Stick to a financial plan

Seriously, how do you stick to a financial plan?

This question is for those who are financially worry-free. I don’t mean wealthy people or those who don’t take care of their own finances. I mean people who are working, raising families, and yet on top of their financial situation. I am married with 2 young sons. What we make in take home pay covers well over our usual bills. Groceries and gas are budgeted, but a little looser. Saving money seems like a joke.

I budget out our finances to the point I get obsessed with it. It doesn’t seem to matter how much out of debt we get, we can always find some place to use the extra money instead of using it to pay off another debt. I’m really frustrated because I have no idea what I’m doing wrong. Why can I figure it on paper, but can’t make it happen? I write out a meal plan for an entire month and stick to it very closely, we don’t eat out, and we don’t go out. Because of our situation, I really worry about how my sons will learn to manage finances. Give me a clue!

It’s hard. I know what you’re going through because this is what I teach people for a living so I’ve heard every story you could possibly imagine about finances. Have you done a detailed tracking of where your money is going? If not, both you and hubby need to write down every penny you spend for the next month. Put it into an excel spreadsheet and categorize it.

See if you can figure out where the money it going. Additionally, here are some suggestions I have for you:

1 – you need to sit down with your family, including your kids (get them involved in family finances early), and figure out what your family’s financial goals are. Make a list of them, prioritize them, assign due dates and come up with a plan on how to meet them. Then implement your plan. 2 – make everything automatic. On the day you get paid, set up automatic payments to your credit cards, loans, savings accounts, retirement accounts, etc. Everything that you want to pay towards should come out of your account the day you get the money. Whatever left after you pay towards all of that is how much you have to spend that month. 3 – tracking every penny will make you insane. Instead, implement #2, set aside your grocery money and then the rest is fair game. 4 – give yourself an allowance. You and hubby both get $X/month to spend on whatever you want. Once that’s gone you’re done. No robbing peter to pay paul. When the money’s gone you’re done. You and your husband should both read Smart Couples Finish Rich by David Bach. It will make you take a look at your relationship with money and give you tips on how to make it work. You can do this. You just need to get control of where your money is going.

PNB Launches Global Gold and Global Classic Credit Card

Expanding its product portfolio, the country’s second largest public sector lender, Punjab National Bank, has launched a global credit card.

“To start with we are launching two varieties of credit cards– Global Gold and Global Classic, which will meet the needs of its customers and will cater to the requirement of different income groups, “PNB Chairman K C Chakrabarty said yesterday during the commercial launch of the cards.

He said, the bank had done soft launch in November but with the commercial launch it would be available across 1,200 branches of the bank across the country. The card would be initially offered to existing customers of the bank, he said.

With VISA as a payment gateway, the card will be accepted in over 29 million merchant establishments and a million ATMs across the worldwide. The fully loaded photo credit card comes with a host of features like free credit period of up to 50 days, no annual fee and attractive reward points.

HDFC Bank surpasses ICICI Bank in terms of branch network

The country’s second largest private sector lender, HDFC Bank, which added 658 branches in 2008, has pipped ICICI Bank in terms of branch network.

As per the information available on its Website, HDFC Bank has a nationwide network of 1,412 branches spread across 528 towns and cities. At the same time, ICICI Bank, the largest player in terms of asset and market capitalization, has a network of 1,400 branches.

ICICI Bank has already got permission to open another 587 branches, a spokesperson of the bank said.

HDFC Bank has almost doubled its branch network last year through organic as well as inorganic growth route.

Last year, the Mumbai-based bank acquired Centurion Bank of Punjab leading to the integration of 404 branches, while it opened 254 new branches of its own during the year.

The bank also opened its first overseas branch in Bahrain during the year to provide trade financing to corporate clients and wealth management services for NRIs.

Financial Services Advertising budget dropped

The ongoing downturn has forced firms to cut back on advertising expenses. The banking, financial services and insurance segment (BFSI) has cut advertising budgets by nearly 40 per cent.

An analysis of AdEx data, a comparison of the volume growth over the June-October period in 2007 with the corresponding period in 2008 , shows that bank advertising on TV decreased by 3 per cent, advertising for loans went down by 39 per cent and mutual fund advertising was down 84 per cent.

However, insurance grew by 74 per cent. So the decrease in advertising spend from the financial sector is countered to an extent by the insurance advertising increase to some extent.
BFSI sector contributes 5 per cent to the total advertising on TV. This financial year the estimated contribution is 350 crore.
Insurance has seen a drop in sales from 70-80 per cent to 30-40 per cent in the last quarter, but it hasn’t deterred companies’ spend on advertising. Debashis Sarkar, senior director and CMO, Max New York Life, says: “Insurance is a need rather than investment. Who can do without financial planning? In a downturn, while advertising is the first thing to bear the brunt, I believe otherwise. Brand building is a strategic investment.” Max’s advertising budget for this year is around Rs 60 crore.
Insurance sector advertising is growing for a host of reasons. Three new players entered have the sector this year: AEGON Religare, Sahara India Life Insurance and Canara HSBC Oriental Bank of Commerce Life Insurance.
Chandradeep Mitra, president and head, Mudra MAX (media buying arm), Mudra, says: “Earlier insurance companies used to advertise in the tax saving period of January to March. Now the ads run throughout the year. Companies have also added a slew of new products.”
Sarkar adds: “Tax-saving period does not need advertising, it just requires a more aggressive sales force. Advertising is done to attract people ltowards real saving from a long term perspective.”
Max alone contributed half of the total insurance advertising on TV, which is a very unusual spend from an insurance company. Max was the exclusive telecast sponsor of the IPL.
Sujit Ganguly, senior vice-president and head-marketing, ICICI Prudential, says: “For us the trend is not new. We have always been communicating that insurance is not a tax saving tool, it’s a long-term saving goal. On the back of strong advertising, we have reached a market share of 13.5 per cent from the last year’s 12.7 per cent. Our advertising budget is intact this year.”

SBI Q2 profit grows by 40 per cent

Beating projections, India’s leading financial conglomerate State Bank of India has posted 40 per cent growth in net profit for the second quarter of this fiscal on high interest income.

Crediting the good numbers to income from high interest rates and fee-based income, SBI Chairman O P Bhatt said bank has been giving good returns consistently in the last 5-6 quarters and growth has beaten projections by analysts.

SBI has posted a net profit of Rs 2,259.72 crore for the quarter, a growth of 40 per cent against 36 per cent in the same quarter a year ago. The bank’s profit in the September quarter last year stood at Rs 1,611.42 crore.

The total income rose to Rs 17,909.64 crore in the second quarter from Rs 13,658.22 crore a year ago, an increase of 31 per cent.

The bank registered a deposit growth of 67.93 per cent at Rs 57,861 crore. Its current and savings account (CASA) ratio was up by 26 basis points to 39.71 per cent. Advances of the bank grew by 162.35 per cent to Rs 51,020 crore.

Return on assets was flat at 0.99 per cent, while return on equity was at 14.64 per cent at the end of September 2008.

Besides, home loans grew by 23.47 per cent, auto loans by 30.48 per cent and education loan by 43.81 per cent.

Submit KYC details to avoid account freeze: SBI

Country’s largest lender State Bank of India on Thursday asked its customers to immediately comply with the Know-Your-Customer guidelines, failing which their accounts would be freezed.

“All account holders of the bank who have not yet complied with the KYC guidelines are hereby requested to make their accounts KYC compliant by contacting their home branches and completing the required documentation latest by October 31,” SBI said in a notice.

As per provisions of the Prevention of Money Laundering Act 2002 and the direction given by RBI, all customers are required to comply with KYC guidelines.

Banks were advised to follow certain customer identification procedures for opening of accounts and monitoring of transactions of suspicious nature by the RBI in context of the recommendations made by the Financial Action Task Force on Anti-Money Laundering standards and on Combating Financing of Terrorism.

Failing to comply with the guidelines would result in freezing of account operations, it said.

“Several account holders have still not submitted local address and identity proofs, thereby violating the KYC guidelines issued by the apex bank on account opening,” a senior SBI official said.

Despite repeated reminders sent by the bank through registered and regular posts to such customers, there has not been any response yet and it seems they are not interested in operating the accounts, he said.

It is a final notice after which the accounts would be freezed, the official added.

The largest bank having a branch network of about 10,400 has over 13 crore customers.

Free clinic by Financial planners

A group of financial planners will conduct a free clinic this week for people who have questions or concerns about their finances.

The Financial Planning Association Kansas Chapter will have about 20 planners available from 4 to 9 p.m. Thursday at the WSU Hughes Metropolitan Complex at 29th Street North and Oliver.

Organizer Richard Stumpf said the clinic is for people who have questions but don’t know who to ask.

Any topic is open for discussion, including 401(k) accounts, estate planning, wills and taxes. No documentation is necessary. However, participants are encouraged to bring paperwork — account statements, wills, etc. –if they want to talk about specifics.

Stumpf said planners who participate are required to sign a pledge that they will not market their services.

Rushikulya Gramya Bank and Bajaj Allianz Life enter into ‘Bancassurance pact’

Rushikulya Gramya Bank (RGB), a premier Regional Rural Bank (RRB) of Orissa operating in Ganjam and Gajapati districts, has joined hands with Bajaj Allianz Life Insurance, India’s leading private life insurance company to provide life insurance solutions through its branches.

Under the arrangement, Rushikulya Gramya Bank will offer insurance products through its distribution network of over 79 branches, spread over in two districts.

Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between two leading conglomerates- Allianz AG, one of the world’s largest insurance companies, and Bajaj Auto, one of the biggest two and three wheeler manufacturers in the world.

The insurance firm possesses the strongest distribution network in the country with its 1200 owned branches across more than 950 towns and rapidly extending Bancassurance partnerships.

Money Manager: A link between financial planning firms and prospective financial advisor seekers

From the very beginning, Money Manager developed lasting relationships with seekers and financial planning companies and always showed its gratitude for using the site as a bridge for future assets management.

Money Manager is an online site that creates a link between financial planning firms and prospective financial advisor seekers. It aims to collect profiles of services of different registered financial advisor and advising firms and deliver them to the users who are looking for such services. Some of these services include investment advisory services, credit counselling services, debt consolidation services, or a combination of such services.

The need for financial planning services is gradually increasing as life is becoming faster and more hectic; people conversely want to focus more on the meaningful aspects of their lives rather than spend their significant time and stress themselves in managing their assets. Moreover, the help of professional financial planning firms is becoming more effective as they continuously come up with new strategies and management tools to plan out strengthening the customers’ financial assets. Registered financial advisors enable their clients to have strong control on how to protect their assets and constantly make them grow.

Financial planning firms can be needed in any stage of a person’s life, and it is nice to know that they have built a solid industry, and they are here to stay. Whether it be about retirement, a change of job level, a change of civil status, a financial bankruptcy, or an issue of inheritance, Money Manager can help seekers of financial planning firms in choosing the best and most reputable institution there is. Money Manager ensures that the financial advisors and financial planning firms in its database are registered, legal, reputable, and have high degree of expertise.

From the very beginning, Money Manager developed lasting relationships with seekers and financial planning companies and always showed its gratitude for using the site as a bridge for future assets management. What sets Money Manager apart from other financial services marketing sites is its dedicated evaluation of its participation in the success of dynamics of the seeker and the helper, always making sure that the best client meets the best advisor and vice versa.

2 new retirement plans launched by Future Generali

The insurance venture between Future group India and Generali group Italy, the Future Generali India, announced two new retirement plans. The plans will be called Future Pension Plan and Future Pension Advantage Plan (Which is a ULIP)

The Future Generali India Life Insurance’s CEO & Managing Director Jayant Khosla told reporters “We are launching two retirement plans which offer distinct and relevant advantages to customers in line with their needs and aspirations. The Future Pension Advantage plan will have 40-80 years age band.”

The Future Pension Plan:

• Offers a way to create a regular stream of income after retirement.
• Guaranteed addition of 5 per cent to accumulated pension fund after 15 years.

The Future Pension Advantage Plan:

It offers a minimum policy term of 2 years under single premium and 5 years under regular premium.

There is also a tax benefit under section 80 C and 10 (10D) of the Income Tax Act.

Future Generali is targeting achieving 4 lakh policies in FY’09. Both the promoters have infused Rs 200 crore capital and are adding around Rs 75-100 crore every quarter, Khosla said. “We are targeting 25 per cent of our sales through mallassurance and 75 per cent through our alliances and distributors.

We have started offering insurance products through 300 Future Group malls out of 450. The Future group plans to add 1,000 malls in the next two years period,” Khosla said. Generali is keen on replicating Future’s mallassurance concept globally, he added.