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    Harshvardhan Roongta on financial planning and IPL for the new woman

    Synopsis

    “If one of the partners passes away, the surviving member needs to have a clue of what investments have been done, the insurances, the fixed assets and how to go about claiming the money and transferring that money to oneself and use it effectively for the welfare of the family in general.”

    Harshvardhan Roongta-1200ETMarkets.com
    “We suggest a structured programme. we just put it in a format and call it an IPL for the new woman. This is an acronym that we have given to this entire exercise which we encourage all couples to undertake, all family households,” says Harshvardhan Roongta, Principal Financial Planner, Roongta Securities.

    You have been planning peoples’ life financially for a very long period of time now. What are the impacts of not disclosing or not discussing your financial life or your financial health with your partner? How would it backfire if you are not prepared for it?
    It is a very important subject matter for a simple reason; the Indian society by and large is in such a format that generally women are the home markers. If a woman being a homemaker tries to involve herself in a family financial discussion, sometimes it is not looked upon favourably. In some cases, we have seen women are generally indifferent to the whole thing saying that my husband or my father or my in-laws are taking care of finances and so I do not want to involve myself at all.

    So there could be a situation where a woman herself is not involved or even if she wants to be involved, it is not looked upon favourably. So an awareness needs to be created that it is not the reason that somebody is starting to find out more about the financials of the family and it is not in a negative manner.

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    As you rightly pointed out, if a couple is not aware of the financials, so many problems can arise when it comes to effective use of that money especially if there is a death in the family.

    If one of the partners passes away, the surviving member needs to have a clue of what investments have been done, the insurances, the fixed assets and how to go about claiming the money and transferring that money to oneself and use it effectively for the welfare of the family in general. So the taboo around this conversation needs to go. There has to be encouragement from the elders of the family for an open conversation between the couple.

    This helps in planning the expenses effectively because at one point in time, we will see that one member of the family is not aware of the exact financial situation and probably could be spending or thinking everything is fine, wherein the other member of the family is aware of the the real situation and believes that the situation is not so comfortable and we need to curtail expenses.

    So most certainly there has to be conversation around it, one needs to know about the other’s investments, assets and insurances so that the financial planning process is completed in a 360 degree manner and not in a haphazard manner.

    How do we kickstart it? How do we sit down and talk about our finances? What should we start first with – our savings, investments or spending?
    We suggest a structured programme. we just put it in a format and call it an IPL for the new woman. This is an acronym that we have given to this entire exercise which we encourage all couples to undertake, all family households.

    Just one clarification: it is called IPL for women and so there is nothing for guys over here?
    Actually it is the IPL for the new women.

    But this involves sharing both the couples finances right? Financial life and their details?
    Yes.

    Why have you made it so women centric and women-oriented?
    As I said, the Indian societal formation is such that generally speaking women are considered to be homemakers and yet are out of the purview of household finances. In this exercise, we are trying to encourage and tell women to just get a hang of what is happening and this is for all the family members in the households to start putting across all the finances that we have in a structured manner.

    So what I mean by the IPL for the new women? I stands for all the investments; the first thing that you need to do is on a simple excel sheet or on a piece of paper and note down all the investments that you have, note down the accounts numbers, the folio numbers if you have a mutual fund, the insurance details and all that PAN Numbers, the Aadhar.

    In fact, we also go ahead and say that you create a common family email id for investment, say investments.comthapliyal@gmail.com. It could just be a common email id but all your OTPs and mobile numbers because in case of demise one person, one has to access those statements. So this is the investment part. Just get all your assets, investments, everything put down in a place with your folio numbers which is easily accessible for the surviving members.

    The P of the IPL is protection. You need to ensure that you have knowledge of all the insurance that have been bought by family members. You must be aware what those insurance policies are, where they are stored and if they are in an electronic form, all that information has to be given in the common email ID.

    In case of the demise of the policy holder or the insured that is exactly the reason you bought because your surviving member should get the benefit of that insurance policy. So they need to be aware of that insurance. There are so many people that have bought term insurance and have bought all different kinds of insurance and the nominees and beneficiaries are not even aware that there is a policy. So how is that person going to claim because that is eventually the purpose of the information. So you need to make sure that you are the protection element already recorded, all insurance numbers, policy numbers etc. handed over to your beneficiary to know that this is where you go and claim insurance.

    What is the L and W all about?
    L is about liability. In today’s times, we have people with home loans and different kinds of loans. We just need to make sure that you are aware of all the liabilities, what the EMI contributions are and in case the earning member of the family is not around, there is a provision to pay those EMIs.

    You need to make sure as a surviving member, as a woman of the house, you do not want to only lose your loved ones but also want to ensure that your house is not taken away at the same time. There is a chance of double whammy of losing your loved one and your house together! It can be a very traumatic situation. That is the liability part that you need to ensure that it is well taken care of and EMIs burden will come up on you.

    The N part is the nomination when there are several cases where people have nominated somebody in their bank accounts, in their insurances, in their PPF accounts etc. Even in the case of real estate in a housing society, one could have a nomination and then if nominees passed away, you need to change your nomination and so please update all your nominations.



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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