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Stoa Digest #120: 🏼 A Penny Saved = A Penny Earned 🏼
You don’t have to see the whole staircase, just take the first step.
It’s been an eventful and high-intensity week of exam fever! C12 just completed their final exam and have completed the Stoa GMP program, and C13 is just through the midway mark of their Stoa journey. Kudos to all the fellows for putting in a solid effort on a Sunday morning! 💯
So you might have noticed we’ve spoken about finance in the last few editions of the digest. Today, I want to go a little deeper into the subject.
As I completed a year of working and earning that paycheck month on month, I soon realized that the end of the FY (Financial Year) was nearing, and the whole process of filing my ITRs (Income Tax Returns) came into the picture.
This was something completely new to me, and to be very honest, I had little knowledge of how to go about it. 🤔
Many households I know have a CA to file the returns for earning members of the family. Mine was no different, but the idea of doing it by myself piqued the curious cat in me.
So, I started to read up on it, and I found myself discovering a million things. Something that really caught my eye was “tax saving instruments” & “reduced tax liability”. I suddenly was like - Do I have a PPF? What are ELSS Schemes? Do I have an EPF? What is an NPS? Have I even invested in any of these?!
I was pleasantly surprised that I could save (operative word being save) on my total tax due year on year. And I was lucky enough that my dad had already kickstarted investments for me in a few funds. Shoutout to my main man! 🙌🏼
So, I went through my bank statements to collate my earnings, accessed my investment statements and did a little bit of math. I was happy to learn in my final calculations that I had saved on my taxes.
To break it down - I set up a monthly SIP in a PPF account with my salaried bank account. I also invested in Equity-Linked Saving Schemes (ELSS) that offer tax benefits. The catch here is that my investment is locked in for a 3-year period. (Playing the long game!) 🏃🏼
The more I read, the better I understood the why and how of tax-saving instruments (Still learning). A lot of it is designed to incentivize the earning Indian professional to save more and help them improve their financial discipline. (or so it seems to me)
While I was writing this, I also got in touch with a seasoned pro on the subject - Mr. Sharad Dubey from C4. Here’s what he had to share on the topic -
I started investing with pocket money received from relatives and small contributions from my father. After I started earning, I invested in Index funds and some Bluechip Mutual Funds. I’ve learned quite a bit over the years on being a smart investor - A lot goes into doing research on your own and a lot of scuttle butt investing. Ground work is important and generally where retail goes, money is not made.
Sharad also leads discussions on the Stoa Money WhatsApp group. Stoans, DM me on Discord to get access to daily updates on all things Finance! 💸
I think it’s fair enough to say that I felt some kind of satisfaction in knowing that with a little bit of time and effort spent on reading up on the subject, I actually saved money. Investments not only act as a source to avail benefits on your taxes but also help set you on a path to financial freedom.
~ Adi, Team Stoa
🔥 Community Sneak Peak 🔥
We’ve got an exciting Fireside Chat incoming with Niranjana Ravi, Ex-Chief of Staff at CRED. Tune in this Wednesday from 9PM onwards to join the discussion! 🔥
We are also hosting an offline event with Abhash Kumar, VP of Marketing at Springworks this Thursday from 5PM onwards at BIC, Domlur for a workshop on Leveraging AI for People Function. 👥
If you know someone in the field or an HR from your company, share this with them!
⏯ For Stoans by Stoans ⏯
An interesting article on the Indian ‘study abroad’ ecosystem.
A brilliant podcast on understanding the Indian consumer.
“There is no such thing as startups. They are all businesses.” Read here.
Book recommendation of the week - Alchemy by Rory Sutherland.
Here’s a framework to classify product features into tiers to set them up for success.