Hinduism teaches us to invest in long term avenues
Bhagwad Gita is a source of stimulation and knowledge every time you devote serious moments of life in it. Not only you get to discover the new facets of life but a sense of realization is set in that surely changes the way you assume the world around.
While going through the initial few pages in Bhagwad Gita, I was fascinated to read or you can say discover a new truth of life.
The Holy Gita says “we humans struggle for worldly pleasures and even in our prayers seek those materialistic gifts from the Almighty that have very limited shelf-life. We forget that our physical self (the body) is mortal and so are these materialistic pleasures. Therefore, we should try to seek those long term benefits from God in our regular prayers that help us to achieve salvation and assist us in getting rid-of the continuous cycle of birth and death.”
In short, nothing else is immortal and indestructible except our inner soul and purification of our soul would determine the future course of action once we leave this world.
We should try to look beyond the short term goals and invest for longer ones. Momentary or short terms gains are worthless as they are limited in their time span unlike long term gains.
Similarly, our tax structure works on the above mentioned principle too.
Short terms gains attract more taxes by the government in comparison to long term gains.
Therefore, we should make it certain that our investment is prudent and for a longer period of time, in order to reap its real dividends. With time, value of most of the capital assets appreciate and thus provide more benefit.
To make matters transparent, any capital asset held for longer period of time attracts less tax from the government.
In case of equities, more than 12 months of holding period means zero level of taxation. Just booking profits as the markets rise/fall suddenly is foolish and unjustified. Such gains can never match the level of benefits offered by long terms capital gains.
Hence, the mantra offered by Bhagwad Gita is to invest keeping in sight the longer term goals so that you life becomes more prosperous and joyful.
Long term capital gains:
Short term capital gains: