1) If your standard of living is Rs 25,000 per month, you need an SIP of Rs40,000 to be financially free in 10 years.
2) If your standard of living is 50,000 per month, your SIP rises to Rs 80,000 per month.
3) For Rs 1 lac per month standard of living, SIP is Rs 1.6 lac per month.
4) For Rs 1.5 lac per month Standard of Living, SIP value is Rs 2.4 lac per month.
5) Many lower middle class families can do an SIP of Rs 40,000 because all family members of the lower middle class are in some kind of employment.
6) If 4 family members are each earning Rs 20,000 per month, they make Rs. 80,000 per month.
7) After deducting Rs 25,000 as their living cost, they are left with Rs 55,000 which is more than the Rs 40,000 requirement for Financial Freedom.
8) With Rs 55,000 they will attain Financial freedom in just 8 years.
9) On the other hand the so called rich people making lacs per month have more challenges.
10) Let’s say Salary is 3.5 lac per month. Post tax salary is 2.45 lac.
11) EMI of house and car would be say Rs 75,000 per month.
12) Cost of living Rs 1 lac per month.
13) Money available for SIP Rs 70,000 per month.
14) Only one family member works and all the rest dependent family members have big aspirations of owning Iphones, International Holidays, Gourmet Restaurants, Boutiques to buy their clothes (Sabyasachi).
15) This family will get their Financial Freedom only and only after 18 to 20 years.
16) EMI Generations are most vulnerable.
17) The lower middle class is all poised to taste financial freedom in 8 years time after which their lifestyle grows and compounds for several years and they will end up as upper middle class.
18) The Upper Middle Class (who feel they are Rich and Wealthy) will be financially free only after 20 years.
19) And today the probability of retaining jobs for 20 years itself is a question mark.
20) And bringing down one’s standard of living is nearly impossible or extremely painful.
21) The Upper Middle Class therefore may never become financially free and in fact run the risk of transforming themselves into Lower Middle Class in the long run.
22) One needs to become aware of the situation.
23) The smartest thing to do is to moderate standard of living.
25) This is the only recourse available for the so called Upper Middle Class Rich.