Wouldn’t they file bankruptcy where court would mandate minimum what a person should have for living?
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“i dont want the taxman knocking on my door.”
Oh the taxman is coming alright.
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the bankruptcy code has different meanings in US and in India.
In US if the business is bankrupt, the founder’s personal life or wealth are untouched/un recovered.
In India, the banks will come after you, seize all the assets you have put in auction & still if the bank is unable to get its money will go after your guarantors.
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Yes, the banks will auction the founder if that was possible.
In India loans to companies often require personal guarantees of the founder and/or top management.
I thought it’s not possible under LLP.
For smaller companies & startups the major chunk of collateral comes from individual, eg: land, gold or house.
If the company fails - these will be recovered. So the founder is not exactly insulated.
For big companies - the asset of the company is kept as collateral & only that is seized. Even in this case if the asset of the company doesnt fulfill the repayment due - banks will not stop there.
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This is the best question I’ve come across. As a 25 year old in a joint family I find this very relevant. Thanks @viswaram
Are the employees of the same company with same experience paid different based on which city they work?
I remember the HRA component will vary based on metro or non metro but is the overall CTC that wide?
Depends on the joining date and salary negotiation.
If both employees joined the company as freshers in same year, they will most likely be paid the same, irrespective of city.
If both employees joined as lateral recruits, it depends on project requirements, budget, existing salary of candidates and negotiation.
Considering the career prospects are the same, there is an Arbitrage opportunity. If the employee is in a city where the rental, grocery & other expenses are lesser - he will have a greater savings rate.
Then what exactly is the use of forming LLC and/or Pvt Ltd.? How can one provide personal property as collateral for a company loan?
If a company goes bankrupt, the promoters should or can not be held responsible for the company loans unless they have actually gotten loans using their personal property (in which case the lines between the company and the promoter are already blurred) or there is evidence of fraud.
When you start a company, the asset it has is whats contributed by the partners/directors.
If the company has no asset on its own, on what basis will the bank give the loan?
The reason why most startups go for funding is avoid this trap, the VCs fund the company without asking a collateral on the founder’s asset.
But banks dont give loan against equity, atleast not for a startup.
Yes, once the promoter starts pledging their personal property, the lines are already getting blurred.
Starting up with a loan seems a disaster in waiting, might as well YOLO it in trading, both have similar odds of success.
But just wanted to clarify that the banks simply cannot come after the promoters over and above the company assets and/or properties that the promoter has pledged.
If a promoter is signing up for a personal loan in lieu of the company, might as well shut up shop even before it is started.
Yearly fees is almost more than a lakh even for a 1st standard kid in any tier 1 city
I mean majority of schools charge this much.
There are few schools they charge less.
but again we have to consider couple of things like extra-curricular activities, sports, music classes, way of teaching and so on.
You can google and see any top schools in these metro’s.
I agree. Even my engineering fees was 70K per year in 2009.
This question depends on whom you are asking?
You can ask a maid, a teacher , a milkman.
But you ask here. And all smart pants, will try to find a pattern, put Excel numbers and inflation. And guess it ll never end.
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Yeah - most things in spreadsheet wont work in reality.
what instrument gives assured 12% returns?
there are other expenses in day to day life also - like groceries, utilities etc
seriously what do these people teach the kids, did you account for the transportation costs also in this?
my engineering fees in 2003 was Rs6000 per year. hostel fees Rs1500 per month extra
Guys calm down.
The thread was created to help avoid poverty. Not to point out the mistakes of others nor to suggest them to do something.
I am a full time trader - sometimes i get paid in a day, sometimes in a month or sometimes once in year. But 100% of my expenses are monthly - loans, utilities, electricity, maid, food, children education, internet, transportation etc. Monthly because i chose to pay most of them using a credit card.
Recently i met my old schoolmate who went bust doing a construction business - he is neck deep in debt. Thats why i tried to crowdsource the idea of our expenses and the MLRF (Minimum Level Required to run the Family) in each city of India.
Most active traders here in tradingqna share a similar dna to rise & perform - i have noticed that from comments. So humbly request you all to join us in this research.
If we are able to find how much a household needs monthly & they get the right financial education say at 18 to 20 yrs old before they start a family - maybe they will be good with their choices and avoid going bust.
Had i known this 20 years back - i would have planned by investments quite differently. So lets keep the spirits up and try digging.
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I still don’t understand, has the metric to calculate the inflation changed after 2015?
The actual scale of rise in prices was felt in 2018, 2019 and 2020 even before COVID hit, remember the fuel prices were rising and so did the logistics cost.
But the inflation data is misleading
Well there is a takeaway. Milkman, teacher and maids are all in minimums(minimum expenditure) So maybe this can be replicated . It should be straightforward though.
I quite don’t understand one thing here. Why not file bankruptcy lose everything , have 0 account. I mean as ridiculous as it sounds shouldn’t one start with 0. For sure you become eligible for PDS. You can adopt the above expenditure model from milk man, maid for expenses then ask your friend to buy a auto and drive ola auto or something. And slowly build things. I find starting with 0 account more easier than -ve.