Most
of the people in their life always wonder where really their hard earned money
was gone. Why their savings not come to their rescue when most needed? Actually
answers lies in their problems itself. Today we try to find out answers on
above questions.
In
today’s time every individual wants that their investment should give highest
returns. Ironically whenever asked what they mean the highest returns their
response is either pure blank face or some unimaginable figures, which they
also don’t know from where these figures arise.
I have met so many people who curse their advisors, insurance agents.
The reason they feel their investments not giving desired yield but when asked,
why they invest without doing proper analysis. Answer is prolonged silence. As my
colleague Mr. Ashish Bhave (Chief Financial Planner, ARB Financial Consultant)
often says “If you sign without acknowledge for what you are signing then you
deserve to be cheated.”
Today I will share some brilliant ideas to become poorer in your life.
And this also gives satisfaction that most of us are working very sincerely in
that direction.
Investment
in Insurance: In today’s time insurance has
become sure shot remedy for every financial need. Whether it’s Child education
or retirement, daughter’s marriage or pension, wealth creation or market
investment one plan is always ready to satisfy ones need. Expert always
recommend that insurance is not for investing. But still people happily chose
to invest in insurance. I also recommend if you want to fell short in your
financials goals then keep taking insurance plans for every financial goal.
Investing without Financial Goals: “Without goals, and plans to reach
them, you are like a ship that has set sail with no destination”. - Fitzhugh Dodson .Most people don’t know why
they are working so hard? What exactly they want from their life? As we all
know without goal life has no meaning, then why we can’t apply same rule with
our finances? Most of the people invest like dogs chasing cars without knowing
what is the purpose of such investment? Investing in any instrument without
proper backing of financial goals can lead it to catastrophic consequence.
Objective should be clear while investing. Have we ever seen any archer
training without target boards/decoys or football match without goal post? Then
whenever investment is concern we always intend to chase wild goose. So if you
are seriously looking for losing your money than it’s really recommended to
invest without prioritizing your financial goals.
Underestimating
Financial Risks: “Risk
is like fire: If controlled it will help you; if uncontrolled it will rise up
and destroy you.” – Theodore Roosevelt. This is very common habit
we come across that people always think they don’t required Life/Medical cover
or undervaluation of financial risk. The reason I am healthy as a young horse! It’s
really wastage of money and time! I really can’t see the requirement in near
future etc. etc. I think Lord almighty
ask their permission or prior approval before creating problem/difficulties in
their Life. 90% of financial problem in life arises due to such unconcerned
deeds. Also many people purchase Life/Medical insurance without understanding
the basic concept of insurance; the need means purchasing insurance without
Need based analysis. Proper protection plan is like foundation of the house and
house future is depending on the fact that how much stronger the foundation is.
Under insurance is more dangerous than no insurance. So if you like to see your
family’s future in deep financial turbulence/complications then keep following
above idea.
Inappropriate
habit of Credit/Loans:
“Debt, An ingenious substitute for the chain and whip of the
slavedriver.” -Ambrose Bierce. In today’s world nothing
is out of one’s hand. Every bank or NBFC have something to offer one’s credit
need. Now a day using Credit card has transformed to need then luxury. Most of
people do not hesitate to use such facility beyond their capacity of Payment.
Then start the infinite cycle of repayment. But ignoring
the fact that credit card interest is highest in all lending instrument and
fall anywhere between 32% to 38% apart from late payment charges. Some people feel there is
no big deal in defaulting the payments and settle in later years when lenders
offer them settlement in lesser amount then outstanding. Such blunder work
against their personal credit score or CIBIL score. Such acts sometime cost
dearer when they required loan for medical emergencies or at the time of
purchasing home. As good CIBIL score help to get loans easily and probability
to get lower interest rate. So the
person who really want to relish future financial suffering and lose mental
peace then my recommendation to preserve
above sprit and start spending like you are not going to see next day of
your life.
No/Unplanned Retirement Planning: “Retirement planning in India means having 3
kids and praying one of them supports u after 60.”Recently I
came across above excellent quote by known financial planner. This will give
crystal clear picture of current opinion on retirement planning. Some people
think Retirement planning should be done after completing 45 yrs. of age. Above
opinion will lead them to horrifying path of poverty. As I feel Retirement age is real age when you
live for yourself. Very recently I came across update on Facebook where a 65-70
year old man selling face shape puppet gloves and ironically peoples like this
update and praising the spirit of that man. But nobody bothered to understand
why he has to work on that age? Who want to sacrifice enjoyment and peace of
mind of their golden days, to earn more money? Such situations arise due to
ill/no planning of retirement. This fact is also drawing our attention on the
other most important matter that one cannot trust or fully dependent on coming generation.
As quoted by George
Foreman “The question isn't
at what age I want to retire, it's at what income.”
