Everything You Need To Know about Emergency Funds

A Thread 🧵👇

This year I started writing daily on Twitter about finance and investing and gained more than 500 followers in 2 weeks

Here are the main things I learned on Twitter growth

1. Brand
2. Content
3. Engagement
4. Networking
5. Tools

/THREAD/

1. Brand
You need to find a niche you are interested in and focus on it
E.g. finance, fashion, travel, etc.

Adjust your profile by adding a profile picture and banner that will show someone what your profile is about and why they should follow you.

Add a linktree that will have all the links for your blog, website, newsletter, etc.

2. Content
Don't wait to gain followers before posting. Nobody will follow you if they see an empty feed.

Start posting daily focusing more on single tweets or threads that provide insights on a topic people in your niche might be interested in.

At first, it will feel like talking to a mirror.

Have a pinned tweet, which will be your best one that will catch the attention of someone visiting your profile.

Mega Thread on Personal Finance 101

👇👇👇

Rule of 72 (Double Your Money)
Rule of 114 (Triple)
Rule of 144 (Quadruple)
Rule of 70 (Inflation)
4% Withdrawal Rule
100 - Minus Age Rule
10, 5, 3 Rule
50-30-20 Rule
3X Emergency Rule
40℅ EMI Rule
Life Insurance Rule

♻ Rule of 72

No. of yrs required to double your money at a given rate, U just divide 72 by interest rate
Eg, if U want to know how long it will take to double your money at 8% interest, divide 72 by 8 and get 9 yrs

At 6% rate, it will take 12 yrs
At 9% rate, it will take 8 yrs

📋Rule of 114

No. of years required to triple your money at a given rate, U just divide 114 by interest rate.

For example, if you want to know how long it will take to triple your money at 12% interest, divide 114 by 12 and get 9.5 years

At 6% interest rate, it will take 19yrs

🗒️ Rule of 144

No. of years required to, quadruple your money at a given rate, U just divide 144 by interest rate.

For eg, if U want to know how long it will take to quadruple your money at 12% interest, divide 144 by 12 and get 12 yrs

At a 6% interest rate, it will take 24yrs

🗒️ Rule of 70

Divide 70 by the current inflation rate to know how fast the value of your investment will get reduced to half its present value.

The inflation rate of 7% will reduce the value of your money to half in 10 years.

Some interesting snippets from @MotilalOswalLtd 25th Wealth Creation Study:

(A Short thread)

1. Consumer/Retail is the biggest wealth-creating sector over 25 years.

2. Almost 60 of the top 100 market cap companies in 1995 did not make it to the Wealth Creators list.

3.Corporate profit to GDP at all-time lows + Market cap to GDP close to an all-time high.

4. Permanent change in the long term interest rate band is leading to a change in valuation expectations.

5. Twenty-five stocks for the next twenty-five years. Read the Disclaimer.

India’s largest lender SBI is gradually capturing the very lucrative unsecured personal loan(PL) market.

A thread 🧵

As per credit bureau CRIF Highmark Unsecured PL market has seen significant growth in recent years. This has been driven a lot by liquidity crunch due to lockdown and emergency medical needs.

Total unsecured PL portfolio as per CRIF was estimated to be at 4.1 lakh crore as on March 19. This increased to 6.5 lakh crore by March 21.

Interestingly, in spite of fintech and NBFC penetration, public sector banks still had majority share – they originated 50% of incremental unsecured PL loans in FY 21 by value.

SBI’s PL portfolio during the period also increased from 1 lakh crore in March 19 to 2.4 lakh crore. This growth was driven by their Xpress credit product which uses credit bureau and other data to sanction loans within just eight minutes!

Terry Smith is often referred to as "the English Warren Buffett".

He runs Fundsmith which has a fund size of £27.9bn.

Despite the size, Fundsmith did a CAGR of 18.4%.

In his book Investing for Growth, he explains his investing philosophy.

Here's a breakdown:

1. Fundsmith's winning formula

Find companies that focus on delivering value.

Not those who are looking to pacify Wall Street with short-term results.

2. Avoiding "cheap" companies?

Low multiples are not a reason to buy a company.

A ship will continue to sink if it has a hole in it.

"A stock may have a low valuation but an even lower intrinsic value. Buying such a stock is not a recipe for investment success."

3. Getting quality right

For long-term investors, getting the quality of the business is more important than the valuation.

“An investor could have paid 281 times earnings for L’Oréal, 156 times for Colgate, and 147 times for Brown-Forman and still beat the market.”

4. "Unprofitable" companies could be good investments

Many of the best companies don't show earnings today.

But that's because they're heavily reinvesting for the future.

It's just that the earnings hasn't show up.