Coping with Financial Stress
Coping with Financial Stress
Life is an ongoing adventure in which we continually strive to do our best. However, sometimes, even in our financial lives, there are occasions when the best-laid plans and well-planned actions fail to deliver the expected results, resulting in financial stress.
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Unfortunately, there is no magic pill, no quick plan to get out of the stress, else you would not be going through the same. Things can only get better - slowly, gradually and one step at a time. It is not just important to look at the bigger picture but you will also need to focus on the minute things with the mindset of an engineer or a doctor. The following discussion is a road map that can help you on different fronts, all ultimately leading you to take control of your finances and go into the 'green light' once again.
Nothing is impossible. No matter if the odds are against you at the moment, nothing can beat faith that walks a mile every day, in the right direction. Getting into financial stress is nothing to be ashamed of as it is temporary and can happen to anyone, at any point in life. You don't have to give up and lose your confidence or self-respect or hope for a change. If you are suffering from stress, pressure, it is time that you let the steam out!
Start by talking to your financial advisor/distributor/accountant first. They would understand your situation and may offer some financial guidance. Next, talk to your family, especially your spouse and parents. Tell them about your situation and that you all need to work together in facing this challenge as one team. Your children, if they are old enough and are amongst the spenders, need to be made aware too. This can be a very valuable experience and lesson in their lives and will surely make them more conscious and respectful of money and what they have today. Listen to their worries and also get the conversation going. While doing all this, please also take extra effort to spend more quality time with your loved ones as this will only strengthen you more emotionally. Your family will appreciate your honesty and will pitch in with their own support and help.
One sure thing to do is to track the numbers. Take time out, every week, and keep a tab on broadly (a) how much money you have (b) how much income you are making and (c) how much money you are spending. In other words, start tracking income sources, tracking your cashflows, knowing your net worth, finding the gap between income and spending, making a budget and so on. With financial stress, budgeting becomes a huge challenge as the likely cash outflows/spendings outweigh the cash inflows/incomes. Here we need to identify the necessary and discretionary spendings and prioritize the same. Check out your past few months track - find patterns/habits which are hurting you and find expenses which can be reduced or avoided or delayed, at least for the time being.
With your math worked out and a deeper understanding of your financial situation, you should now be able to explain your problems to even a child. Chalk out a road map of what needs to be done as part of the solution. A financial plan for the next year or so should be on your check-list too. Here is how all these should work:
  • Identify your problem areas and the extent of your problem.
  • Devise solutions or an action plan to get out of the mess.
  • Identify the steps you need to take - on fronts like spending, saving, debt management, insurance, liquidation/restructuring of investments, seeking credit, and so on.
  • Have a monthly budget and a financial plan ready to be implemented.
  • Implement your plans in a time bound manner.
  • Keep track of your plans religiously.
Often, what we lack in intelligence, resources and luck, can be more than made up with discipline. People have broken mountains with just a hammer, discipline and patience for a fact. Stick to your plans - blindly for say next 6 months or a year and see the difference you would have made. Stay away from any unplanned, discretionary spending or from unnecessary shopping all this while. If required, avoid going to fancy restaurants, malls and even shopping apps on your mobile. Instead, take morning walks, go to the beach, learn to enjoy the finer things in life and have fun with family without having to buy it with money.
As discussed, stress can bring a lot of physical and health challenges and can push you into bad company and things which should be avoided. You do not want to open up a new front in this delicate situation. Instead, try having a good sleep, eat good food, practice meditation & yoga and try to be healthy. Try to incorporate exercises and physical activity to your daily routine. Physical activity boosts the production of your brain's feel-good neurotransmitters, called endorphins which help in stress relief, distract you from your worries and give you confidence.
Nobody is immune to financial problems. Unforeseen financial crisis are like uninvited guests, all you can do is, be prepared. With the right road map and discipline, you can turn a potential tragedy into a minor setback. While you are doing it, also have gratitude for the things that you have and the people who are with you. It's life, both good and bad things happen. What's important is to keep walking, one step at a time.
NJ E-wealth
Investment Mantra For Wealth Creation
Investment Mantra For Wealth Creation
When we think about money, all of us want to be wealthy and most of us would do anything to create that wealth. It's easy to speak about building wealth, but it's very difficult to achieve it. It takes a lot of smart work and a lot of your most precious possession – time. But, with discipline and proper strategy to save and invest, even ordinary people like us can achieve incredible feats.
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"If you don't find a way to make money while you sleep, you will work until you die." - Warren Buffett. Wealth creation is not about putting a part of your remuneration in your savings account each month. Investing in wealth-creating assets, i.e., assets that deliver decent returns over inflation, and post-tax, will help you create wealth over time. Investing in such assets, especially equities is like investing in other businesses - the money works for you and rewards you with compounding simply by not doing anything. Equity is perhaps the only investment which pacifies both inflation and market expansion in your portfolio.
The following table shows the comparative average annualized returns of different asset classes and the resulting difference in wealth creation over a long period of time. Actively managed equity mutual funds have fared even better than the equity markets.
Period: 40 years, India - 1982 March to 2022 March, Average inflation: 5.95%.
Asset Class Bank Deposits Gold Company Deposits Sensex
Returns * 8.37% 8.44% 9.37% 15.01%
Rs. 1 Lakh Grows to ₹2,490,938 ₹2,556,115 ₹3,596,901 ₹26,879,683
* Source: RBI Database on Indian Economy, BSE India
"If you aren't thinking about owning a stock for 10 years, don't even think about owning it for 10 minutes." - Warren Buffett. It is not just important to invest but it is equally important to start investing from an early age as it will maximize your returns and you will benefit from the power of compounding. The benefit of compounding works very well for long-term investments. With 15% returns, a Re.1 investment would grow to just Rs.4.05 in 10 years and Rs.16.37 in 20 years. The real difference is in the next 15 years when this amount will grow to over Rs.133. That's the power of compounding.
Entering and exiting the market with a short-term objective is not good for your financial health. As seen, you have to stay invested for the long term to create meaningful wealth. Regular and systematic investment for a long time is the ideal strategy for investing in wealth creation. SIP (Systematic Investment Plan) brings in discipline and helps to create wealth in the long run by investing small amounts regularly. SIP also gives the benefit of rupee cost averaging, i.e., getting more units when the market is low and getting fewer units when the market is high.
Protection against income and cost shocks is just as important as investment protection. Insuring yourself and your loved ones against unfortunate events is the simplest and cheapest way to safeguard yourself and your loved ones. A sufficient amount of cover for life, health, personal accident, critical illness and motor insurance can protect you from financial shocks emanating from associated risks while also providing you with much-needed peace of mind.
There is an old proverb, "Don't put all your eggs in one basket." Diversification is an effective strategy to balance risk and returns in a portfolio with exposure to different asset classes and styles of investments as per your risk profile. The idea is to have assets with risk and return characteristics uncorrelated with other asset classes. Alternate options offer the power to build a resilient portfolio in dynamic and uncertain markets. Diversification can be across asset classes like equities, debt and, if required & interested, to gold and real estate. Within equities, diversification can be at many levels - country / market cap / sector /style level (value / growth), and so on. When investing with mutual funds, diversification can be easily done and with even more options.
Another golden rule of achieving your financial goals faster is increasing your investments as your earnings grow. Ideally, your savings ratio should follow / track the growth in your income. Once the basic needs are met and disposable income increases faster, it is only wiser to divert a huge chunk of that towards investments, else, there is a high risk it will be spent generously. One way of automatically ensuring that you are increasing your savings is to register your SIPs with the top-up option which automatically increases your SIP amount at a fixed frequency with a fixed amount.
In the journey of wealth creation, investors often redeem their investments to meet unplanned expenses. These withdrawals have a significant impact on your wealth creation journey as you are not just losing your present investment but also the many years of growth and compounding. Take that into consideration too. Fortunately, this can easily be avoided with Loan Against Securities or Mutual Funds. This alternative helps you avoid selling your investments, and is especially helpful when you need funds urgently and the markets are not right for selling. Explore this option with your financial products distributor.
Investing is one of the many tools that help build wealth and achieve financial independence. But, it also requires a good level of financial literacy and discipline to master the game. In the long run, however, follow these 7 Wealth Creation Mantras as guiding principles, consistently and in a disciplined manner. You can bet to come out wealthy at the other end of this journey. Stay consistent and keep investing!
NJ E-wealth
A Simplified Guide to Buying Personal Accident Insurance
A Simplified Guide to Buying Personal Accident Insurance
Life is full of unknown factors. One can never really predict how the road ahead will bend. While accidents can happen anywhere and at any time, one of the most common ones is road accidents. They have become a significant root cause of death, injury, and property damage, especially in India. Recently, this fact came into highlight with the high-profile death of Mr. Cyrus Mistry, the former Chairman of Tata Sons, in a car accident.
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There are two types of PA insurance policies available. A family PA policy and an individual PA policy. You can choose between both, depending on your needs. Please remember, spouses and children are entitled to a limited cover per policy. Therefore, make sure that the policy covers all of your family members appropriately. Comprehensive and adequate coverage of the earning member is of prime importance under a PA policy.
There are mainly four types of coverages available under PA insurance:
, in which the sum assured of the policy is payable to the nominee in the event of the policyholder's death.
, in which a pre-determined amount is paid to the policyholder if an accident results in permanent disability, such as loss of both limbs or eyesight (both eyes).
secures the insured financially from a permanent partial disability in an accident. In this case, the insured receives a percentage (up to 100% of the sum assured) of the benefit. For e.g., loss of one limb or eyesight of one eye.
provides coverage to the insured suffering from a temporary total disability and is bedridden for an extended period. The insurer here gives weekly compensation for the loss of income during the period of disability.
Most insurance companies provide all four coverages in a comprehensive PA policy. Therefore, one should prefer the comprehensive PA policy for maximum coverage and benefits. The cover should include activities that could result in accidents at various workplaces such as home or office/work. Generally, a PA insurance policy provides worldwide and 24*7 coverage. It means it will provide the above-mentioned benefits to policyholders anytime & anywhere.
As previously said, PA policies are very affordable. One may, however, choose a policy with balance of the premium amount and the coverage provided. Moreover, premium rates are the same from 18 to 69 years and PA policies do not consider the age factor in premium pricing. Furthermore, occupation plays a vital role in deciding the premium amount of PA policy as the risk of accident is more or less related to the nature of the work of an individual.
It is also important to select a reputable insurer through a reliable insurance intermediary/agent. The track record of a company's claim settlement speaks volumes about its quality and dependability. You may inquire about the claim process & ensure that it is quick and easy. You may also learn about the claim handlers also known as Third Party Administrators (TPA) participation and their claim history.
PA policies also come with add-ons and riders which provide additional benefits such as hospitalization, blood purchase, transportation of mortal remains, burns, coma, and so on. Some plans include these benefits, while others require you to purchase them as add-ons. Choose the one that best serves you for a reasonable premium.
PA policy excludes certain events from the policy, like self-harming cases of suicide and criminal acts, pre-existing diseases, natural death and so on. Therefore, keep a keen eye on exclusions in the policy. Pay attention to policy details during the purchase.
To summarize, consider all of these factors before deciding on the ideal policy for you. PA insurance can help you prepare for unforeseen events not covered under other policies. Regardless of your age or health, it is prudent to obtain PA insurance, especially if you travel frequently. Before you sign the policy, please understand the risks covered and other finer aspects of the policy, in fact for every policy, not just this one.
loans
1. As and when the client repay the loan amount / EMI, he can make a request for unpledging the securities.

Client needs to post a query from NJ E wealth account desk.

Request for Unpledging of Full securities :

Module Path : Login to NJ E wealth account desk > Help & Support > Send Query [Select Query Type - Loan against Security(LAS) related & Sub Type - Request for Unpledge of Full securities.
Request for Unpledging of Partial securities :

Module Path : Login to NJ E wealth account desk > Help & Support > Send Query [Select Query Type - Loan against Security(LAS) related & Sub Type - Request for Unpledge of Partial securities.
TAT for processing above request: Once a request is posted by a client on the E-Wealth desk, securities will be unpledged within T+3 working days.

Fund Manager INTERVIEW
patner Interview
Mr. Trideep Bhattacharya
CIO - Equities, Edelweiss Asset Management Limited
With PGDM in Finance from SP Jain Institute of Management & Research, Mumbai and B.Tech in Electrical Engineering from IIT, Kharagpur , meet our CIO – Equities – Mr. Triddep Bhattacharya.
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Kotak Deepak Amrutlal (ARN-127784)
AMFI REGISTERED MUTUAL FUND DISTRIBUTOR

Deepak A Kotak
  • Retirement Assessment
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  • Portfolio Review
  • Mutual Fund:Debt / Equity / ELSS

"We have taken due care and caution in compilation of this E Newsletter. The information has been obtained from various reliable sources. However it does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions of the results obtained from the use of such information. Investors should seek proper financial advise regarding the appropriateness of investing in any of the schemes stated, discussed or recommended in this newsletter and should realise that the statements regarding future prospects may or may not realise. Mutual fund investments are subject to market risks. Please read the offer document carefully before investing. Past performance is for indicative purpose only and is not necessarily a guide to the future performance."

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