BhupC at Bangalore

I was thinking of doing for past many months. But then I thought I should do it in complete privacy. I wanted to be able to peep out of my window even while doing it. But you know I just was not able to select a right partner. And also I had a limited budget. So no way I could have afforded a costly deal. It had to be a middle class deal.

So, I finally got my partner, my laptop and so here I start blogging. Right on my desk near my window, peeping out of it, almost after every line.

On investing

Long time since the last blog! So, here I am, writing another one in hopes of resuming and hopefully reducing the boredom. Feels good already!

For past few weeks, folks around me have been talking about investing. Actually, this is quite popular a topic among us these days. One choice of investment that caught my eye was: real estate. Real estate in SF bay area has been a good investment in past 10 or so years. However, started declining in the past 1 or so years. I have personally invested money in real estate and this is the reason I started thinking about the question: should I invest more? what would be the returns etc. 

While it is not a sure shot return option, it is definitely safer than the stock market. To be exact, the option that was kept in front of me was - lets buy a run-down property, renovate it (as cheaply as possible) and then either 1) sell it or 2) rent it. Here we call it "flip" the property. This is not a bad idea, especially if the property is in areas like Berkeley where the rental market is good given the university is around. For me personally, I don't like this as the best way to utilize my money. And here is why. 

Flipping the property requires some amount of skill and time investment. Do I have the skill? Somewhat. We (Nikita, my wife and I) bought out house and did significant improvements and love the house now. The process taught a lot and we have friends who have gone through the same process. So, I think I have the starting skill set. Do I have time? If one is engaging with a cheap contractor, this will mean more time investment (even with the basics like plumbing and electrical), let alone interior design. I don't personally want to devote that much time to that kind of work. Specifically, I don't see any selective advantage in I doing this work vs someone else. The reasoning I have heard here is that not a lot of people work with contractors and almost always they want a hassle free house. So, we, the flippers, are making premium by providing our acquired skill in dealing with contractors and knowledge on how a house is generally built. This is essentially being a project manager and the investor at the same time.

Given my background of s/w engineering, I feel my time that I would be spending arguing with contractors, can be better spent in learning skills and networking with folks that can open wider set of opportunities. Given our age profile (30s), we can take more risks with our money and invest it on ourselves and the payout can be much larger. For e.g. 100K invested in a well research IPO/your own startup can mean 2-3x in payout. Of course, research needs to be mine and I think I am qualified to do so. But if I keep my time for my contractor, I think I will be missing on it. I can may be make 20% payout in a year at best. 

Another good thing about research is the knowledge learnt can be used to increase the payout in the future years. But here, the payout remains about the same. At best, we will have 10s of houses to flip in a business where payout remains 20-30% annually. 

However, I do think flip is a good option especially when you don't want to risk all your money. E.g. 20% in flip while 80% in a well research business opportunity. Also, as my risk profile will shrink in next 10 years, I would probably try to grow money through other venues like flipping. But today, I will use the money to grow me and then eventually itself. 

Boredom(?)

I get bored very easily. In fact, every couple of days, I tell my wife life is getting boring.
I sat down and started thinking, what exactly do I mean when I say "life is boring" ?

I used to wake up at 9 am or even post 9 am and this has been for past say 10 or so years. I drive to work for about 10 years. In fact, I drive to every place I have to go. I used to eat out every meal until I got married. Now most of the meals are at home, but still frequency of eating out is much higher. The moment we feel lazy, we go out and eat. We watch TV for hours when we don't feel like doing anything. We hardly read. I work long hours and come back home tired enough to eat and sleep.

Looking at this routine of past 10 years, I can definitely say that it is boring. The key word is "convenience".
In my opinion, I have created this life of convenience around myself and this has what has taken the "fun" out of me. It is not that I was bored each and every hour of these 10 or so years.

I worked in a startup in NYC for 4 or so months and then continued that in SF for about 7 or so months. That was such a fun life and the key part was that I was always out of my comfort zone. I woke up at 7 only to run to a subway station in NY. It took me an hour or so to reach. I bought a breakfast bagel or a cheese omelet from a Deli run by Asian family close to office. It was crazy the office as soon as the stock market started. I used to lunch at different places every day. Every day at office was dependent on how our customers were reacting and so it was different each day. At around 9 in the evening, we used to get out of the office and walk into a bar for a drink. We had dinner then some work and retire back at 1 am. Weekend was all about  booze and clubbing.

It was sure crazy and sure fun. NO boredom. Every thing we did was out of our comfort zone and probably that's what we need to do once or so a day to feel not bored.

So, this is hat I am trying to do things out of the comfort zone. I don't want to drive and instead take public transport to office. For some days, I come back home and cook.

Another think that I want to do is to slow down the pace a bit. Rather than try doing a lot of activities in a day or month, do things at a slower pace. Try to take interest in things and not just do them.