How to be your own financial planner in 10 steps

DISCLAIMER The author and publisher of this E-book have used their best efforts in compiling this E-book The author and publisher make no representation or warranties with respect to the accuracy, applicability, fitness or completeness of the contents of this E-book The information contained in this E-book is strictly for information purposes only Should you desire to apply any information contained in this Ebook, you may verify the information with a third party and take full responsibility for your actions Network18 Publications and Network18 group companies not endorse any advertisements appearing on this E-book This E-book contains copyrighted material and must not be copied, reproduced, transferred, distributed, licensed or publicly performed or used in any manner whatsoever except as specifically permitted in writing by the publisher or as allowed under the terms and conditions under which it was purchased or as strictly permitted by applicable copyright law Any unauthorized distribution or use of this text may be an infringement on the author’s and/or publisher’s right and those responsible may be liable in law accordingly The author and publisher disclaim any warranties (express or implied), merchantability, or fitness for any particular purpose The author and publisher shall in no event be held liable or responsible to any party for any direct, indirect, punitive, special, incidental or other consequential damages arising directly or indirectly from any use of this material, which is provided “as is”, and without warranties By subscribing to or using this service you are deemed to hereby accept this disclaimer Network18 Publications and Network18 group companies reserve the right to take legal action, as deemed fit, if the terms and conditions of the use of this E-book or its services as described herein are not compiled with Any disputes in relation thereof shall be subject to the exclusive jurisdiction of the courts at Mumbai, India Network18 Publications and Network18 group companies and content providers shall have no financial liability whatsoever to the users/subscribers of this E-book For more information contact Network18 Publications and Network18 Group Companies at cd@network18online.com E-Book ISBN 978-93-80200-81-1 Published by Network18 Publications Private Limited in 2013 507, Prabhat Kiran, 17, Rajendra Place, New Delhi-110008 Acknowledgement This book is created out of my experience with all the blog readers and clients I have worked with While I wrote this book, I received immense help and support from various people to design and create this book I would like to start with a big thanks to thousands of our blog readers and hundreds of our clients who have given me insights on the issues they face in real life and the potential areas any investor would like to improve and solve in their financial life I would like to thank my business partner and a great friend, Nandish Desai who brainstormed with me and helped in shaping to this book He helped me with amazing insights on how the book can be of most value to the reader and how it can become a stronger book I would like to thank my parents and wife who supported me in writing this book and gave me enough space and time to my job in the best possible manner I would like to thank Mahavir Chopra, Namrata and Narendra Ahuja who looked at my work and suggested me improvements at some places in the book Finally, I would like to thank Network 18 who published this book and my editor who helped to give a polished look and language to my writing Without the support of everyone, this book would not be created the way it is today Thanks to all Manish Chauhan CONTENTS Wake Up Call Step 1: Optimize Life Insurance Policies Step 2: Optimize and Clean up Other Investments Step 3: Health Insurance Step 4: Emergency Fund Planning Step 5: Short/Long term Goal Planning Step 6: Start your Retirement Planning Step 7: Estate Planning Step 8: Be ready with a Great Credit Report and Score Step 9: Debt Repayment Step 10: Organise your Financial Life Bonus Step - How to be ready for the future I want to start this book with this small introductory chapter that I call a “wake up call” I have worked with hundreds of clients and dealt with thousands of my readers replying to each of them personally on email I get close to 100+ emails each week with different kinds of financial problems people face in their life and I spend countless number of hours solving their queries Based on that experience I want to tell you two stories today Read on JATIN Story Jatin has lost his job due to recession with a multinational company Jatin has always been an amazing performer in his team and he was 100% sure that nothing can happen to his job ever, but that has been proved wrong He lived his life from pay check to pay check and he never thought that he would ever have any emergency in his life He faces these issues right now: He is paying EMI for his home loan from last years, but due to the job loss, he is finding it tough to service his EMI now, as he is not getting a new job anytime soon Some of his investments are locked in ULIPs and insurance products, which he had bought, but those products are not coming to his rescue in this bad phase of life He had never saved any extra money for these kinds of bad situations It’s time to pay his life insurance premium money, his home bills, house loan EMI, but it’s literally impossible for him to pay all of them on time He fears what he can in this situation He applied for a personal loan too, but it was denied by the bank because they say that he has not paid his credit card bills on time from last many months on time and they don’t think he is the right person to lend any money at this moment He is worried about his situation, because if something happens to his health or his aging parents, at this moment, he doesn’t know what he’ll His parents are very dependent on him for their survival While Jatin loves his parents and wants to the best for them, he fears now with this eyeopening incident on how his own financial life is turning out to be in next 1030 years He fears if he has done enough to fund his financial goals in his life and if he will be so dependent on his children for his retirement needs Jatin wants to really change his situation now SAKSHI Story Sakshi & Shailesh were married just a year back; they were working in Bangalore in an IT company and earning really well The amount of money they were earning seemed as if they would never have any issue in life to reach their financial goals The present looked so promising that they just could not worry about the future Shailesh knew that he had to save a lot of money, so each month he kept making new fixed deposits with the money he got out of his salary The money Sakshi earned went into different kind of financial products, but all on Shailesh’s name only, never on Sakshi’s name This never came to their mind Their life was moving without any issue and the future looked extremely beautiful Shailesh was killed in an accident one morning while travelling to office Suddenly the ugly situation that was underneath the beautiful life cropped up and showed its face to Sakshi She never imagined how life could take a huge turn Here were some of the issues: Shailesh had never covered his life properly against such mishaps and now Sakshi was very dependent on her own income and she was wondering how Coming Soon 11 priciples to achieve Financial Freedom Written by Nandish Desai This is not just your run-of-the-mill typical personal finance book This book goes one level above traditional personal finance books; it teaches you to live an extraordinary financial life Each person wants to know how to explore his full financial potential as an investor and this book teaches you just that The book will act like your mentor, friend and coach, and show you how the best investors behave, think and act in their financial life This book does not focus on products and numbers, but focuses on YOU Personal finance is not about numbers, it is about YOU, and this book will help bring that change Your financial life will change when you change, your numbers will change when you change Your bank balance will grow when your thoughts grow and your wealth will grow when you choose to grow as a person The book is written in a story format - Sam’s journey Sam, an IT professional from Mumbai, is lost in his financial life; he finds a financial coach and works with him for 90 days to design an awesome financial life Sam discovers that his vision for his financial life is ordinary and limited and during his journey he finds out a whole new world in his financial life The book is divided into 11 chapters, which talks about 11 principles and with each level Sam is transformed into a more powerful investor By the end of the 11 levels, Sam becomes a powerhouse of ideas to take his financial life to the next level Sam’s financial coach teaches him wealth creation The 90 Day Money Game as taught by his coach leads him out of the confusion that can be finance and investing, and changes Sam’s perception of personal finance and forges a new relationship between Sam and money Grab this book and find out how you can take your financial life to the next level THE BEST OF THE BESTSELLERS Bestsellers 18 More than 50 info-packed titles covering a broad spectrum of topics Business empowerment and management insights Entertainment and Music Marketing and Finance Stock Markets and Commodities and more FINANCE SERIES What your Financial Agent will tell you and why you shouldn’t listen | BOOK MRP: Rs 299/- Systematic Investment Planning - SIP | CD-ROM MRP: Rs 299/- Invest the Happionaire Way | BOOK IN ENGLISH MRP: Rs 499/- Invest the Happionaire Way | BOOK IN HINDI MRP: Rs 299/- Everything You Wanted To Know About Investing | CD-PACK MRP: Rs 499/- Everything You Wanted To Know About Investing | BOOK & CD ROM MRP: Rs 599/- Everything You Wanted To Know About Investing | BOOK MRP: Rs 299/- Mutual Funds Made Easy | CD-PACK MRP: Rs 149/- Market Guide (Hindi) | VCD-PACK MRP: Rs 399/- 10 Happionaire’s Cash the Crash | BOOK MRP: Rs 499/- 11 ETF’s and Indexing | BOOK MRP: Rs 299/- 12 Financial Planning For Doctors | BOOK MRP: Rs 499/- 13 Everything You Wanted To Know About Investing In Difficult Times | BOOK MRP: Rs 499/- 14 A Trader’s Guide To Indian Commodity Markets | BOOK MRP: Rs 699/- 15 Systematic Investment Planning | BOOK MRP: Rs 299/- 16 Happionaire’s Money Game | BOOK MRP: Rs 399/- 17 Everything you wanted to know about Stock Market Investing | BOOK MRP: Rs 399/- 18 Retire Rich-Invest Rs 40 A Day | BOOK MRP: Rs 399/- | BOOK MRP: Rs 19 Kaise Nivesh Kare Mandi ho ya Tezi (Hindi] 299/- 20 The Art and Science of teaching children about money | BOOK MRP: Rs 499/- 21 Bill and Penny’s Money adventure | BOOK MRP: Rs 299/- 22 Retire Rich-Invest Rs 40 A Day (Hindi) | BOOK MRP: Rs 399/- 23 Romancing The Balance Sheet | BOOK MRP: Rs 699/- 24 10/10-Now control Your Money Perfectly | BOOK MRP: Rs 499/- 25 Investing In Commodities made easy (English] | BOOK MRP: Rs 399/- 26 Investing In Commodities made easy (Hindi) | BOOK MRP: Rs 399/- 27 Investing In Commodities made easy (Gujarati] | BOOK MRP: Rs 399/- 28 Simplifying Financial Jargons with Professor Simply Simple | BOOK MRP: Rs 299/- 29 Get Rich- A wealth Prescription for Doctors | BOOK MRP: Rs 599/- | BOOK MRP: Rs 30 The Seven Steps To Get Your Dream Home 499/- 31 Step by Step Guide to Investing | BOOK MRP: Rs 499/- 32 Everything You wanted to know About Stock market investing | BOOK MRP: Rs 499/- 33 Everything You wanted to know About Stock market investing (Hindi) | BOOK MRP: Rs 499/- 34 Everything You wanted to know About Stock market investing (Gujarati) | BOOK MRP: Rs 499/- 35 Plan Your Money | BOOK MRP: Rs 199/- 36 Plan Your Insurance | BOOK MRP: Rs 199/- 37 Manage Your Debts | BOOK MRP: Rs 199/- 38 Invest Your Money | BOOK MRP: Rs 199/- 39 Millionaire’s Don’t Eat Cakes, They Make Them | BOOK MRP: Rs 499/- 40 Happionaire Investment Secret for Women | BOOK MRP: Rs 499/- 41 Mutual Fund Guide | DVD-PACK MRP: Rs.399/- 42 Jago Investor- Change your Relation with Money | BOOK MRP: Rs 499/- 43 Jago Investor- Change your Relation with Money | BOOK & CD MRP: Rs 699/- 44 Everything you want to know about Investing in Mutual funds | BOOK MRP: Rs 499/- 45 Fundamentals of Investing in Equities and Assets that Create Wealth | BOOK MRP: Rs 699/- 46 Setting The Right Financial Goals | BOOK MRP: Rs 499/- 47 Romancing the Balance Sheet (Hindi) | BOOK MRP: Rs 399/- 48 Everything you wanted to know about Business & Economics | BOOK MRP: Rs.499/- 49 Financial Instruments standards | BOOK MRP: Rs 1199/- 50 Make Your Money work harder by Monitoring Investments | BOOK MRP: Rs.499/- 51 Spot the next Economic bubble | BOOK MRP: Rs.699/- 52 Income tax for Doctors 2012-13 | BOOK MRP: Rs.499/53 The only financial Planning Book you will ever need | BOOK MRP: Rs.499/- LEADERSHIP SERIES 54 Business Legends | VCD-PACK MRP: Rs 999/- 55 Dialogues With H H Sri Sri Ravi Shankar | VCD-PACK MRP: Rs 999/- 56 Business Legends | VCD-PACK MRP: Rs 999/- 57 Dialogues with Deepak Chopra | DVD PACK MRP: Rs 999/- 58 Unlocking the Hidden Dimensions of your life with Deepak Chopra | DVD PACK MRP: Rs 999/- LESSONS IN EXCELLENCE SERIES 59!essons In Excellence - 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400 013 India Tel.:91-22-6666 7777 ... wants to the best for them, he fears now with this eyeopening incident on how his own financial life is turning out to be in next 103 0 years He fears if he has done enough to fund his financial. .. have done your financial planning” yourself This will not be the same as having a financial planner doing it for you, but that’s a different concept all together Financial planning is in itself... “Protecting your family security” or “Life Insurance”? Is it adding value to your financial life? Or is it slowly destroying your financial life and your wealth creation process without your knowledge!