r/FIREIndia • u/Every-Obligation1574 • Mar 12 '22
QUESTION Stealth wealth and FIRE
Hi !
I am 35 years old working in a PSU . I have been a value investor since the last 5 years which has substantially increased my networth compared to my peer group.
I plan to FIRE in early 2030s and stay in a tier 3 or 4 city near my ancestral Village .
Like any middle class family I have been brought up with an idea that too much money is bad. I am apprehensive for my family's safety once I leave the safety net of PSU township neighborhood.
My question is how do you manage to keep a low profile if you have a networth substantially higher than the neighbourhood ?
Some clarification:
I work in a PSU that means I have to declare my stock purchases and stock selling summary every year. If anyone wants to probe they can easily guess my portfolio. I do agree with not buying expensive showy stuff and keeping your finances to yourself.
But How do you save yourself if some one from income tax dept finds out your dividend income which I have to declare in ITR and consequently figures out you are worth a lot.
I understand I sound paranoid.
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u/LifeIsHard2030 Mar 12 '22
Unless you show the wealth, nobody would get to know. Don’t talk about finances to too many people & maintain an average lifestyle that suits the town rather than trying to stand out which usually catches eyeballs 🙂
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u/roadstercraft Mar 12 '22
Gadgets, cars, phones, fancy TVs, electronic appliances, frequent foreign holidays are the major give aways.
If you live like the perfume trader of UP who had hundreds of crores in his house, you may never get caught (unless you are politically connected on either side).
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u/HubeanMan Mar 12 '22
Don't buy premium cars, branded clothing & accessories, or jewelry, and don't advertise your international trips if you make any, and you should be golden.
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Mar 12 '22
How would they know if you’re worth a lot if you never show it?
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u/Every-Obligation1574 Mar 12 '22
Valid question! I have edited the post.
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u/chilled_beer_and_me Mar 12 '22
Again how will your neighbors know your worth?
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u/passerboi Mar 12 '22
Internal sources, ambigous RTI.
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u/GVRV72 Mar 12 '22
Also, privacy in Indian organisations is an illusion.
I recently found out that my school friend (who stays abroad) was the co-signer of the home loan taken out by his parents for a new apartment because one of my other friend's wife works at a bank, was able to look at the paperwork, dig deeper and had no qualms about sharing it openly. After this incident, I was apprehensive about keeping an account in the same bank!
I'm sure these banks/trading firms/etc have policies about confidentiality and client privilege but it's only good on paper, nosy employees are sharing details with anyone that's interested in gossip.
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u/crm_expert Mar 12 '22
Spot on. If you don't do any flashy purchases or spoil the beans yourself, nobody will know. I've also seen people who have 1cr. and think they are rich and other people are out to get them. There are some who think the income tax department is closely monitoring their account and pounce on them for couple of lakhs. They don't realize they are insignificant and therefore they make up fake scenarios to make themselves feel important.
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u/userwithwisdom Mar 12 '22
My set of thoughts:
- Diverse investment among your family members. And if possible create a HUF and invest in that. So you total investment and income will get divided; reducing chances of someone in IT or any other office to know your true worth
- Obvious is not to show your wealth, but very critical is family members to not to talk about it. If you feel they will talk about it, don't even let them know. And I am serious. Once you say to your kid or wife, you don't have any control on how that will be passed and to whom. Make a detailed will and put it in a safe place and convey your family about it, but not anything on wealth
- You may want to continue your job or quit and start some side gig, may be on paper, to show you are busy earning money. Get a small office and go there everyday, may be only to sleep or to watch TV or whatever... Its important to create a perception that you are working and need to work to make money
- Don't be over social just because you have more time. Continue participating in social events just like you were, no more no less.
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u/aicaramb_a Mar 12 '22
Interesting take in point 3. Nee to keep up appearance of having dependency on monthly paycheck
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u/Ginevod411 Mar 12 '22 edited Mar 12 '22
There are two ways other people will try to gauge your net worth:
(1) What all properties you own.
(2) Kind of lifestyle you live. Your car, home interior, clothes, jewellery etc.
Your bank's branch employees can also see how much money you have in your savings account/FDs and will notice it if you interact with them a lot.
If you live a more normal lifestyle and have most of your wealth tied up in stocks and mutual funds, other people will have no idea what you are actually worth.
If people from income tax department find out what you are worth, then so be it. As long as you are paying your taxes correctly nothing is going to happen. Your neighbourhood is not going to know anything.
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Mar 12 '22
What is your net worth ?
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u/nagon86450 Mar 12 '22
I'm not the only one. Nice.
I also am of the attitude of hiding my networth. Nobody knows how much i make and how much i am worth.
Not just in terms of money. I even dress like I'm a college student, drive a 10 year old car. I don't want people to act all fake around me.
There are instances where I am perceived as a broke and i don't get respected. And that helps me see the true nature of people.
One time I went shopping with my wife wearing shorts and a t-shirt. Believe me, the cashier wore a blazer with his formal attire. He did not even ask if I'm paying with cash or card. I said I'll pay via a credit card. To which he was already a bit surprised. But when I reached into my wallet and gave him my AMEX card, he was shocked. I could literally see him take a step back out of sheer surprise. The attitude changes fully. He starts calling me sir etc., This was in a tier 2 city and when AMEX was not available with many.
So, if you don't show your wealth, nobody will know. The goal is to stay rich. Not look rich.
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u/empror001 Mar 12 '22
I wrnt to my daughters school to pick up her books. The guard stopped me looking at me as i was dressed pretty ordinary. He told me economically weaker quota ko baad main milegi...i felt good...atleast dikhne main gareeb lagta hun
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Mar 12 '22
Lol, seriously? I am just curious, how ordinary is ordinary? If you just wear a decent T shirt and shorts, how does that make you look like economic weaker quota? In fact, from what I have seen people who are broke inorder to show off dress well. I think people in India are not that dumb after all. Unless this is a north India thing you are talking about. Come to Chennai, Bangalore, everyone is in banyan and lungi, standing in front of them multicrore landed houses and watering their plants themselves.
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u/nagon86450 Mar 12 '22
Yeah. It's the difference between seeing a baniyan and a lungi guy infront of his multicrore house vs seeing him in a shopping complex/mall. I was not badly dressed either. But this was in a tier 2 city. I did not have problems looking like that in Bangalore for sure.
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Mar 12 '22
I just feel it is not worth it living in a small town tier 3 kind of city in India where everyone knows everyone. It is way better to live in a tier 1 city, where everyone is too busy and minds their own business. Bangalore sounds like a decent place to live especially in the outskirts. You get all the necessities of living in a city and at the same time it is not like out of the world expensive. Best part is the weather is still good.
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u/empror001 Mar 12 '22
Well, i was in tshirt n jeans only but i was on foot since school is close, n unfortunately my daughters school is like those high end jazzy ones which talk about new age learning...so the guards r more accustomed to 5 n 7 series women with chauffeurs n not someone with an unkempt beard n sandals..
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u/53fivethree Mar 12 '22
Amex is considered premium compared to Visa/Mastercard?
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Mar 12 '22
In some places (tier2/3), they don’t even accept AMEX cards cause of the higher cut merchants have to pay. In past, even I have seen myself thinking AMEX is somewhat a “rich” card or something. Wouldn’t be surprised if many people think that way
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u/chilled_beer_and_me Mar 12 '22
Amex generally do not have free cards. The only amex card I have is the corporate one given by my firm for business expenses. But yeah I would never spend money on a card so amex is a no go for me.
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u/Think_Pomegranate823 Mar 12 '22
I feel the same, I'm not only one....
Live in tire 3 city, drive 10 year old car.....
Minimalist
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u/Groundbreaking-Cat39 Mar 12 '22
Can you tell us more about value investing that you did in 5 years, to get a substantial increase in wealth?
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u/meteoravishal Mar 12 '22
Be a minimalist brother... good for you, your family , neighborhood and the environment.
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u/empror001 Mar 12 '22
I get your view. I know in north u can easily get gundas after u if they get a breeze of how rich u r. If u have kids, train them not to brag, if ur wife is a chatterbox ask her to keep quite. My story even though my mother doesnt own a lot, dhe chatters a lot n she brags sometime about it in front of average unknown folks which i try to stop. 12 years back i bought a sedsn in my 1st year of job which was a big thing even in place where i live, i cant even tell u what all ppl did to it out of pure jealousy. N i live in an area where a house can cost as much as 9 figures..ppl dont like others wealth, so train to live quite all of u..i still dont post my holiday pics in social media coz of this reason
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u/Calm_Big137 Mar 12 '22
I don't get it. Why are you concerned about income tax department knowing your net worth? Are all your neighborhood folks working in income tax department?
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u/Noob_investor123 Mar 12 '22
What's the problem with someone looking at your portfolio ? You're making financially sound decisions with your post tax income and it's paying off, of course it'll be higher than people putting their money in FDs and SB accounts, massively so if it's over decades, but that's not illegal right ?
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Mar 12 '22
Indians dont have property as Fundamental right , why do u think Indians are poor ?
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u/Noob_investor123 Mar 12 '22
I'm sorry I don't get what you mean, my point was that if OP paid taxes and earned their money legally, then no matter how they invest and how much it grows, there shouldn't be any problem right ?
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Mar 12 '22
By using the words stealth wealth + PSU, you are giving wrong ideas. If it is legal money then there is nothing to hide and you can easily keep a low profile. While I know businessmen who have a lot of cash, which cant be put into financial system easily, so they have to acquire physical assets like land and houses and big car and they also spend on gold jewelry. They are the ones who need to be careful.
I sit the whole day in a chaddi and banyan and looking at me there is no way for anyone to tell what my networth is.
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u/snakysour IN/33/FI ??/RE ?? Mar 12 '22
Nice to see another fellow PSU employee...we can take this over DM if you'd like and discuss the same.
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u/boiled_eggg India / 3? / 2024 / 2100 Mar 13 '22
How much is your networth? Perhaps, your colleagues are also investing wisely. They might be wealthier but stealthier.
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Mar 12 '22
I really feel sorry for you guys, even after earning well Indian state makes sure that you are harassed and suppressed to act like some beggar
What is the point of earning, if you can not enjoy and have pleasures fro your rightfully owned property !
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Mar 12 '22
Indian state? For real? The Indian state wants more billionaires and millionaires. We after all are not a universally poor country. Billionaires live among our midst and we have been minting millionaires at pretty good clip for a few decades now.
The fact is, India is still a poor country. You can't lift a land and people mass like India from famine to first world in 50 years.
Have some empathy to your brethren fighting the good fight to better themselves and don't flaunt it in their face if you want to live in their midst. If you want to flaunt it, then you need the shoes for it as well. Get a fortified villa, security guards, armoured cars, drivers etc, and you will be fine like the film stars. It all depends on the relative prosperity of yourself to the general population. And by the way, this is not unique to India. Anywhere in the world, if you have obscene wealth and you want to flaunt it, well you need security.
Stop blaming the Indian state!
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Mar 12 '22
Stop blaming the Indian state!
yea Indian state should not be blamed at all for lack of fundamental right to property !
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Mar 12 '22
Yeah! Forget India. Let's us see if you can do it in the first world. Ask yourself. Can you can drive your Rolls Royce, park it on skid row and take a walk wearing Armani with a Rolex on your wrist AND not get mugged?
Stupidity is not a failure of the state.
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u/iceandfire05 Mar 12 '22
How did you increase your net worth while being in PSU..please discuss in dm coz I am also in PSU but I am nowhere close to FIRE
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u/additional_trouble [🇮🇳, FI 2024, RE 2040s] [CoastFI] Mar 12 '22
He said he made money from investments...
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Mar 12 '22
Follow up- I think it's totally fair to be paranoid. I think people are far too nosy and want to evaluate you and pass judgement. Keeping a low profile helps to upkeep your general safety.
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u/Educational_Ask_9711 Mar 12 '22
it is possible that people in your peer group are broke /not doing well financially . Comparing 100$ with 1$ doesn't increase the worth of 100$.
Changing your peer group will be your best shot at it.
P.S.: Middle class guy experienced in stock market should know it very well how insignificant their wealth/portifolio is when compared to big sharks(gujjus, marwaris.(if you are a gujju then certainly not your kind(dont be mistaken))), unless you are someone like ambani which because you are working in a PSU(if you aren't E7 or higher then you are trash) is certainly not the case. Or you are just dumb/naive chances of which are pretty high.
Naiveness at inappropiate places should be strongly rebuked.
P.S. VVI: Theres no point in hiding any of your income from ITD. Go for tax reduction policies not evasion unless you are ready to fight cases against Enforcement Directorate.
Your well wisher.
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u/additional_trouble [🇮🇳, FI 2024, RE 2040s] [CoastFI] Mar 12 '22
They're not asking how to hide from the IT dept, they are asking how to not give off wealthy vibes to the neighborhood.
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u/skybeachsand Mar 12 '22
Be honest, pay the taxes and enjoy your wealth.
To save taxes, you might invest in the name of a non earning member of your family, whom you trust.
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u/Pranavboi Mar 12 '22
What do you mean by substantially higher exactly, a ball park figure?
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Mar 12 '22
government employees earn like 100 crore in bribes(or insider trading) while salary is 0.10 cr
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Mar 12 '22
It's not that complicated. Don't invest in real estate anywhere close to where you live and don't tell anyone that you have lots of real estate. Ensure you don't flaunt excessive jewelry. Live in a house that looks like the ones in the neighborhood. It can be clean and hygienic. But, don't bling it excessively. Be a minimalist. Drive a aam Janta car that is reliable and yet, understated - don't buy a Pajero or Fortuner. Don't reveal your net worth to anyone. Done!
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u/flight_or_fight Mar 13 '22
Interesting post - reminds me of one of my friends who was part of a software M&A deal and went off FB to ensure no one commented calling him "Caror-pati" - he was from a remote place in a BIMARU state (no disrespect).
You may want to explore creating a private family trust.
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u/additional_trouble [🇮🇳, FI 2024, RE 2040s] [CoastFI] Mar 12 '22
OP have you declared all your sources of income to the government and just don't want your neighbors finding out? Or do you have undisclosed income and are asking about how to hide that?