kashinath2013

The motivation to write this article is my first hand experience. I was born in a financially poor family in India. And always tried to find the answer or way to get out of poverty. Today, I can confidently say that I am in the upper Indian middle class and would like to share few tips which poor and lower middle class people can use to rise and reach financially better position.

Let me give a context of my family’s financial situation so that readers can evaluate the tips better. We were a family of six – 4 kids and parents, living in a small house of 180 sq. ft. in the chawl of Mumbai. Parents were together earning a meagre sum of Rs. 3000/- p.m. in the late 1990s and early 2000s. The situation was hand to mouth. we were barely able to meet the monthly expenses, taking the debt from friends and families in the times of distress.

But all the hard work paid off when we both brothers became engineers and got jobs. Though not highly paid, it brought us from poverty to lower middle class.

Now, the next step was to move from lower middle class to middle class. The solution is to keep doing the same things again and again i.e. show yourself to the job each and everyday whether you like it or not. Enjoy the life – splurge a little bit on eating out, movies, trips/picnics but keep the lifestyle within budget and save each month. If we keep doing this year after year we reach middle class in a few years.

Now, comes the interesting and difficult step in the journey of financial/economic progress. Most of the families reach middle class level and get stuck there forever. Here, I will try to discuss a few ways on how we can move from middle class to upper middle class/rich class in India:

1. Improve Financial awareness: Try to learn how the economy of a nation works and how the US economy affects the Indian economy. Try to understand what is a share market, different investing assets. While reading, try to understand the fundamental principles – for example, the reason for a company going for public listing is to raise capital – may be for business expansion purpose.
   • track down your monthly expenses.
   • try to save fixed % of money every month, like 30% of the take home salary.
   • invest in diversified investment assets like – FD, mutual funds, gold, real estate
   • talk to a financial planner to understand your families financial health.
2. Increase your earning potential: Keep learning new skills every 3-5 years, it will add value to your portfolio and will open up new opportunities and in turn increase in hand salary and quality of life.
3. Invest in relationships: Investing is not only about money, it is also about investing time. Spending time with family, relatives, friends and like minded people will help you to have emotionally fulfilling life.
4. Growth mindset: Being rich/upper middle class requires a different mindset. Having growth mindset is half the battle won. We need to change thinking from “what we can consume to what we can create/provide”. When we come across any problem – think about how we can solve the problem? can the solution become a business? can I monetize the solution?
   • Start valuing time more than money. wherever possible, trade money to save time.
   • Buy better quality products instead of cheap products even though a bit costly. It improves life experience and saves money over products entire life.
   • learn the art of cooking.
   • build the habit of reading books.
   • Try to automate/ outsource mundane tasks, like bill payment, utensil cleaning, laundry, clothes ironing, grocery shopping, etc.
   • create checklist for various daily, weekly and monthly tasks.
5. Health: Take care of your health. Your body needs to support you till the end of your life. give everyday at least 30 mins for exercise/physical activity and eat well.
6. Mind: Mind controls your body and whole life. Give it required rest by sleeping well, being happy and meditating 15-20 min each day.
7. Spirituality: Connects you to your soul. Once or twice a week spend some time for spiritual reflection.

So, basically we create a system/framework for our daily activities and life. Once, the process is in place, the result will take care of itself. Hopefully following these steps will lead us from poverty – to – lower middle class – to – middle class to – upper middle class. Best wishes for the beautiful journey called life!!