By Jagjit Singh, 19th December 2011 @ 11:00, Total Comments: 1, Hits: 1433
IT is Saturday evening and ‘City bar’ is full of activities. Tony, sitting in a distant corner is quietly having his drink but appears a bit uncomfortable, for the reasons best known to him. Every now and then he stares towards entrance of the bar as it seems he is eagerly waiting for the arrival of one of his close buddies.
The wait is turning longer and unbearable for Tony and he slowly and unknowingly enters into the flashback of his longstanding friendship with Zafar. And this is how the old memories start to get rewind.
Tony and Zafar are close friends since their childhood days. Both stayed in the same locality, studied in the same school and surprisingly even pursued the same stream of specialization during their higher studies. Zafar was an average student and Tony always came to his rescue whenever there was any special task or assignment given in the school.
Despite this, Tony never made Zafar to feel that he was in anyway superior to him and this is how their friendship was exemplary on all counts. Both finished their graduation in time and were looking for a suitable job. Tony was getting lot of interview calls as he had secured above 80% marks, whereas Zafar just managed to pass-through.
As expected, Tony soon got an offer from a leading company in the town as a ‘Sales Executive’ and he immediately took up this employment. This is the first time when both friends got separated and it was not a very pleasant experience for either of them. The business was growing manifold and thus the company was on a continuous recruitment drive.
One day, the General Manager called his sales team and requested for referral candidates, if anybody knows one. This is what Tony was waiting for all these days. He immediately contacted Zafar and informed him that he is recommending his name for the post of ‘Sales Executive.’
Additionally, just before the job-interview, Tony assisted Zafar in his preparations and luckily the company decided to hire Zafar for the same post. Both friends were now very happy, as they again got reunited after a short gap. Life was good as they were enjoying their respective work.
Being in the sales team, though there were monthly targets, however, Tony often assisted Zafar to achieve the set targets, whenever there was a need to do so. The journey continued
and in due course of time they both settled down respectively, got married and eventually each one got blessed with two lovely children.
Once in a fortnight, both families would assemble at a common point to celebrate their long lasting friendship. This was also an occasion to share good and bad moments of life and one was always ready to travel the extra miles in order to make the other comfortable. It was the beginning of year 2008 and the whole world was reeling under the grip of recession.
Business across the sectors was on a downward spiral and most corporates were struggling to survive. Consequently things moved from bad to worse for the company where Tony & Zafar were working and finally the day came when the entire sales team was abruptly called by the General Manager for making an urgent announcement.
Without exchanging many pleasantries, the General Manager announced the most unexpected verdict. He stated that due to extreme business conditions, the company has decided to temporarily suspend the production line and as a result the entire sales team stands disbanded.
Moreover, due to impending recession jobs were hard to come and both Tony as well as Zafar had to contend with by sitting at home and doing nothing. Slowly the fortnight celebration meetings of both families stopped and as a result there was a lesser and lesser communication exchanged between these friends. Tony kept thinking that life has come a full circle since the time he had lost the job.
It is only a period of four months of unemployment and situation for the family has completely turned upside-down. There was no money to pay the school fees and as a result kids were thrown out of the school. Though Tony’s wife took up some petty jobs, however, the earnings were barely enough just to manage two square meals for the family.
As if this was not enough, the landlord of the house was continuously threatening Tony as he has not been able to pay the rent for the last two months. The impatient landlord finally tendered Tony a three days notice - either to pay the pending rent else to face a forced eviction from the house.
This was unbearable for Tony and this is how he decided to call his old time friend Zafar to meet at the City bar to discuss the situation. Through some common sources he found that Zafar is also in search of jobs; however, life for him is bit normal as no untoward incidents (as similar to Tony) seemed to have occurred to the Zafar’s family.
Tony, with tears in his eyes was busy in doing the introspection of his life and this is when he felt a lovely pat on his back. He suddenly turned back and found his friend Zafar standing there. On seeing Zafar after a long time Tony could not control his emotions and he suddenly broke down completely.
Zafar consoled Tony and both friends settled down for a drink. Tony with a lot of grief narrated the whole story. While doing so, Tony was equally eager to know as to how Zafar has been able to manage the bad phase with lot of ease despite their conditions being quite similar (i.e. when both of them were jobless).
At this juncture, Zafar ordered one more drink and informed Tony that during the period they were employed, Zafar was keeping aside some money for rainy days and this is how he created a ‘Reserve Fund.’ Zafar continued by explaining that this is the same fund which has enabled him to sail through the unexpected phase, when jobs are hard to come due to impending recession.
The curiosity of Tony was at its peak, as he was eager to know more about the ‘Reserve Fund’ and Zafar happily went on narrating the same. In simple terms Reserve or Contingency Fund is – “an amount kept in reserve to guard against possible losses.” Another well accepted definition defines Contingency Fund as – “reserves set aside for meeting extraordinary expenses resulting from a possible business interruption or disaster.”
From the above two definitions one can easily make out that creation of ‘Reserve Fund’ is required to handle unexpected situations if they arise so. As a thumb rule, a fixed percentage of your monthly income should always be spared towards creating a ‘Reserve Fund.’ The accumulated money can further be invested into financial instruments of your choice but mind it, into the ones which at least count higher on the liquidity front i.e. when in need; the money is available within a shortest possible time.
Another important point which needs attention is on the possible quantum of a Reserve Fund. Though there is no fixed rule, however, it is expected that a Reserve Fund should be sufficient enough to run one’s affairs for a period of at least 6-8 months duration. Accumulated amount being lower than this limit will put a person/entity into a slightly danger zone, whereas one would relatively feel safer if the accumulated money can cater to a longer period than the one specified hereunder i.e. 6 to 8 months.
It is nearing midnight and both friends are still in deep conversation. Finally the security guard of the bar had to intervene and requested them for an exit. On a parting note, Zafar agreed to help Tony out of his own Reserve Fund in order to bring his life back on track. This was badly needed before Tony’s belongings are thrown out in the street by the landlord and his family is left with no choice but to beg in order to survive.
From the above narrated situation, we could sense that Tony generally outsmarted Zafar in every walk of his life. However, Zafar played a master-stroke in the situation by creating a Reserve Fund, which Tony had completely missed out so far.
The moral of the story is -howsoever smart you may be, there is always a need to prepare yourself for handling any unexpected tragic events and the same can be achieved by creation of a well managed ‘Reserve Fund.’ With this lesson, let us pray that henceforth no human being would emulate our today’s character of ‘Tony.’
Total Comments on the above stories (1)
Comment
Hi Jagjit,
This is a very good article in quite simple English without much of hard words or jargons.
The example flow is also very interesting and will make a very avid reading for people who go through it.
Your idea on how to keep saving from your regular income, comes out very very clearly through this example.
Great Reading my friend.
Regards
Sandeep
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