In the first part of the blog here, we looked at why Insurance is not an ideal investment. Let us look at this a bit more quantitatively now, to let the numbers do the talking. We will compare quantitatively the returns from the two scenarios below: “Invest” in LICs “New Endowment Plus” policy of 10L…
When you ask any 80s/90s kid, what are their investments – most of us will start by saying “I have a LIC Policy of 5L”! Try this out, will you :)? Say this with me insurance is not an investment! Let us look at the definitions of Insurance and Investment from wikipedia. Insurance – Insurance is a…
We talked about the advantages of automating investments and how “Analysis Paralysis” can be avoided by automating them. Not just investments, even predictable expenses should not cause us unnecessary shocks. And this is what I mean by “Automate your expenses”. It is actually “Automate the savings for your expenses” – but you would not read…
Biggest problem with us, is that we think there is a lot of thinking and analysis required behind investing in an asset. While it is true that analysing is important, it’s most important to not get into an “Analysis Paralysis” mode. So Automate your investments! And the key to investing for a salaried person is through…
Please read about Human Capital in the blog here. We ended with a question for you, what do you do to protect your Human Capital? Should we even protect it? Adverse scenarios – Several scenarios can affect your human capital adversely and it is not possible to list every one of them. But some of those…
Term Insurance – Life is insured for the term period. If the insured dies with in this period, the nominee gets the insured amount. If the insured survives, there is no survival benefit. Generally extremely cheap compared to normal Life Insurance. Normal Life Insurance – Life is insured for the period. Upon survival of the…
Generally speaking, wealth is measured in Total Capital. Let us take a look at how that is determined. Total Capital, one can say is divided into two parts – Human Capital and Financial Capital. Human Capital can be defined as the future earning potential, whereas Financial Capital is arrived at based on one’s Net Worth…
Creating a kit for the family in case of any eventualities to oneself, is very important. I call it the financial tool kit.
