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.
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.
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).
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 ?
A few months back we started something called “Investor’s bootcamp”- which is an online tribe of action oriented investors. Till now more than 250+ people have participated in our investor bootcamp and the results have been amazing so far (People have produced unprecedented results in their financial life). We want every investor on our blog to pass through bootcamp experience at least once in their life time.
Let’s look at why we created Investor Boot camp?
We created boot camp so that investors can work on their financial life in a very simple, fun and effective way. This bootcamp happens over facebook group (closed), and is very flexible to attend and participate. One can participate and take part as per their time and convenience. The intention of boot camp is ACTION. Bootcamp is created to put knowledge into practice; it is created to gain valuable insights in different areas of financial life. It’s where you get a chance to brainstorm with other investors. When you go through the process you will get CONFIDENT as an investor.
We are proud to share with you some power pack sharing from different boot camp participants. While the boot camp was on some of the sharing brought tears to our eyes and they filled our heart with a lot of fulfillment.
Experience of Bootcamp Participants
We are going to share some of the experiences here. Very soon in next few days, we are going to create Action Booklet of boot camp participants, which we will share with you all and it will inspire investor’s community
Guru Prasad
Batch #3
Testimonial 8
“You gave me a start and have put all the dots.”
Before I joined this bootcamp, I had a question – “Will I get my money’s worth?”
I thought for some time, then got an answer – Whatever happens in this bootcamp, I definitely owe Manish and Nandish the fee for the knowledge I got through jagoinvestor through all those quality articles!!!
Coming to the bootcamp, all I wanted to know was how to deal with money, how to attract more money and to understand about investing money. I should say all the boxes are ticked with satisfaction. The biggest of all is dumping(made paid up) my LIC policies which I had taken 7 years back and had paid close to 3 lacs. I lost huge money, its ok, i will pay the price for my mistake and being horribly ignorant on these issues.
Had some actions taken. I bought one term insurance, will buy one more in April. Almost got a good health cover for mom, will be get getting it next month for dad. Got to know more about financial products. Most important of all, I had been thinking a lot about money and my finance for the last month and a half. It has made quite some difference. The other day, while having a casual chat with my friend who had taken LIC money back policies, I told him to separate risk and investment separately, and these money back products does neither. I advised him to go for term plans. I could see the joy in his face which made me feel I opened his eyes, and he thanked me again and agin for sharing with him. I told him actually its not me, the 2 persons whom he is supposed to thank are namely Manish and Nandish!!!.
Regarding the books, Finished all the 3, “How to be your own financial planner in 10 steps” is the best of all. And Nandish, the line, “You earn exactly what you think you are worth” is still vibrating in me, got the book’s worth in just this one line.
I enjoyed your program. I have lots of pending work though to be completed, you gave me a start and have put all the dots. I need to spend time regularly and start connecting them by taking actions. Thank you.
“I feel that in the past 6 weeks of the boot camp has made a huge impact to my financial life.”
I started reading the first book by Manish – “16 personal Finance principles every investor should know” and it inspired me a lot. I then started reading a lot of articles in the Jagoinvestor blog and continue to do so- its got so much information on different financial aspects and its through this I came to know about the Boot camp and signed up for the same.
Now coming to the boot camp, the experience has been amazing. I had the opportunity to interact with Manish and Nandish and it has been one fulfilling experience – thanks a lot Manish & Nandish. Apart from this, another good thing about this was l got to hear and learn from other members of the camp as well. I feel that in the past 6 weeks of the boot camp has made a huge impact to my financial life, it made me think and take actions of the different aspects of my financial life which I had not completed before.
I have taken many actions and some of them are pending and am working on completing them soon. The boot camp has brought in a lot of awareness and also taught us in detail about the various aspects of one’s financial life. I am still reading through the books and its been a very good experience as the language and most of the examples are simple and easy to relate to.
Overall this has been one awesome experience, thanks again Manish and Nandish for this. I would also like to thank all the members of this camp as well as I learned from some of their experiences.
When is the BEST time to join boot camp?
We would like to share one Chinese proverb
“The best time to plant a tree was 20 years ago. The second best time is now.”
This is the RIGHT time for you to plunge into personal finance actions. Let bootcamp be the medium for you to take important personal finance actions
The overall structure of Boot camp is amazingly simple and absolutely EFFECTIVE
Our Invitation to join BOOT CAMP
We strongly recommend each one of you to be a part of upcoming boot camp on 7th April. With this article we take this opportunity to extend our personal invitation to each one of you. We will be in a position to take around 35 people this time and so make sure you book your seat at earliest. The boot camp is going to be a game changer; it’s going to help you dust all your laziness and casual approach in the area of money. (So don’t miss this opportunity)
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)
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” ?
“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?”.
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.
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
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.
It is common nowadays for salaried employees working in big companies to have a group health insurance cover from their employer. Some firms provide health cover to the employee, his spouse, and his children while the more generous ones also extend this cover to the employee’s parents.
In this article, I want to help you understand in some detail, what exactly constitutes group health cover. I will also cover the benefits of group health insurance policies that are not available in the individual health insurance plans one buys directly from health insurance companies.
What is group health insurance ?
The concept of group health insurance is very simple. When you buy health cover policies covering big groups of 50 people or even 500 people, it is termed as group health cover. Normally big organizations would take these policies for their staff.
The good thing about these group health insurance policies is that it can be tailored to the requirement of the proposer (one who is taking the policy) and can be offered as a benefit to their employees. Insurance companies benefit from this arrangement, as they get massive premiums from a single source (imagine how much premium Infosys would pay yearly). The big ticket-size also allows insurance companies to offer more benefits at a relatively lower premium value (How Insurance works – The full business model).
I recommend that everyone have his or her own health insurance apart from employer health cover, but that’s a different topic of discussion. The focus of this article is to highlight some of the good points about group cover and how you can benefit if you fall under such a scheme.
4 advantages of group health cover from employer
1. No Medical Checkup’s
The best part of group health insurance cover from an employer is that there is no requirement of undergoing a medical checkup – both for self and family members. Everyone is covered automatically in the group cover from Day 1 and you can completely avoid the hassle of a medical checkup.
2. Maternity cover from Day 1
This is going to bring smiles on lots of faces! From Day 1, maternity expenses are covered under group medical cover in almost all companies. So if you join a company and if you are part of the health cover benefit scheme, you will get maternity benefits immediately; unlike the individual health cover which has timing limitations.
3. No Waiting period Concept
Another great feature of group health insurance is that there is no concept of waiting period for any illness. Even pre-existing illness are covered under group cover. So if your parents are suffering from some illness such as diabetes or heart ailments, it gets covered from Day 1. This is never the case with individual health cover that you buy on your own. Again, this exception is only made possible through the dynamics of group health cover that I explained earlier.
4. More Cost Effective because its a group cover
Like I mentioned in the beginning or this article, because of economies of scale, the premium per insured person is very low for group health insurance policies. Hence, if your employer is providing you a group health cover, it makes sense to apply for it, even if you have to pay the premiums yourself.
How to fit in Group Health Cover in your overall Health Insurance Portfolio ?
So now the question is how should a group health insurance cover find a place in your overall health insurance portfolio? While we have seen advantages of group health insurance, in the same way there are lots of disadvantage of the group health insurance. The first importance should be given to having your own individual health insurance policy so that the complete control is in your hands, not your employer. While group health insurance from employer is great, but look at it as secondary option, not primary for the reasons I have mentioned in this article.
So, make sure you do not depend 100% on employers health insurance because it can stop anytime, it will not be available for long term after your retirement.
Do you want to share any insight on this topic or your views?
