How to plan for your child’s education inflationary costs?

April 16th, 2015

With the ever rising school fees, educational expenses have hit the roof. Parents are ready to even compromise on a lot of their expenses like EMI’s for the sake of their child’s admission in a branded school. There is a trend of around 10% inflation on the child’s current education. Thus, to meet the expenses and the demands and peer competition, there needs to be a plan well in advance.

Immediate School Expenses: So to beat the inflation of around 10% in a short time, just for school fees or admission, there are very few options Bank Fixed Deposits or Recurring Deposits or Debt Funds. This is because, 2-3 years is a very short time for investing in the market for average returns. Hence play safe by investing more for these yearly expenses.

Future Educational Planning: Now, when you need to plan for the child’s future expenses, keeping in mind your dreams, the child’s expectations and your abilities, there needs to be a proper plan well in advance. If you start early, then you can reap the benefits of the Power of Compounding as well. This simply means that the earlier you invest, the larger your money can potentially become because of the Compound Interest that accumulates on the entire fund. Also, when you plan, please do keep Future Value of Money and Inflation in mind.

So, the basic tips to plan for your child’s future expenses would be:

· Start Early- so as to reap maximum benefits. The longer the horizon of investment, the larger your returns will be because of the Power of Compounding. The Power of Compounding would help you accomplish your goals much easily.
· Need Analysis- more often than not, a proper need and requirement analysis is not done and goals and aspirations are not set. This is a very important step so that you know what you need at the end of the day so that you can plan for the same.
· Make a Proper Plan- most people end up taking a loan or making haphazard expenses for the child’s future only because it has not been planned well in advance. If the cash flow analysis properly done at the beginning, the execution of the same will not be very difficult.
· Be Diligent- If the plan has been properly designed, all you need to do is follow the same diligently and not budge from it unless it is absolutely mandatory. Once the need is established, the plan is in place and you follow the same to the T, there is no reason for you to fall short on the plan.
· Review- just like checking on a road map to see that you are travelling on the correct path, it is very important for you to check that you are following the correct path of Financial Planning for your Child’s future expenses. This is perhaps the most important reason for which you are earning and working hard to provide the best to your family. Review is also important because Needs, Wants, Goals, Dreams and Aspirations keep changing with time, lifestyle, etc.
· Contingency Plan- is like making a Plan B so that if there is a requirement for any additional funding at any point of time, there is no shortfall in reaching perhaps the most important destination of your life, i.e. your Child’s Higher Education Expenses!

Thus, by following the simple steps and choosing a portfolio mix with diversified asset classes according to your risk appetite, it would be a cake walk for you to plan for your child’s future educational expenses. However, you need to constantly check and ensure that you are on the right track! All the best!

6 Tips for Planned Investment

April 16th, 2015

In economics, there is a concept called “Life Cycle Hypothesis”, which discusses that people
plan their consumption and savings behaviour in the best possible manner over their entire lifetimes. In many ways, this theory explains why people incur high amounts of debt in their early years of earning an income despite lacking a strong financial backup. They do so because they anticipate a higher income at a later stage. This works very well for some people, but not for all. After all, if every individual followed theory faithfully, then the global debt crisis would not even have crept up at all.
The fact is this: Saving is extremely important for the well-being of the individual as well as for the economy as a whole. Some people save a lot of money as well, especially in India where the Financial Savings Ratio for 2011 was as high as 10.9% of the Gross Domestic Product. However, loads of people who “save” reasonable amounts of money in their working years also fail to build up a commendable corpus at the time of retirement or exigency because of their unplanned financial behaviour.

In order to save in a planned and systematic manner, one needs to “invest” money rather than simply save; this ensures that inflation does not eat into the savings. With inflation in India being close to 10-12% p.a. and savings bank accounts paying only 4% interest, a person actually ends up losing 8% of his wealth if he keeps the same in a bank account. The same amount can be invested intelligently and according to the person’s risk appetite and financial requirements, thereby generating more money smartly.

Thus, planned investment is the key to a sound financial future. The key word here is “planned”. It means:

1) Considering one’s future goals

2) Taking into account one’s expenses and liabilities

3) Ascertaining one’s

– Risk Appetite

– Horizon for Investment

– Investment Objective

4) Deriving a plan for the same

5) And most importantly, sticking to this plan and reviewing it from time to time

It may sound difficult but it is not so difficult in reality. After all, we are talking about the most interesting thing in your life – YOUR FINANCES and YOUR MONEY! The charm of achieving such a goal makes the path seem simpler.

6 Basic Tips to keep in mind while making a Planned Investment

1. Create a Goal Sheet and Chalk out the Larger Objectives of Your Life: It may sound silly, but actually penning down larger financial objectives – like your daughter’s higher education at a foreign university in 20 years or your son’s international tennis tournament in 15 years, etc. – can prepare you to become disciplined enough to continue such investments over the long term. Your objectives may vary with time and lifestyle changes but the broader goals will remain more or less the same.

2. Make a Proper and Diligent Plan and Continue with It: The most important step for planned investment is conducting a cash flow analysis or preparing a financial plan either by yourself or through a professional, keeping the above mentioned factors in mind. Try to stick to your plan as much as possible without deviation so that the larger objectives of your investment are fulfilled.

3. Review the Plan Once, or at the maximum, twice a year: It is necessary to review your plan once or twice a year. But reviewing the same every day or every week will not serve any purpose. This is because the investment horizon of any investment tool is determined by the objective, and hence, should only be reviewed after a certain period has elapsed.

4. Have a Health Insurance Family Floater Plan: People often take their good health for granted and do not plan for rainy days. Hence, health insurance usually takes a back seat unless you feel the pinch of medical bills yourself. To plan for a sound financial future, it is important to maintain a healthy lifestyle along with a health insurance plan. This ensures that:

Medical expenditure does not eat into your earnings

The flow of income does not stop for medical reasons

This is true for all members of a family, which is why a comprehensive family floater plan is recommended.

5. Build a Contingency Fund: You can do so in a savings bank account, a liquid mutual fund or some other similar tool. Such funds should be set aside for medical exigencies and other emergencies so that investments intended for the larger financial objectives are not eaten up during this cash crunch. Avoid touching this investment under any circumstance and plan effectively by taking emergencies into account

6. Educate your Nominee: Your nominee should know about all your investments and your will so that your family remains financially protected even if something unforeseen were to happen to you. By maintaining a healthy lifestyle, you should live a long life. Nevertheless, when talking of planned investment, remember that it should be system driven and not person driven; it should be automated such that all kinds of financial worries are eliminated. Most people make the mistake of depending upon a lawyer or a friend with power of attorney but this often leads to incidents where the family does not receive the money that was due to them. Hence, educating your nominee is one of the basic steps you should take for planning your investment in a systematic manner.

How to Save Money for Investing

April 16th, 2015

Money has diverse roles to plays in all our lives. From meeting our daily requirements to helping us fulfill our life’s goals in the future, the value of money cannot be undermined. In today’s unstable economic conditions, it is important to be prudent and invest for a steady future ahead. And saving your hard earned money is the first step towards this goal. This assures us safety of future cash, and helps us to meet unexpected financial emergencies.

Where saving means setting aside a certain amount of money for a purpose, investment results in wealth building and yields returns on your savings. Here are a few practical tips to start saving now and invest for a steady future ahead.

1) Define Your Goals
We all have goals, whether it is to buy a car, or funding our child’s higher education. Define your goals well. This gives you a clear picture of what you need to save towards. The more your goals the more you need to save and invest, so that your hard earned money would reap benefits at the right time.

2) Cut your Debt
Keeping your debt at low levels is an important step towards saving money. Where a home loan may prove advantageous as it works towards building an asset, what we are essentially talking about here are unsecured loans such as credit card dues and other personal loans. Unsecured loans carry a very high interest rate of around 30-40%. So reducing such debt could help you save money unquestionably. Credit cards do come with its share of convenience; however its usage must be done with diligence. Pay up all credit card dues well before due date. If you have personal loans, work towards repaying them at the earliest.

3) Have a Budget
Maintaining a monthly budget is a very important step to monitor your spending and your saving. A budget does not imply you need to curtail spending. It just helps you understand your spending pattern and plan your savings on a regular basis. Draw up a monthly plan of your necessary expenses such as children’s fees, household expenses, medical expenses etc… Set these essential expenses apart. Utilize the balance to save and invest.

4) Spending Wise
Apart from just creating a budget, the key to saving and successful investing also lies in spending your money wisely. Allocate your resources towards necessity expenses and towards savings and investments. Necessities come first and other non essential expenses take their turn second. Stay away from impulsive buying. Various sales and offers are often quite a treat, but hold on. You actually may not require them. Look for suitable bargains when the necessity arises to buy a particular item.

5) Prioritize
After having listed your goals and needs, it is important to prioritize them. What’s your immediate needs and what requires to be met 20 years hence? Prioritizing them helps to streamline savings and effectively channelize them towards investing. For example saving regularly in a long term plan may cater to a long term goal such as children’s education. For short term goals of buying a car or towards holiday expenses, a bank fixed deposit may prove advantageous. So prioritize to effectively manage money

6) Educate yourself
It is never too late to educate yourself on matters of personal finance. Be aware of all the options available to save and invest. Numerous options from bank deposits to regular savings plans exist to suit different needs. So understand your profile and use the most appropriate option available for you.

7) Save for a contingency
Have a contingency fund in place that would meet emergency and unforeseen expenses such as a job loss or medical costs. Not having a contingency fund may derail your savings and investment plan towards long term financial goals. Besides, you may also end up using your credit card or opt for unsecured loans resulting in a high interest rate debt.

Pros and Cons of Pet Health Insurance

April 16th, 2015

While pet health insurance is not as common as human health insurance, it is certainly gaining popularity due to the increasing costs of veterinarian care and the medical procedures that are now available to in the animal health industry.

So what are the Pros of pet health insurance?

Pet health insurance can save you a bundle if your pet needs surgery or treatment for a serious disease. For instance:

Cost of surgery due to injury ($1000 to $2000)
Cancer treatment ($5000)
MRI’s and CAT Scans (aproximately $1000)
Hospitalization (Prices vary widely but hospitalization is not cheap)

These are unexpected expenses that you may have to incur if you want to keep your pet alive. Many owners are often faced with choosing between a very expensive treatment or euthanasia and often are forced to put their pets to sleep because they can’t afford the cost of the treatments. If your pet is covered by health insurance, you could avoid life-or-money decisions like these.

By spending anywhere from $10 to $50 a month in premiums a large amount of these expenses will be covered by pet health insurance.

Veterinay care keeps getting more expensive.
Most policies will cover recovery costs if your pet gets lost.

On the downside, here are some points to consider before you buy pet health insurance:

– Insurance companies will not cover pre-existing conditions so it’s best to buy your policy before your cat or dog gets really sick
– Premiums increase as your pet gets older
– Most policies have a spending limit. Usually the limits are per incident, but in other cases the limits are per year

Not all pet health insurance companies offer the same value. In fact, deciding which plan you are going to sign up for could be a nightmare. Do your homework, read up about it as much as you can before you make a decision but if you are willing to do anything to keep your pet alive, pet health insurance might save you money in the long run.

Thinking of Buying Pet Health Insurance?

April 16th, 2015

Thinking of buying pet health insurance?

Pet Health Insurance is becoming more popular not only because health care prices are rising, but because many treatments and surgeries once reserved for humans are now being applied to our animal companions.

Pet health insurance is not something new. In the early eighties, Dr Jack Stevens DVM started Veterinarian Pet Insurance. The purpose of his endeavor was to prevent animals from being euthanized because of budget concerns. Even now, treating pets has become so expensive that euthanizing the animal is oftentimes the most economical solution.

When medical veterinarian treatments include radiation, MRI’s, surgery, physical therapy and cancer treatments, the cost of caring for a dog or cat can be staggering. Accidents can also play a part in the high expense of health care. A broken leg, swallowing a foreign object or other types of accidents can end up costing thousands of dollars. Just think: ten days of dialysis treatment can cost $12,000 and cancer treatment could be as much as $40,000.

Americans will spend about $9.4 billion this year on the health of their pets, according to the American Pet Products Manufacturers Association.

Unfortunately, many pet owners find out the hard way. Their dog or cat gets into an accident or get really sick and they are faced with the hard decision of either paying the high bills (which sometimes they can’t afford) or putting their pet to sleep.

Rather than waiting for something terrible to happen to your dog and ending up with a huge vet bill, why not think ahead and get some sort of health insurance and avoid the stress that may come when your animal gets sick.

Pet health insurance comes in many “flavors”. Before making that decision, it is best to talk to your vet and get an idea of what kind of coverage you are going to need.

As with other health insurance, pet health insurance is subject to premiums, deductibles and certain limits on the amount of coverage. Insuring certain breeds could be more costly because of genetic factors.

When doing research, try to find out about the company’s reputation and efficiency. The Internet is a great place to start. Look in forums for people’s reviews and personal experiences. http://aspcacommunity.ning.com/forum is a good place to start. You will read opinions from people who have no vested interest in any particular company so you are more likely to learn the truth. Keep in mind that people are more likely to complain and express their disappointment with something than to praise. It is still a good place to get an idea of pet owners’ experiences with pet insurance.

When choosing an insurance companies find out about specific coverage and don’t forget drug coverage, dental treatment and recovery treatments such as physical therapy. Some insurance companies will even cover the costs involved if your pet gets lost or stolen.

What You Need to Know Before Buying Pet Health Insurance

April 16th, 2015

By now, you have probably heard read about pet health insurance. But what does pet insurance do exactly?
Health insurance for pets may help you pay your veterinary bills if your pet has an accident, gets sick, or needs routine preventive care. Most plans cover dogs and cats, and some plans cover other types of animals.
What you should consider before you buy pet health insurance:
• Shop and compare – Ask your vet to recommend some pet insurers. Be aware that policies and premiums vary widely. Compare monthly or annual costs, and the differences in deductibles, co-pays and coverage limits. These may limit payouts by incident, annually, or your animal’s lifetime.
• Carefully read policies – Read the clauses on deductibles, co-pays, coverage limits, and exclusions before you buy a pet insurance policy. Pre-existing problems and hereditary conditions such as dysphasia in certain dog breeds, such as German shepherds and retrievers, are normally excluded.
• Do your math – Make sure you add up the total costs of the policy for the anticipated life expectancy of your pet. Be aware that the age of your pet affects the premium. The older your pet is, the higher the premium you will pay.
Questions to ask insurers:
• Can I choose my vet? – Does your insurance plan allows you to get the vet of your choice or do you have to choose from a “network” or designated care giver.
• Is there a waiting period? – Most policies have a waiting period and it might be different for accident or illnesses
• Do you cover routine wellness exams? – Most plans will not cover wellness or routine care though some policies give you an option if you pay extra
• Do you cover neutering or spaying?
• Does the plan include prescription drug coverage? – Some plans include prescription drugs others won’t
• Do you cover claims annually or by incident? – Find out the maximum coverage. Some plans will have a maximum per incident others will have a maximum per year.
• If the coverage is by incident, is there a time limit?
• Is there a dollar limit for vet office fees? – Some companies will only reimburse ” allowable” veterinary expenses. In other words, they set the price.
• If my pet has a pre-existing or hereditary condition, will this plan cover it?
• Does this plan cover chronic or recurring conditions?
• How long do you take to pay claims?
• Do you give discounts for insuring multiple pets?
• Does this plan cover advertising costs and rewards if my pet is lost or stolen?
• Does this plan make payouts if my pet is being treated and dies?

How Does Pet Health Insurance Work?

April 16th, 2015

Pet health insurance works as an indemnity type insurance. This means that you pay your veterinarian, you file a claim, and then you are reimbursed for a portion of the fees.

After you get health insurance for your pet and you will have a waiting period. The waiting period can be 3, 8 or even 14 days depending on the policy and the company.

After that, if your pet gets sick or gets into an accident you will be ready to file a claim.

You need to make sure that you visit a licensed veterinarian

Next you need to obtain a claim form. Very often you can download a claim form from your pet health insurance company’s website. The form needs to be completed by you and your veterinarian. A good practice and a time saver is to keep a few pre-filled claims form in your pet’s file at your veterinarian’s office.

After you have your claims all filled out, you will have to attach a copy of the invoices. These could be your veterinarian bill, but also bills for x-rays, hospitalization or other charges that may apply. A quick fax or mailing the completed forms will start the process of reimbursment.

Since most plans have a deductible, the insurance company will deduct the specified amount and then send you a check for the percentage of coverage that you chose when you purchased the policy. According to our reseach, percentages go anywhere from 65% to 90%. In some instances, even 100% after the deductible is covered.

Some companies will only reimburse ” allowable” veterinary expenses. In other words, they set the price. This is why it is so important to inform yourself and do the research before buying pet health insurance so there are no unpleasant surprises.

If don’t have a policy and are thinking of getting health insurance for your cat or dog, you can start by asking your vet. He or she may have first hand experience with one or more companies. You can also search for customer comments on blogs or forums. You can also view a comprehensive pet health insurance comparison at :

Pet Health Insurance Review

April 16th, 2015

Pet Health Insurance is becoming more popular not only because health care prices are rising, but because many treatments and surgeries once reserved for humans are now being applied to our animal companions.

Pet health insurance is not something new. In the early eighties, Dr Jack Stevens DVM started Veterinarian Pet Insurance. The purpose of his endeavor was to prevent animals from being euthanized because of budget concerns. Even now, treating pets has become so expensive that euthanizing the animal is oftentimes the most economical solution.

When medical veterinarian treatments include radiation, MRI’s, surgery, physical therapy and cancer treatments, the cost of caring for a dog or cat can be staggering. Accidents can also play a part in the high expense of health care. A broken leg, swallowing a foreign object or other types of accidents can end up costing thousands of dollars. Just think: ten days of dialysis treatment can cost $12,000 and cancer treatment could be as much as $40,000.

Americans will spend about $9.4 billion this year on the health of their pets, according to the American Pet Products Manufacturers Association.

Unfortunately, many pet owners find out the hard way. Their dog or cat gets into an accident or get really sick and they are faced with the hard decision of either paying the high bills (which sometimes they can’t afford) or putting their pet to sleep.

Rather than waiting for something terrible to happen to your dog and ending up with a huge vet bill, why not think ahead and get some sort of health insurance and avoid the stress that may come when your animal gets sick.

Pet health insurance comes in many “flavors”. Before making that decision, it is best to talk to your vet and get an idea of what kind of coverage you are going to need.

As with other health insurance, pet health insurance is subject to premiums, deductibles and certain limits on the amount of coverage. Insuring certain breeds could be more costly because of genetic factors.

When doing research, try to find out about the company’s reputation and efficiency. The Internet is a great place to start. Look in forums for people’s reviews and personal experiences. http://aspcacommunity.ning.com/forum is a good place to start. You will read opinions from people who have no vested interest in any particular company so you are more likely to learn the truth. Keep in mind that people are more likely to complain and express their disappointment with something than to praise. It is still a good place to get an idea of pet owners’ experiences with pet insurance.

When choosing an insurance companies find out about specific coverage and don’t forget drug coverage, dental treatment and recovery treatments such as physical therapy. Some insurance companies will even cover the costs involved if your pet gets lost or stolen.

How Much Does Pet Insurance Cost?

April 16th, 2015

Many people want to know how much pet insurance costs, and I am sure would like to do a price comparison and compare pet insurance companies before they commit to buy insurance for their pets. So the question comes up all over the Internet, in blogs, forums and some wiki websites.

The answer though is not an easy one. Pet insurance like most insurance have many variables that could make the price higher or lower.

First, let’s start with the company itself. If you decide to get a quote, and you try several companies, most likely you will get different premiums for the same pet, so the company you choose is definitely a factor in the price of your premiums.

Next is the type of animal. Are you insuring a dog or a cat? Cats are generally cheaper to insure due to several reasons. Cats are usually kept indoors so they are less likely to get into accidents. They are also less prone to disease and they seem to stay out of trouble better than dogs. Cat owners will tell you of course that cats are smarter, but we don’t want to go there do we? The truth is that dogs are more impulsive and usually greedy when it comes to food and are more likely to ingest a foreign object or to get hit by a car because they ran after something on the street.

Another variable is breed. Regardless whether a cat or a dog, certain breeds are more prone to diseases. In fact there is a pet insurance company that will only provide accident insurance (no illness) for Chinese Shar-pei and Shar-pei cross-breeds.

Another factor that affects your premiums is location. Every time you want to get a quote from a pet insurance company, they will ask you for you zip code. This probably has to do with veterinary rates.

Age also plays a role on the cost of pet insurance. The older your pet, the higher the premiums. This doesn’t mean that pet insurance is not available for senior pets, in fact, many companies will still enroll your pet even if she is older than 8 years. This is why it pays to do a little research before jumping into pet insurance.

And last but not least, is the amount of coverage and the size of the deductible you choose. This can make a big difference on your monthly premium. For instance some companies will allow you to choose you premium from selected amounts. It could be $50, $100 or $200, and the percentage of the reimbursement which can range from 70% of the bill to 100%.

If you really want to know how much pet insurance costs, you need to visit the company’s websites and get free quotes. The information you will need is the zip code where you live, the age of your dog, the breed, whether it is a cat or a dog, male or female.

An Overview on Pet Health Insurance

April 16th, 2015

Pet health insurance is becoming very popular and is catching on in the US. With rising pet health care costs, the prospect of having those costs covered by an insurance program is becoming more attractive.

Pet Health Care Costs

Pet health care costs have increased dramatically in recent years, mostly because vets use more sophisticated diagnostic tools (MRIs and CAT scans, for example) and those tests can be very costly.
In addition, the cost for life-saving treatment such as chemotherapy could be around $2,000.
Health insurance for our animal family, can be almost as confusing as health insurance for people, but it also can be an asset in an unexpected situation—particularly for an animal owner whose companion develops a major medical condition.

Coverage

Many pet owners have accidental coverage only. My research showed that there are a several pet health insurance companies that offer a diverse animal health insurance rates from routine care coverage to life threatening illness protection. Most companies won’t cover congenital problems such as hip-dysplasia for any dog, and one company provided a listing of health problems that do not qualify for coverage based on breed. . Some plans cover preventative care and others are just major medical while plans cover only accident and illness

Policies

So how do most of these pet health insurance policies work? Almost all policies have a deductible and a co-pay requirement. You pay for the services provided and then file a claim with insurance company to get reimbursed. Policies and costs vary widely from company to company, so you definitely need to research and shop around to find the right policy for you and your pet.. Some policies cover a broad range of treatments, from cancer medications to acupuncture and some but not all, provide policies for senior pets.

Premiums

Costs are generally in the $100-400 range annually. Discounts are available sometimes if you pet has a microchip ID implant. f you have more than one pet on your policy then you will normally receive a discount. Usually the discount for multiple pets is about 5%. If you work for a major corporation, check to see if they offer pet health insurance. Over 1,500 companies in the United States already offer pet insurance as a benefit. Some insurers also offer discount for service pets but you must show proper documentation.