Debt Repayment

The time for repayment of our debt to the motherland (DTM), is looming large on us.  After repaying the minor debts of house tax, water tax, VAT, Income tax and what have you, the time is at hand for repaying your biggest debt.  No, no; we are not talking of your housing loan or the recent car loan.  We are not even talking of the per capita debt in India which now stands at INR 33000.  It is the debt of duty towards the motherland.

There are several, with two very prominent ones, who find their debt burden so heavy that it can be repaid only at the august office of the Prime Minister and they are clashing bitterly to be at the head of the queue.  You can form an idea about the size of the debt from the fact that it takes at least five years to settle one account.  The settlement is often partial and extra time is demanded to complete the repayment in full.  Human life being short as it is, many large debtors aspiring to clear the dues have to contend with the fact that their lifelong wait in the queue may not bear fruit.

Lesser mortals with lower burdens of debt have been advised to repay it at their respective workplaces.  As the advise goes, the teachers owe it to their students and doctors to patients under their care.  However most of us are at our wits' end at the perverse nature of this repayment when we look at the dent that these services, namely, education and health make in our finances!

As far as I am concerned, I think I have repaid my debts at the workplace over a long period of 37 years and I hope the account is settled in full.  Though numerous Tax Deductions at Source seem to suggest otherwise.

As part of this repayment festival, geriatricians are welcome to repay their DTM through me.

Election Season Prayer

Our boss(es) in the High Command, blessed be the family name.
Thy government come, Thy will be done in future scams as in the past ones.
Give me this season the Lok Sabha ticket,
Make me a minister as you made even those who deserted you in the end.
Do not succumb to the pressure from Aam Aadmi but deliver us from the CBI.

Amen.

कुछ दोहे मच्छरों पर

जलता कछुआ देख कर दिया मास्क्विटो रोय
मैं बाहर हूँ टापता, मानुष अंदर सोय.

तुलसी पंछी के पिए घटे न सरिता नीर,
मच्छर से न अनीमिया पर डेंगू है गंभीर.

मच्छर रखो पास में कछुआ देव बुझाय
मेरी तो मंशा यही बस पूरी हो जाय.

चलता जो बिजली का रैकेट छुवत भस्म कर जाय,
मच्छर हुआ तो क्या हुआ मैं क्या प्राणी नांय?


मच्छरों के स्कूलों में प्रातःकालीन प्रार्थना:

  तू प्यार का सागर है, तेरी एक बूँद के प्यासे हम......

Does it make sense to invest in Pension Plans?

Ten long years ago I decided to invest in a pension plan.  The scheme I chose was from HDFC.  The investment was fixed at 10 yearly installments of Rs. 10,000/= each. However there was no assurance about any minimum payout and it was going to be dictated by the market.  Back-of-the-envelope calculations showed that taking the return at 10% p.a with yearly compounding the maturity value should be Rs. 1.75 lakhs (It would be higher with quarterly compounding.)  Also the pension on this corpus at the same rate should be 17,500/= per annum if the corpus was to be returned to legal heirs on death of the pension holder.  In case the annuitant chose for annuity without any return of corpus on his death, the return should be even higher.

All the calculations have fallen flat on the ground.  The total maturity value was Rs. 1.4 lakh approximately.  Here is what was offered to me by HDFC on maturity (PLEASE ZOOM TO 200%):

And lest you should forget, let me remind you that this annuity income is liable to be taxed in your hand.  This means a deduction of 10 to 30 percent depending on your other income.

To top it all, during the past few years I was being charged service tax on the annual premium paid by me.  Then again I have had to pay service tax on the amount being invested in annuities.  The tax on a investment in annuities of Rs. one lakh comes to Rs. 3,019.

I have chosen to invest the mandatory portion of annuity purchase with LICI who are offering a very slightly  higher annuity.  This could be possible under the Open Market Option which has to be compulsorily offered to the investor.

This raises serious doubts about the fate of the new employees being covered under "defined contribution" pension scheme which will work on these very lines.  Notwithstanding our government's dislike for it, investment in gold will be a far far superior option.  Real estate, too, will be a good or a better choice.

मोदी की दावेदारी

मोदीजी खम ठोंक कर हैं आ गए मैदान में,
मनमोहन कुर्सी पर अपनी बैठे हैं गहरे ध्यान में,
जो समझ में आई ना जनता को वह है बात यह,
क्यों देर हो रही है मोदी की अगुआई के ऐलान में.

DDS (Deep Distrust Syndrome)

Recently while in the check-out queue at a retail store I was watching a couple make payment for their purchases.  The lady took out a fresh packet of one hundred rupee notes and separated a bunch looking at the distinctive numbers.  Perhaps unsure of her arithmetic, she started counting the notes while the cashier and her husband looked on attentively.  Then she passed it on to, no, not the cashier but her husband.  He also counted the notes with the same thoroughness while the wife and the cashier looked on.  Next, of course, it was the cashier's turn to count the notes.  And the couple did focus their total attention at the cashier while he was at it.  And finally with the return of some change the payment was successfully completed and everyone in the queue heaved a sigh of relief.

I think this behavior is a symptom of the DDS (Deep Distrust Syndrome) pervading our society.  The distrust is towards organizations / institutions as well as individuals manning these.  The following also result from this DDS:

• If an accident takes place, the mob adopts a your-money-or-your-life attitude towards the driver  who may or may not be at fault.  No one believes that the system will make insurance company settle the claim of the victim.
• We don't trust our fellow citizens to honestly pay their electricity bills.  As it would be grossly unfair to have to share in the burden imposed by non-payers, we choose to join them by hook or by crook.
• We don't trust any selection process to be fair.  So everyone puts in his best efforts in influencing the process and the selectors.
• We don't trust the government to provide us good governance using the taxes collected from us.  So we try to evade paying taxes if we can.

The list could go on and on.

 

Any prescriptions for treating this DDS?

Quick comments on Budget 2013

• FMs seem to have lost all interest in senior citizens after Mr Pranab Mukherjee reduced the cut-off age from 65 to 60. This group is hardest hit by persistent inflation and screams for reducing interest rates. They deserve a higher exemption limit at the least, if not respect and gratitude for their services to the nation.

• FM says there is a bit of Azim Premji in every taxpayer. I am sure that recipients of Premji's charities do have a sense of gratitude towards him. The government hardly seems to have any towards its taxpayers.

• The pirates infesting the route along which allocations travel to intended beneficiaries must be celebrating increased allocations in the budget with great enthusiasm.