Saturday, May 31, 2008

Kick the butt before you kick the bucket!

So you think it's cool to light up and puff away at a cancer stick, do you?

And the younger you are, the more attention you tend to get when you're smoking a cigarette -- even disapproving glances give you some kind of satisfaction, as long as it's not an elder relative or family member who catches you doing it and reports straight back to Daddy!

Well, World No-Tobacco Day 2008 is coming up on May 31, so we thought we'd bring young smokers the lowdown on the ill effects of smoking.

According to research, nine out of 10 tobacco users start before they're 18 years old ( And yes, with all the wordly wisdom of their teenage years, they believe that they'll never get addicted to it.

But the fact is that you do get addicted and your body suffers, because tobacco is poison and cigarettes are small doses of it!

Yes, yes, you've heard about the heart risks, the increased possibilty of cancer and emphysema, but that always happens to someone else, right?

Wrong! And besides these more serious concerns, here's a number of other health issues ranging from the trivial to the life-threatening that are sure to make youngsters sit up and take notice!

Bad breath, tooth decay and gum disease

Of course, smoking leads to cigarette breath, given that you're breathing in smoke and nicotine and most folks find the odour rather unpleasant. But it's very likely your breath will remain bad for a long time after you've smoked and may cause a permanent problem.

Cigarettes cause a build up of nicotine and tar on the teeth, tongue and inner lining of the cheeks; they also hamper the secretion of saliva, which leads to the growth of bacteria in the mouth ( These bacteria are the reason behind bad breath, so the next time you pucker up for a goodnight kiss after a date, you'll know the reason why your partner is holding his/ her nose shut!

Other than bad breath, the bacteria in your mouth can also cause unsightly yellow stains on your teeth and in some cases, gum disease.

Wrinkled, damaged skin

So a pimple on your face usually calls for drastic measures?

Here's a heads-up on what smoking can do to your skin -- you may be 25, but cigarettes could have you looking 10 years older!

Because smoking tightens the blood vessels, it does not allow the requisite oxygen and nutrients from nourishing the skin. As a result, your skin may acquire a pale yellowish tinge. Also, instead of remaining supple, it becomes more prone to premature wrinkles, because nicotine has a damaging effect on your skin's collagen and elastin too (

Sexual dysfunction

Yes, smoking does affect your performance in the sack!

This is applicable to men, because as mentioned previously, smoking restricts the blood vessels, which in turn inhibits the flow of blood to the penis. As a result, erectile dysfunction, or the inability to sustain an erection, occurs.

Cigarettes can also create problems for those who are trying for a baby. Women smokers take longer to conceive -- chances of pregnancy are reduced by 10 to 40 percent. As for men, besides hampered sexual performance, smoking leads to reduced fertility -- it damages the sperm and causes a reduced sperm-count (

Hampered overall immunity

Research has shown that smokers are more susceptible to illnesses and infections than non-smokers. You are particularly more prone to respiratory disorders like common colds, asthma, bronchitis etc. Also, cigarettes tend to kill one's hunger and a lot of youngsters smoke to curb their appetites, thereby depriving their bodies of vital foods and nutrition. This also leads to reduced immunity (

Life-threatening health concerns

If all the above hasn't convinced you to quit smoking, maybe the mention of the following life-threatening diseases will:

~ Researchers have found that even smokers who are in still their teens have severely damaged blood vessels and cells which result in chronic bronchitis, heart disease and strokes.

~ Smoking is the main reason behind various forms of cancer in the lungs, mouth, throat, bladder, pancreas, and kidney.

~ The more you smoke, the larger the chance that it will ultimately lead to your death. One in three smokers die as a result of the habit and several more suffer from debilitating diseases ( So look at it this way -- if nine of your friends are addicted to cigarettes, three of them will die if all of you don't quit!

So think twice before you light up again -- you'd rather kick the butt than kick the bucket!

Friday, May 16, 2008

Why your boss is overpaid

It is a typical 'Dilbert' strip. The boss announces, "Our CEO has voluntarily slashed his pay from $6 million per year to $4 million. In a written statement, he said he wants to 'share the pain.' Do you feel better now?" A downtrodden intern replies, "I make my underpants from sandwich bags."

But that's office life, is it not? Bosses make obscene sums of money, while downtrodden cubicle slaves toil almost without reward. It might seem insane, but economists have a surprise for us: The insanity reflects nothing more than cool economic logic. There is method in the madness.

The ugly truth is that your boss is probably overpaid--and it's for your benefit, not his. Why? It might be because he isn't being paid for the work he does but, rather, to inspire you. In other words, we work our socks off in underpaying jobs in the hope that one day we'll win the rat race and become overpaid fat cats ourselves. Economists call this "tournament theory."

After all, managers find it hard to spot an excellent performance. It is a rare job where workers can be fairly paid according to some objective criteria.

There are some exceptions, of course. Critics and audiences may disagree about the literary merits of Dan Brown's bestseller, The Da Vinci Code. Yet from a business point of view, the success is easy to measure. He has sold about 40 million books and is rewarded with a payment for each one.

The economists Edward Lazear (recently appointed to chair the Council of Economic Advisors) and the late Sherwin Rosen argued, in a hugely influential paper published 25 years ago, that tournaments are an integral and often invisible part of the workplace. Workers are frequently ranked relative to each other and promoted not for being good at their jobs but for being better than their rivals. It is a natural response to the difficulty of true performance pay.

Tournaments also help protect workers against risks they cannot control. Companies can be affected by recessions, unexpected competition and hurricanes. As long as every worker is equally affected, the incentives to try hard remain the same. Trying to encourage performance through, say, stock options would unnecessarily expose workers to risks without really encouraging them to work harder.

Promotion tournaments sound sensible: Good workers are promoted, less capable workers are not. Yet the widespread use of tournaments also goes a long way toward explaining the frustrations of office life.

First, one way for you to win is for your colleagues to lose. Companies that rely too heavily on competition to determine promotions may find that their employees discover that the most efficient way of winning a promotion is by sabotaging the efforts of their rivals. You don't need economic theory to spot that risk.

The second, and more counterintuitive, prediction of tournament theory is that the more luck is involved in work, the larger the pay gaps should be between the winners and the losers. If Jack's promotion is 90 per cent luck and 10 per cent effort, Jack may be inclined to goof off--unless, of course, the rewards for promotion are absolutely astronomical. And they sometimes are.

Tournaments also demand increasingly absurd pay packages as workers get higher up the hierarchy. At the lowest level, a promotion may not need to carry much of a pay increase, because it opens up the possibility of future, lucrative promotions. Nearer the end of your career, only a fat check is likely to spur you on.

Finally, tournament theory also helps to explain why insiders, not outsiders, get cushy jobs. You thought it was all about the old-boy network, but in fact, the logical reason for promoting insiders is clear: These jobs are designed to keep your workforce motivated.

Lazear and Rozen's tournament theory has stood the test of time and been supported by many subsequent pieces of empirical research. It also passes the smell test: The more grotesque your boss's pay and the less he has to do to earn it, the bigger the motivation for you to work for a promotion. As Lazear wrote in his book, Personnel Economics for Managers, "The salary of the vice president acts not so much as motivation for the vice president as it does as motivation for the assistant vice presidents."

Economists don't even pretend that your boss deserves his salary. Suddenly, everything is clear.

Thursday, May 15, 2008

What ails Bangalore's Royal Challengers (RC)?

The Indian Premier League is a new phenomenon in the Indian sports scene for its sheer commercial blitzkrieg. The demigods of Indian and international cricket were auctioned to the highest bidder, mostly top industrialists and film stars, and certain icon players were bought for dizzying amounts. As the matches began, some team owners expected returns on their investment. Only, several of these players and teams didn't perform as expected, Bangalore's Royal Challengers being one of them. In this case, it has led to a public spat between captain Rahul Dravid and team owner Vijay Mallya, who has squarely blamed him for the team's losses. He even called the Royal Challengers to a Test team. Victories and losses were part of the game before; But today, when a cricket team has become an investment, looks like some bosses of the game will not tolerate a string of defeats.

Negotiating salary? Important tips

When Prateek Dhawan took the offer to join a new company, he was quite happy with the CTC salary that was offered to him.

However, after the first month, when the salary cheque came, he was shocked with the numbers. His actual take-home was slightly more than his previous salary. And, Dhawan is not alone.There are many of us who get lured with the numbers that show in our CTC package, but when the actual take-home salary comes in our hand, it causes a lot of heartache. It is therefore very important that when you are negotiating the salary, you should have a clear idea about numbers. A good way to achieve this is by using tax saving strategies that would reduce your burden.

Ah! those slips that snip

The first thing to look for is the different heads in your salary package. Heads like performance incentive sound challenging, but they are always taxed. Special allowances, added with conveyance and phone reimbursement, also attract tax.

Often, there is a notion among salary-earners that a lesser basic pay and high allowances may bring down income tax burden. However, it is best if you avoid this approach. A reduced basic salary leads to a lower provident fund, which is a forced saving for your future.

Anyone who gets many allowances must combine all of them under a single head. Put car allowance, books reimbursement, house rent allowance, office travel allowance, phone, vehicle and staying in hotels under on head, which straight away lowers your tax bill. Call this consolidated allowance.

Allowances that help

Always go for conveyance allowance. A sum of Rs 800 a month is tax-free. Even if your office does not give conveyance allowance, you can ask for a reduced basic pay and additional conveyance allowance. This move can cut down tax outgo.

Daily allowance, wherever allowed, must be grabbed with both hands because it carries total tax exemption. Professional tax, up to Rs 2,500, is also unencumbered by tax. Also, office loans for car or personal reasons can be used to avoid taxation to a great extent.

Policies that pay

Employees State Insurance Scheme, if available, must be compulsorily availed. Unlike LIC schemes, the amount is absolutely free from income tax. Fidelity Guarantee Scheme is another insurance plan that is completely tax-free.

Even if you are contributing to a Public Provident Fund, a salaried individual must also opt for Employers Provident Fund, because this also doesn't attract tax. Many salaried people are unaware that a loan for medical treatment is exempt from income tax under Rule 3 A, but make sure that your medical insurance policy is not utilised.

Avoiding FBT

The fringe benefit tax can be avoided if you own a car and the company pays for maintenance and petrol bills. The most profitable way to claim HRA is to ask the company to take a house on lease, which is owned by any of your relatives. If it's your parents, who don't have any income, it works completely to your advantage.

It is because, on one hand, you claim HRA and they, having zero income, don't have to pay any tax. In fact, even if they have some income, but less than the stipulated base limit of Rs 220,000 a year (assuming they are retired), they would gain from the situation. The maximum benefit occurs when the rent is over 20 per cent of your salary.

When gift vouchers are given, insist on taking them under the employee welfare scheme.

Mobile phone bills are considered a perquisite and taxed, causing your office to fret a lot. You can again offer tax counselling by suggesting a simple trick.

The mobile phone bills can be placed under "recurring operative expenditure" head. All taxes are eliminated at one stroke. At home, leased phone landlines installed at the company's behest and cost, allows you to get rid of paying tax on calls.

Travel expenses and hotel stays are taxed under FBT. In fact, even a conference to discuss reducing tax incidence on perquisites will also be taxed! However, by not showing the expenditure as conference/seminar and calling it "convention" would remove the tax burden.

The office may want to give meals, breakfast or tiffin, but FBT fear precludes an employer from extending this perquisite to staff. Why not have an office "food and beverage" account? Show the claim in the income tax return.

The FBT will not apply, at all. Finally, soft furnishings for a house (such as curtains and table cloth), which give the abode a decent appearance for entertaining guests who drop in for official duties, can be shown as expenses. They also qualify for tax exemption.

Thursday, May 8, 2008

Tendulkar hoping to play May 14 IPL match

Eager to make his debut in the ongoing Indian Premier League Twenty20 tournament, after missing seven matches because of a groin injury, Sachin Tendulkar said on Wednesday he is hopeful turning out for the Mumbai Indians' team when it takes on Chennai Super Kings on May 14.

Watching his teammates fight it out with Rajasthan Royals in Wednesday's IPL tie in Mumbai, the home team's regular skipper, however, said he will take the field only if fully fit.

"I can tell you roughly that I'm targetting the next match," Tendulkar said.

"If I'm in the middle, I should be able to compete; for if I'm not able to compete, I'll be letting down the team," said the ace batsman from Mumbai.

Tendulkar also gave the thumbs up to the IPL, dubbing it the biggest event ever in the history of cricket.

"Without a doubt (this is the biggest event in cricket's history). It has taken the game virtually to all the households in the world. If cricket is looking forward to go global, this is the format. It's a three-hour entertainment, which the entire family can watch together," he said.

Tendulkar believes tournaments like the IPL have the potential to bring in new audience.

"Earlier, people wanted to watch a match but found it difficult to devote the entire day. I think Twenty20 is also bringing families together. I mean, how many times you otherwise see all the family members watching a cricket match together?"

Morning sex can keep you hale and hearty

A steamy sex session in the morning can keep you in good health, say researchers.

According to a research from Queen's University in Belfast, a good morning session at least three times a week, decreases the risk of heart attack or stroke by half and a regular session improves circulation, thereby reducing blood pressure.

According to a study in New Scientist, a steamy session twice a week enhances IgA, an antibody that provides protection against microbes that multiply in body secretions, reports The Sun.

Morning sex also helps in alleviating arthritis and migraine. It burns around 300 calories an hour that simultaneously diminishes the risk of developing diabetes.

Moreover, an American study involving 300 sexually active women whose partners did not use condoms revealed that they were less prone to depression.

Sex increases the production of testosterone that provides stronger bones and muscles thus helping to stave off osteoporosis.

A good morning session can make the hair shine and skin glow by raising the output of oestrogen and other hormones associated with it.

According to Yale School of Medicine researchers, it can aid in averting endometriosis, a condition where the tissue that normally lines the uterus, grows in other parts of the pelvis.

However, the researchers have also warned that having sex more than three times a week can have a negative impact on our immune system thus lowering its resistance

Daily investment through mutual funds

The advantages of investing through the systematic investment plans route are well documented. To recapitulate, SIP is a method wherein you invest a predetermined fixed sum of money every month, irrespective of the state of the market.

For instance, if you want to invest a total of Rs 60,000 in an equity mutual fund scheme a year, you can either do it by putting in a lump sum or through the SIP route of Rs 5,000 every month for 12 months. This amount can be invested on a predetermined day of every month like the fifth or the tenth day.

The biggest advantage for the investor is that there is rupee cost averaging. That is, when the market goes down, more units of the scheme can be purchased because of a lower net asset value. However, most companies have SIP schemes that allow you to invest on different dates of the month.

Last year, ING Mutual fund introduced a product called Zoom investment Pack or ZIP. The unique feature of this product is that it is a daily SIP. An investor can make a bulk investment in the ING liquid fund and a transfer is made to any of the equity funds of ING Mutual on a daily basis.

The features are as follows:

  • Affordability: The minimum investment required is as low as Rs 5,000. The investor can choose to invest just Rs 99 per day.
  • Volatility: Captures daily market movement.
  • Convenience: Since the investment is made as a systematic transfer plan (STP), only one form needs to be filled.

According to a back-testing done by the fund house, the performance of the daily ZIP is as follows:

They have undertaken a study of the performance of three time periods that include stable market, rising market and falling market conditions by investing through an STP in ING Domestic Opportunities Fund. Also, this performance has been compared with ING Domestic Opportunities fund.

The benefits are apparent in stable and falling markets�ZIP outperformed. However, in a rising market, investment through SIP will always underperform because fresh investments are made at higher NAVs.

The Indian equity markets have witnessed a turbulent period in the last quarter. While the Sensex has moved from 20,300 points in January 1, 2008 to 16,721 points on April 24, 2008, the volatility during the period has been very high. A product like ZIP can capture the daily movement in the Sensex for the investors' advantage.