Last month, we saw how you can make your money grow by keeping them in fixed deposits and by lending them to good and trustworthy businesses. This month, we will explore how one can earn more money by investing.
What exactly is “Investing”? It sure sounds complicated. How is this different from savings and fixed deposits? Investing involves taking some risk in order to make more money. Usually, the greater the risks that you take, the larger the returns that you get on your investments. But let us first begin at the beginning and see some examples of Investments.
One of the biggest avenues for investment in India is land. Why is this? Take the example of your own city. How has it grown in the last five years? In the last 10 years? You see, year after year, there is a continuous migration of workers from villages to big cities. This is because, even as our population grows, the villages and small towns do not provide employment opportunities to their residents, especially the youngsters. So these youngsters move to cities in search of jobs.
Growing city
Thus the population of cities keeps increasing. Along with the increase in population, there is a greater demand for land in order to house the ever-growing number of residents of the cities, which usually expands by extending their borders. As this happens, the outskirts become part of the city and all kinds of facilities like schools, hospitals and so on spring up. For example, in Chennai, Tiruvanmiyur was once considered the southern end of the city. Now, the city extends several kilometres to the south from Tiruvanmiyur, all the way till Sholinganallur, which is around 15 km from Tiruvanmiyur. There are hospitals, schools and even multiplexes nearby.
Several years ago, the land in this village Sholinganallur was available very cheap. This is because it was far away from the city and there were no facilities nearby. However, as the city expanded to include this village inside its borders, the land became more valuable. With all these changes, new facilities cropped up to make this village liveable. This is the case with just about every city and town in India. The rural to urban migration is causing our towns and cities to expand thereby increasing the value of the land in the fringes of cities and towns.
So discuss with your family and see how you can increase the family wealth by investing in land outside your city or town.
Money Trivia
If you place the 1.2 billion people of India in four person houses of 1,000 square feet each, we would cover only about one per cent of India’s total area!
Young World Money-Wizards Quiz #22
If your family buys a piece of land outside your town, can you construct a 10 storey building on it? What factor determines how many storeys you can build on your property?
If you know the answer, email it to youngworld@money-wizards.com. The first five correct answers within seven days will each be awarded flipkart evouchers worth Rs. 250. The results and the answers will be published at www.money-wizards.com.
