Organise and plan your finances in simple steps

Abhinav Gulechha
Investment Advisor & Principal
Financial Planner, www.sohamfp.com
© 2014 www.sohamfp.com

Why plan and organise?
So that you can “LIVE WELL”

How to Plan and Organise?
A series of surprisingly (!) simple steps
+
ACTION on your part (just good
intentions will not do:)...

And the steps are....
Put the house in order
Decent emergency fund
RIGHT insurance covers
Proper planning for financial goals

Step 1: Putting the house in order
Your monthly cash flow pattern
Your saving philosophy
Go down the memory lane
Shaadi ke side effects:-)

Step 2: Emergency fund
How much = Minimum 6 months * Your
fixed financial obligations
Where = Fixed deposit or Liquid MF

Step 3: Insurance
What is “insurance” anyway?
What all risks you face in life RIGHT now?
Do a stress test: If anything bad happens,
what risk management plan you have?

Risk: Death
Calculate: How much life insurance you need
Go for “Pure Term Insurance”
Disclose family medical history honestly

Risk: Hospitalisation expenses
Min. 3 lacs for non-metros/ 5 lacs for metros
Also cover your parents, if dependant on you
Go for Pure Re-Imbursement based
Mediclaim product

Risk: Temporary/ Lifelong disability
Atleast as much as your life insurance cover
Go for Standalone Individual Personal
Accident Plan

Other Risks:
Critical Illness
Damage to House Property/ Contents
Credit Card Theft
Professional Indemnity

Step 4: Financial Goals Planning
Begin with an END in mind
(Exercise: write down your financial goals
and year when you need the money!)
Prioritise, prioritise, prioritise...

financial goal when reqd priority
My retirement 2040 high
fund for child's
education and
marriage 2034 high
car 2018 medium
closure of home
loan 2020 high
vacation 2016 low

Financial goal Nature
Current
investment Action plan
retirement long term EPF
Open PPF in own name
+ Start SIP in 1 good
equity MF
fund for child's
education and
marriage long term Nil
Open PPF account in
child's name and start
contributing
car short term Nil
Start SIP in a Short term
debt MF
closure of home
loan short term FD
Use FD to pre-pay fund
+ Earmark Rs. 5K
savings to loan closure
vacation short term Nil Nil

Salary 70,000
Household expenses 30,000
Surplus 40,000
Goal Based Investment Plan:
Own PPF account - retirement goal 5,000
SIP in large cap fund - retirement goal 10,000
child's PPF account - child's education goal 3,000
SIP in large cap fund - child's education goal 8,000
SIP in short term debt fund - car purchase goal 3,000
Balance - park in liquid fund - for home loan
closure goal
11,000

• Fixed Deposit
• Recurring Deposit
• Liquid/ Debt Mutual funds
• Fixed Maturity Plans
Short
Term
Goals
• Public Provident Fund
• 1-2 Large Cap Equity Mutual
Fund
• Gold (10% Max.)
Long
term
Goals
Right financial products to invest

Avoid these!!!
Traditional
policies (e.g.
LIC policies)
Child Plans
Pension Plans
Sector funds/
Mid & Small
Funds
Direct Equity

Goal Planning: Some more thoughts
Make retirement your No. 1 goal
Kill the rabbit in sight first
“Udhaar ki topi” : Better off without one
Find out how much risk you can take...
Diversify, diversify, diversify....

Common Financial Mistakes
Mixing insurance with investment
No emergency fund backup
Chasing next rabbit that crosses the path
All eggs in one basket
Good on intentions, poor on action..
Waking up late...thankfully its never too late:-)

About Soham Financial Planners
My Story
My Mission
What I do

Questions:-)

Thank You!!
www.sohamfp.com
facebook.com/sohamfp
@abhinavgulechha

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