Get Your Priorities Right

A few months back I met my school mate – Pravin(39) during a common friend’s family function. After a casual conversation I told him that I am a financial planner and he became interested to know what I really do. After explaining him about my profession he agreed to meet me at my office to get his financial plan done. Pravin is working as Vice President- Operations at a leading Infotech company. We met as planned and after discussing about his financial goals and other financial details, I requested Pravin to provide me with all his financial documents related to his income, expense, assets and liabilities in order to analyse and provide the right solution.

After that first meeting in Jan’ 2012, it took me nearly 4 months of reminders and constant follow up to get all the required documents from him. Pravin constantly apologized saying that it would take some time to locate all the documents. Finally the plan was prepared and after discussion we prepared the implementation schedule too. But again due to his job commitments, Pravin somehow could not even complete the initial risk cover enhancement or any investment suggestions and we are now at the fag end of completing 1 year.

Pravin’s is not an isolated case. I had another client, Raviraj(40), GM in one of the leading companies in the hospitality industry. Raviraj maintained scans of all his investments and insurance documents and was therefore able to provide all his financial documents within 2 weeks of starting our financial planning engagement in December’2011. But once the financial plan was done, it became difficult to contact and communicate with him since Raviraj has to travel constantly to different parts of India as well as South East Asia. Even though the financial plan was ready in January’2012 itself, it was discussed only in mid April’2012 when Raviraj was fortunately in Mumbai. Now it’s nearly 5 months ever since we met and there is no news on the implementation of the insurance or investment recommendations. At times the emails sent to him are answered after nearly 2 weeks. 


In both Pravin and Raviraj’s case, we find that though both are very keen in putting their financial lives in order, somehow or the other due to job commitments they are not able to give priority to their finances. They did not even feel it necessary to involve their spouse thinking that they already had other family commitments. And what is the end result.

  1. Both are heavily underinsured and have excess funds lying idle in savings account earning 4-6% interest when the prevailing inflation in our country is in the excess of 7%. Ultimately this excess cash sometimes gets utilized in buying fancy things which might not be your need but desire.
  2.  Imagine if in such a situation if god forbid either of them meet with an unfortunate event, and the family income stops, they being the sole earning members of the house. This is a possibility given the fact that today people earn a fat salary but in return they spend countless hours at office under stressful circumstances.  


What’s the way ahead?

Just like a manager in an organization knows exactly what is to be done when he is supposed to achieve certain targets, we too need to prioritise our financial goals in such a way that we are constantly reminded of our very own little things which we have planned to achieve within the stipulated time. A few tips here should help.

  1. Keep Reminders: People use gadgets like mobile phones or the ipad- off late to set reminders for their official meetings. Why not incorporate meeting your financial planner or meeting your insurance advisor to complete that pending life insurance/ mediclaim proposal, in your reminders!
  2. Take responsibility: No one else but you is responsible for your financial future. The more you neglect and delay planning for your present and future, the more difficult it will be to achieve even basic goals like your retirement planning. Have you thought what would happen to your finances in the event of a job loss? Why wait for calamities to fall on you to meet your planner or to begin your investments?
  3. Involve your spouse: Financial planners recommend involving the spouse in financial planning in order to ensure that one person takes charge and religiously helps in implementing the suggestions which is what is the ultimate aim of preparing a plan. It also helps that the spouse is aware of all the financial aspects related to insurance/ investments/ assets/ liabilities of the family. Haven’t we heard of several cases where on the death of the male earning member, the spouse was not even aware of how much insurance cover or loan liability her husband owned?

Article written by Steven Fernandes

Certified Financial Planner

Chief Planner – Proficient Financial Planners

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