Thursday, July 21, 2005

Something 'profound'

A few of days ago an old school friend of mine calls up and says.. "I read your 'Diwali' post. I'm disappointed. I expected you to write something 'profound'." ('Profound' is in quotes because it was the exact word he used). That upset me a bit because I had thought that post was well written. I told him my intention had been purely to entertain and not to make a point. But his words stuck in my head. So last Saturday I sat thinking of something profound to write. Agonizingly nothing appropriate came to my mind.

It struck me that 'life after death' would be really 'profound', given the fact that no one knows anything at all about the subject. But then I didn't either and having posted only twice until then I most certainly did NOT want to scare people off by talking about bizarre stuff like death. After breaking my head some more, I came to the conclusion that "profound" things were beyond me at that moment and so I went ahead and wrote about my weekend.

A couple of days back however, I had an opportunity to read "Rich Dad, Poor Dad" by Robert T. Kiyosaki. That really started me thinking. Basically what the book says is this: 'EDUCATION IS NOT GOING TO MAKE YOU RICH'. (.. (sob).. My dreams have just been shattered). But the book is right. For those of you, who are thinking you will attain financial freedom through MBAs and Phds, think again. You will not. At the most, education can ensure financial security but not financial freedom. What financial security translates to is- you get all you need but not all you want. Even this is at a cost. Chances are you will end up slogging day in and day out, doing something you don't like (even if you do tell everyone you like it). Financial freedom on the other hand means you get to do what you want and still have the money to spend as you see fit.

Many people are under the impression that an American education/job will ensure financial freedom. I was too. Until I spent some time here that is. Then reality hit me. Let me illustrate by guiding you through the typical lifecycle of a hypothetical Indian landing in the United States. Let's call this Indian, Raj. (Mind you, I have no particular fondness for the name. I picked it for 2 reasons.. 1) It's SRK's name in the much acclaimed DDLJ. I'm just hoping this might generate some interest in my audience and prompt them to read the boring story that follows and 2) It has just 3 letters and is just one syllable)

'Raj' comes to America to do his MS on a full assistantship. Living normally (neither extravagantly nor miserly) he breaks even upon graduation. Soon after, Raj gets a job and starts living it up a bit. He buys a car he fancies and travels around America. Something he was never able to do as a student. Still manages to save around 20000$ each year. After a couple of years he gets bored of being single and decides to get married. Let us assume he marries someone who earns around the same amount as he does. (And no, I'm not going to call her Simren. Lets just call her Ria (I couldn't think of a girl's name with a single syllable)). Expenses should double obviously but in reality they triple. So R&R manage to save 30000$ a year. Together they plan to buy a house. Now a good house in a good location would be anywhere between 300000$ and 500000$. Let's suppose they buy a house for 400000$. Of course this is on a loan at say a phenomenally low interest rate of 5 %. Once they move in they would obviously save all that they were spending on renting a house. They save 60000$ a year now. With that kind of savings it would take them approximately 10 years to pay off that loan (including interest).

In the meantime of course R&R are not idle. They have a couple of kids. Expenses go up like hell. (Parents here have the habit of literally filling their kids' rooms with expensive toys and the increased family count means India trips get more expensive). But both parents are working hard and obviously get pay rises every year. So I'm going to let that rest. By the time the loan on the house is paid off, the children are in the middle of school. It's time R&R started saving for their college education. Now trust me, good undergrad education can be a very costly affair in the United States. And just like Indian parents want their kids to study in the IITs, R&R want their kids to study at Stanford even if it costs an arm and a leg! In numerical terms a four year education at Stanford for two kids would mean R&R would have to save around 400000$ (Assuming 50000 a year per kid). Also, keep in mind that expenses would skyrocket once their children reach adolescence. Boys would require money to take out girls. Girls would require money for perms, facials, manicures etc... Also the legal driving age of 16 in the United States means cars have to be bought and this in turn means doling out for gas. In any case R&R being the typical steadfast and caring Indian parents, manage to save what is necessary when it is time for their children to enter college.

After the kids graduate, R&R are finally able to save a substantial amount. But by this time of course Raj and Ria are 50. They work hard for the next 5-10 years and then retire to spend the rest of their life with whatever they have saved. THE END.

I wonder if I'm going to be like Raj... :-(.. I just hope not..

PS: I just reviewed what I have written and realize that this is a feeble attempt at being ‘profound’ (inspite of all the numbers… lol). I can’t for the life of me imagine why I couldn’t have left out the cracks and stuck to serious sentences. Perhaps it’s because I think life itself is a joke. I really need to grow up…(sigh)

30 comments:

Anupama said...

njoyed this one too.........good reading dude!!!!!!........comments on the contents will be delivered in person........keep blogging.

Leon said...

Thanks anu.. :-)

Pavan said...

Hmm....well I HAD to comment on this. I haven't read the book, but it is not difficult to come across quite a lot of succesful ppl telling ppl that they made it without college degrees. and we have good examples too (at the risk of sounding corny - Bill Gates). Who doesn't get impressed with stuff like that. tell a teenager that you can make money without going through the rigors of college and it will surely leave an impression on him. but in this 'even i can do it' euphoria, one mustn't lose ones rationality. how many ppl are there really who made it big without formal education, and how many are there who made it big with a formal education. the numbers (if someone would actually go ahead and collect statistics) will surely have a different story to tell. there is this section of ppl who think that 'leaders are born', while there is another which says 'leaders can be trained as well'. and that's why we have all these universities etc etc. so what can you do if you are not a born leader ?? your best shot is to get trained. hmm.. so enough said. i think i got my point across.

mystery tryst said...

well written again.the word "well written" is beginnin to sound cliched in the bloggin sense.the line i liked best was the one were u admit "u need to grow up". i appreciate honesty!! and then all the hypothetical figures were impressive. i agree with pavan wen he says tat there are more people with formal edu who make it than not. but there was nothing in ur blog against this at all.pavan u dont have to make this point.(though ur comment was well written too....now im beginnin to see wat my 4.5 was in relation to....)MOST people realise and accept it.tats y most people are willin to spend their life's savings on their kids' education.tho bill gates is "O so famous" i've nevr heard any parent advise any child to quit studying and follow his example.and wen young ones dream big...a lot of them dream of goin to great schools and having a great education. even uneducated parents who make it big and have looots to leave their children want their children to study well.education is universally respected.so rest assured tat it is not losin its value at all.....

Leon said...

Pavan: err.. I've actually very incompetently managed to get you to misunderstand what I was trying to say. In fact I should probably edit the post to include the following paragraph.


I'm not talking about the "Bill Gates",the "Paul Allens" or the "Michael Dells" of this world. Some people are just destined to be 'rich' and 'great'. And I'm most certainly not saying people should drop out of college! Far from it. Nothing could be dumber than to drop out and hope to become a millionaire. In fact I'm certain that for every dropout who made it big there are a million dropouts who failed in life miserably. My point is that "hard work" and "good grades" in college may not pay off as people think they do.. For instance suppose you were the topper in your class. Does that mean you would make more money than the average guys in your class. NO. It takes more than just "learning" to make money in today's world. It takes interest to look for opportunities to invest, it takes guts to take risks and invest, it takes enterprise and finally it takes luck. I for one could spend hours reading a good book but when it comes to looking around for a good deal I'm just plain lazy.

To put it in a nutshell..

The amount you get paid for the skills you learn at college is simply not enough to make you rich. One should try and ADD to the knowledge gained in college, some investment basics and also make an effort to generate the interest to identify and focus on business opportunities.

Thanks for taking the trouble to type out such a detailed comment.. :-).. you too nish..

[nish] thanks also for noticing that there was nothing in my post against Formal education... (I did SOMETHING right.. :-)). I didn't like what you said about the line you liked best though... ;-).. lol.

Pavan said...

okk.. so the post after mine was nisha's. firstly, its a great honor to be appreciated by Nisha - the only debater I admired in school. after reading nisha's and leon's replies, i kind of re'thank' my original opinion. yeah, maybe i stretched it a bit too far. anyway, your point is valid. college education will probably get you your first job (in some cases, not even that) but it will not help you keep it.

mystery tryst said...

thanks pavan!! its more than an honor to b admired by you - one of the few people i really respected in school.

nimu sorry abt using ur blog comment space to exchange compliments. and also...how do u always know its me wen i use different names each time??? and this time i took care to not use "dear" or "nimu". u have written without a doubt in ur mind tat it was me....not even "was tat u, nish???". how ??how?? how?? wat did i do wrong?? last time u said "Born Critic" was a familiar name....???!! ok i got it!!!...im the only one who makes up names on ur blog!! evryone else uses his/her real name...and also since i addressed pavan direct...u figured it had to be me!!!! :-)

Leon said...

Nish, that 4.5 helped too.. :-)

nomadic_waves said...

She said-->Sigh...the scenario depicted by u is pretty bleak.
Especially for students like us,who have our eyes firmly trained on the US for higher studies.

Leon said...

Thanks for dropping by Nomadic Waves.

Actually the picture is not too bleak. Wouldn't you be satisfied if your kids studied at Stanford and if you had a 400000$ house in a good locality in the United States?

All I'm saying is you would have to do a little more than just make it to the United States for higher studies if you want to be REALLY rich.

You might want to take a look at my reply to Pavan's comment.

And hey, do come to the United States for your higher education. It's a mind-blowing experience!.. :-)

Akruti said...

Education opens ample doors for u to make it big,it is only a begining,how you use it along wiht your talents and using your attitude and presence of mind depends up on individuals.I know many who were the best in college but couldn do well in the real world where bookish knowledge is not enough,u need lot more:)
Enjoyed all your posts,specially the Diwali one,Let the posts be prfound or not,but let them be straight from your heart,and satisfaction follows:) happy blogging

Leon said...

Thanks Akruthi.. for reading through all the posts.. I'm encouraged.

Dawn....सेहर said...

Was just going through and I agree with akruti...:) practical behaviour is much what it takes u somewhere..!
good luck!
keep blogging

Ms. V said...

I have just been told today that I don't write anything meaningful. And I was planning to dedicate my next post to writing something meaningful about why I never write anything meaningful.

Soumyadip said...

Hey! I think I just got the next story for the next big Bollywood masala movie. Just got to sprinkle some melodrama and a dozen songs in there. And I have the next big NRI hit after DDLJ.

Leon said...

Dawn: Thanks for dropping by.. :-).

Ms. V: I'll be waiting for that meaningful post of yours... lol.

Not that I think you've not written anything meaningful. From what I've seen of your blog I think you write from your heart like Akruthi put it. And that does wonders to a blog.. :-).

Soumyadip: lol.. thanks dude.. I'm sorry though that I can't help with the melodrama and songs. I'm very bad at that kind of thing.. ;-).

~*. D E E P A .* ~ said...

hey ...

well cats are weird creatures ... and i dont think a brother of mine would have ever kept cats ... dogs maybe, not cats ...

~*. D E E P A .* ~ said...

man ... u paint such a sorry pic of life :(

sad na ,.... every damn thing on this planet depends on jobs !!

silverine said...

This is an interesting scenario and quite bleak. brrrr

Leon said...

Deepa: Indeed, and that's all the more reason to find a job one loves.

Silverine: Like I said to nomadic waves, the intention of the post was not to paint a bleak picture but to inspire people to do something more than just earn a degree at College.

PS: (sigh).. I'm discouraging everyone..

the-think said...

:) ah, growing up? one could want that at 90 too! hehe
btw, thanks so much for coming by..see ya around more!

nin said...

its a wonderful story.....nice reading..
keep it up.....

Leon said...

Thanks.. the-think and avik.. :-)

harish sury said...

Dear Nirmal .. You seem to be developing a rhythm and generating a lot of interest . Keep it up .. btw i am planning to start my own blog soon .. will mail you :)

Leon said...

Thanks Harish!.. :-)

angelsera said...

Hi Leon,

"those of you, who are thinking you will attain financial freedom through MBAs and Phds, think again."

I totally agree with this.Education should be purely for knowledge gaining, and because you have this knowledge, you have some value.however,when it comes to making money, you will have to do sth new, sth innovative,only then it might sell.Education is a tool that helps you to secure a job that will in turn pay, but it is not the be all and the end all of things.There are so many who w/o education have made more money.

Leon said...

Thanks Angelsera.. :-).. you put it very succintly..

Surya said...

Nice post. Not too bad an attempt at profound. =)

I totally agree with the Rich Dad, Poor Dad line of thought - what you have described abt R&R is so true. And to think a little financial education can go a long way towards helping people. Yet, thats not a part of school curricula..

Leon said...

[Surya] Thanks.. :-)

JJ said...

I think so too... that's one of the main reasons I never tried hard for an MS!!!

But this IISc thing is a lucky break!