Riding the Wave of Inflation: A Guide to Investments
November 11, 2022
Usha Mallya
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Inflation is a long-term pattern of rising prices across the economy yearly. Inflation rates indicate the rate of erosion of the value of an investment over time as well as the loss of purchasing power. Investing in assets requires a return on investment consistent with their living standard.
To overcome the effects of inflation on your investment, you must have financial planning and knowledge. Here are a few things you should know.
Inflation: What Causes It?
Inflation occurs when the demand for an item or service exceeds the supply of that good or service. This is referred to as demand-pull inflation, and it causes price increases.
Inflation is also caused by a rise in the cost of producing products and services. As the cost of manufacturing an item rises, manufacturers raise the selling price in order to achieve or maintain a specified profit. This is referred to as cost-pull inflation.
Here's a chart demonstrating how a lakh's value decreases over time to help you comprehend this better.
Financial vs Physical Investment
Physical assets can be felt, seen, touched, or held, such as real estate, precious metals, jewellery, plant and machinery, vehicles, tools, etc. These assets must be maintained, repaired, and upgraded, which can lead to expenses.
An intangible asset, such as shares, bonds, deposits in banks, accounts receivables, goodwill, copyrights, patents, etc., cannot be seen or touched, except for the records proving ownership of the asset, for example, shares, bonds, deposits in banks. The value of financial support does not depreciate or diminish with time. Nevertheless, depending on market conditions, the value of a financial asset can appreciate or depreciate.
Asset Classes and Inflation
The value of liquid assets tends to rise less over time than the value of other types of assets since inflation affects them similarly. Because of this, liquid assets are more susceptible to inflation's effects. The larger economy tends to retain fewer liquid assets when inflation rates are high.
Although illiquid assets can generate interest and grow in value, inflation also affects them. Investing in stocks, bonds, and mutual funds is one of the best ways to protect savings against inflation. In times of high inflation, people often spend their liquid assets on consumer goods or invest them in interest-paying assets.
Systematic Investment in Equity Mutual Funds
Mutual Funds offer a Systematic Investment Plan (SIP), a means of investing a fixed amount at regular intervals, say once a month or once a quarter, instead of making a lump-sum investment. Instalments could be as low as INR 500 per month and are similar to recurring deposits. Moreover, it is convenient since your bank can give you standing instructions to deduct the monthly amount.
Here are some examples of the power of compounding
Three Golden Rules of Investment
Start Early
It is recommended that you start early in order to gain greater financial wellbeing and to maximise your returns on investment. If you allow your investment portfolio to generate returns over time, your returns will essentially create more returns. In technical terms, this is called compounding, proving that even small investments can accumulate into large sums over time.
Invest Regularly
Regularly investing rather than attempting to time a lump sum investment can help you become a more disciplined investor. Ultimately, you must invest no matter how high or low the price is. As a result, investing becomes less emotional, and you can put your money to work more quickly.
Invest for Long Term
The relationship between volatility and time is an advantage of long-term investing. The volatility of investments held for a more extended period tends to be lower than the volatility of assets held for a shorter period. The longer you invest, the more likely you will survive market downturns.
Investments with their risk vs return potential
Conclusion
If the returns on an investor's assets are less than the rate of inflation, even if they show profits, they will lose money. Additionally, individuals should ensure that their income increases at least as much as inflation; otherwise, they are technically earning less than they would otherwise and losing financial stability.
Embracing Change: The Shift from IQ to Adaptability Quotient
November 16, 2022
Aakriti Agarwal
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One of the most famous phrases attributed to Albert Einstein is, "The measure of genius is the ability to change." It is more accurate than ever in today's swiftly changing world.
Change is unavoidable, and we must be prepared to navigate it successfully. And, like so many other things, change may travel in both positive and harmful directions. We are practically sure to experience disaster and failure if we fail to manage the stormy seas of change in the proper way.
We will surely grow more clever, insightful, and adaptable as we learn to maneuver through life's changes. To thrive in life and conquer the challenges that come your way, you'll need perception, assessment, and adaptability. When presented with a difference, intelligence is tested by making adjustments and changing subsequent actions accordingly.
When we change, we develop and become wiser in the process. Humans generally thrive on change and expansion, but they might have many inner or outward factors to change.
Trying to maintain everything the same is not only unhealthy but also impossible. You are misinterpreting human traits and thriving if you avoid change.
The way we work, live, and interact with one another is changing dramatically. Unprecedented rates of change have emerged from extraordinary technological developments in automation and artificial intelligence, disruptive innovation, and globalisation. As a result, leaders in the business sector are continually rethinking how their companies create value and stay relevant in an unpredictable climate.
Furthermore, the future of employment is continuously evolving. Technological improvements have decreased the expiry date of staff talents to the point where a typical corporate capability is only relevant for 4.2 years, down from 30 years in 1984. According to the World Economic Forum, 65 per cent of present employment will be obsolete by the time today's primary school students reach the workforce.
What is the adaptability Quotient?
The capacity to decide what is relevant, discard obsolete information, overcome hurdles, and respond to change in real-time is known as the Adaptability Quotient (AQ). Those with a high AQ exhibit the following characteristics:
Open-mindedness. They actively manage their unconscious prejudices to remain receptive to new ideas.
They go out of their way to perceive things from other people's viewpoints.
They place a high value on acquiring new skills and investing in their education to better prepare themselves for an unpredictable future.
Adaptable leaders and staff are better suited to meet their company's changing and growing demands – and they're in great demand.
"Adaptability is the quality that distinguishes the survivor from the perished." - Charles Darwin
How can adaptability be developed?
Years of practice responding carefully to problems as they emerge are required for adaptability. You have the power to influence your team and propel your company ahead as a leader. Adaptability, like emotional intelligence, may be increased and enhanced.
Model the high-AQ behaviour you want your workers to emulate. For example, leaders who adopt the pacesetting leadership style may increase their team's AQ by displaying flexibility and encouraging team members to alter and update their abilities. This will aid in the creation of a stress-resilient and change-adaptive environment.
Take charge of your educational path. Recognise the importance of continuing your education. Assume responsibility for your education, and you will increase marketability for years to come.
Decide which positions you want to pursue depending on how much you can learn. Then, make future opportunities to learn critical new skills a priority.
What is agile, and how is it more effective in bringing adaptability to you?
The three pillars of Agile are quality, speed, and value. It encourages people to risk discovering new ideas and developing them with the least amount of danger possible. It's a cycle that starts with an idea and ends with a worthwhile result. It encourages people to take the risk of generating new ideas and developing them with the slightest danger of failure.
A group of people may work together to develop an idea, correct errors, and make it worthwhile. The possibilities are designed, and duties are shared after the concept is conceived. As a result, more than one team would be working on the idea, each with their skill level in a specific area. If a mistake occurs, only the team assigned to it will reprogram it, saving time and energy for the others.
Three tips to help you develop the mindset to adapt to change:
One of the most challenging aspects of the process is recognising and embracing change—one of the first things we do as humans are to deny reality. As a result, we frequently ignore the shift to avoid dealing with it, or so we believe. But, on the other hand, denying or postponing this problem may make it worse and more unpleasant than just embracing it from the outset.
It's critical to acknowledge that change is occurring and to attempt to emotionally and, if possible, physically prepare ourselves for it! Recognising and embracing change is a crucial part of the transformation process.
Maintain a positive attitude
Consider the change in a good light. Rather than focusing solely on the bad, write or speak about why this change could benefit you and any other benefits that may result from it. In times of despair, being optimistic is crucial and an excellent tactic. In any scenario, there are positives, and it is up to you to locate them.
Ignore your negative feelings about the shift and concentrate on the good, even if only for a short while. This upbeat outlook can assist you in getting through it!
Talk about it
Make a phone call to your best buddy. Speak with a member of your family. Speak with a therapist. It doesn't matter who you talk to, as long as you find someone you can trust and tell them everything. It's critical to express your feelings and discuss them with someone you can trust and rely on. It is a sign of strength, not weakness; to know yourself well enough to recognise that you require support is a sign of strength, not weakness.
This support system may also provide the tools you need to overcome or better adjust to the shift. They can also bring a fresh viewpoint to the problem, which may or may not be beneficial, which is also OK!
Conclusion
Remember, change is unavoidable, and it affects everyone! What distinguishes it is how you respond to the change. And don't be concerned if it takes you longer than someone else; you're all on your road! It takes time to adjust, but if you stay optimistic and open-minded, you will succeed.
Workplace
How to Battle Gaslighting and Toxic Workplaces
March 5, 2024
Mohit Sahni
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Work should be a place where you feel motivated, valued, and have opportunities for growth. Unfortunately, toxic work environments and insidious tactics like gaslighting can make your professional life a nightmare. Gaslighting, a form of psychological manipulation, involves making someone doubt their own perceptions, memories, and even their sanity. It often manifests in power imbalances and can erode your confidence and well-being.
Understanding these destructive dynamics is the first step towards protecting yourself and creating change.
Identifying Gaslighting: Red Flags to Watch Out For
Denial and Contradiction
Gaslighting can be deceptively subtle, making it difficult to recognize immediately. However, gaslighters often rely on certain patterns of speech and behavior designed to confuse and undermine you. Let's look at some of the key tactics they use:
Denial and Contradiction
Gaslighters might flatly refuse to acknowledge something they said or did, even when you have proof. This direct contradiction of your memory can leave you feeling disoriented and questioning your own experiences. For example, you might confront a colleague about their disparaging comments during a meeting, only to be met with the response, "That never happened. You must have misheard."
Trivialization and Minimization
When you express frustration or hurt, a gaslighter might downplay your emotions, making you feel like you're overreacting or being too sensitive. This is a way to invalidate your experiences and make you doubt your own feelings. For instance, you might express exasperation over being consistently overloaded with work, and they respond with, "Stop being so dramatic. Everyone has a heavy workload sometimes".
Shifting Blame and Guilt-Tripping
Gaslighters are masters of redirecting blame. Instead of taking responsibility for their actions, they twist situations to make it seem like everything is your fault. This manipulation can leave you feeling guilty and ashamed, preventing you from advocating for yourself. For example, when a project goes wrong, the gaslighter might say, "This entire disaster is your fault. If you hadn't been late with that report, none of this would've happened."
Gaslighting by Proxy
Sometimes, a gaslighter enlists others to participate in their manipulation. They might spread false rumors about you to colleagues or paint a misleading picture of your behavior, further eroding your confidence and isolating you within a team. For instance, a gaslighting boss could speak poorly of your work ethic to other managers, leading to a widespread perception of you as an unreliable employee.
Emotional Withholding and Silent Treatment
Emotional manipulation is a powerful tool for a gaslighter. They might suddenly become cold and distant, refusing to talk or withdrawing affection as a form of punishment or to instill a sense of insecurity in you. An example of this would be a gaslighting romantic partner who, following a minor disagreement, refuses to speak to you for days, leaving you feeling bewildered and questioning your actions.
Discrediting Your Perceptions and Reality
The ultimate goal of gaslighting is to make you doubt your sanity – your memory, your judgment, and your very perception of reality. Phrases like "you're crazy," "that's just your paranoia," or "you're too sensitive" are common ways to chip away at your confidence in your own experiences. Imagine you bring up a clear inconsistency in a story the gaslighter has told, and they respond with, "You're clearly imagining things. Honestly, you might want to see a therapist."
Remember, gaslighting doesn't always manifest in blatant outbursts. Sometimes, it can be hidden within seemingly harmless jokes laced with criticism or backhanded compliments designed to sting. Pay attention to how your interactions make you feel. And most importantly, trust your gut – if something consistently feels off, it likely is.
The Toll of a Toxic Workplace
Toxic workplaces aren't just about one bad apple. They are characterized by patterns of dysfunctional behavior that impact everyone:
Lack of Communication: Healthy workplaces have transparency and open feedback. Toxic ones thrive on gossip, secrecy, and leaving employees in the dark.
Unrealistic Expectations and Pressure: Constant unreasonable demands and an atmosphere of fear and negativity lead to burnout.
Bullying and Harassment: This can be overt or subtle – insults, put-downs, exclusion from important meetings, or being micromanaged.
Favoritism and Lack of Recognition: Hard work goes unrewarded, while certain individuals receive preferential treatment, creating resentment and distrust.
Strategies to Combat Gaslighting and Toxicity
Surviving (and thriving) in these environments takes a combination of self-preservation, gathering support, and proactive steps to create change.
1. Trust Your Gut and Validate Yourself
Your instincts are powerful. If something consistently feels off, honor that feeling. Don't let anyone undermine your perception of reality. Practice self-affirmations and remind yourself of your strengths and capabilities.
2. Document Everything
Maintain a thorough record of incidents. Include dates, times, specific details of conversations, and the names of any witnesses. Save emails, project notes, and anything that provides a concrete record, both for validating your experiences and potential escalation.
3. Build a Support Network
Don't fight this battle alone.
Trusted Colleagues: See if others share your concerns and experiences. They can offer both emotional support and practical advice.
Friends, Family, Therapist: A safe space to vent, process your feelings, and gain outside perspective is invaluable in combating gaslighting.
HR and Employee Assistance Programs (EAP): If available, utilize these resources for guidance navigating your company's policies and procedures.
4. Set Boundaries
This is essential for regaining a sense of control:
Limit Contact: Minimize interactions with the gaslighter when possible. Choose email over in-person conversations for clear documentation.
Learn to Say "No": Respectfully decline requests outside your job responsibilities or that negatively impact your workload and well-being.
Assertive Communication: Practice clear, unemotional communication without aggression. State facts, avoid accusations, and focus on solutions.
5. Protect Your Mental Health
Toxic workplaces and gaslighting take a toll. Prioritize self-care habits:
Stress-Reduction Techniques: Deep breathing, mindfulness exercises, and meditation can calm your nervous system in the moment.
Physical Well-being: Focus on sleep, a balanced diet, and regular exercise to manage stress and boost resilience.
Therapy: Professional therapy offers tools to unpack the gaslighting, process its impact, and build long-term coping mechanisms.
6. Focus on What You Can Control
Your Reactions: While you can't control the gaslighter, you can choose how you respond. Limit emotional outbursts and strive for neutral responses.
Your Perspective: Reframe their manipulative behavior as a reflection of their own insecurities, not a deficit in you.
Your Goals: Stay focused on what you want to achieve professionally and don't let negativity derail your progress.
When Do You Stay or Walk Away?
Sadly, sometimes the best option is leaving a toxic workplace. Consider these factors:
Severity and Impact: Is this a personality conflict with one individual or pervasive dysfunction in the company culture? Is the damage to your well-being too severe to stay?
Potential for Change: Does HR take these issues seriously? Have you tried addressing concerns with leadership, and is there any openness to improvement?
Alternative Options: Do you have another job lined up or the financial means to quit before securing one? Having a plan eases the transition.
If You Choose to Stay: Additional Strategies
If leaving isn't immediately possible, focus on harm mitigation:
Limit Interactions: Minimize contact with the gaslighter when possible. Communicate via email for documentation.
Grey Rock Technique: Become emotionally unresponsive, uninteresting to the gaslighter, and therefore a less appealing target.
Focus on Your Goals: What do you want to achieve in this role? Prioritize deliverables and minimize getting sidetracked by the negativity.
Build Your Exit Strategy: Start networking, update your resume, and actively look for opportunities that align with a healthier work environment.
Remember: You Are Not Alone
Gaslighting and toxic workplaces are, unfortunately, far too common. By building awareness, setting boundaries, and seeking support, you can protect your well-being. If possible be part of the change by advocating for a healthier work culture. You deserve a workplace where you feel safe, respected, and empowered to do your best.
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