Tag: Beginner Level

5 reasons why Financial Life begins at 30 – A wake-up call for all YOUNG investors

Posted on by Nandish Desai

This article is to be seen as Financial life –  wake-up call. (Read it and share it with those whom you think needs a wake-up call)

When you are in your 20’s the areas that rules your mind are getting a good placement, partying, buying gadgets, finding right life partner or it can be setting-up your own business. There is very little space for money management (This is true for majority of people, there are always some exceptions).

I can say this because in my early 20’s, personal finance was an alien to me. In a way I was not ready to play role of an investor. I was totally casual and irresponsible with the money I had.

Financial life - wake-up call

Now, when you step into your 30’s the entire scene changes. Some kind of short circuit happens in your head and you suddenly become serious about your hard earned MONEY. You start to gather personal finance knowledge from different sources, look for information, advice on internet and you start to read about personal finance (even if you struggle to understand it)

The Student in YOU is STILL alive

When you were a student I am sure you never started studying on the very first day of your college. Like majority of students you would have waited for the exam dates to get announced and when the exams get extremely close you would have purchased or opened your books (got notes photo copied) and started to prepare for your exams.

The last 7-10 days were the most crucial days for you. In such situation passing or scoring good marks turns into a mission.

Now, this is exactly what most people are still doing in their financial life; they are waiting for the last moment to arrive. They are waiting for the right amount of pressure to get build.

In your 20’s the pressure is least, in your 30’s it starts to build and in your 40’s or 50’s it turns into a do or die situation. Most of you don’t start your investments with the first salary you receive and so I made the statement that the student in you is still alive (If you are an exception I congratulate you)

Top 5 Moments of Transformation that makes you serious about your hard earned money

1. When you experience Ants in Your Pants

In your 30’s when you get face to0 face with your net worth the question that hits your mind is, where did it all go?

You realize that you have been slogging 13 hours a day from last 7-10 years and your net worth is not satisfactory at all. This moment is extremely confronting and it makes you feel uncomfortable but at the same time this is the moment of transformation.

In such moment you become serious about your financial resources and your financial life. Some people start to write budget, some hire a financial planner and some write their situation to bloggers like Nandish and Manish. (Every day we get one such mail from some or the other investor and we start our rescue operation)

Hello Manish,

To start with I am one among very few people who practically is broke I must say.  I took things for granted as most of us do and realized what deep shit I have got into. I am 31 years and believe me I don’t have savings worth my age as well.

Your blog woke me up from that undisturbed sleep that made me feel everything is okay.  Swear to God it is not. Considering the things I have been to in the past. Lived the American way like there is no Tomorrow. Paid the biggest price ever Sir.

Not anymore, after reading you first book on personal finance I made a promise to myself that enough is enough. Not anymore and made couple of promises to myself that I am sure will keep.

Also would like to use your paid services sir, I never found a number that I can call on on the blog sir. Please provide with a number or advice how to start with considering I am in deep mess, I guess I need to recover all those years I’ve spent without savings.

Lost those early years sir and planning to recover them somehow.

Regards,

Stuck investor

Get this clear, it is not about this investor/person because many of you are sailing in the same boat in the area of personal finance

2. When Goals starts to Appear Scary

Most of the investors become serious about their finances when they do some calculations around their goals. Goals like buying house, children education, children marriage and retirement are considered to be the scariest amongst all other financial goals.

getting serious about money

If you want you can test it, do some calculations and then look at your current savings and bank balance. The thought that will strike your mind will be “It’s high time I start doing something about my finances”. This particular moment is again moment of transformation.

In this very moment you start to become serious about wealth creation and you start taking actions in your financial life. By the way in reality no financial goal is scary, if you mismanage money the goals starts to appear scary. (You are one who makes them scary)

3. When you Experience Personal Earth Quake

Imagine a strange situation in which you experience personal earth quake right under your chair (Others are fine only your chair is shaking). We can say this from our experience of working and interacting with investors that such situations make’s a person serious about their financial future.

In your world you think you have made all the right investment choices but on one fine day you land on a blog like jagoinvestor and you discover that you have made all wrong choices and you are a victim of mis selling.

This personal earth quake moment shakes you, wakes you and in a way shatters your financial world. In this very moment you start doing required home work in your financial life, before putting blind signatures you will take out time to read the brochures of different financial products. From this very day you stop trusting all the uncles and relatives who supplied you free dose of advice.

4. Real life experiences causes transformation

Reality is the best teacher you will ever encounter in your life. We have come across numerous cases which brought drastic change into people’s overall attitude towards money management. One of our clients lost his elder brother at a very young age and this event made him very serious about life protection and how important it is to keep things organized.

A lot of people after one of their family member gets hospitalized they become serious about health cover. My invitation is do not wait to take actions in your financial life. You don’t have to wait for some accident to take place before you start wearing helmet.

Look around you and learn from some real life experiences as they are of the biggest source of transformation you will ever find.

5. Breakdown in Career

It is said that “Man proposes and god disposes”. In my book “11 principles to achieve financial freedom” we have a chapter called “Your plan vs. God’s plan for you”. It is a fun and insightful chapter that helps you to think beyond making plans in your mind.

We have coached many investors who had some kind of career breakdown and we could see how it made them extremely serious about their finances. Somewhere you start to value money most in your bad times.

Most of people in their 30’s take major career decisions, they are clear that their idea is going to get them all the success that they are looking for. I am not saying doing business is risky or one should not experiment. All I am saying is such situation leads to personal transformation into an investor’s financial journey.

Some final wake-up words to engage with

Do not wait for a kick on your ass or for some unpleasant situation to occur before you get serious about money management. We wrote this article because majority of our clients for financial planning and financial coaching are in their 30’s. Something happens when you step into your 30’s and you need to acknowledge the moment or event that got you serious as an investor.

Whatever is your age right now just start taking actions in your financial life. Also, in the comments section share the moment that made you serious as an investor and what would you say to those who are yet not serious when it comes to money management?

This article is contributed by Nandish Desai. Let us know your thoughts about this article.

How can you add an “extra” Godrej lock in your bank locker and make it 10 times more secure?

Posted on by Jagoinvestor

Today you are going to learn how you can add an “extra” 3rd lock in your bank locker and make it really more secure compared to what it is now at this moment. This information is really hidden one and almost no one is aware about this really interesting and useful thing.

I would like to thank Jay Sheth, a reader of this blog to share this information with me in one of his comments. Let’s acknowledge him fully for his openness for sharing this amazing information with all of us and appreciate him to take out time to send me all the pictures and information which you are going to read below. The author of this article is Jay Sheth, so from now on the article language will be as if he is sharing his experience.

Why there is 3rd Key Hole in the bank locker ?

One day when I was operating my Bank locker I realized that there is a third hole in the bank locker apart from the two key holes where I and the bank person put our respective keys to open the locker. This made me wonder as to why it has a third key hole when it’s not being used?

third hole in bank locker

With these thoughts, I further researched on this. There is hardly any information on the internet. I met several authorities, contacted Godrej (who are manufacturing locker cabinets) and found something very useful. There is something called as “Renter’s Personal Lock” which is available directly from Godrej, and we could fit it ourselves easily with just a screw driver.

So if you open your bank locker, and see the exact back side of this 3rd keyhole, you will see that there is a specific fixed place along with already drilled screw holes , where this “Renters Personal lock” from Godrej can be installed. Let me show you how the back side looks like

backside of bank locker

How to Install this lock in Bank Locker ?

There two ways you can install this extra lock in your bank locker.

Method #1 – Install it yourself – This method is recommended, to install the lock yourself. It is very straight forward. When you buy this Lock from Godrej, It comes into a sealed pack, with the lock, one single key, and 2 screws. All you need is a screw driver at your end to install this. Visit your bank locker, once the bank person opens the locker for you, and leaves from there, you can then close the door first (so that no one disturbs you). And then you can put the lock in the bank of the locker and install it with screws there.

Here are the easy steps to put up the lock yourself:

  1. Insert the key in the “extra” (bottom left) keyhole.
  2. From the back side of the door, place the new lock in such a way that the key inserted above gets in its keyhole. This will give you the correct positioning quickly.
  3. Tighten the two given screws with a screw driver (top left and bottom right side respectively).

Let me show you a sample picture of how it has to be installed, it will give you a fair idea.

–

install godrej lock into bank locker

Here is an important point if you are installing it on your own. Just get your locker opened and wait for the officer to walk out. Then install it at your pace and leisure. Next time when you want to open it, you will have to put both keys (the key cannot be taken out while the lock is open, which is for our safety only. But the officers will know). But that’s perfectly fine, as it is absolutely legal and allowed – just that many officers do not know the rules, so to avoid arguments with them just put it up silently for the first time. Read this incident where one guy struggled to get back his locker content back after it was closed by bank.

Method #2 – Installation by Godrej – Contact the Godrej Dealer in your city and they will send a person who will take around Rs. 250-300 as installation charges and will do it for you. This is a simple way, but cost a bit to you. There could be the following issues in this approach:

a)  You might not be able to find the right person in your city, as this whole thing is not well known and even some Godrej guys are not aware about it. Manish called a guy in Pune who said that you can get this done in Pune. You might want to search a bit in your own city.

b) For confidentiality reasons, you might not want them to know the bank, location and locker number of the locker in which you intend to put this lock. Naturally, all of this is compromised if they install it for you.

c) You might have a hard time convincing the bank officials that this is indeed a person from Godrej, as many banks are pretty strict about only allowing the actual renters to enter the locker room.

Once you are done installing the extra lock, from there on, your locker will open only when all the 3 keys are applied, where those 3 keys are

  • Your Main Locker Key
  • Bank Locker Key
  • Your EXTRA Godrej Locker Key

Here is how it looks from the front when you have installed the extra lock.

bank locker front with godrej lock

Should I really add this “extra lock” to my locker ?

Bank lockers are very safe compared to your home locks. But then it is only comparatively safe. You must have read about a lot of incidents where there were robberies in bank and lockers were looted, you might also have read about stories of how someone’s locker belongings were missing when they checked it after many years. There is always this thought which crosses one’s mind that what if there is some security loophole, or if someone misuses your bank locker main key, what if it’s lost and goes into a wrong hand? In that case, if you are too concerned about your bank locker and want to add a 3rd layer of security (which is just one time work and costs a bit) , then you can install this 3rd lock.

There have been incidents where bank lockers have been compromised and looted . So now its your choice, if you want to add this extra lock in your bank lockers or not.

How to Buy the Personal Renter’s Lock ?

Now let’s come to the main topic of from where you can buy this extra lock called “Renters Personal Lock”. You will get this only and only from Godrej company. You can contact a Godrej dealer in your city and ask him about this lock. It costs approximately Rs. 800-1000. If you are interested in getting it installed by the Godrej person, then you should ask about this from the same dealer itself.

renters personal lock from godrej

You can buy the lock and get it via Courier

You might face some issue finding it, but don’t worry. Keep trying to find it from many vendors, try to search Godrej dealers from justdial or internet and will surely be successful.

If you are in Pune – then you can buy it from this place mentioned below.

Godrej & Boyce Manufacturing Co Ltd

4, Shop 517,Dyananda Society,

Dyananda Society Sadashiv Peth,

Pune, Maharashtra ( West ) – 411030

Phone – 020-24471453

Price mentioned by them over phone to us – Rs 880

If you are outside Pune, you can still buy it and get it delivered via courier

Manish called them and confirmed that they will be able to deliver the lock via courier to all over India, however the courier charges will apply apart from the lock price of Rs 880.

Just call 020-24471453 and the contact person is Mr. Gafur Shaikh . Hope you get it 🙂

(Please understand that we are just connecting you to them, and nothing else. If you face any issues with them, it will be between you and them, dont blame us for that)

Let us know if you are going to install this extra lock in your locker or not. Also tell us what you feel about this information.

Finally thanks Jay for sharing this useful information with all of us.

Last Bootcamp Batch of this season from 19th May (Free Wealthclub membership worth Rs 4,999)

Posted on by Jagoinvestor

It is said that all the good things come to an end; with this article we are announcing the last batch of our online Boot camp. Initially we planned to conduct such boot camps on regular basis but looking at our current schedule and projects on hand we won’t be able to conduct boot camps on regular basis.( It is not like we will never do them but yes it will take some time for them to re-start)

bootcamp environment

Last batch comes with a SPECIAL GIFT

Here is your LAST Chance to be a part of our BOOT CAMP

Kindly see this blog post as personal invitation from our team to participate in our upcoming boot camp. If you are someone who wants to be a part of committed investors mastermind group, you will create a lot of value for yourself. You will get a chance to work on your financial life and will be able to gain valuable insights.

If we (I and Manish) had to choose between financial planning and boot camp we would opt for boot camp because here you get a chance to learn from other investors, here you learn to get on driver’s seat and because boot camp is all about TAKING ACTION and moving forward.

Some of the highlights of Bootcamp

  • Bootcamp happens online on facebook group (closed)
  • Bootcamp is flexible in timings, so there is no fixed timings when you have to be available
  • Bootcamp is a group program which helps everyone to learn from group and move ahead each week collectively
  • Bootcamp is 6 weeks program
  • Every week bootcamp focuses on one area of your financial life
  • Bootcamp is an action oriented program, not knowledge oriented

The BIG Debate – One should Lend money to relatives and friends or NOT?

Posted on by Nandish Desai

In past have you ever extended any kind of financial support to some friend or relative and now you are unable to recover the money that you gave? You may have tried hard to get your money back but instead of money you only receive (false/genuine) promises in return. Imagine of a situation where your close relative or friend is in real need of money, they place you in a position where you just can’t say NO to them. And out of your goodness you end up lending money to that person.

lending money to friends and relatives

The important questions that one needs to ponder are; you should lend money to friends and relatives or NOT? What to do when people don’t return money on time? What to do when the situation is highly emotional and it is hard to say NO? One should get totally practical or not? Do you earn to help others or you earn for your own financial well-being? What if some people want to take undue advantage of your strong financial position and they act needy all the time?

I want to share what we posted inside our boot camp 6th Batch

Wednesday Brainstorming Question

How many of you have given money to some friend or relative and you are now afraid to ask for your own money? – Let’s brainstorm on what really STOPS people in asking for their own money also let’s discuss how one can initiate such recovery conversation. Giving money is one part of the story what about the other part which is about recovering your money (With or without interest)

To create wealth one has to be a good receiver and not just a good GIVER. If you are only good at GIVING it just does not work. We want you to call-up your friend or relative and initiate money recovery conversation, here in such issues it is NOT about money, it is always about your relationship with money.

We would also love to hear experiences from those who are willing to ask for their own money. (We want this group to recover all such blocked money)

PS: In case you have taken money from someone we invite to have conversation about returning that money. Don’t wait for other person to come and ask. This is how you master your relationship with money and people.

Amazing Reply by Arnab Mitra

We received some amazing sharing and experiences from all our participants. All the experiences shared were amazing but a few points raised by Arnab Mitra (who is also the co-author today with us on this article). He encouraged us to write this article.

Here is the reply by Arnab

Under certain circumstances and situational basis, people lend money to relatives, friends, sometimes to the circle of your labors. Earlier I saw my parent’s situation of how they struggled to reclaim loaned money from their blood relations ( YES indeed ..) . And now, I am no exception either. I have already lent a relative and a servant significant amount of money. I understood their requirements, and as I mentioned – situational bias obliged me to lend. However, the position/response of reclaiming the amount back is not satisfactory. I am able to recover recurring partial payment from 2nd person ( who is not a relative ) from his monthly wages , but recovering the significant amount of money loaned to my relative is quite away.

Several phone calls/reminders didn’t seem to work. Interestingly, the relationship is so close that I didn’t think about to inform my family. But, few months ago, as I was indeed worried whether I would get my money back, I had to inform my close ones. It was very very embarrassing situation for me as well as for my close ones to discuss on lending. I have received a part payment but – certainly there is imbalance in that relationship. There are few more such instances I have mentioned below.

My leanings from the above

1. Forget about relationship (obviously if it’s within your own family) when money comes in between you and distant relatives. Controlling emotional thrust is what I have learnt can zip your wallet.

2. It is all about your hard earned money – it’s not for donation.

3. How small the amount is – if you loan to someone – go chase it. Let me share similar fact – I gave Rs. 500 to worker, who runs a tiny store next to our apartment complex to iron people’ apparels. I made sure I recovered that through enough number of apparels without paying to recover the amount. May be people think – what the hack – just for Rs. 500 – but that is what circumstances taught me.

4. Another one – I loaned Rs. 3K to a known person as he is about to setup a homeopathy dispensary. That guys requested amount from all of the families in our apartment complex. What we did, we kept a diary of record of money loaned by each lender and got it signed by us and that person. We will recover a monthly amount from him once, the dispensary is fully functional.

5. The above steps seem to show selfishness, but those have changed my behavior of lending money ( even though if its Rs. 100 ) , and to become selfish.

Let me also share the exact snapshot from our bootcamp page, so that you get the feel !

arnab mitra reply on bootcamp on lending

7 dimensions to keep in mind while lending money

1. Give space to NO

There are so many people who end up lending money just because they are not able to say NO. How will it look? Is the question that clouds their head and they are not able to say no in that crucial moment. Now, we also have category of people who very well know that they should learn to say NO but still they end up saying yes. Your “yes” turns expensive when you are hold a NO in your mind.

I was once participating in a seminar where I was taught that 99% of people are victim of ‘looking good factor’, when in front of people they either try to look good or they are busy trying to avoid looking bad. In some situation saying NO serves you better and so learn to say NO when you are not in a mood of lending money to someone.

2. Create Clear agreement

While lending money people are aligned with each other but what about agreement. Alignment is internal chemistry between two people whereas agreement is something which happens in the external world. When it comes to lending money along with good alignment one needs to create clear agreement with each other. Creating clear agreement is about agreeing to something which leads to mutual understanding of things.

Here is how you create an agreement – “I am giving you x amount for x purpose and you agree to return full amount with/without interest by so and so date”. When you create clear agreement there is very little space for expectations to breed. People who fail at creating clear agreement while lending money always get disappointed by expectations that they set for the other person.

3. First check your Capacity to lend

You may have money to give someone but do you have the capacity? Once your basics are in place and after making all the investments for your goals if you are left with surplus money, it shows you have extra capacity to lend. A lot of people miss out on this point, their decisions are driven by their emotions and they do not take decision to lend money based on their capacity. One should lend only when one has the capacity to lend and not otherwise because such casual lending will have direct negative impact on your financial life and future.

4. Prepare a legal document or take something in writing

This point according to me is the most important point to consider while lending money to someone. Adding the legal dimension sometimes checks the genuineness of the person who is asking for financial help. If the person is clear he is going to return the money he/she wont hesitate for such legal documentation. Also in many cases it has happened that instead of returning money, the borrower claims money from the family of lender. (In case of sudden death of lender). Such confusions and complexities can be avoided with the help of legal documentation or by taking things in writing.

5. Mechanism of Reminders

Most people fail to set-up mechanism of reminders. While lending money both the lender and borrower can decide upon weekly, monthly or bimonthly reminders. You can set auto reminders on your google calendar or by email,sms or by calling each other at regular intervals. It is important to stay in communication because once the channel of communication breaks it becomes difficult to recover your money after some time.

6. Habitual Behavior

If more than 3 to 5 people have not returned your money so far it means you haven’t yet got in touch with your habitual behavior. May be you give money and then wait for the other person to return money on its own. Lending money is not bad but such habitual behavior can keep you away from your own money. A lot of people stop lending money after one or two bad experiences because they feel they are now wounded. Instead of stopping to help people financially why not examine your habitual behavior that prevails in your relationship with money.

7. Check what’s behind the curtain

A friend of mine approached me once for money. I asked him why he wants money and he said, “I want to pay salary to my employees and so I am in need of money”. I immediately told him money is not your problem, poor cash-flow management is your real problem and so let’s fix that so that you never find yourself in such situation. People who borrow money always see money as ultimate solution to their problem, but as a lender you have to check what’s hiding behind the curtain. I personally feel that providing such powerful guidance is much more powerful than just lending money.

Conclusion – Pick phone and get clarity

If you have given money to someone we invite you to initiate fresh set of conversation with that person and share your experience with us on the blog. Also, if you are someone who needs to return money to someone, pick up the phone and bring clarity with that person. We have used the word debate in the title because to lend or not to lend is a personal choice. Lending is not bad; asking for your own money is not pressurizing. The intention behind this article is to make you aware before you lend money to someone so that you do not become victim lender.

Work on your financial life with our Online Facebook Bootcamp Support

Lastly, our 7th Batch of boot camp is starting from 19th of May, if you want to learn from other committed group of investors and want to jump start your new journey as an investor, don’t miss to participate in our upcoming boot camp. (We want to sell this program to every investor on this planet)

This article is written by Nandish Desai along with Arnab Mitra. The Co-author of this article is Arnab Mitra who is based out of Kolkata; he works as IT Technology Consultant at Cognizant Technology Solutions Ltd (CTS).

Please share your inputs and your experiences about lending to friends and relatives in comments section please.

7 Special Things YOU can do for your Parents – along with Buying Health Insurance

Posted on by Nandish Desai

Today’s article is not about which health insurance you should buy for your parents or how much health cover you should buy, the intention of this article is to help you to do something special for your parents health than just buying health cover for them. This is something that no insurance company or website ever taught you or told you about.

Health Insurance is Important, but … 

Health cover for parents is important – but a lot of people miss out on something very important, which I am going to address in today’s article. After your parents reach a particular age, do they really need health cover or is it something else? Do they need your money for paying premiums or is it something else? If you buy health cover for your parents – Is the job done or something more needs to be done?

I was thinking about these questions and they really made me think hard. I and Manish invite each one of you to add this new dimension to your financial life.

7 Special Things you can do for your parents apart from buying health cover

In my view buying health cover for your parents is just 30% job done. The rest 70% is where you can do something special for your parent’s health and we want all our readers to focus on that 70%. Now lets see each of those 7 points below.

1. First Give Them Total Assurance

assurance to old parents

Your parents need assurance (some kind of confidence) from YOU and nothing else. And so go and have conversation with them that makes them feel confident. Tell them, with or without health insurance – you will take care of them. Make a promise that you will provide them with the best medical facilities no matter what, if required put 2-5 lakh aside and dedicate the corpus/fund for your parents health.

This will build your parents confidence and may be this assurance and confidence will add a few years to their life. Assurance is one of the best gifts you can give to your parents. They got to see, experience and feel your rock solid stand that you hold for their well being.

2. Having Loving Conversation

loving conversations with parents

Parents want one simple thing from you and that is LOVE. Love is the best policy you can cover your parent’s whole life with. I invite you to block some uninterrupted time for your parents every day or every week. Loving conversation will act like therapy to your parents. We all reach at a point in life where money and financial products takes a back seat and all you want to receive is love and nothing else.

I know life is hectic and we are loaded with different kinds of responsibilities and it is difficult to take out time, but see that you do something in this area and have loving conversation with your parents. It can be a small thing like calling them from your office and asking them if everything is fine or not? Caring is 1000 times more powerful than any health cover or policy.

3. Help your parents to connect with their friends

connect parents with old friends

This is one of the most special things you can do for your parents. Do something so that they stay connected with their friends or with people they love to spend time with. When they are surrounded by their friends it means they are surrounded by energy and enthusiasm. Friends are the best support structure for your parents. It helps them to keep their old days and memories alive.

Make list of people your parents would love to meet but they have not been able to see or meet them from a long time. And arrange a meeting for them. Old friends do one thing very nicely and that is they will bring a smile on your parents face.

4. Go on a walk with them

going on walk with parents

How many of you go on walk with your parents or grandparents regularly? It is important to understand your parent’s inner world. What are they thinking, what are their concerns and worries or what is it that they want to share but are afraid to share. When you go on a walk with them you get a chance to understand their world better. You get a chance to be with them fully and you are able to understand them.

Giving such quite time to your parents is worth millions. Your parent’s health will start improving with this simple step of yours. After all health is a conversation that one indulges into and you have to empower them with respect to their health.

5. Help them engage with some light physical activity

old parents exercising

My parents go for evening walk every single day. They go to a nearby club for their evening walk and they have been doing this from last many years now. Evening walk has become like a ritual to them. I think any kind of such light physical activity is extremely important. It can be going for walk, or doing light yoga or some simple kind of simple activity.

Help your parents in this area if they are currently not engaged with any kind of physical activity. Body, mind and spirit is all connected and for sound health of your parents see that some light physical activity is part of their routine.

6. Keep a Check on their diet

keep check on parents diet

It is our responsibility to take care of our parent’s diet. Sometimes our parents are not very particular about their diet or about their food intake. For 3-4 days observe your parents diet, are they drinking enough glasses of water or not? Are they having raw vegetables and fruits in their diet or not? If possible get a dietitian to design their diet plan and help them to stick to their diet plan.

7. Yearly full body check-up

full body checkup senior citizens india

This is extremely important task. If possible place this task on your calendar. After crossing 50 ask your parents to undergo full body check-up every year. One of my close friends mother is detected with last stage cancer which is now hard to cure. Body is the most complicated vehicle god has ever created and such regular check-ups are a must to keep this vehicle running.

Sharing from my life, my father gets his yearly check-ups done but my mother is scared of going through such check-ups. After writing this article I am going to enroll my mother for the same.

Some Final Words

It’s high time you think beyond parents health insurance cover and do something special for your parents. It’s not like you have not been taking care of your parents health, I am sure you must be doing your level best in this area. Your time, care and respect are three greatest gifts you can give to your parents. Your parents need YOU more than health cover and always keep that in mind.

Please note that we are not stopping you from buying health insurance for your parents (It can be of great support to you financially). The words put into this article are not new, but still a lot of people are not able to think beyond buying health cover for parents and think that once they buy it, their job is 100% done.

Do share with us in this week or month what special you are going to do for your parent’s well being or health?. Also do share your thoughts with us on this and please share this article with all your loved ones.

This article is written by Nandish Desai

New Fraud by Agents – Changing Policy tenures from “Single Premium” to “Yearly”

Posted on by Jagoinvestor

Today, I wish to highlight a fraud, which has been going on for many years, but one that has not received enough attention. While the fraud itself is small and easy to conduct, its impact on investor wealth is significant.

What is exactly is the Fraud ?

Many investors, who wish to deposit money in some financial product as a ONE-TIME payment, opt for a ‘Single Premium’ policy. Here they are required to just pay the premium fee once, and the policy carries on for many years after that.

The mistake some investors make, is that they convey these instructions verbally to their agent and do not fill up the form themselves. Neither they do verify the tenure filled by the agent. Now what many unscrupulous agents do, is that instead of ‘Single Premium’, they specify ‘Regular Premium (or yearly) as the payment scheme – leading to a situation where the investor has to pay the same premium amount every year for many years thereafter.

beware of agents filling up form

What are the possible problems which happens ?

  • The premium amount is quite substantial at times. People can’t afford that sum each year and subsequently have to discontinue the policy
  • Investors remain unaware about the tenure of the policy and stay under the assumption that they do not have to pay any more money. However, the policy lapses after a year due to non-payment (If the investor does not have an email id, they do not even get premium reminder emails)
  • Even if investors come to know about the changed tenure, they need to run around from pillar to post just to cancel the policy – suffering the consequences of a problem which should never have been theirs to begin with
  • This whole experience shatters their faith in agents/ companies and leads them to avoid other agents in the future, even good ones.
  • There is a massive emotional impact as investors see this as a breach of trust and at times they lose their hard earned money – funds which thy might have set aside for some dream project!

3 real life examples of how investors were cheated by agents by changing the Tenure

There are several readers on this blog, who shared their real life experience in the comments section on how they were cheated and lost their money and peace of mind. I just want to make you aware of these experiences. Read on below.

Example #1 – How Mr. Syed Jibran cheated by people at HDFC Bank

Through the HDFC bank, I told the concern person to deduct the amount of Rs 200000/= from my saving account and consider as the single premum only, as i cant pay the amount of rs 200000/= every year. But later I come to know that they have consider my premium as the regular premium. Next day I sent the mail to head office, not to process my application and refund the same amount in my saving account.

I got the call from head office, that they cannot process to cancel my application, as they required in written cancellation letter . I agreed with team, but this is not at all my fault. Yesterday, I got a mail mentioning that there are free-look charges. This mail shocked me – even your agent cheats me, but you charges me. I send you many mails not to proceed my case and refund the same amount in my account. you can check that????????????????

Example #2 – How Naresh policies were Lapsed because he was cheated

One of my relative taken policy from Religare insurance broking ltd before 5-6 years ago with kotak-3 lacks, birla-8 & 5 Lacks as one time premium, now they are saying that the policy was regular premium plans and that is lapsed. sir now my relative want his money back.what should he do now.pls help.

Example #3 – How Reliance Life Insurance agents cheated Mr Ashok

We discussed with Reliance Life Insurance , Senior Sales Manager Mr Amit Khandelwal that we need single premium policy , he has taken our signature on application form and advised us not to fill the forms saying that “ form is complicated and likely to be filled wrongly by you consequently form will be rejected , better I will fill up the forms , as discussed , we are doing day in out this. “

Later on , he filled up the forms in his own handwriting, he has given his own home address and the worst thing he did he has filled up regular premium payment of 5,00,00/- for 5 years despite that we decided for single premium.

Return of policies was not possible for us as we have received policies very late , much beyond 15 days free look period , as policies were dispatched to Sr Sales Mgr address.

Even after this Reliance letter , I was keep on getting phones from local Indore office that we are discussing your case with our HO Mumbai , but off-late nothing has happened as yet. It is a clear case of mis-selling , breach of trust, fraud and forgery by Reliance Life Insurance. Reliance Life has terminated policies and Fund value is 50%.

Why is this fraud done by Agents ?

Frankly, it’s just because they earn higher commissions through this ploy. Agents earn meager commissions on “single premium” policies, but on yearly premiums they stand to reap much higher rewards.

single vs yearly premium difference

For example – For pension plans, the single premium commission is capped at 2% (that too one time only), however if it is a regular premium, the commission would be 7.5% for first year premium and 2% in subsequent years. Which means that if a person buys a pension plan with Rs 1 lac premium, for a Single premium policy, the agent will get 2,000 rupees, whereas if he cheats the customer and puts “regular” as the premium tenure, then he will get 7,500 rupees in first year and 2,000 in next year premium (provided it is paid by the investor).

Also on various other life insurance policies like endowment and moneyback plans, the first year premium is as high as 35-40%. So why would an agent settle for just 2% premium as commission, when he can take 20-40% of the premium (which is 10-20 times original commission)

How to save yourself from this fraud?

Here are some simple common sense tips which will work

  • Never ever let the agent fill up the form; you should always fill up the form yourself.
  • If you can’t fill the form for some reason, let the agent fill it in front of you, and once he is done, review each point filled by him. Take photocopies of the filled form for your reference
  • If you still sense that the agent is being dishonest, return the policy in the free-look up period which is generally 15 days from the date when you receive the policy in your hand
  • Email the management and customer care and tell them you will be complaining to banking ombudsman and grievance cell about this and also file a police complaint on fraud.

I invite suggestions from our readers on what solutions are possible if someone becomes a victim of such a fraud?

New LIC Term Insurance relaunched with low premiums

Posted on by Jagoinvestor

This is a bit old news now – but a lot of you might not know that LIC has relaunched their Term plans (offline) few weeks back. LIC has two term plan policies now called Anmol Jeevan II (below 25 lacs sum assured) and Amulya Jeevan II (Above 25 lacs sum assured) , and now both of these are relaunched (earlier one was Jeevan Anmol I and Amulya Jeevan I) to make sure that they comply with new IRDA regulations which came some months back.

LIC new Jeevan Amulya Term Plan

The main change in the new term plan and the old term plan is – that SINGLE premium option has been removed from these term insurance policies and the premiums have dropped due to change in mortality rates, which was due from long time for LIC to adopt (that was the main reason why LIC term plan premiums were very high compared to other companies)

Lower Premiums for New LIC Term plans

For the simplicity purpose, in this post we will just talk about LIC Jeevan Amulya (Sum Assured above 25 lacs) and not LIC Anmol Jeevan.

So now the premium is lower.  Consider an example where a 30 yr old person wants to buy a 25 yr policy . In this case the old LIC Amulya Jeevan premium was Rs 292 for every Rs 1 lac sum assured, however in the new Amulya Jeevan , its only Rs 196 , which is a reduction of approximate 33% .

Now with this new rates – if a person wants to buy Rs 1 crore term plan with LIC – then it can be bought at only Rs 19,600 , compared to Rs 29,200 earlier !

New LIC Term Plan premiums

Is LIC Term plan premium lower than other companies? 

No , LIC Term plan is still one of the highest even after reduction in its premium rates, but if someone is hell bound on buying a term plan from LIC only, then its a great news for them. If you consider other private companies – then the premiums are much lower for other companies like Bharti Axa, Aviva or HDFC Click2Protect . For example – A policy of 1 crore sum assured (25 yrs tenure) , most of the other companies will charge below Rs 10,000 per year, however in case of LIC its Rs 19,600 which is almost double .

Already bought old term plan from LIC long back , Will your future premiums be lower?

I dont think so, if you already have bought LIC Amulya Jeevan Term plan some time back, you will be paying higher premium which was decided at the time of buying and you will continue paying that only. So now its your choice if you want to re-purchase a new term plan or not, But better check the premiums difference in case you plan to repurchase it now , because if you re-purchase it now, your current age will be considered and it might happen that the premium difference is not much for you.

So now – if you still have not bought a term plan , and if you are only interest in LIC term plan, then its a good time to buy the term plan from LIC – go ahead !

How you are cheated at Petrol Pump and lose money on every visit ?

Posted on by Jagoinvestor

Today I am going to explain a trick employed by Petrol Pump guys which might be costing you a lot of money on a per year basis. You might be loosing a couple of thousands each year because of this scam which probably goes on at each petrol pump.

Petrol Pump Scam in India

How Fraud at Petrol Pump Works!

When you ask them to fill petrol for Rs 1,000 , the attendant fills up the oil only for Rs 200 . When you ask him why he didnt fill up for Rs 1,000 . He will give a innocent smile and say that he heard Rs 200 and he will fill remaining Rs 800 , he resets the meter and fills up another Rs 800 petrol and you pay Rs 1,000 (200+800).

Whats the scam here ? The problem is that he never resets the meter to 0 , he continues from the Rs 200 point itself and go till Rs 800 , so in reality you only get the petrol worth Rs 800, but pay Rs 1,000 . The trick here is that when he says that he is resetting the meter to 0 and moves towards it, at that some moment, another team mate of attendant will disturb you with some question like – “Sir, Cash or Card?” , or “Sir, PUC karana hai kya?” , Or “Sir can you fill up this coupon ?” .

As a human tendency – you will have to look at him or hear him and in those 3-4 seconds , the main attendent will start the meter again and by the time you look at the meter, its somewhere near 300-400 , and you feel that the meter has restarted starting from 0 , but actually it was just continued from 200 point only. So you loose Rs 200 here.

how petrol pump fraud works in India

I would like to show you some of the real life experiences

Experience 1

Today I went on a 150Km trip to Kanchipuram. Because it was a long trip I decided to check the mileage of my car, so did not fill petrol at a regular pump and waited for the fuel indicator to sync with a marking. I reset the trip meter and filled petrol at the next petrol pump which was an Indian Oil pump in Pallavaram on the left while going towards Tambaram. I told the cashier that I wanted petrol for Rs.500 and took out the money from my purse and handed it to the cashier. When I looked at the guy at the pump, he told me that he had filled the petrol and wanted me to verify.

The meter showed Rs.200, so I told the guy that I asked for Rs.500, but I sensed something wrong. I was sure when he filled the next 300 from the time it took for it that he had not filled anything to start with as he showed me the meter too soon. I wasn’t sure about what to do in that position and left. It was obvious when I checked the mileage that the guy had cheated. I could go for a distance of only 52Kms with that petrol and the mileage for Rs.500 of petrol with that distance is 7.5Kmpl. Whereas if I take it as Rs.300, the mileage is 12.5Kmpl which is within the expected range. Moreover I filled for another Rs.500 at Kancheepuram and the mileage I got is 12.7Kmpl and the fuel indicator is still above the mark. I have been driving since 2001 and this is the first time something like this has happened to me. (Source)

Experience 2

At the first petrol dispensing counter (as you enter the petrol pump), the attendants frequently cheat customers. You ask them to fill, say, Rs.100 worth of petrol. However clearly you say it, one employee will fill only Rs.50 worth of petrol in just about 2 seconds when another employee tries to distract you. Within a blink of an eye, the counter goes from Rs. 0 to Rs.50. When you tell him that you’d asked for Rs.100 worth of petrol, he will apologize saying he didn’t hear it properly, and fill the remaining Rs.50 worth. The second Rs.50 petrol will take about 5-10 seconds to fill. You finally end up paying Rs.100 and getting petrol worth far less than that.

This has happened a few times with me and some friends. The cheating procedure has always been the same although the amounts differ. I know for sure that I’ve been cheated because my bike gives me a mileage of about 50km/litre normally, but when these incidents happen, I get far less mileage than this.. (Source)

How to Complain for this Petrol Pump Fraud?

IF you feel you are cheated, you can complain about this fraud to the petrol pump company like HPCL, BPCL or IOC. You have customer care numbers of these companies and also web portals for registering complaints online explaining them the exact issue (it can be various issues).

HPCL Web Portal – http://retailcms.hpcl.co.in/retailcms/registeruserissue.aspx
HPCL Customer Care Phone – 155233 / 1800 2333 555

BPCL Web Portal – http://ebiz.bpc.co.in/ccs/complaintCreation.faces?form1:sbu=1000
BPCL Customer Care Phone – 155233/ 1800222725

IOC Web Portal/Customer Care – https://www.iocl.com/TollFreeCellNumber.aspx

Some other things you can do other than complaining

  • Also ask for complaint book from the attendant, and put the written complaint in that complaint book. Most of the times they will make an excuse that the complaint book is locked in the room or something like that, tell them you are calling the company customer care and will complain about them
  • Make sure you ask them to meet the outlet manager, ask for their phone numbers if they are not present and try to talk to them, make the scene
  • Make the scene, scream at them and be tough if you are very sure you are duped and lost the money. In front of other customers they are bound to correct their mistake
  • Open you fuel lid, only when the meter is reset to 0 .
  • Get out of your CAR and stand next to the person putting fuel, makes it tougher for them to cheat you

Conclusion

This is happening all over the country of various petrol pump outlets and this can easily be a scam worth thousands of crores rupees, provided there are thousands of petrol pumps in country and millions fill up petrol everyday. The best measure to fight against this is to spread this information to more and more people you know and also be attentive and alert while you are filling up petrol or diesel in your vehicle.

Have you ever come across this fraud has it happened with you ?

6th Batch of Online Investor Bootcamp starts from 7th April – Limited Members

Posted on by Jagoinvestor

A few months back we started something called “Investor’s bootcamp”- which is an online tribe of action oriented investors. Till now more than 250+ people have participated in our investor bootcamp and the results have been amazing so far (People have produced unprecedented results in their financial life). We want every investor on our blog to pass through bootcamp experience at least once in their life time.

Let’s look at why we created Investor Boot camp?

We created boot camp so that investors can work on their financial life in a very simple, fun and effective way. This bootcamp happens over facebook group (closed), and is very flexible to attend and participate. One can participate and take part as per their time and convenience. The intention of boot camp is ACTION. Bootcamp is created to put knowledge into practice; it is created to gain valuable insights in different areas of financial life. It’s where you get a chance to brainstorm with other investors. When you go through the process you will get CONFIDENT as an investor.

We are proud to share with you some power pack sharing from different boot camp participants. While the boot camp was on some of the sharing brought tears to our eyes and they filled our heart with a lot of fulfillment.

Experience of Bootcamp Participants

We are going to share some of the experiences here. Very soon in next few days, we are going to create Action Booklet of boot camp participants, which we will share with you all and it will inspire investor’s community

Guru Prasad

Batch #3

 

Testimonial 8

 

“You gave me a start and have put all the dots.”

Before I joined this bootcamp, I had a question – “Will I get my money’s worth?”

I thought for some time, then got an answer – Whatever happens in this bootcamp, I definitely owe Manish and Nandish the fee for the knowledge I got through jagoinvestor through all those quality articles!!!

Coming to the bootcamp, all I wanted to know was how to deal with money, how to attract more money and to understand about investing money. I should say all the boxes are ticked with satisfaction. The biggest of all is dumping(made paid up) my LIC policies which I had taken 7 years back and had paid close to 3 lacs. I lost huge money, its ok, i will pay the price for my mistake and being horribly ignorant on these issues.

Had some actions taken. I bought one term insurance, will buy one more in April. Almost got a good health cover for mom, will be get getting it next month for dad. Got to know more about financial products. Most important of all, I had been thinking a lot about money and my finance for the last month and a half. It has made quite some difference. The other day, while having a casual chat with my friend who had taken LIC money back policies, I told him to separate risk and investment separately, and these money back products does neither. I advised him to go for term plans. I could see the joy in his face which made me feel I opened his eyes, and he thanked me again and agin for sharing with him. I told him actually its not me, the 2 persons whom he is supposed to thank are namely Manish and Nandish!!!.

Regarding the books, Finished all the 3, “How to be your own financial planner in 10 steps” is the best of all. And Nandish, the line, “You earn exactly what you think you are worth” is still vibrating in me, got the book’s worth in just this one line.

I enjoyed your program. I have lots of pending work though to be completed, you gave me a start and have put all the dots. I need to spend time regularly and start connecting them by taking actions. Thank you.

→ Register for Bootcamp

 

 

Karan Kapasi
Batch #3

 

Testimonial 10

 

“I feel that in the past 6 weeks of the boot camp has made a huge impact to my financial life.”

I started reading the first book by Manish – “16 personal Finance principles every investor should know” and it inspired me a lot. I then started reading a lot of articles in the Jagoinvestor blog and continue to do so- its got so much information on different financial aspects and its through this I came to know about the Boot camp and signed up for the same.

Now coming to the boot camp, the experience has been amazing. I had the opportunity to interact with Manish and Nandish and it has been one fulfilling experience – thanks a lot Manish & Nandish. Apart from this, another good thing about this was l got to hear and learn from other members of the camp as well. I feel that in the past 6 weeks of the boot camp has made a huge impact to my financial life, it made me think and take actions of the different aspects of my financial life which I had not completed before.

I have taken many actions and some of them are pending and am working on completing them soon. The boot camp has brought in a lot of awareness and also taught us in detail about the various aspects of one’s financial life. I am still reading through the books and its been a very good experience as the language and most of the examples are simple and easy to relate to.

Overall this has been one awesome experience, thanks again Manish and Nandish for this. I would also like to thank all the members of this camp as well as I learned from some of their experiences.

When is the BEST time to join boot camp?

We would like to share one Chinese proverb

“The best time to plant a tree was 20 years ago. The second best time is now.”

This is the RIGHT time for you to plunge into personal finance actions. Let bootcamp be the medium for you to take important personal finance actions

The overall structure of Boot camp is amazingly simple and absolutely EFFECTIVE

Bootcamp Structure

Our Invitation to join BOOT CAMP

We strongly recommend each one of you to be a part of upcoming boot camp on 7th April. With this article we take this opportunity to extend our personal invitation to each one of you. We will be in a position to take around 35 people this time and so make sure you book your seat at earliest. The boot camp is going to be a game changer; it’s going to help you dust all your laziness and casual approach in the area of money. (So don’t miss this opportunity)

What exactly is Financial Planning – 8 things we learnt after working with 300+ clients

Posted on by Jagoinvestor

“Financial planning” is the NEW buzz word these days all over the internet, TV channels and newspapers. These days even bank employees are selling a lot of financial products on the name of “Financial Planning” .

Investors are literally bombarded with the word – Financial Planning from various sources like blogs, articles, advisors and every mutual fund and insurance agent, and the flow of information has created some kind of mental image in investor’s mind about – “what is financial planning?”.

what is financial planning

In a typical financial planning exercise, a financial planner goes through your financial data and then draws a written financial plan, which touches upon various area’s of your financial life like life insurance, health insurance, asset allocation, retirement, children goals etc etc.

But in this article we want to add more dimensions to what is financial planning, and want to add a whole new perspective to what is financial planning. The article’s motive is to help you to see financial planning process with new and empowering perspective.

Our view of “Financial Planning”

We feel that at Jagoinvestor – even our own view about the term called “Financial Planning” has changed over a period of time and we would like to share the same with you all today.

We have worked with close to 300+ clients till date and today we want to share our learning and insights which we have drawn from our experience in so many years. With every passing day we are evolving inside our profession and we also want our readers to grow with us.

What Investors and Financial Advisors think about “Financial Planning”

We want to know what do investors and various financial advisors connected to us on social media think about “Financial Planning” , We wanted to know from them what is their view about “What is Financial Planning?”.

So we asked them on facebook here and here. We got lots of answers and we are sharing some of them with you below. There is no wrong or right definition here, so we just collected few answers from investors and financial planners and we want to show you what they think about it.

financial planning meaning

8 insights about Financial Planning

Now We will share with you 8 insights about how to perceive financial planning in a new way. We feel a big number of investors and financial advisors have a very narrow view about “financial planning” and its potential.

We simply want you to see Financial Planning tool with fresh pair of eyes. May be it’s time to question our perception about what financial planning is all about. Here are those 8 insights below.

1. It is not about securing future, it is designing your present

A lot of investors and advisors think that financial planning is about future, in our view it is not about future. Financial Planning is an exercise that helps you to design your present as an investor. Future is an illusion and it just does not exist in reality.

You have to use financial plan as a tool to make each day/week/month and year your best financial year. A lot of investors think with the help of financial plan I am going to secure my future, but in reality it is about learning to play fully in this very moment.

Let me share an example with you – All the investors who drop a financial planning inquiry on our services page – we usually ask them why they want to go for financial planning and what financial planning means to them ? And the most common answer we here is, “I want to do financial planning, so that I can secure my long term financial goals like children goals, retirement etc.”

They think financial planning can help them to be more secured. We ask them to stop over focusing about future and look at what best they can do right now with their financial resources.

2. Financial Plan is not about “Financial Goals”, it is about Financial commitment

A lot of people think financial planning is only and only about financial goals. May be financial goal is one small part of the whole financial planning exercise, but surely its not only about financial goals.

In our view it is about strongly announcing your financial commitment and what you are going to do now on-wards in your financial life and then sticking to your commitment. We encourage all our clients to announce their monthly financial commitments. Setting financial goals is extremely easy, but sticking to your monthly financial commitments is where the rubber meets the road.

Let me share with you something about our clients, what we do with our clients – When we get on call with any investor clients of ours, they bring all their WANTS on table (difference between Needs vs Wants here) . Wants like second home, A lot of clients want to even plan for the kid who is not yet born.

Now, the moment we start the commitment conversation the goal list starts to shrink. Commitment is doing what is required to get what you want and not allowing anything to get in your way.

3. Financial planning is NOT about bringing Certainty

As human beings we are always attracted to Certainty. Most investors want to know whether they will be able to achieve their financial goals or not ? This is the core reason why they hire a financial planner! . In our view the best thing about life is that it is mysterious and uncertain.

If we pull uncertainty out of future then it is no longer the future; It is present – which is projected forward and nothing else.

We want investors to hire a financial planner not only with core focus of bringing certainty, but to building financial muscle, to face every kind of situation that life throws at you, to bring more completeness in various areas of financial life, to get an external opinion about your financial life.

We have seen this happening with many investors – No matter how much they plan, life turns out the way it turns out. Now this does not mean you should not plan, but you should develop your mind that is constantly planning in face of what happens.

Watch this video of Financial Coaching by Jagoinvestor: 

4. It is NOT about financial plan, it is about the Journey

We find so many investors and financial planners – who are totally attached to the document called “Financial Plan”. They pick small small things from the PDF document given to them and over focus on them, it might be some number , some fund name or some assumption taken.

In our view the real results are not inside of a financial plan, they are located outside of a financial plan. We ask our clients to draw key learning’s from the financial plan and then throw away the plan. Every investor is on some journey and it is important to enjoy the journey. If you are not enjoying the wealth creation journey, you will never enjoy the so called destination.

We have seen people who after reaching the age of 55 or 60 years of age, tell us that it is the financial journey that matters at the end and nothing else. When we work with investors we just do one thing, we simply ask them to enjoy the process of wealth creation. This eliminates all the worries from your head and helps you to take proactive actions in your financial life.

5. It is NOT about picking perfect financial products

In our view financial planning is not an exercise to pick right or perfect financial products. A lot of investors spend maximum time in “Which Mutual Fund is Best?” or “Which Health Insurance policy premium is lowest?” and similar points. While that’s important to some  level, but finally wealth creation is all about testing and exploring.

A lot of investors fail to create wealth because they stop testing and exploring. A good financial planner will always encourage their clients when it comes to testing and exploring new things. He/she will educate you in a way, such that you are motivated to test new things in your financial journey.

A good planner will always say “Don’t’ worry I won’t let you fail but I want you to test new things as an investor”

When we work with our clients – we ask them to test new and unknown territories. We once asked one of our client to think about creating an alternate income even though he was working in a software company. We asked him to cross his mental barriers and keep looking at opportunities.

Few months later, In one of the offices, there was a food counter in cafeteria space, which he setup and hired a worker and it was doing well , The question is not what happened later, but the main thing is that he explored some new ways of earning money.

Then there are so many investors who never ever invested in mutual funds thinking it is a risk proposition. We ask them to test this new route and we become their guide. We helped them clear their myths about equity products and once they become comfortable, they started exploring it.

6. Financial plan is not about products, calculations and returns, it is about YOU

The number one expectation an investor holds in his mind is to find a financial advisor who helps him/her to get more returns. “A Financial Plan  is not about products, returns and calculations, it is about YOU” – This line is from my book “11 principles to achieve financial freedom”.

This entire book has no numbers and calculations in it, it teaches an investor to develop right kind of mindset in the area of money. Financial planning is an opportunity to be 100% honest in the area of money so that you can work on your discipline level and can make corrections as an investor.

Let me share an small experience here. I was working with a client who told me – “I have no idea why my financial life is not good”.

I simply asked him to get the truth on table, I asked him to search inside him to get real answer. He finally agreed and owned all his mistakes and took entire responsibility of his financial situation. It was painful for our client, but things started to shift when the truth got on table.

This realization and acceptance gave him a lot of power to change things. It was all about HIM and not about situations and circumstances.

7. Financial planning is NOT about advice, it is about ACTION

The old definition says that financial planning is process where two people connect, number crunching takes place and advice is imparted on what needs to done.

Giving or taking advice is just 20% of the job done, because the rest 80% is all about taking actions. More and more investors will make the most of financial planning tool when they will take actions, because at the end only action produces results and nothing else. As an investor check, how action oriented your advisor is or how action oriented you are as an investor?

A lot of readers write to us and say – “Can you advice me on so and so issue ?” . We say – “NO , We will help you to gain insights along with giving advice so that you are empowered to take actions”

We ask our existing clients to report their weekly personal finance actions to us. This is how things start to shift in their financial world. In our facebook bootcamps, we focus on taking actions for 6 weeks and we have helped more than 250+ investors to make their financial lives awesome till now.

Look at one of the recent bootcamp sharing where, one of our participant “Sachin Gopalkar” is sharing what all actions he did while he was in bootcamp

Jagoinvestor bootcamp sharing

8. Financial plan has to be a LONG document

Who the hell says financial plan has to be a long and lengthy document. You won’t believe, but there are many software’s which financial planners use and all these software’s are in the race of 30-50-100 page financial plans.

Even a lot of financial planners believe that longer the document they give to client, they can showcase the work done by them and all the “analysis” they did. They feel that can justify their “work-hours” put in the financial planning exercise and help them to charge more fees.

But, almost all the investors we have talked to till date are not looking for a lengthy plan; All they want to learn is how to get in control of their financial life. Lengthy documents just confuse the clients. After looking at number of pie charts and heavy graphs and complex calculation tables in the financial plan, investors get more frustrated.

Why not give a financial plan that the investor can own and implement, why not give a one page plan  or may be something which is short and sweet. A short plan, which only has something which really matters to clients and makes it easy for them to understand their own financial lives.

We once gave an option to one of our clients – “Do you want a 15 page financial plan or a 1 page plan?”. He said, “I will be thankful if you can give me a 1 page plan”. And we gave him a one page plan, which was sufficient for him to take important actions in his financial life.

Conclusion

Now, you have a whole new perspective on how to look at financial planning and you also know how not to look at financial planning. Share what is it that stops you from getting a financial plan, what stopped you till date? Is it about your lack of understanding, lack of belief in financial planning or something else?

Do share your views on today’s article, I have not been very active on writing articles but from now on I will see that I share my views from time to time.

– This article is written by Nandish Desai