How I failed into stock trading and 4 amazing things you can learn from my experience

Posted on October 1, 2014August 6, 2019 by Jagoinvestor

Today you are going to learn some valuable lessons of stock market trading from experiences of a person who traded in stock markets for 1.5 yrs and failed miserably during those 1.5 yrs. This person is no one else, but myself

Background

Let me share my story

Sometime in June 2007, I got recruited in Yahoo from campus placements. I was 23 yrs old, fresh into job and had no idea how my life is going to take shape at that time. Suddenly, I saw a huge inflow of money (salary) in my life and I was not very clear what to do with it.

I had some weird notions about “Getting Rich Quick” back then. I was good with numbers, knew about stock markets basics and considered myself to be “analytical”, so I thought I am smart, very disciplined internally and can “possibly” do better than “average” in stock markets (every one thinks like that only).

So I was ready to enter the world of stock markets.

Now, there was one more guy in our new joiners group who was equally enthusiastic about stock market (that guy is now an IAS officer) and just like a smoker finds another smoker in a big group, we found each other and became buddies.

Over the next few weeks we made various plans on how we will get rich trading in markets. We were already millionaires on an excel sheet and we thought even in worst case scenario, we will do well.

So our next step was to open trading and demat accounts.

When God Sent that guy!

Things were all set, we were about to start the race.. and one day one ICICI Direct guy was in office (targeting new set of employees to open trading accounts) and we thought he was god sent ! . We opened our trading + demat accounts in no time.

The Rs.500 annual charges seemed too small to us compared to what we would be minting in coming months. When he said its “FREE” for the first year, we were like – “We won’t mind even if you charge 10X for that in the first year” .

We got to know about “options”

While we were ready to start our journey in stock markets . We got to know that there is something called Options (derivatives) apart from regular stocks. This was something new for us. We googled and searched about options, and we came to know it’s a high risk/return thing. We didn’t focus too much on “high risk” part , the only thing we could read was “high return” part.

So next moment, 20-30 eBooks got downloaded on our laptops and we decided we will learn about it and make sure we don’t leave any stone unturned for make our “millionaire dream” a truth. It was a bit hard for us to delay our “trading” for few weeks 🙁

Learning about options was FUN

Learning about Options trading opened up to a whole new world for us. We learned that options trading is an amazing leverage tool which was very fascinating. I learned about technical analysis also and used all the office bandwidth to download technical analysis eBooks and videos (at one point of time, I had 1000+ eBooks on stock markets and I didn’t read 998.8 eBooks out of it).

For those who want to learn about options in detail, I would recommend an excellent resource on it from Deepak Shenoy of Capitalmind. He did a webinar on the topic and it was recorded and uploaded on youtube. You can see it below

After getting introduced with Options, our greed went to next level and now we became much more rich on excel sheet. Our profit margin went really high (but we didn’t focus too much on risk factor, infact we were not even clear on where we are entering into and how risky it can turn out to be).

So were all set with high energy, but could not take any action because our trading account was still not active that time and we were waiting for it.

Finally we started Trading

So, one day I got a sms – “Your Trading account XXXXXX9484 is Activated – ICICIDirect” . I logged into my account, transferred 10,000 from my ICICI bank account to ICICIDirect account (they were interlinked already) and there was one stock we were following from long time. We bought an OPTION for that stock , I had to pay approx Rs 6,000.

We went for lunch and were back in 3o min
I logged in my trading account and saw the current price of the Option trade
It was Rs 8,500. I SOLD it

I made Rs 2,500 profit , a 24% profit during LUNCHTIME and now we were planning, if we can I leave our jobs ?

I realized years later that one should never make profits in their first trade in stock markets, it fuels the overconfidence in you like anything and gives you a false sense that you are really some smart guy !

Now the Learning Starts

Till now I was giving you the background of what all happened before we started our options trading journey . For next 1.5 yrs, we were very much involved each day into stock markets, made some money, lost a lot more money, got frustrated, some short-lived happy moments came in too and finally one day I put a big break on my options trading.

I learned a lot of lessons in those 1.5 yrs of my journey in stock markets and realized that I can pass on some learning’s to others who are now trying to enter the markets or are fascinated with the potential stock market trading holds .

I am not saying my learning’s are some hidden secrets which are very new, but I can share what all I learned in my style , I am sure it will help someone who wants to learn from my mistakes.

These few points will help you to not make mistakes I did and help you overcome some myths and notions associated with stock market trading . Just a request – Note that these learning have come from my trading in Options (which is derivatives) and not regular stocks, but that does not change the learnings you are going to read below.

Mistake #1 – I focused too much on Knowledge

When I entered into stock markets, I was of the impression that I need to acquire a lot of knowledge on how things work, how various strategies work ? How technical analysis can help in trading ? I learnt all the technical indicators, back tested them on the past data, wrote lot of programming scripts to test my hypothesis.

I even went on to download lots of videos online and watched it over and over for many months and I realized that my knowledge had gone up significantly. I now understood lots of concepts, strategies, complex terms .

I could see a chart and instantly see lots of hidden patterns and could tell more than a normal person who does not know how to read a chart.

But then, over the months, I realized that “knowledge” is just a secondary element to trade successfully in stock markets. Almost all the good traders around the world agree that “knowledge” does not contribute more than 10-15% in being a successful trader. It’s an important thing , but certainty not the holy grail

I am not saying that one should not focus on “knowledge” part, all I am saying is that it’s not that KEY thing to succeed. Over knowledge will only create problems for you.

One of the famous stock trader Ashwani Gujral says in his book – “How to make money trading derivates” – that as per his experience over many decades, he feels that knowledge of charts etc contributes to just 10% of success for any trader. Here is the chart which explains what he mentioned in the book

So, learn things in stock market and then concentrate on the other important elements which you will learn in some time. Dont overthink about knowledge part.

Mistake #2 – I went against the Trend

What I have seen is that all the new traders somewhere want to challenge the markets and want to predict when markets will fall and when it will rise. They want to predict when the trend will reverse. They want to catch that top or bottom.

This is the essence of where most of the failed traders are stuck . If markets are rising , somewhere inside me, I wanted to catch the top and wanted to prove as if I “almost” know that now markets will fall OR if markets were going down.

However in this process, I realized that all the time I was just trying to swim against the trend, If markets were going up, I tried to predict when it will fall and how much and vice versa, and in that process I never stayed with the trend. There was some kind of fun in going against the trend. It was very tough to accept that markets can be simple (not easy)

Below you can see last 1 yr graph of NIFTY Index and see that there has been an uptrend in market and it has risen from 6000 in 2013 to around 8000 now . That’s 33% increase , but imagine someone who didn’t stay with the trend and always tried to predict when will market fall and looked at markets with suspecting manner and never got in the trend itself.

So just make sure that you never go against the flow in general. If I have to compare this trend following with some adventure sports, then I will compare it with Surfing, where you ride on the flow of the water. The flow of the water itself will take you with it, you just need to stay with it. Imagine what happens if you try to go against the water flow, the chances of you getting crushed is high.

So, try to identify the overall trend (upside , downside) and then make sure whatever is your trading style , be with the flow itself.

There is nothing wrong in having a contrarian view and predict when the markets will turn its direction, but be sure you know how you will take that decision. You can surely take a call against the trend , but make sure you accept that you were wrong in case you fail. Don’t try to prove yourself right if you are wrong, because it’s only going to harm you.

Mistake #3 – I didn’t realize that Money management is supreme

I personally think this is the most important part of being a successful trader . The biggest reason for my failure was that – I was very casual about money management and made the biggest mistakes in this area. Money Management in context of trading is all about managing your overall money and how much part of your overall trading capital you put at risk in each trade.

I will give you an example – Let’s say you have set aside Rs 10 lacs for stock market trading . Now let’s say you make 2 rules

Rule 1 : You will never use more than 20% of your capital in any given trade, no matter how promising it looks to you. Which means out of Rs 10 lacs you have , you will not put more than Rs 2 lacs on any single trade (so even in worst case, you will lose only 20% of your capital)

Rule 2 : The maximum loss you will allow on any give trade is 10% , which means that if you put Rs 2 lacs on a trade, you will not let the loss cross 10% , which is just Rs 20,000

If you see these 2 rules, you can see that the maximum loss in any single trade will not be more than Rs.20,000 which is 2% of your overall capital. So assuming you make 1 trade each month, you have 50 months of quota with you to go wrong fully

No one is so bad that they will make bad decisions every time, you make good and bad both decisions , but important point is that you should survive in markets till that time when you start taking right decisions .. Hence it’s important to be in the game and unless you take money management very seriously , you are bound to get out of the game some or the other day.

This is exactly what happened with me. By the time I started realizing that I am moving from “bad trader” to an “average trader” zone , my capital was over and I was already in loss and I never went back to the game itself.

Why one should use Money management ?

The biggest reason why money management should be used is that it does not expose you heavily to the risk on a broader level, even if there is very high risk on individual trades.

And the next big reason why money management is crucial is that it brings some kind of consistency in your growth overtime.

Below you can see 3 versions of money management, which is BAD , Average and GOOD money management, where the overall risk taken on a single trade is moving from high to low.

I did some simulation on excel where we are measuring how capital will grow over 36 months (assuming 1 trade is done in a month) . I ran 25 tests and plotted them on a graph together. You can see how in case of bad money management the growth of capital is very random, unpredictable and varies from very high (lucky) to very low (unlucky)

But in case of good money management , the growth of capital a trader has moves up over time and with high consistency .

So to sum up , I would say money management system is like having a great stamina . If you are there for longer time in markets, in a way you win the battle to some extent.

Mistake 4# – I thought trading is all about WINNING

Psychology plays a big role in being a good trader. From the childhood we are programmed to WIN and that same mindset takes over rational thinking in stock markets trading too. We want to WIN on all the trades , It’s hard to accept that you were wrong , being wrong means taking a LOSS . LOSS equals FAILURE and we are never taught properly how to take failures. And that’s exactly what happens in trading, novice traders don’t cut their losses fast, they let them grow (ego) and keep hoping that they will WIN

This is what also happened with me. When I bought an option for a stock, every time I wanted to WIN, every time I wanted to make profit on that option. I thought I will become a great trader , if I WON more and more ..

I was so WRONG

Winning MORE times is not same as making MORE money in stock markets trading. I know some of you who are reading this are confused with this statement , but let me explain this important point

So when it comes to stock market trading, you can’t choose how many times you WIN or LOOSE, but can control HOW MUCH you will win or lose !

All you can do is 3 things

1. You can control how fast you can get out of loosing trade (getting out of a bad decision)

2. You can control how long you will stay with a winning trade

3. And You can control when you will take the decision using your knowledge.

WINNING MORE , but still LOOSING

Every trade you make in stock market, you should make sure that your profits potential is generally much higher than the risk potential. Here is how it should look like

It’s very much possible that a trader wins 6 out of 10 times and still looses the money and in the same manner, it can happen that a trader wins just 4/10 times and still makes a lot of money.

Let me explain this with an example. Let’s say a person has Rs 10 lacs to start his trading .

A good trader wins just 4 times, but he makes sure that he will make big win and every time he makes a bad decision, he cuts the loss fast.

And in same way, a bad trader might win 6 times , but every time they are in hurry to book their profits (so they earn small every time) and when they are in loss, they do not book their losses fast (no money management rules in place) and hence let their losses grow because they can’t accept they made mistake (Ego) . The chart below will explain you this .

This is the only big difference between a good trader and bad trader .

Conclusion

Today I have shared my mistakes I did when I traded OPTIONS and I hope you will learn from my mistakes . But this can just be starting point only, you will only learn when you get on the ground and do the real trading. Till then it’s just a practice no matter what you do.

It’s extremely addictive to trade and if you are like me, you will feel a great thrill trading either stocks, futures or options (or any other instruments) , while I didn’t succeed in trading, I at-least know why I failed, I at least came to know my weakness and now I can improve upon it. I can at least help others to not make the same mistakes I did.

Also in future, if I get into trading again, I am sure I will be 10X better compared to earlier version of mine. I know it will still be very though, but I can try at least and when I stopped my trading, somewhere I felt bad about leaving it. I felt as if I am turning my back and got a feel of leaving the battle ground, but it was a right decision because I could have damaged my own net-worth to a big extent had I not stopped.

I would love to hear what you feel about the points I shared and if you would like to share your own experiences

Why you should collect NOC (No Objection Certificate) once your loan is complete ?

Posted on September 11, 2014August 6, 2019 by Jagoinvestor

Once you pay off your loan, a big responsibility is off your mind and you feel relaxed. Its a moment where you do not want any further run around and want to now move on to other things in life.

And this is exactly why most of the loan customer do not collect a document called “NOC” or “No Objection Certificate” from their lender and it can get them into trouble later in life. At some places you will hear the word “No Dues Certificate” , but generally most of the executives in real life use the word “NOC” only

Read the incident below to understand its importance

importance of NOC No objection certificate

What is NO Objection Certificate (NOC) ?

With reference to loans, An NOC or No Objection Certificate is a legal document provided by the lender which states that the loan has been complete and their is no outstanding to be paid by the customer as on a specific date. Whenever a person pays off a loan, its important to take this NOC document from your lender.

How to get the NOC ?

Generally, all the lenders dispatch the NOC document to your registered address once your loan is complete. However at times, people do not pay attention to it and loose out on it for some or the other reason. Also if the registered address with lender is your old address (suppose you changed the address in between the loan), then also you will miss the NOC document.

So if you do not get the NOC, better contact your lender and ask for it specifically.

What kind of problems can happen if you dont have NOC ?

A lot of people think that just because the EMI’s are paid off fully, the job is done. However its extremelly important to have a legal document with you which clearly states that you do not owe anything more to then lender.

This way you are protected legally and if someone claims later in life that you owe more to the lender, you can produce the NOC if required. I would like you to have a look at the incident below which create some issue for one of the loan customer, who had paid off the loan, but didnt have the NOC with him

Hi Manish,

I have taken a personal loan from Bajaj Finance in the year 2004. All along, I have been thinking that I have paid the loan. To this effect, Cibil report also says, there is no balance outstanding and the account is closed on 31.12.2008. I don’t have NOC.

Today, I have received a call from a Lawyer saying that he has a summons to arrest me and I need to pay the balance amount of Rs.3750/- and that too I need to pay before 3 pm.

Could you please responds me as to what should I do. My question is will he really have Summons or just he is threatening. I can pay, but he is asking me to pay beofre 3 pm. That’s what I am not able
understand.

Here is another incident where Rahul settled his outstanding credit card dues with Standard Chartered bank and didnt collect the NOC . Then after many years he got a notice from the bank to pay 7.7 lacs. Here are his comments

Its been 12 years now, and I dont have the copy of NOC (or No Dues Certificate) with me. How do I prove my case as SCB isin’t ready to check me credit card history to see where the problem was. They just keep saying “they can’t retreive the information as they have sold those accounts to saha finlease.

And what about the notice they sent me asking me to attend conciliation camp to be held on 11th November?

Read the full incident on our forum

How NOC can help you in future if some problem arise

NOC is a legal document which has weightage . It proves that you really have paid off the loan fully and if there is any confusion, then NOC solves it.

Read these two incidents which were shared on our forum and you will understand its importance

Dear Manish,

Same problem as Sandesh I had with Indus Ind Bank Kolkata recently. They told me that my score is very low so they are not considering me. However, I submitted them my CIBIL Report which clearly says 763. There was an issue with a credit card which I cleared 1 year back.

I submitted them the NOC too. The HR here told me that she has forwarded the details to her central office. Now I am waiting to hear from them.

(Source)

Dear Ravish,

If you have the NOC issued by the bank, saying all dues have been cleared and there is nothing pending, you can get a loan. But as Dear Ashal has suggested file dispute with CIBIL and wait for 2-3 months to get it rectified.

I had the same experience about 3 years back and credit card in question was issued by HSBC. I got the NOC issued by HSBC and applied for loan with HDFC, while submitting the application I informed HDFC about the HSBC story. Later on, HDFC asked for the NOC and cleared my loan.

(Source)

Go get your NOC right now

So now, if you had any loan in past which you have completed and paid off, make sure you have applied for the NOC and keep it safely in your records

10 smart actions every Indian Parents should take, once their baby is Born ?

Posted on September 1, 2014August 6, 2019 by Jagoinvestor

When a new kid is born, your entire life changes. You are excited to enjoy the new phase of your life. Today we are going to touch upon some basic things you should watch out for and focus on after your new kid is born.

These are few things which you will eventually complete, but if you are too late, you might end up waste your time and energy. So its better to learn from others mistake and take some actions before hand.

Things to complete in your financial life once a new kid is born

Note that we are going to look at only those things which are related to personal finance at some level. Also most of the things are generic in nature, so if you do not agree to some, just move on and do not implement them for yourself. Lets look at them one by one.

1. Review your Life Cover

Once your kid is born, a new life comes into existence. Its now an additional responsibility you and your spouse have on your shoulder. All the future and current expenses needs to be taken care.

Think about it, all the school expenses, future education expenses, providing for all the best things in life – This all is going to cost a lot of money and the breadwinner is going to provide for that. So, If something happens to breadwinner, your life insurance should provide all these expenses.

So make sure you increase your life cover after reviewing all the numbers. In case you have not yet taken any life insurance, I strongly recommend now get a life insurance plan. As a thumb rule, I think increasing your life cover by Rs 50 lacs is the minimum you can do.

2. Get the baby added into Health Cover

If you already have a health insurance plan (either bought yourself or through employer), make sure you add the kid to the policy the moment they are born. If you do not have the health insurance yet, you can now get the health insurance and make sure the kid is part of the policy.

Some policies already cover your new born kid without any extra premium from the birth itself provided they have also paid for the maternity claim in the same policy.

As an example – Family First Health Insurance from Max Bupa has provision for new born babies from the day they are born and even cover vaccination costs for the first year. Look at the snapshot below

add newborn baby in health insurance

Below is the vaccination chart along with the age, vaccination name. It will help the new parents.

vaccination chart india

3. Start a Recurring deposit for upcoming school expenses

We conducted our workshops in 3 cities in India and one of the common point most of the participants agreed on is that school expenses on a yearly basis are in the range of Rs 50,000 to Rs 1 lac per year. Even the pre-schools are costing a bomb now, which can range anywhere from Rs 25,000 to 2 lacs per year.

Below is a report on pre-school charges in Bangalore from Times of India

Some pre-schools also double as creches providing day care, and charge astonishing rates. One such school in HSR Layout charges Rs 1.38lakh per year for day care of kids up to two years old. Timings are 8.30am to 6.30pm — one hour less costs Rs 1.25lakh, and till 3pm, it’s Rs 96,000.

There are some pre-schools that charge up to Rs 1.5lakh. A prominent national chain, with a branch in Indiranagar, charges around Rs 80,000. On an average, Rs 30,000-35,000 is what you will need to give your child a headstart in life. Most schools have also started their own pre-schools, from where the children automatically move on to nursery.

As these expenses will arrive in next 2-3 yrs, its important to make sure you are ready to arrange the money for this. The most simple way to plan for this short term goal is to either open a Recurring deposit in your bank or start an SIP in a debt fund.

If you want to plan investments for your children education or overall financial planning, you can leave your details on our services page and we will get back to you.

Coming back to the point, As an example, suppose the expenses are going to be Rs 45,000 and if you have 30 months in hand. You can just open a Rs 1,500 RD and when it matures after 30 months, you will have that money with you.

When I asked for some suggestions on this topic one one of the facebook groups run by Ashal Jauhari. Pattu gave an interesting point regarding School Expenses in the start. Have a look at the conversations below which was part of the long discussion in the thread there

school expenses for kids

4. Update your Nomination’s in various financial products

You might want to have your baby nominated in some of the financial products you own. It can be your bank accounts, fixed deposits, mutual funds or even some property. You might want to add your newborn as one of the nominee in the assets you own. Read more about nominations in this article if you do not understand what exactly nomination is.

Also, if you have written your WILL, then you might want to update it soon after the baby is born. If you miss this, and if you old WILL didnt have the right kind of wordings, then your baby might loose his/her share in your wealth in worst case.

5. Register the birth Certificate

Make sure you apply for the birth certificate for the new born asap. It is a simple process if you complete it in the starting itself, else it will get complicated later. Most of the hospitals anyways has this as one of the mandatory things you need to do.

You can get the form from the hospital itself and then submit it to the local authorities within 21 days of birth. This page mentions the procedure in detail in-case you want to have a look.

6. Start a Saving Bank account for kid

One of the best things you can do for the kid from the start itself is open a saving bank account for the new born the moment they are born. Almost all the banks have facility for kids to open their bank account. For example – ICICI Bank clearly mentions that any kid starting age 1 day to 18 yr are eligible to open a bank account called “Young Stars” with them.

I would like to draw your attention on 3 reasons why you should open a bank account for your newborn kid.

Reason 1 – Put all the Cash Gift in the Kids Bank account

The moment your kid is born, for next many months and years – you will start getting lots of gifts in form of Cash. Often this money is not handled properly in families because of its small ticket size and it gets consumed here and there and finally evaporates.

You can always make a rule that all the small/big money coming in the baby name (on their birthday’s or baby shower functions etc) will be deposited in the saving bank account opened for the kid.

Reason 2 – You can open dedicated long term investments for your kid’s future

Another reason why you might want to open a saving bank account for the kid is that if you want to invest for your kid long term education or any other thing. You can make sure you start the investments from the kid account itself.

This way the account will be dedicated for that purpose and your volatile decision making will not impact the savings for kid. You can either invest in Kids PPF account through this account or do a SIP in equity mutual funds for long term investments needs.

Mr. Jinesh Shah from in one of the facebook group shared what he does for her kid.

Reason 3 – Your kid will learn about banking and personal finance from very start of his life

Another good reason for opening the bank account for your new born kid is that once he/she turns upto 8-10 yrs, you can allow them to partially handle their own bank account and teach them banking aspects.

Learning that they have their own personal bank account will make them feel good and also they will take keen interest to learn these things, which most of the people learn very late in life.

Bonus Tip : You can also apply for your baby’s PAN card within few weeks/months of his/her birth. Anyways you have to make it later, so why not in the start itself. Its always a good practice to have a proof of identity in the start.

It will be handy if you want to apply for other kind of documents like Passport, bank account, etc . You can read this experience from Amit Gupta when he applied for PAN Card for her daughter.

7. Buy clothes and toys smartly – they’re often gifts

I know new parents are excited and want to give their best. They will buy lots of clothes and toys and no one has any authority to advice parents on what to do and what to not do. The emotional side of joy cant be suppressed. However Often new parents realized later that they have overspent too much on things which baby never needed.

In reality, for the first few months – the babies only sleep almost all the times and they grow so fast that things you had bought for them is now not needed by them. And when relatives and friends come for visits, they anyways bring lots of things you had already bought for kid.

So there are few tips which can optimize the expenses side and also help reduce the wastage done by many parents.

Rotate things among your group – There can be many things which can be rotated among parents for their new born kids. If you have some item which can be shared with some other new parents, then better share it with them and help them reuse things. There is nothing wrong in it.

Shop Slowly – Buy things one by one and not in a lot – If you want to buy something for your kid, start small – let the moment come and buy it. This way you will not buy things which are unwanted for kid.

Below is a survey done by Moneylife on the topic “The real cost of parenting” sometime back. It explains what kind of expenses families are doing on various stages for their kids. I am sharing the results for the age group 0-4 here. If you are interested to look at the full survey results, please read their full article here

8. Dont invest in CHILDREN PLAN

Yes, thats correct.

The moment you become parents, Apart from the joy and happiness, some part inside you will also be “very worried” about the kids future and how you will provide him/her best in life. This is the perfect mis-selling moment on the name of kid by various agents.

All the insurance agents (uncles and aunties) will come to you and try to sell you a CHILD PLAN. You will be sailing on the emotional boat at that moment and you will hear sentences like – “Gift you kid his bright future” and “This is the perfect thing you can buy for your kid in the start” .

While I am not against any policies and plans, but these Child Plans are often designed to exploit these kind of emotions and things are bundled in such a way that they look over attractive proposition to a new parents for their kid.

Inside the product its often the mix of insurance and investments with some kind of payout on regular basis. These are high on costs and a bit complex products. Its nothing but a slightly changed versions of ULIP’s or traditional insurance plans.

In case you are really impressed with those products, my suggestions is to wait for some months, and later study them properly and then buy them if you are fully convinced about them.

In general I would recommend any new parent to insure them with a simple Term plan and either open a Recurring Deposit or just invest in a simple mutual fund with SIP route to start with or you can follow this ready made calculator, I create sometime back for planning your kids investments

9. Have a 24/7 reachable Doctor nearby home

Medical expenses and Doctor visits are one of the top most expenses you will have to incur after the baby is born and for at-least first 1-2 yrs and you cant even avoid this issue.

You will have to travel many times to doctor. These visits are sometimes planned and often emergencies. You even might be in your office when you get a call from home that baby needs urgent attention and then you take a day off or leave early from office.

It helps a lot if the doctor is near you home or within few KM’s distance. At times people have their doctors as far as 15-20 km’s (for reasons like – “He/she is the best doctor I think”) and then in-case of emergencies it can take 2-3 hours to just travel.

So its always the best thing to have a good doctor nearby and try that they are reachable almost all the times. Ask their permission if you can call them anytime (day or night) and take consultation. Compensate them for their effort and they should agree.

10. Make a Baby Emergency Kit and save on Time+Money

This is a great tip shared by Nandish (He became father 1 yr back), while I was working on this article.

He shared that they have created an emergency kit for baby, which has medicines for the recurring issues and most common things which new parents will encounter all the times like stomach ache, teething issues, loose motions, fever etc. You can sit with your doctor and take consultations on what all to do in various situations without visiting them.

To show you importance of this emergency kit, I would like to share an incident which happened with Nandish. Her neighbor’s kid was having some issue around afternoon time, when her husband was in office and no one was there at home (I forgot the medicine name) .

She was trying to find out how she can get the medicine asap from somewhere. Because there was an emergency kit available at Nandish home, that common medicine was there and she could get it instantly. This is a small action, but it saved a visit to doctor and even a trip to market to just fetch the medicine.

This kit can also have wet wipes, extra nappies and every other thing you can imagine. Its even very handy if you suddenly have a travel plan (locally within city) and its going to take yours . Medimanage has put up a very nice starters guide for new parents, have a look at it.

Conclusion

The points if implemented will help you make your parenting journey more smoother and your financial life more better over long term. I know most of the people do not think about all the points mentioned above thinking they will handle things once they arrive, but then its your choice. Its a always a good idea to prepare for things well in advance and not wait for the last moment surprises.

Can you share some more tips which are not mentioned above. It will help people who are about to become parents or new-weds who will plan for their kids in next few years.

How this Lady paid Rs 25,000 in pay-order charges for claiming her PPF maturity amount

Posted on August 6, 2014August 6, 2019 by Jagoinvestor

Is your PPF account going to mature very soon ? You are excited to finally redeem your years of saved money in PPF account.

But do you know that some banks are playing with some investors ignorance and charging them hefty amount in the name of DD charges or Pay-order charges to give bank the Public Provident Fund account matured amount.

Let me unearth this no so known or talked about thing today.

bank charges

Read this incident below to understand what I am talking about

My neighbor (a very old working woman) had a PPF A/c in SBI, on 31st of March 2010 it completed its 15 year term and hence the same was eligible for withdrawl, she duly filled up the redemption form and asked the bank to redeem the amount.

On 14th of April 2010, the bank issued a pay order but deducted bank charges (as the savings account is with another bank), SBI has nearly deducted bank charges of about 25000/- from her.

My neighbor didnt have a bank account in SBI, her account is in IDBI and SBI has deducted the charges for preparing a pay order. Here no service is being rendered but rather its bank obligation to make the payment.

Please help. It would be good if we can help her.

(Source)

Some Banks not allowing PPF Maturity Redemption directly to saving bank account

When your PPF account matures, and you want to redeem the money, there are several options you can get the money. You can either take it directly in your saving bank account, or get a DD created or a pay-order.

However a lot of banks fool customers and never share with them that the money can be directly credited to the saving bank account and force them to make the Demand Draft or Payorder, because that involves charges and it adds to the bank revenues.

And most of the times, the helpless customers fall for it because the charges at times are in range of few hundred and they do not want to pursue the matter and complicate it.

In the example above, you can clearly see that the person was forced to get the money through pay-order and such a heavy charges for that was applied.

This whole mis-guiding worsens, when the person does not have the saving bank account in the same bank, the officials in-charge tell that its mandatory to have a saving bank account in the bank if you want to get the redemption amount in your saving bank account, else you will have to get it through DD or payorder, which is completely wrong.

There is no rule like that. One should be able to get the money through NEFT or RTGS or direct bank transfer if they wish to and the PPF redemption form gives that option clearly. Have a look

sbi ppf widthdrawal form after maturity form C

You can clearly see that there is an option of crediting your PPF maturity amount to any saving bank account.

Some real life Incidents of Banks Asking for heavy charges at the time of PPF maturity payment

Mr. Naresh was asked by Bank of Maharashtra for DD Charges for PPF maturity Payments

Bank of Maharashtra charged me DD charges of Rs 5050/ while making maturity payment of my Public Provident Fund account money. I had asked them to transfer money by cheque or NEFT, but they refused and issued me DD. Is there anything I can do?

Mr. Premji was charged payorder charges of Rs 900 by State bank of Hydrabad

State bank of Hyderabad recovered about Rs.900/- for issuing their banker’s cheque (pay order) for PPF part withdrawal. I am told that as per the PPF rules, the bank cannot recover any charges for issue of Banker’s cheque or pay order for PPF withdrawals. However I am unable to find out such rule in print.

What is the correct status regarding the above issue? Which authority will give a authenticated clarification?

Where to complain for these kind of issues?

A lot of people are not even aware that banks are taking them for granted and trying to levy charges which are unethical. Customers do not resist at times, because they dont want to get into the mess and waste their time for small charges (like Rs 500-Rs 1000).

At times they are excited to receive the big amount from their Public Provident Fund account and cant wait for it. At times there are emergency situations which dont allow them to fight back. But incase you want to fight back. Make sure you follow these following steps

Make sure you meet the Bank Manager and tell him clearly that you know the rules and there is no such rule that you have to pay DD or Payorder charges to get back your own money
Ask them in writing for charges and also insist that they show you the rule book.
If nothing works, file an RTI to RBI asking about the bank action and if there is any such rule. You can also file a RTI to Post Office (which handles PPF finally) about this rule.

Have you ever come across this situation in life ? If not , great ! .. you are now informed what to do when you face this situation

Are you Scared of Having a kid due to money reasons ? Here are 5 things you should know

Posted on July 7, 2014August 6, 2019 by Nandish Desai

Day by day I am realizing that the impact of money is huge on our decision making capacity. The conversation of money is very deep rooted and not just limited to financial goals or wealth creation.

Today’s article is based on interaction I had with one my relative, who works in IT sector. We do not meet very often but as and when we meet, we make a point to update each other about, what’s new is happening in our work and life. He and his wife both are doing extremely good in their career and their pay scales are also good.

scared of having kids

Here is how our conversation went

Relative: So, Nandish How is life after becoming father?

Nandish: Life is wonderful, it is great becoming father and playing with my kid is great fun. I and my wife feel becoming parents is the greatest gift to receive in life.

Relative: That’s wonderful to know Nandish but I am really scared of this idea of “Having a kid”

Nandish: Scared? Why are you scared? What is so scary about becoming a parent. If you want we can have a conversation that can forward you in this matter.

Relative: Thanks Nandish. I always like having conversation with you. You are my lifetime coach. Honestly speaking, I and my wife want to plan a kid, but we are scared whether we will be able to handle all the expenses that are related with kid or not?

Nandish: But you can always plan for your children related expenses and children related goals. Your savings per month and year according to me are sufficient.

Relative: When we see other people’s kid, we feel like we should plan a kid – but somewhere we are not confident about this whole process. I personally feel that becoming parent is a huge responsibility and it also calls for financial commitment.

Nandish: Yes, but why don’t you and your wife first get friendly with the thought of becoming parents. It may appear scary, but in reality it may not be so. There are some thoughts or beliefs that are holding you back.

Relative: I and my wife stay alone in a rented premises. Income wise we are good, but we still feel we are not ready financially. We dont know – how other people manage this big change but we are scared. Really scared…(He literally started crying)

Nandish: Hey don’t cry my friend. In life sometimes, we find ourselves on a cross-road. Such cross-road moments are painful but it is a point where you gather courage to make some BOLD choices in life. Over thinking or over worrying wont help you and your wife. Be clear whether you guys want to step into the realm of parenthood or not?

5 things I learnt from the interaction I had with my relative on parenthood

1. Imaginary world is scary

Our imaginary world is always more scary than the real world. We anticipate all the worst things to happen to us, but in reality things turn out very differently.

I feel that a lot of people like my relative are sailing in the same boat. They have strange notions about parenthood and they envisage those strange notions will soon convert into reality. They always come-up with reasons like let the family income reach to X level, or first let me first buy my own house. etc

(Here reason is not important, but the point is you are in grip of money related concerns)

2. BOLD step is required

Life demands you to take BOLD steps. You have to step beyond your so called fears and worries and you need to take a stand in life. Take a stand to accept parenthood with a lot of power and grace. To bring new life into this world demands commitment.

I am not saying, don’t examine your situation – but get present to what is stopping you and take a bold step in this area.

3. Don’t let conversation of money rule your decision

Don’t hand over all your power to money. Money is an integral part of your life, but at the same time money is not everything in life. When it comes to parenthood don’t let the money conversation hold you back. Take a step forward and don’t get stopped by financial concerns.

4. Trust your ecosystem

After the transition takes place you will start experiencing support coming from different corners of your family. Sharing from my own life, our parents have brought huge strength and support into our life. After becoming parents I and my wife started experiencing true power of our family ecosystem that we are into.

This whole transition became smooth for us, because of the family support we have. Look around and get in touch with your family eco-system.

5. The Age factor

I am not an expert in this area, but all I know is that age of women matters when the couple wants to plan a kid. I have interacted with some clients of ours who kept on pushing parenthood for some initial years and finally they had to face some complications due to age factor.

We suggest you to go and consult right person who can guide you better on age factor thing.

Conclusion

Don’t let the conversation of money hold you back from experiencing parenthood or any other beautiful experience in life. Have conversation with your spouse and make a choice that serves you most. It is a sensitive subject and our intention is to share our observation, we just want to share how money impacts our life decisions.

We are not asking you to do something or don’t do something, it is about getting present to the impact that money have on us. Jagoinvestor as blog is not limited to personal finance education, we really want our readers to be happy in life.

We want to spread happiness along with personal finance education. If you have experienced something like this in your life – feel free to share in comments section, if you want. Sometimes we are afraid of writing articles on such sensitive topics but as I mentioned in the article we also have to show boldness in our writing.

How I bought 23 things out of excitement and never used them – Lets celebrate SELL week on Jagoinvestor

Posted on June 9, 2014August 6, 2019 by Nandish Desai

This article is one long letter, that I have written to myself and to all the spenders out in the world. We have not got any money to promote OLX, we are using the name of the company because most people can relate to the content that way.

I have a confession to make, I am an OLX consumer and I am not proud of it. Today’s article is not about financial products, it is about products that you bought out of excitement and now it is lying in some corner of your house or apartment. Today’s article may not be about personal finance, but it is about your hard earned money, that gets blocked in different expensive goods and products that you buy.

Whenever the advertisement “O Womania” of olx.in comes on TV, my family members will start looking at me. This is because they know, I am a spender and they feel I spend a lot. They want me to sell a few things, so that we can have some free space in our house.

There is nothing wrong in buying NEW things, but before any purchase make a commitment to gain value from all that you purchase.

My OLX list of 23 unused items

Yesterday morning – I made my “OLX list” which contains goods and products, that I bought out of excitement and I no longer use them. My list has total 23 items. This exercise helped me to gain some interesting insights, which I would like to share with you in today’s article and we will also be posting pictures of some items we bought and are not using them now.

Unused Item #1 : Sports Equipment

I bought a table tennis table 2 years back, thinking that I will invite my friends to play on weekends. Honestly speaking I have not played more than 20 games with my friends till date. Slowly the table tennis table started shifting places in my house and eventually it is now lying in our servant quarter. Before I bought table tennis table I was so excited and I had big plans, but I can see that I did not make the most out of it. My family members have warned me not to buy any such sports equipment in future.

Unused Item #2 : Fitness Equipment

A lot of people invest money in fitness equipment’s but they don’t utilize it fully. Some people choose to buy treadmill over joining gym. My in laws bought treadmill, which is now lying in one of their balcony and no one has time to use treadmill.

I am not saying don’t buy fitness equipment’s, the point is – If you buy one, see that you make proper and consistent use of it. Block some time on your calendar for your fitness equipment before you invest your money into it. Even Manish bought one expensive sports cycle a few months back to regularly bike on it, but when I asked him yesterday – if he is fully making use of it, his answer was “No, but I am soon going to start my cycling regime” . This article is a wake-up call for both Me and Manish personally 🙂

Unused Item #3 : Electronic Goods

There are so many people who invest very heavily in electronic goods. While I was making my OLX list, I found in my house there are total 5 television sets out of which 3 we do not use at all, one spare refrigerator which we do not use, some speakers and music gadgets which I no longer use. So, I have decided to donate 3 unused television sets to one of my relative’s hospital. There are so many people who have more gadgets in their life than financial products.

Counting Challenge – How many things you own ?

I have an open counting challenge for all individuals. I bet, if you start counting everything that you own, you won’t be able to count all the items in one life time. The truth is that you already own so much in life and still you feel you need something more. When your income increases, your purchasing power also increases and you start making random purchases (at least I fall in that category). My invitation is – If something is really required and it will add value to your life buy it or else look for some alternative.

Spenders need one trigger

Spenders like me, needs one good reason for buying any new product or goods. Spenders get triggered very easily for making fresh purchases. Companies like OLX and QUIKR are making millions today, only because most of us are busy making random purchase decisions. I am not against these companies and also I am not endorsing them.

Choose to slow down (listen to awesome audio on this topic) before you make any new purchase decision, ask yourself and your family members whether you will make the most out of that purchase or not. There is no fun in being a master consumer.

Conclusion

We are not saying consumerism is bad or one should not spend on different goods and services. All we are saying is spend wisely, because at the end, it is your hard earned money, focus on the value that you are going to create out of each purchase. If you own something which is not of use to you, gift it to someone who can benefit from it.

Let’s celebrate this week as SELL week, you are free to share in the comments section what you are going to do with your unused or underutilized goods and products.

Build your “unused item list” – (Share it in comments section)

Make (your olx/quikr list) list of all unused/underutilized products and goods which you can either sell or you can gift to someone.
Make fresh promises if you are willing to make use of underutilized items that you own
What kind of actions you will take in next 7 days to either sell or gift the same to someone in need.

This Article is contributed by Nandish Desai

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

Posted on May 12, 2014August 6, 2019 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 6^th 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 7^th Batch of boot camp is starting from 19^th 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.

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

Posted on March 31, 2014August 21, 2019 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 ?

How I arranged my financial life in 4 steps – The Inside Story of my real life

Posted on March 20, 2014August 6, 2019 by Jagoinvestor

Today I am sharing my real life story of how I arranged my financial life. Our financial lives over time gets messed up because we are lost in our jobs and family and everyday some new information or financial document enter our life and gets piled up. We keep stuffing documents here and there in our almira thinking – “I will keep it properly next Sunday” .

Which never comes !

In my personal case, I consciously try to keep things arranged as far as possible, but just like everyone, my financial documents and various information become unorganised like every other person. So finally one day, I decided to have my own “Personal Finance Management Week” , where I decided to finally come out of my “comfort zone” and cross all my mental limits, defeat my laziness and arrange all my documents and fix various other “issues” and finally make things neat and clean in my financial life. And thats exactly what 150+ participants of our last bootcamps did in their financial life too.

But why Did I decide to arrange my financial life ?

For Myself – Everytime I have to find out some document or information, I really had to struggle remembering where exactly I had kept it, The piles of xerox papers, insurance papers, bank documents, property papers etc etc had got mixed with each other and it takes more than 10-15 mins, lots of frustration and that little guilt inside for creating this mess and not keeping it clean . I wanted to have a clean space of things, where if you ask me about document X or information Y – I can give it you in less than 60 second.

For my Family – Because I know, my family will really get confused and frustrated when they will have to deal with my financial mess. They are not as much financially aware as I am, they dont understand this “personal finance” area so much and it will scare them like anything in future when they need to deal with it. So I need to create an environment, where my family members can find out various things related to my financial life, as easily as possible. If you want a proof that family members can suffer if you dont take care of this area, then I want to share a real life case which was shared on our blog itself where, a wife was never able to claim life insurance after her husband’s death, because she had no idea where are documents and which company was it .. here is the sharing by Nisha
and Finally, because its once a year task – Truly speaking, this whole thing does not take a lot of time, all it takes is huge commitment and a small START. There is a great chance that even you have not completed this, just out of lethargy and nothing else, It takes few hours of dedicated work and huge commitment and nothing else. Once you arrange all the things, then from next year, it will be just 1 hour of additional work to update things.

4 things I did for arranging my financial life like a SuperMan

So, here is how I started. The first thing I did was to buy 3 BIG folders and 2 small plastic pockets which can contain few documents and then I did following 4 tasks

Action #1 – Created 5 folders to hold documents and categorise them

The first big thing I did was to buy 5 folders where I arranged 5 kind of documents in each, so that if I need a particular kind of document or information, I have a separate folder for that. Those 5 folders were

a) Protection Related Folder – This folder contains all my documents which protect my financial life like – Life Insurance, Health Insurance, Car Insurance related papers, which includes Policy documents, Health Cards, Premium Receipts, A paper containing all the customer care numbers. I still need to add a document which explains them what to do to claim each of them. Imagine you meet an accident and are not accessible, this folder will help them like GOD , Won’t it ?

b) Property related Folder – This folder contains all my property related documents, like Loan Agreement Paper, Home Loan related document, Property Tax receipts and any other small or big document which is property related

c) Banking Related Folder – Banking is a big aspect of everyone’s financial life and I thought why not have a dedicated folder for this. So in this folder I have all my cheque books, Bank related document, Locker papers, FD receipts (if any) , any bank statements which I want to keep etc etc. If you have more than 2-3 bank accounts, it really becomes very cumbersome to manage them, so this dedicated folder comes very handy.

d) All the Bills/Receipts/Warranty Cards Folder – This is not exactly related to personal finance, but over the years, you collect so many important bills, warranty cards, receipts which you want to keep because they are needed later in future and if you cant find them, you really regret mismanaging them and not keep them properly. So in this folder I am now keeping all the bills and important warranty cards. You can also store all your old ITR acknowledgement copies in this folder.

e) Education Related and Important Documents – And finally I have dedicated a folder for all my and spouse education related document like 10th , 12th , graduation and post graduation certificates , marksheets , passing certificates etc etc. Plus , I have also chosen this same document to keep our important documents like Passport, Aadhar card, Driving License xerox, Voter Id Card etc etc, Cable related, Electricity bills etc etc.

After making these 5 folders , now if you ask me you want X , I open my almira, know which folder has it, open it and can find out the required document 80% faster compared to old situation. Now my family, knows that things are not randomly lying here and there, but somewhere neatly arranged .

How 150+ investors organised their financial documents in Bootcamp

We have just completed our Facebook Bootcamp with 150+ investors and we dedicate one full week for arrangement and cleaning up of your overall financial life. Almost all the 150+ participants had taken huge actions and with lots of commitment, they all cleaned up their financial lives. They all arranged their documents and you should see what kind of conversations happens on our facebook bootcamp. See the snapshot below

Action #2 – Created Scanned Version of all important Documents

The next important thing I did was to scan each of my very important document and keep the scanned version online accessible to me and my family. Some people might think its going extra mile and not required, but then its your choice and mindset. God Forbid, if you loose your physical documents somewhere, due to fire, robbery or any damn reason, it gets really tough sometime, especially in case of education related certificates.

There is no harm in scanning documents and keeping it with you online, especially if it takes 2-3 hours of work. All you need to do is take out time and pick which documents you want to scan and then finally scan then. Make a folder, compress it in ZIP format and mail it to yourself on your email id and someone else in your family. Keep it saved in a CD format also and keep at home or locker. It does not hurt at all, other than it takes fews hours of yours, but so what, its for your own good, Its a once and for all kind of activity.

I would still make sure I will take care of my physical documents , but god forbid if something happens to them (for any damn reason), atleast I have a scanned version of it, Its a better situation then to have nothing in your hand. In my case, I have scanner at my home so it was handy for me.

Here are those documents which I scanned

Health Insurance Policy First Page (which mentions Sum Assured and Premium)
Life Insurance Policy first Page
Health Insurance Cards
10th , 12th and other educational certificates marksheets

Action #3 – Created Emergency Black box Kit for my Family

The next thing I did was to create a emergency black box kit, which any one from my family can open and they will get every possible information about everything at one place. It will have all the basic + critical directions for them to follow, whom to contact in which case, where to go in which situation, how to claim for various things etc etc. Here is a snapshot of what all it can contain

All Important Contact Numbers like CA, Tax Consultant etc etc
Toll Free Phone numbers of Health Insurance, Car Insurance, Life Insurance
Customer Care numbers of all the banks where we have account
Email id of all the Insurance and Investment companies
All Documents numbers like – PAN number, Driving Licence Number, Passport Number
Process to claim life insurance, health insurance etc
Process to close bank accounts and claim back the money
Process to claim back all the mutual funds and other investments

Here is a rough idea on how it can look like

It can be roughly 6-8 pages long. You can keep the online version on your computer, email and dropbox and also take a printout and keep it at home and label it respectively like – “Open in case of emergency” . So incase something bad happens and you are not accessible or can’t help your family, your family members can look at it and their life will be more easier !

Store some important Contacts on Phone also

I extended this task and also stored some very important things on phone , which can be very handy and save you a lot of time in the times of crisis. I have my health insurance card scanned version on my phone, so that I can use it whenever required. Also I stored all the customer care numbers properly one by one with this format – “COMPANY-NAME CUST CARE” , so that in future if me or my family members have to call some customer care, we just can look at the phone search for “CUST CARE” and then choose the number.

I have seen people who try to find out the important phone numbers on the last minute, and that eats out some important time of theirs. Also in case of crisis or emergency – you really need it handy on your finger tips, This particular action might look very trivial , but in times of need, you will really feel very relaxed and happy to have it with you. More than yourself, its for your loved one’s who don’t have to struggle for this.

Action #4 – Created a Run-Away File

I dont know if this is my invention – but this came into my mind some weeks back . Every time I had to go for some important work which requires my Identity card xerox or address proof, I had to everytime arrange for it because I didnt had the xerox ready with me, so I had to carry original and then on the way, I have to xerox it. This takes up time …

Then at times, I had to return back home because I was not having my cheque book, because it was not asked to me . Then at one time, my trip to a property tax department was a waste because I didn’t bring my Index2 (house ownership proof) .. So then I thought why not create a RUN-AWAY file , which has all the things you can imagine which might be required ! for some work . So if you have to take a new phone connection, just pick the run-away file and go

If you have to go to book a new property – Phew .. Just pick the run-away file and thats all .. It will have all the things ..

So it will have

Atleast 2 Xerox copies of PAN CARD
Atleast 2 xerox copies of your address proof (electricity/phone bill)
Passport xerox, aadhar xerox, driving licence
4-5 passport size photos of yours, spouse ete (if needed somewhere)
1 cheque leaf of your bank accounts (unsigned)
1 pen

You place all these things in a plastic packet and that’s all, you take it where ever you go , You don’t have to arrange for things every time. From the day I have created it, my life has become very easy, all I need to do is just open my almira and pick up that folder and I move on ..

Define your own style of arrangement

What you just saw above was my personal way of arranging things. This is just a idea of what all you can do, next – you need to define what all you want to arrange, in what manner, to which level and which are more important things for you and what is not. It might happen that you might feel, that what I did was little over-doing of things, but thats fine – its your choice. You can choose to go for a lower version, but I would just say that a lot of things are just one time task and then a small pinch of yearly review, Give the benefit you will get out of it, compared to the time you put, its worth going a little deeper.

Arranging Things is 1st Step , Communicating with Family is 2nd

We feel we should communicate all the things about our financial life to our spouse, children , parents etc and they should be aware about what all is there, but imagine if you do that without arranging things . If things are messed up in your financial life, the communication from do will not be effective.

However, if you arrange things neatly like this, and then when you show these things to your family members – they will be able to consume it in a better way, they will understand things more clearly, because they are able to “see” things before their eyes. They know what to find, where to find, and how to find. If things are clean and neatly arranged like this, they will also become more serious about overall finances and they will really feel that you are responsible and think about their care in future.

You will feel amazing

Once you arrange your financial life and fix lot of other things which were pending from long time, you will really feel amazing. I want to share one of our bootcamp member experience of working on his financial life and how our bootcamp has changed his financial life overall.

This looks so small thing, but the difference it makes in your day to day life is really great ! – So are you still waiting for “next Sunday” ?

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

Posted on March 11, 2014August 21, 2019 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

Background

Let me share my story

So I was ready to enter the world of stock markets.

When God Sent that guy!

We got to know about “options”

Learning about options was FUN

Finally we started Trading

Now the Learning Starts

Mistake #1 – I focused too much on Knowledge

Mistake #2 – I went against the Trend

Mistake #3 – I didn’t realize that Money management is supreme

Why one should use Money management ?

Mistake 4# – I thought trading is all about WINNING

I was so WRONG

All you can do is 3 things

WINNING MORE , but still LOOSING

Conclusion

What is NO Objection Certificate (NOC) ?

How to get the NOC ?

What kind of problems can happen if you dont have NOC ?

How NOC can help you in future if some problem arise

Go get your NOC right now

1. Review your Life Cover

2. Get the baby added into Health Cover

3. Start a Recurring deposit for upcoming school expenses

4. Update your Nomination’s in various financial products

5. Register the birth Certificate

6. Start a Saving Bank account for kid

Reason 1 – Put all the Cash Gift in the Kids Bank account

Reason 2 – You can open dedicated long term investments for your kid’s future

Reason 3 – Your kid will learn about banking and personal finance from very start of his life

7. Buy clothes and toys smartly – they’re often gifts

8. Dont invest in CHILDREN PLAN

9. Have a 24/7 reachable Doctor nearby home

10. Make a Baby Emergency Kit and save on Time+Money

Conclusion

Read this incident below to understand what I am talking about

Some Banks not allowing PPF Maturity Redemption directly to saving bank account

Some real life Incidents of Banks Asking for heavy charges at the time of PPF maturity payment

Where to complain for these kind of issues?

Here is how our conversation went

5 things I learnt from the interaction I had with my relative on parenthood

1. Imaginary world is scary

2. BOLD step is required

3. Don’t let conversation of money rule your decision

4. Trust your ecosystem

5. The Age factor

Conclusion

My OLX list of 23 unused items

Counting Challenge – How many things you own ?

Build your “unused item list” – (Share it in comments section)

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

7 dimensions to keep in mind while lending money

Conclusion – Pick phone and get clarity

How Fraud at Petrol Pump Works!

But why Did I decide to arrange my financial life ?

Action #1 – Created 5 folders to hold documents and categorise them

Action #2 – Created Scanned Version of all important Documents

Action #3 – Created Emergency Black box Kit for my Family

Action #4 – Created a Run-Away File

Our view of “Financial Planning”

What Investors and Financial Advisors think about “Financial Planning”

8 insights about Financial Planning

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

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

3. Financial planning is NOT about bringing Certainty

Watch this video of Financial Coaching by Jagoinvestor:

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

5. It is NOT about picking perfect financial products

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

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

8. Financial plan has to be a LONG document

Conclusion

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