be in dire straits. Charlie Chaplin said, “I like walking in the rain so no one can see me crying.” One could feel sorry for oneself and be tearful, but on a rainy day one may end up walking with no real rain to hide one's tears.
COVID has been a big rainy day. Many lost their near and dear ones, or spent a fortune on hospitals. Many lost their jobs. Many lived out of their savings — savings that were not meant for this rainy day called COVID. It has been great learning. One must not forget the financial hardship one went through and make an earnest effort at saving for that rainy day that may befall us in unimagined intensity.
There’s no doubt that all of us need to save for a rainy day. With the money salted away, one can deal with unforeseen events when they happen.
I end this post with this quote:
“Do not save what is left after spending; instead spend what is left after saving.”– Warren Buffett
My next post, FC #1000 will be my last post for now. Don’t worry, resume I shall, but know not when. Until then, take care & God bless!
Thank you Viji.
A very smart and subtle hint:)