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POSTED BY ON March 15, 2012 8:41 pm COMMENTS (10)
I am writing an article on this topic , so want some experiences and inputs . A lot of people want to do what they love and really makes them excited . But because of home loans they feel trapped and stuck in their financial lives and despite having so much of dreams on working in a small startup or starting their own, they cant do it or face lot of issues .
can you share your experiences and stories on what you feel or faced in life ? Also do you agree with this or not ?
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If not EMI one has to still pay his rent. So entrepreneurship is purely a persona trait
A person who is motivated & convinced of his Idea, irerespective of EMI/Rent status, will go ahead with his start-up.
Hi Manish
In the context of your article, I wish to put a couple of thoughts basis my experience:
Home Loan, or for that matter, any loan, never comes in the way to decide whether one has to go on his own or not….its the circumstances you are put through, and the destiny you are born with and co-create as you move along in life (sorry for being slightly philosophical here:)…..has anyone seen Rocket Singh though:)…
Coming back to the context of your article, a home loan in fact gives one the confidence that ok there is at least own roof on the head (I see some of my well-paid friends, who have waited and waited for prices to come down and now cannot afford 1 BHK flat in Mumbai). The good thing in having a home loan is that at least one is aware of the fixed outgo range per month, even if floating rates are considered. (if the loan EMI is Rs. 20,000, one is at least aware that ok, if today I am starting own business with zero revenue and a 2-year contingency fund, my business should start giving me loan EMI amount + living expenses after this many months/ years, in short, it helps to crystallise the cash flow projections in a better way.
However, I need to mention that yes, when you have a home loan and plan to start a business, forget about planning money for other goals for the time being, like children’s college education (despite the wife pressing to buy gold for daughter’s marriage) – however much you want, you cant do that…
Also one more point, as financial planners, a personal loan or car loan EMI pinches far more than a home loan (as one knows the interest rate, associated tax benefits etc…)
Sorry if my post was off-track from the running discussion and thought-flow, but just thought to share my thoughts on this topic which can be a different perspective on how a home loan liability is viewed….
Manish,
Yes definitely its a trap with home loan in place think about exploring anyother area or risk is nearly impossible. I have known few friends who are in this trap.
I myself is in this trap but then i have not made up and plans of Entrepreneurship ,but if i want to at this stage it is not going to happen.
But on other hand i have a alternate plan which might or might not work for all. I save for my business which i might start after 10 years by which time if possible i will close the home loan. I am not sure if i will be in the same mind as now after 10 years.But still to keep the options open i have a goal set for capital for my business to be started in future.
Dear Manish, From the tile of your query, I assume you are talking about the type 1 people i.e. salaried ones as marked by dear justgrowmymoney. In my opinion, it’s a personal choice how & what & where is the starting point for this Entrepreneurship? In terms of financial security for the family & self before biting the bullet, yes home loan being the largest & longest loan commitment ‘ll keep you away from your dreams.
How one is going to change the situation ‘ll be a personal call.
Thanks
Ashal
Ashal
See my reply above
Dear Manish, yes home loan is a trap but how to play around within the given situation is a personal call.
Thanks
Ashal
There are 2 kinds of people who want to pursue entrepreneurship:
1) Folks who want to avoid facing a manager (whether ihe/she is a beginner or having 15-20+ years of experience) + who feel they are overworked and underpaid. This incudes literally every salaried person. Everyone want to manage their own life, make money for themselves and live life their at their pace. Little does this group understand that entrepreneurship involves lot more work.
2) The truly passionate ones who want to pursue entrepreneurship because it rhythms with what they want to do in life. You are writing about this group.
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Having made this demarcation I believe that entrepreneurship is indeed stifled by liabilities to some extent. However the reality is this: Dhirubhai Ambani made it great because he had nothing to lose (We ofcourse dont know about the thousands of other entrepreneurs who did not make it big). Mukesh Ambani made it big because he had nothing to lose either.
What I am trying to say is most of us sitting here on the online world discussing these things are neither so poor nor too rich. Most of live in the middle path, definitely endowed with basic things and small luxuries in life but several right steps or wrong steps can enrich or destroy financial futures. This sounds like one pessimistic approach but it is mostly the truth!!
In a bid to ensure we at least retain what we have most of us prefer to take the safe path. I am willing to listen more from the Jagoinvestors here!!
Hi justgrowmymoney
I think you have over analysed the question and divided into cases, my question was for all type of people . The simple question is home loan a deterant for starting something on your own , would the case be very different if a person did not have home loan ?
I know the answer is yes because in case of home loan the extra pressure of keep paying EMI will definately make people fearful of taking risk . But wanted to know how others feel . Just take our own case and some of your friends and tell me how they are feeling? Like one of my friends is fed up of his job , but when i ask him why dont hey think about starting some thing of his own or joins a company where he loves the work even though the pay is less – his answer is simple – yaar , now i have home loan , tomm if i loose the job or if the pay is not more , how will I lead my life , i cant take that much risk .
So lets say you choose 1000 salaried people . Out of that say you ask them how many have home loans , and 500 people say they do , out of that 500 ask how many of them would like to join a startup or some thing which they love , but pays less or have more risk than their current job or want to start something of their own . lets say 100 people that they would like that . Now out of that 100 people how many really can do it in reality ? How many of them would be very fearful to actually go ahead and take action ? What would most of them say when you ask them what stops them to move ahead , what will be the reasons they will give ?
Manish
Manish – I agree with you that this is for all people but a majority of them want to pursue entrepreneurship only because they hate their current job/pay which is not a bright reason in my opinion!
Home Loan liability is a veil behind which people hide and console themselves saying they would have pursued entrepreneurship but for a home loan – is how I look at the entire picture. [I am ready to get a lot of flak in this forum 🙂 ]
Yes .. actually I am of same opinion as yours . If you are really wanted to do something , you will find out a way , and just leaving a job and starting something of their own just because you hate your job is not a right thing . But we are also talking about taking a similar job in some other company or a startup , which is again not much appreciated because “home loan ka EMI kaise bharenge, agar salary kum hoga” .
So I want opinion that is Home loans at one side is making people own home and making them happy , but at the same time making them trapped in their jobs and taking away their freedom a bit ?
Manish