Create your life's financial rainbow...

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

Create your life's financial rainbow:

Rainbow is something wonderful which can be seen but not touched or felt by us. It's sort of an intangible creation by nature. Same is the case with planning our money in our lives. Money can get tangibles and intangibles, and many a time intangibles are long lasting and enduring... Tangibles like gadgets, cars, luxuries do fulfill the aspirations of the want seeking people. But only the intangibles take care most of your needs.


Need Vs Want

The debate of "Need Vs Want" has been evolving over the years.. Some of the wants of yesteryears are the need of the present. For eg., Mobile phones, internet. But a prudent person will focus on the needs of the life first...


The following are the seven rays, which are the essential needs for our future and they form our life's financial rainbow...

• Adequate life insurance cover
• Adequate health insurance cover
• Children's education plan
• Children's future plan
• Retirement plan
• Wealth creation 
• A Financial plan

1. Adequate life insurance:

Human life is precious and more so for the family dependent on him/her. Life insurance is a great tool to quantify the human life's value in financial terms. It is very ideal for one to have a life insurance cover of atleast 5 times of the annual income @ any given time. For eg., if some one has an income of Rs 10 lacs PA, the person should atleast have a cover of Rs 50 lacs which will be a good cover for the family on his/her absence. Remember,
Life's value for insurance purpose = Annual income * 5 times...



2. Adequate health insurance cover:

Health care costs are set to rise in the coming years, due to various factors. Advancement in medical technology, longer life spans, imbalanced life styles are key factors which will adversely impact the health care costs in the future. It's important that the family is well protected for such rises in health care costs. Ensure adequate health insurance cover for self and the family. Do not be dependent only on the cover provided by your organization.During the times of career shifts you will be left with no cover.



3. Children's education plan:

Next in the line is the financial plan for children's education. Education costs are skyrocketing now and they are expected to continue this way in the future as well. This again is contributed by rising ambitions among the children and the cost of such ambitions. It's important to have a financial plan for your children's education.

http://mymoneyavenues.blogspot.com/2011/09/beware-of-sky-rocketing-costs-of.html



4. Children's future plan:

Indian parents' responsibility does not end with children's education alone. It's beyond that.. Though one cannot predict the future social outcomes after 20 years, particularly on marriages, it's fair to assume status quo and plan them accordingly.It's important to have a children future plan.

5. Retirement Plan:

Coming years are going to be extremely challenging for this generation of professionals. Given the fact that the shelf of our working careers are getting shortened, we have very limited time to plan for retirement fund. In short, what we do in terms of financial planning over the next 15 - 20 years(stretched time frame) will determine the financial future for the rest of our life. It's important to have a retirement plan for our financial security.


6. Wealth creation:

Earning wealth is just one part of the story. And we all work really really hard to earn our wealth. It's equally important to put your money to good use. I always believe in the mantra that "You work hard for your money... Let your money work harder for you..."
Make your money earn better returns than what it earns now.. Remember, the world's wealthiest people are the ones who started with few dollars in their wallet.


7. Have a financial plan and a planner:

Our careers are always about challenges. Challenges to meet our targets both on personal and professional fronts. But unfortunately, professional front is immensely hectic, that we miss a lot on our personal front, particularly on the money management. Leave it to a professional financial planner, like Money Avenues and get on with your professional career. 


So what are you waiting for? Go ahead and create a perfect financial rainbow and it will give you a secured financial future.... Even if your life is faced with rainy days, there is a financial rainbow to guard you and your family...

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

What's your Personal Financial Happiness Quotient?

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

What's your Personal Financial Happiness Quotient?

We strive to be happy every second, every minute, every hour, every day... Though there are many factors which contribute to such happiness, money plays a vital link in securing one's happy moments.
Numerous studies have equated money with positive impact on our lives. A couple of years ago, researchers found people who dipped their fingers in hot water after counting stacks of cash actually reported feeling less pain than people who dipped their fingers after counting stacks of blank paper. Conversely, the fear of not having enough money seems to be strongly associated with certain negative health consequences.

Money gives you more opportunities and greater freedom; it represents protection against cold and hunger; it allows you to create a comfortable life for your children; literally money makes your mouth water. 

That's the conclusion of a study performed by David Gal, an assistant professor of marketing at Northwestern University's Kellogg School of Management. Gal had undergraduate participants look at various pictures while holding cotton dental rolls in their mouths. When he collected the rolls later and weighed them to see how much saliva they'd absorbed, he found that the students who looked at pictures of money had drooled the most. 

Money can get you happiness in two forms 
Tangibles and intangibles. 

Tangibles are all those things which are bought to enjoy your life like the expensive gadgets, sedan, home, jewelry, other luxuries etc.,

 Intangibles -

Money is not felt this way, right?! It's not there in our backyard tree to be touched and felt every day. Intangibles are your insurance cover, savings, investments etc., Remember, money gets you both tangibles and intangibles in life. But we are more excited with tangibles as we see, touch and feel them every day. But there are many intangibles money get you which are not touched or felt or seen every day. But they are the ones which give you the FINANCIAL FREEDOM AND FINANCIAL SECURITY...


The ideal mix of tangibles and intangibles determine your personal financial happiness quotient...

Many a time we are more excited about tangibles which money get you. But on the other hand intangibles give you the life long financial freedom and security. After all, our earning capacity has a limited shelf life, but we need to live longer and longer with whatever wealth we have created during our prime earning years.
Here are some of the intangibles money get you for your financial freedom:

Adequate Life insurance cover: 

Creation of long term wealth:

Retirement fund:

Children's future:

Remember, our earning shelf life is shrinking by the day.. What we save and invest in the first 25 years of life determines how we live the rest of our life post retirement. The age old adage says, "What we sow is what we reap"...
Have a balanced approach towards tangibles and intangibles to earn higher personal financial happiness quotient.

What you sow is what you reap.. You invest now and be financially happy later...

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 
 

Beware of sky rocketing costs of education....

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

Beware of sky rocketing costs of education:

The cost of education is definitely sky rocketing and it would continue to do so in the future as well... Any parent who has put in their kid in the KG in the recent times would vouch for it. Starting from the basic education till the professional degree or foreign degree, the costs are expected to zoom in the coming years. 

The scenario is definitely alarming when compared with our student days and hence a separate plan for children's education is imperative keeping this trend in mind...


Recently a survey was conducted in the US on this subject and the results are startling for us to see.

 http://www.zillow.com/blog/2011-09-07/homes-for-the-price-of-4-year-college-tuition/

One of their key findings is that college costs in the US have nearly tripled since 1980. Throughout the recession, that rate has jumped as local governments cut higher education spending, leaving the universities and thus, students and parents, to shoulder more of the cost. 


We can certainly draw similar comparison out here in India and also given the fact that more number of children may opt to go to the US for their higher education in future. Both ways the study is relevant.

In my earlier blog updates, had made some estimates on the future costs of education and here is just a recap of them for your perusal...

• If you were to admit your child now into a good college and spend about Rs 7.5 lakhs for the under graduate professional education, can you imagine what would be the same cost look like after 15 years??? 

 Rs 61 lakhs

• If you were to spend about Rs 15 lakhs for your child to pursue a foreign degree now, can you imagine what would be the same cost look like after 15 years???

 Rs. 1.23 Crores

If you are astonished with these estimates, don't be shocked if the actual costs are above these estimates in the future.... It's very much a possibility.

Plan for your children's education NOW....

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

Life's wake up call... 20/20 Financial Planning

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

Life's wake up call - 20/20 financial planning

Incredible stories around the world offer us the Hope for living. Once such is the story of Mike Jaffe. 

Mike Jaffe falls into the category of someone who should have died on 9/11, but was saved by chance. He worked on the 96^th Floor of the World Trade Center, but was late to work that day because he had decided to have breakfast with his wife and daughter that morning. When he showed up to the office, most of his coworkers and friends had already perished. “I lost many friends and co-workers on 9/11, which served as a painful but powerful reminder of how precious life truly is. I knew I could never again settle for a life that was simply fine,” he told me. So, what does Mike do now? Well, he left his financially secure corporate lifestyle in favor of becoming a motivational speaker and life coach. Today, he works with thousands of individuals to help them find the motivation to make the same type of shift that he has. “I see myself as a Human Wake up Call, waking people up to new possibilities for their lives and businesses, without losing another precious day."

http://www.jaffelifedesign.com/mikes-story-human-wakeup-call.htm

The world has changed drastically after 9/11 with global security is under constant and rising threat. Compounding such threats are our ever increasing job related mobility. Mike Jaffe snatched himself away from the death by mere 20 minutes. But 3000 others were not that lucky that day. The underlining fact is that the world is increasingly getting uncertain and highly risk place to live on. 

But is there a way out from this uncertainty? Not really, we don't have choices, but atleast we can make sure that our loved ones are not left stranded in such distressing times.

Do we have a tool to mitigate such risks? YES

20/20 - Financial Planning

Spend 20 minutes to make sure you secure the financial future of yours and that of your family's for the next 20 years which is a fair goal to aim. And following are the points you need to take into account for this 20/20 Financial Planning.

1. Ensure adequate life insurance cover:

2. Ensure children's future:

 3. Know your financial priorities:

4. Long term wealth creation:

Plan for long term wealth creation

 5.Do it "NOW" :
Plan for your financial future "NOW"...

Because, one may not get a chance another time as we live in an era of uncertainty...
20 minutes you spend to plan can shape yours and your family's financial future over the next 20 years....


20/20 Financial Planning is about 20 minutes for 20 years... 


(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

To be an investment winner, start very early.....

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com)  

To be an investment winner, start very early in life....

If there is one thing in investing which can make you a real winner, is the power of compounding. And it works very very silently, but makes a remarkable difference over the longer periods of time. Lets look @ the case of three friends who are aged 50 now and see who won in the race of investing. The friends are Mr. Cautious, Mr. Responsible, Mr. Fun.

Mr. Cautious started investing @ his age 30 by putting Rs 1 lac @ a return of 12% PA. After 20 years, @ the age of 50 his money would have grown to 

Rs. 9,65,000

  

Mr. Responsible started investing @ his age 35 by putting Rs 1 lac @ a return of 15% PA. After 20 years, @ the age of 50 his money would have grown to 

Rs. 8,14,000

Mr. Fun started investing only @ his age 40 by putting Rs 1 lac but @ a return of 18% PA. After 20 years, @ the age of 50 his money would have grown to 

Rs. 5,23,500 

The results are there to be seen. 

# Mr. Cautious who earned 12%, lowest among the three still made good money because he started quite early in life and became a winner @ the end. Time ripened his money.

# Mr. Fun who started very late in his life and could not be a winner despite earning very high 18% returns on his investment. He finished third despite earning very high returns compared to the other two. The reason being he had little time compared to the other.

Key takeaways of this study are: 

# It's important to start investing early in life, even if the returns are comparatively low. That's how Mr. Cautious won the race, despite earning lower returns than the other two.

# Even if you make high returns @ the later stage, you may not make enough money because of the time factor. That's how Mr. Fun lost the race, despite earning 18% returns.

# Power of compounding (POC) is @ work very very silently and effectively.

Sooner you realize the importance of POC, better it is for your financial future...... Because POC makes no noise and it's very silent in multiplying your value of investment.

Experts @ Money Avenues can make you an investment winner by providing right investment solutions.


(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com) 

Bath Tub investment planning....

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com)

Bathtub Investment Planning... 

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"Warren Buffett’s Bank of America Deal Sparked in the Bathtub"

"Warren Buffett: I Dreamt Up Bank Of America Deal In The Bathtub" 

"Warren Buffett's BofA Bathtub Decision"

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We do get amused when a billionaire like Warren Buffett says he got the spark to invest $5 billion while bathing in the tub... Don't we?! Definitely I was terribly amused...

And, he made a cool $700 million returns immediately in the process..

But that's the hallmark of the men who always ensure to put their hard earned money to really good work... In simple terms, he makes his money work harder than him. Otherwise how can a man decide in the bath tub, when he has the other options to think like, the dress to wear that day, perfume to spray, watch to put on, suit to wear etc.,

This is a great takeaway for all of us who want to put their hard earned money to work even hard for us...

The next time do not complaint that...

# I have no time to plan my investments.

# I am busy with my office work.

# I am always on the travel.

# @ home busy helping out.

You still have time in the bath right?! Because it's your money and your money is hard earned... 

 

Next time, when you are hard pressed for time, do your investment planning while in the bath... You will never know, the spark can turn into a great investment idea.... 

(The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com)

Skyrocketing health care costs....

 (The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com)

  Sky rocketing health care costs.... 

Health care costs in India are rocketing... This is compounded by several factors:

# Innovations in medical science:

Medical science is innovating by the day and such innovations take care of the diseases which were once tough to crack. But such innovations come @ a huge cost.


Innovations in medical technologies: 

Medical technologies have undergone massive transformation in the last several years which has made diagnosis and cure even more accurate. But such technologies come @ a huge cost.




# Drastic changes in life styles:

Our life styles have changed in many ways. Our work, our eating habits, day to day living has made us prone to health risks. And they come @ a huge costs.

What must one do to tackle this?

# Your organization is kind enough to provide health cover to you and to your family. But don't be dependent only on your organization's health cover. During the times of job shifts and transitions, one will be left with no health cover. And during times of extreme distress, the cover may also be insufficient. And @ a later stage if one wants to take one, becomes very cumbersome due to age factors.

# Provide love, affection and liberal health cover for your dependent elders particularly your parents and if they are senior citizens, all the more crucial. There are health policies which take care of the senior citizens.


A glimpse of the future health care costs..........


If one were to spend Rs 3 lac now towards hospitalization,  can you imagine what could the cost after 20 years?

Approx Rs 49 Lacs

It may not cost you more to take a health insurance now... Go ahead and ensure your family's health care.

'Sarve Janah Sukhino Bhavanthu'

 (The author is the Founder and CEO of Money Avenues, a Wealth Management firm based in Chennai. Feedback can be sent to mailfpc@ yahoo.com)