Download App app-link

Keep Investing : A Holiday Can Be Harmful

Mr. Shivhare bought a new residential property in 2003 and for the next 10 years he only focused to repay the loan. He had a single plan that helped him to successfully put his financial life in order. This was the biggest mistake that Mr. Shivhare did as he made a single investment in his life – his biggest asset and to completely payoff his liability he only focused to repay his loan.

He actually wanted to get rid of his home loan as early as possible. So, whenever he got any surplus or an increment in his salary, he just increased the EMI outflow towards the repayment of his loan. This increased EMI helped him to pay off his loan in 10 years which was quite early than the slated date.

After reading the above example you would think that what’s wrong in this? What can be a problem if Mr. Shivhare wanted to finish his loan on an early date?

Yes, there is a problem and surely it is a bad idea. When Mr. Shivhare finally paid the complete loan amount, he felt quite relieved. It was a sense of freedom and wanted to spend extravagantly for some time. It was like a burden off from his shoulders and does not have to save for some time. And this was another mistake by him.

The above two mistakes pushed him back by 10-15 years when it his time for saving and achieving his future financial goals. It is another matter of concern that he never thought of saving and setting up his financial goals for himself or his family leisure. For this he gave a reason that “he just wanted to spend a decent life without any specific financial goals.

Mr. Shivhare’s wife Jhanak is, however, a firm believer in real estate but after so many years she now feels that it’s not a good idea to obstruct the finances at one single place. She finds a major drawback in investing in real estate that the real estate prices become stagnant after some time of that particular area and do not result in desirable profit. Though, being a homemaker she doesn’t understand much about mutual funds so she paced her trust on her husband leaving the investment part in his hands.

Efficacious Route

After realizing his so called off burdened holiday from his real estate investment when he thought for new investments seriously he met a financial planner. The first thing he was asked to do was to embody his financial goals by specifying what he wanted to do with the extra amount after meeting his existing financial debts.

Mr. Shivhare met Somvendra Kelva, a financial advisor and Director with Mudra Home, after detailed discussions with his colleagues on investment and financial planning. He said “I found a right track of being financial well being because of the detailed discussion with my friends, colleagues and talks organized at my work place”. After that only I researched on internet and found about the team of Mudra Home. I found some good reviews about the company and decided to meet personally, said Mr. Shivhare.

As of now, his major financial goals are to have a safe retirement and the education of his two kids. For both his goals he is suggested to invest in direct equity mutual funds. His daughter and son are in 4th and 2nd grade respectively so, he has already started to a little bit of debt as the next goal is only few years ahead. Another goal of safe and happy retirement is a similar switch that will happen at the age of around 55 years. M. Shivhare has also started to save some amount in PPF (Public Provident Fund) in his and his wife’s name, based on Mr. Kelva’s advice.

As of now his short term goal to replace his first bought car which is almost 14 years old and for that he has started investing in short term debt and bond funds. Somvendra also helped him to stop hunting or pursuing new real estate opportunities.

While there were some wrong decisions that he took but there are few rights as well. Mr. Shivhare has taken sufficient term life insurance cover and also individual health insurance plans for himself, his wife and his kids too other than the cover given by his company. The financial advisor also advised him to buy an insurance policy for critical illness. Mr. Shivhare opened a separate saving bank account to separate the funds for his investments other than the regular expenses.


For all the mistakes Mr. Shivhare committed in past, he doesn’t want to pass on the same to the next generation. He has opened a separate saving accounts for his daughter and son and even planning to send his daughter for financial management camp to be organized in her school next month. He now realizes the importance of investing in early days, preferably in 20’s and doesn’t want his kids to fall back when it is about financial management.


Credit Score    Home Loan    Loan Against Property    balance-transfer    Business Loan    Personal Loan



Recent Posts