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Saving is a good habit, but savings by themselves may not be good enough. Gurgaon-based HR professionals Himanshi Kaushik and Rishi Nath Bhagirath realised this. “Earlier, when we used to get our salary, we would just spend it. So, the ‘saving’ was simply what was left at the end of the month. And that too went into very traditional instruments like fixed deposits," said Himanshi. They would hear colleagues and friends talk of their investments in instruments like mutual funds through systematic investment plans (SIPs). “We thought maybe we should also do something like that, but were not sure of what to do," she said. 

Online reading and research led them to the concept of financial planning and then on to financial planners. Interactions with different advisers made them realise that there are some who follow a commission-based approach and some are fee-only. “I felt that fee-only worked better. While as a client you have to make more effort, it is safer as there is no vested interest (from the planner’s side)," she said.

They also came across some advisers who had “an HNI" mindset. But what Himanshi and Rishi were looking for was someone who would not take advantage of them and would be able to explain things to them in simple terms. “We were novices," said Himanshi. Sukhvinder S. Sidhu, founder, FinlifeCare Solutions, fit the bill. A Skype meeting and a few conversations set the ball rolling for them. 

The initial step of gathering information on incomes, expenses and liabilities, and on what their goals were, was an eye-opening experience. “This was important. It opened our eyes to many things that we wouldn’t have noticed otherwise. For instance, we filled petrol in our car whenever it was needed. We didn’t realise how much we were spending on this in a month. Or, on going out," said Himanshi. More importantly, the couple was forced to think about their financial goals. While they had thought of things like buying a house and travel, they had not given retirement and insurance a serious thought. “We had thought that we would be able to buy a house in 3-4 years. But after looking at all our goals and investments, we were told 2052, which was too far away. So, after some adjustments, it came to 2027. I think this is realistic," she said. 

Once the initial details were in place and the couple had fine-tuned their goals, the next step was to calibrate the investments accordingly. “He suggested financial instruments according to the goals. For example, if you want to achieve the goal of buying a house in such and such year, then you should invest this much in this instrument for these many months," said Himanshi. 

While buying a house and building a retirement corpus were two of Himanshi and Rishi’s main objectives about two years ago, the birth of their daughter, Aavya, who is 10 months old now, added her education to the priority list. All these goals are important but will happen at different times. Therefore, the investments too are based on different timelines. 

For needs that are in the near future, the money has been invested in fixed deposits and liquid funds, and for those that are many years later, the investments are in equity funds, balanced funds and debt funds, through SIPs. 

In life insurance, both now have separate term plans, and their own health insurance cover apart from what their employers provide. “This year, we will get critical illness cover also," said Himanshi. 

The couple is fond of travelling but does not invest for it. “We want to travel out of what we save, after all the expenses and investments," said Himanshi. 

A financial plan has made the couple more careful of how they spend. “Now we think of the SIPs and other investments," said Himanshi. They have also learnt about more products and their features. “For example, we learnt that while fixed deposits give liquidity, the returns are very low," she said. They are also happy to see that their combined networth has increased over 2 years, which gives them a sense of security and comfort. “I know that if we ever need money, we have these sources to tap. We won’t have to ask from here and there," said Himanshi. 

Rishi and Himanshi have just gone through a revision of their financial plan to include their daughter’s primary education and also be able to buy their house sooner than 10 years.

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MY PLAN

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Name: Himanshi Kaushik

Age: 29

Profession: human resource professional

Name: Rishi Nath Bhagirath

Age: 32

Profession: human resource professional

Financial planner: Sukhvinder Sidhu, founder, FinlifeCare Solutions 

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