How this Bengaluru family transformed its finances

livemint.com:

Mint recently spoke with a Bengaluru-based family about its decision to seek the guidance of a registered investment adviser (RIA) and how their financial plan is now helping them achieve their goals. Neeraj Gupta, 37 and his wife Etti Gupta, 35, both IT professionals, managed their family finances on their own until 2019. In 2017, he met with a road accident.

Though he escaped largely unscathed, it set him thinking on the need for proper financial planning. “I was quite scared about my family’s future prospects in the event of something untoward happening to me. I wanted somebody to help us plan our finances," says Gupta.

In 2019, Gupta approached Abhishek Kumar, a Sebi-registered fee-only adviser. “Our finances were in a disarray. We did not have a structured plan and relied mainly on insurance provided by our employers.

Abhishek helped us reflect on our short-and long-term financial goals," says Gupta. Kumar advised the family to build an emergency corpus in the initial few months, ensuring enough funds was set aside for unforeseen expenses—crucial for scenarios like job loss in the volatile IT sector. The family next opted for a comprehensive family floater plan with a basic coverage of ₹20 lakh and a top-up plan of ₹1 crore, totalling an annual premium of ₹25,000.

“We got an additional health cover as we could not just rely only on the health insurance provided by our employers. That would not be enough to cover all our medical needs. Besides, in case of a job loss, you could lose coverage" adds Gupta Apart from the term life cover provided by his employer, Gupta also decided to get an additional term insurance to tackle rising inflation and take care of the family’s increasing lifestyle expenses.