ROI ....

Everything has a return…

Especially after specializing in finance, the most common way of measuring anything is ROI. I must say I even started ROI on traveling, eating, sleeping etc… return on sleeping for 4 hours vs. 14 hours, my opportunity cost attached to it etc.

Every this is an investment; in my view spending time on anything has a cost attached to it. Spend time in class gives returns in long term basis.   

EXAMPLE: My father paid up close to INR 1million for my higher education. To this example there is an INR 1.5million opportunity cost attached to it.

If I would decide to work instead of going for higher studies

 At 3lacs p.a for 2 years

·         300,000 x 1 =300,000

·         330,000 x 1= 330,000(10% increase in salary)

·         Investment of 1/4^th of the above amount at 10% p.a as fixed deposit. = 60,000(approx)

·         Investment of another 1/4^th of amount in mutual funds. 15% return p.a = 75,000(approx)

Therefore 630,000+60,000+75,000=765,000 + work experience valued at 1,000,000

Opportunity cost =INR 1.76million

Worth a thought…. Decision making must be done considering a Decision making tree and cost benifit analysis(CBA). Google can help you better with this; I can’t invest more time in it…. Too low ROI …lol…