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We are now a household that plans well, and in advance

LiveMint logoLiveMint 17-04-2017 Deepti Bhaskaran

Name: Arun Kumar Srivastav

Age: 51

Profession: deputy general manager at ONGC

Name: Namita Srivastava

Age: 48

Profession: homemaker

Financial planner: Suresh Sadagopan, founder, Ladder7 Financial Advisories (Registered as Investment Adviser with Sebi)

Arun Kumar Srivastav, 51, is a deputy general manager with the ONGC. He didn’t think about investments or savings for a long time. What he fancied instead, was share trading. “I joined ONGC in 1990. Other than the provident fund, I didn’t have any other form of investment. Most of my money went into share trading,” he said. During the Harshad Mehta scam, Arun lost a lot of money as the markets tanked, but that didn’t deter him. “We had agents who would come to my office. One helped me open a demat account and buy shares. I used to trade intra-day,” he said. In 2009, again he faced a serious loss from the stock market, but this time it forced him to introspect. By that time, the couple also had a daughter to look after. “My daughter was born in 2007 and I realised that I had not saved anything for her. I had, in fact, lost a lot of money in share trading and I had only 19 years of service left,” he said. 

His wife Namita Srivastava, 48, is a homemaker. She said: “Ours was a late marriage and we had a child very late. So as a household we were not financially conscious. It was only after we had a child that we chalked our financial goals.”

Arun, with his friends, began scouting for professional advice and zeroed in on Ladder7 Financial Advisories in 2009. “We went with a lot of fear and nervousness because of our experience, and the fact that we had accumulated nothing except for a flat in Mumbai, which we bought in 2003, as I had got loan at a very low rate of interest,” he said.

The financial planning exercise for Arun began by taking stock of his current financial situation and clearly detailing his financial goals. “I had three major financial goals: my daughter’s education, some money for her marriage and my retirement,” he said.

But reaching these goals meant a serious change to his portfolio. “I mainly had the provident fund and some shares and mutual funds. I never really tracked those mutual funds and I suffered a loss. This was when I learnt the significance of diversification,” said Arun. 

“Now, even though a majority of my investments are in mutual funds, I have a well-diversified portfolio. I have most of my money in equities but I am comfortable with it because I have sought professional advice for picking these funds and even my equity portfolio is well diversified. We had gone to see our planner a few days back and are very happy with the way our portfolio has performed,” he added. Arun doesn’t buy or trade in stocks anymore. 

Consulting a financial planner didn’t just mean a change in their investment portfolio, it also meant a change in their outlook in order to cultivate some financial discipline. 

“Now we don’t waste money as we don’t overbuy. We even plan our travels well, and in advance. Basically, from being a household that conducted financial transactions on the spur of the moment, we have gone on to become a household that plans in advance,” he added.

For Arun, systematic investment plans of mutual funds have helped a great deal in cultivating financial discipline and the couple’s spending habits too have improved dramatically. 

Even Namita, who took sometime to understand their investment portfolio, is now comfortable and happy with the way things have turned out. “Initially I didn’t understand much and would let my husband decide. But my husband made it a point that I was present at the meetings with the financial planner as much as possible because he felt that both of us would need to be financially disciplined. Now, of course, I am comfortable with it and have an understanding of our portfolio,” said Namita. 

For the couple, their financial plan is to work towards achieving their major goals— with allowances for short-term goals as well. By the end of this year, the family plans to travel to the US to meet their relatives. “Our financial plan has accounted for this trip as well,” added Arun.

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