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‘Investment budget getting eroded’

business Updated: Jul 29, 2008 00:21 IST
Sandeep Singh

When 53-year-old Sarita Biswas lost her husband a year ago, she found herself not just grappling with an irreversible loss, but also with a set of responsibilities that were thus far shared.

A year later, this mother of 22-year-old Priyam and 17-year-old Aditi is doing her best to keep up with the standard of living they have always enjoyed. Rising inflation is not making this balancing act any easier for Sarita, who is a schoolteacher.

“Both my daughters are still studying and with a school teacher’s salary which got a revision of less than 10 per cent, it is hard to keep up on the savings while meeting the growing expenditure on all basic necessities, which can’t be deferred,” says Sarita.

Priyam is planning to take admission in a reputed MBA institute and that’s going to be expensive. But Sarita does not want to tamper with her savings for the admissions. “I would rather go for an education loan for her higher studies,” she says.
Aditi’s school, in a kind gesture, waived her fee after she lost her father to a prolonged illness.

If education is a big worry, then grappling with rising fuel and food prices have the Biswases car-pooling for their shopping trips or any social excursions. “I make sure that I take the school bus,” says Sarita. The family uses the car only when they have to go out together either for shopping or household work. “We ensure that once we take our car out we finish the bulk of our tasks in one go on one route,” says Priyam. “As we stay in Noida where fuel price is almost 10 per cent more, we ensure that we get our car fuelled at the nearest Delhi fuel station,” she adds.

“Milk prices have gone up from Rs 14 to 18,” adds Aditi.

The family finds itself lucky to have a home free from EMIs (equated monthly instalments) in this rising interest rate situation. But they have a car loan running for which Sarita pays a little over Rs 4,000 as EMI. “It takes away almost 20 per cent of my salary,” she adds, “I am waiting for the implementation of the Sixth Pay Commission which might bring some
breather for me as the salary increments are no way taking care of the high inflation.”

With her salary supplemented a bit by the rental income from her home, Biswas can manage the expenditure but is concerned about being able to meet her commitment to savings. “The general price rise on all fronts is hurting as the savings that I could set aside for investment is getting less,” she said.

Biswas has taken a Mediclaim health insurance policy for herself and a life insurance policy for herself and the Priyam.

She also has an equity linked savings scheme (ELSS), which is more than three years old along with a pension scheme. In all this sums to a total of Rs 75,000. “This year I think I can manage to meet my commitments, but I really doubt if I will be able to do so from next year,” says Sarita, who along with her daughters has gone on a totally need based shopping. Eating out has also been curtailed. The family buys its monthly ration from a wholesaler and the vegetables from the weekly haat.