Retire in India and live off interest payments?

I am sure that your chinese pals in the politburo are hoping like hell that that statement is true.

but dont hold your breath.

no shortage of communists in india no? esp in bihar and bengal. and certainly the history of india shows clear influence by not only socialism but socialist nations. how many deacades was india more friend to soviet union than usa?

in fact, india has only woken to the 'free market' for which it is anything but. india has all sorts of quotas and barriers and is not wto -so i am finding amusing you are holding india up as some bastion of free-trade or even freedom (poverty/caste system/univ quotas/male chauvanism - list is endless).

and i believe it was churchill i was paraphrasing - ironic no?

and i think the reverse would be true - chinese stomachs are basically full. ergo - they would be in 'trouble' as it could mean the stage stage is persons wanting political freedom.

where the poor an ignorant masses stuck and starved in india will forgo their freedom - for a full stomach.

india has been calling herself a democracy for years but i challange it based on the corruption and the fact it has no appearance of serving the public. casting a ballot does not a democracy make - iraq is a PRIME example, so is cambodia.

mgm, I find it very entertaining that you are taking every opportunity to generally slam India, when I am talking about investing in India, and reacting to your issues which state that India is a poor place to invest, and China is the holy grail.

Generalisations are odious. They are also inaccurate.

Maybe we can have a drink one day and discuss china, churchill, thailand and india, but i somehow doubt it.

its not about taking oppty to 'slam' india. it is about seeing everything with a keen vision. something i would think investors would do as routine.

if you see india as a great investment vehicle -great for you. youre 'in' where others have not even see the train coming.

india has huge issues and i would think an investor of all people would not be pollyanna about. comparing india to the miracle in china is folly. china has been turning in double digit growth for a decade.


as for the drink - up to you

hey, capt, I'm hoping India is not a bad place to invest as I just bought the minimum amount of Matthews India Fund....so far it's holding steady...and if it takes a nose dive, I can't sell for it for 6 months!

these are the fund's top 10 holdings:
Dabur India
Glenmark Pharmaceuticals
Housing Dev. Finance Corp.
Ashok Leyland
Infosys Technologies
Gail India
CESC
HDFC Banking
I-Flex Solutions
Cipla

mgm, not saying India is the best investment vehicle in the world, but not saying it is the worst either.

YG, the stockmarket is a forum in itself i think ... and which I for one don't claim to understand. Mutual funds in India have given excellent returns over the last three years, though.. roughly 30/40% annually... though it would be difficult to expect this as a standard return. Half of this would be my expectation.

yogagirl:

that is a very new fund w/ no track record. hope is in order. we are certainly long in the tooth w/ the markets on the us side. that fund is a big gamble.

its china fund only has 3* from morningstar and lipper is not much better.


the managers of the fund (indian) are young w/ unimpressive backgrounds imo. i also do not see costs associated w/ buying/selling and management fees.

I reckon next year during the Beijing Olypics there will be a new democracy movement that will make 1989 look like a kitty party. Think:- tanks on the streets (again), civil war, US aircraft carriers in the Taiwan Straits, thousands of foreigners shot/held hostage, general panic and global meltdown.
Wouldnt invest in China if I were you...

number6 (i like that nick incidently)
im not invested in china but am partial to east asia. could i perhaps get a bet with you that what youve predicted WONT happen during the olympics??

when it will or if it will may be another discussion. china is arguably a time bomb -but freedom marchers arent going to be allowed to disrupt or humiliate the party.


maybe we can get back to the topic. its obviously been hijacked and ive done a good job of dominating the conversation as well...

The topic "Retire in India" is of considerable interest to me - with thoughts as well as open questions. Clearly fixed income (interest income etc.) is a big part of retirement planning - so the interest part of discussion is interesting as well.

The interest income (particularly over the long term) needs to be looked at in terms of inflation and exchange rate prospects (although the two are related) and taxation differences, if any. So, 8% in Indian Rs and 4.5% in CDN $ might be in the same ballpark of attractiveness, once the fundamentals are considered.

The open question to me concerns the exchange rate scenarios over the long term. The currency in China is presently artificially depressed. Indian Rs might be close, but I might be wrong on that. At the same time, the USD might have artificial support based upon the oil contracts pricing, etc. Over the long haul, I remain concerned about the prospects of the USD as well as Euro (over a longer haul). In the short term, these scenarios are not significant for the retirement planning abroad discussion, but over the 40-50 year horizon, these scenarios are very significant.

For our personal planning, we continue to add to the savings and diversification - including currency risk mitigation. However, some of the folks making the early-retirement decisions or planning a very-low budget retirement (brought up in this thread) might wish to consider that their calculations in today's numbers might not hold over the retirement horizon.

As an aside, the India vs. China investment choice discussion has little to do with the topic of retirement - and the country risk factors for both are clear to most investors. Investments in either economy feature significant currency, valuation, market and country risks and respective rewards. I do not have a crystal ball and don't believe anyone else who claims to have one. Diversification is the strategy I use, but that's a function of my risk - reward tradeoff.

all new funds have no track record, whether they be foreign or american funds. which is why I invested the minimum amount after my research.

as kmalik says, diversification of a portofolio is the key to investment strategy.

mmmm, interesting conversations, better get my 2 pence worth in.

Business is business wherever you happen to be on the planet. Understand your market, know the rules which apply to you, no reason why you shouldn't be successful. Retire anywhere you like! Have a contingency plan, a plan B and C so to speak. Seek advice when you need to – May need to call a an engineer at £1000/day in UK – May be Rs 1000 backhander in India but hey, that’s business. As for free-trade, is there such a thing, just take a look at the common agricultural policy. Don’t jump in without due consideration, them mountains look easy to climb from a distance, only when you start climbing you realise…..

Remember the ‘dreamer’ is the one who goes through life saying “could have, should have”.

Go on, go for it, just keep in mind, may turn out to be a nightmare.

Well you know what they say ‘nothing ventured, nothing gained’.

As for that drink – When and Where?

kmalik, you have summed it up nicely.

The exchange rate risk is a factor I would consider carefully if I was a foreigner. The Indian scenario is more complicated by the fact that the strength of the currency is heavily impacted by oil prices, and periodic RBI intervention.

Between 1978 and today, the exchange rate has gone from less than 8 Rs a USD to about 48 and back to 45 or so that it is now; extrapolating in the eighties or early nineties had many people assuming a 100 rupee to a dollar rate easily in the near future; I know some NRI's who's calculations were skewed as a result.

With taxation, a resident Indian does have a little leeway; a husband and wife should be able to arrange investments to get a tax free income of about 4.5 lacs between them at todays rates, higher if they are senior citizens. And tax slabs are incremental beyond this.

Diversification is the main thing, as you say. And, I think, asset allocation.

Finally, on the subject of retiring in India, how inflation is managed will be critical. There is a whole generation of retired folk who got double whammied in the last two decades... falling interest rates, and inflation.

People who had inflation linked investments, like a rentable property or to an extent stock, have been much better off.

Many of us cannot afford a plan B, let alone a plan C! We are stuck with a decision and the results thereof.

But, if possible, then how good it would be to have those things!

Okay then Nick, let´s talk about plan D instead. What will it be, a bankrobbery or an internet banking fraud?

Hush, hush, I won´t tell anybody. Truth or dare?