No. I am not saying anything new. This is an old old grouse of mine, and for which I have no solution. Or rather my only solution is ‘please buy only simple products that you understand’.

I do not know where to start, but one thing that the BFSI (Banks and Financial services industry) has done is to make the end products financially complex such that negotiating our financial world properly requires a great deal of interest, education, training, knowing the powers that be and discipline. Only a small percentage of the world population possess all those attributes.  So a few of us who seem to have that are superpowers. Lucky me. Guess what? You too may be making the cut. Congrats.

All of us who have a professional degree and reasonable wants have enough money to retire at say age 50 if not earlier. However, given our complex products, and impossible to understand agreements, the financial well being never happens. In fact when somebody does that it creates news!

When a new mutual fund scheme is launched, you need to judge its future ONLY AND ONLY based on costs. There is nothing to assume that the fund manager has some great skill. Look at the total costs that the fund is charging you (you do not?), look at their marketing spend, look at their results…and then you can be sure that the 3 year track record will be better.

Buy pure Term insurance – not return of premium, not with toppings (riders!), and buy it online from the cheapest source.

Medical insurance: it is a complicated buy, please use an agent. Preferably somebody with 20 years experience or at least 10 exp so that you understand sum assured, top up, super top up, what will pay and what will not. Do not buy till you do not understand and buy only from a government company like New India or its likes. Medical insurance companies are notorious in rejecting claims internationally. In India they do not have a long enough track record…so we cannot comment.

Market is not just a race to financial independence. It is also about living, working, enjoying – but if financial mismanagement – can ruin your life. There are just too many financial products that you do not need at all. IN all my training for doctors I keep emphasising on the simple things. Till you lean fund selection, Index funds. Term insurance. One house in which to live. One credit card, one home loan, one medical insurance plan. That is enough.

However people complicate their lives by buying houses, ulips, endowment plans, expensive mutual funds (yes there are schemes from reputed fund houses which charge you 3%+ for a large cap fund. Guess who?

There are fund houses more interested in marketing and sales and do not like to talk about costs and performance. Stay away.

Do not believe the things that you see on television and on blogs (including this) unless you know why that article is being written.

If you do not know who is to pay the bill for the lunch that you are having with your ‘friends’….then it is YOU.