Financial intelligence is not only about money management. With advent of tech, it is also important to keep online information accessible.
When times get tough, our small mistakes seems to cause more damage.
Most of us are very casual when it comes to preparing for emergency.
But this casual attitude cause more damage when emergency actually strike.
In this world the most respected people are those who possess foresight.
Emergency strikes worst fears in case of death of earning member of a family.
It makes me think, what my family should know if I die.
In India it is common that the lead of the house is a man who handles all money matters.
Leading lady (wife) hardly takes any interest in how day-to-day expense is managed.
Even though the lady is a earning member, still in India, money is mostly in hands of a Man.
There are also examples where leader of the house is a Lady.
In both the case the situation does not change.
Both Men & Women are casual when it comes to planning for emergency.
In this article we see what care we common people should take to handle situation of emergency like death of the lead earning member.
#1. Maintain an Updated List of User ID’s & Passwords
#1.1 Primary Email A/c’s
Information is exchanged through emails, like bills for:
- Credit cards,
- Phone,
- Electricity,
- Internet,
- Insurance,
- Digital TV etc.
Intimation of all these bills comes over email.
Maintain an password protected excel sheet and save email id’s and updated passwords.
#1.2 Laptop & Smart Phone Login
These days everything happens on mobile phone & laptop.
It is essential to keep the login id and passwords of these devices handy.
Maintain an password protected excel sheet and save login ids & passwords.
#2. Bank A/c customer ID & Passwords
In case of sudden demise, the first thing dependants will need is money.
In your absence they will have to pay bills, draw money etc.
Maintain an password protected excel sheet and save customer ids & passwords.
#2.1 Debit Card & Credit Card PIN
Generally we memorise the security PIN and never write it down.
Better is keep it written somewhere.
Maintain an password protected excel sheet and save credit card & Debit Card PIN.
#2.2 Utility Bill Details
Details like customer ID’s for making payments like electricity bill, telephone bill, Digital TV etc.
Maintain an password protected excel sheet and save Account numbers, customer id’s etc of all utility bills.
Make sure that your dependent are your Nominee
Generally when we start working, we name our mother as our preferred nominee.
After few years one get married and nominee continues to be the mother.
The nominee should be the dependent which after marriage should be the spouse or children.
But this small mistake can put the dependents in lot of trouble after death of the lead earning member.
One must take full care that correct name of nominee is registered in the following accounts:
#2.3 Banks Savings, Salary, Demat, Trading, Fixed Deposit, Locker Accounts
List down names of all bank accounts one maintains.
These bank accounts can be savings or salary account.
Maintain an password protected excel sheet wherein the name of nominee should be clearly mentioned.
#3. Provident Fund & Pension Account
Benefits of provident fund savings is payable only to the nominee.
Its extremely important to check if correct nominee is spelled in retirement savings account.
Maintain an password protected excel sheet with name of nominee for retirement benefits are spelled out clearly.
#4. Life, Auto & House Insurance
Insurance is not done for only savings income tax.
Insurance is done mainly to help the needy in moments of emergency.
Maintain an password protected excel sheet with name of nominee for all insurance accounts.
#5. Mutual Fund Holdings
Unlike stocks, mutual funds are not saved in demat account.
Hence it needs a nomination separately for all funds.
Maintain an password protected excel sheet with name of nominee for all fund holdings.
#6. Details of Investments Holdings
We all do investments. But how often we take care to maintain a list of holdings.
This can prove to be a very important information for the dependents in moments of urgency.
In absence of the lead earning member of family, the biggest crisis is to maintain the cash flow.
Investment can prove like a saviour in the most demanding times.
#6.1 Stocks & ETF
List of stocks & ETF with details like:
- Name of stocks,
- Investment amount,
- Date of investment,
- Investment goal (holding time or price) &
- Demat account details etc.
These must be maintained in a password protected excel sheet.
#6.2 Mutual Funds
List of funds with details like:
- Name of mutual funds,
- Folio number,
- Investment amount,
- Date of investment &
- Investment goal.
This must be maintained in a password protected excel sheet.
#6.3 Physical Gold & Silver
Physical gold and silver accumulated over the years becomes substantial.
Their details like:
- Amount of metal,
- Purchase price,
- Present vale,
- Date of purchase,
- Investment goal etc.
This must be maintained in a password protected excel sheet.
#6.4 Real Estate Property
Real estate investment are the most visible visible investment so all.
Still it is better to include it in the list of investment purchases.
Details like:
- Type of property,
- Size of property,
- Location,
- Name of project,
- Purchase price,
- Rental income (if any) etc.
This must be maintained in a password protected excel sheet.
#7. Details of Compulsory Payments & Liabilities
It is extremely important to for people to be aware of list of monthly payments that must be made.
After the departure of the leading earning member, these payments will be the responsibility of the dependents.
Better is to keep them aware of these immediate requirements.
Few typical payments and liabilities that’s common for all families are as follows:
#7.1 List of Important Expense
| Expense | Payment Frequency | Amount (Rs.) | Emergency Saving in ICICI Bank |
| Home Loan EMI | Monthly | 50,000 | 3,00,000 |
| Grocery Bill | Monthly | 15,000 | 90,000 |
| Internet Bill | Monthly | 2,000 | 12,000 |
| Electricity Bill | Monthly | 3,000 | 18,000 |
| Digital TV Bill | Monthly | 500 | 3,000 |
| Mobile Bill | Monthly | 2,000 | 12,000 |
| Maid | Monthly | 4,000 | 24,000 |
| Cooking Gas | Monthly | 1,000 | 6,000 |
| Auto Fuel | Monthly | 4,000 | 24,000 |
| School Fees | Semi Anually | 40,000 | 1,60,000 |
| Medical Savings | Anually | 25,000 | 50,000 |
| Property Tax | Anually | 15,000 | 30,000 |
| Auto Insurance | Anually | 10,000 | 20,000 |
| Auto Maintenance | Anually | 15,000 | 30,000 |
| Medical Insurance | Anually | 20,000 | 40,000 |
| 2,06,500 | 8,19,000 |
#7.2 List of Outstanding Loans
| Loan | EMI | Balace Amount | Balance Tenure |
| Home Loan | 35000 | 20,00,000 | 10 Years |
| Auto Loan | 7000 | 2,00,000 | 2 Years |
| Educaton Loan | 5000 | 50,000 | 1 Year |
| Personal Loan | 3000 | 20,000 | 1 Year |
| Credit Card Balance | – | 25,000 | 1 Month |
Final Words…
Is doing all this worth it?
Today it may look irrelevant and non-important. But its importance is unquestionable.
But imagine a situation where your spouse and children are stuck without you being around them.
Consider few examples.
In a shopping mall where after shopping your wife forgot the credit card PIN.
She immediately calls you in office and her problem solves.
But when she will have no body to call?
In this situation she will love you even more for the way you had organised things for her.
This is what is called real love. This is what is the real essence of financial intelligence.
When the leading earning member is not around there are some basic information that family should know.
Its our responsibility to make them aware of them.
Do not consider it as overdoing. Its only wise for a family to face reality before emergency actually strikes.
When you are not around, it will almost be a battle for your family.
These small things will only help them.
When you are not around you cannot do much to lower their sufferings.
But now you have the power to control how they will face that situation.
Plan for emergency and leave no stone unturned.
