Most Common Financial Mistake Every Young Individual Makes

This is a must read letter from a Widow who is a Chartered Accountant….

#GuestPost

It starts like this…

“Hello Friends,

Few things I learnt after my husband’s death.

We always believe we will live forever & bad things always happen to others.

Only when things hit us, bang our head do we realize… Life is so unpredictable….!

My husband was an IT guy. All techie. And I am a Chartered Accountant.
Awesome combination you may think.

Techie guy, so everything is on his laptop….his ‘to do’ list, his e-bill and his bank statements in his email. He even maintained a folder which said IMPWDS, wherein he stored all Login id and passwords for all his online accounts. And even his laptop had a password.

Techie guy, so all the passwords were alpha-numeric with a special character not an easy one to crack. Office policy said passwords needed to be changed every 30 days. So every time I accessed his laptop I would realize it’s a new password again. I would simply opt to ask him, ‘What’s the latest password?’ instead of taking the pain to memorize it.

You may think me being a Chartered Accountant would mean that everything is documented and filed properly. Alas, many of my Chartered Accountant friends would agree that the precision we follow with our office documents and papers do not flow in to ‘day to day’ home life. At office, you have to be an epitome of Reliability / Competence / Diligence, etc., but at home, it’s “there is always a tomorrow”.

One fine evening, my hubby expired in a bike accident on his way home from office. He was just 33. His laptop with all his data crashed.

Everything on his hard disk wiped off. No folder of IMPWDS to refer back to. His mobile with all the numbers on it was smashed. But, that was just the beginning. I realized I had lot to learn.

Nine years married to one of the best human beings, with no kids……just the two of us to fall back on…..but now I stood all alone and lost!

Being a C. A. helped in more ways than one, but it was not enough. I needed help. His saving bank accounts & his salary bank accounts had no nominee. On his insurance, his mom was the nominee and she had expired almost 2 years back. But this was just a start. I didn’t know the password to his email account where all his e-bills came. I didn’t knew which expenses he paid by issuing ‘standing instructions’.

His office front too was not easy. His department had changed recently. I didn’t know his reporting boss’s name to start with. When had he last claimed his shift allowance; his mobile reimbursement?

The house that we had bought with all the excitement was on a bank loan. Thought that with our joint salaries, we could afford the EMI.

When the home loans guys suggested insurance on the loan, we decided that instead of paying the premium on the insurance, the difference in the EMI on account of the insurance could be used to pay towards prepayment of the loan and bring the tenure down. We never thought what we would do if we have to live on a single salary. So now there was huge EMI to look into.

I realized I was in for a long haul.

Road accident case. So everywhere I needed a Death Certificate, FIR report, Postmortem report, etc. For everything there were forms running into pages, Indemnity Bonds, Notary, Surety to stand up for you, ‘No objection’ certificates from your co-heirs, etc., etc.

I learnt other than your house, your land, your car, your bike are also your property. So what if you are the joint owner of the flat? You don’t become the owner just because your hubby is no more. So what if your hubby expired in a bike accident and you are the nominee, but if the bike is in a repairable condition, you have to get the bike transferred in your name to claim the insurance. And that was again not easy. The bike or car cannot be transferred in your name without going through a set of legal documents. Getting a Succession Certificate is another battle altogether.

Then came the time you realize that now you have to start changing all the bills, assets in your name. Your gas connection, electricity meter, your own house, your car, your investments and all sundries.

And then, change all the nominations where your own investments are concerned. And again, a start of a new set of paperwork.

To say I was shaken, my whole life had just turned upside down, was an understatement. You realize you don’t have time to mourn and grieve for the person with whom you had spent the best years of your life, because you are busy sorting all the paper work.

I realized then how much I had taken life for granted. I thought being a chartered accountant, I am undergoing so many difficulties. What would happen to someone who was a home maker, who wouldn’t understand
this legal hotchpotch?

A sweet friend then told me, “Dear, this was not an end. You have no kids; your assets will be for all who stand to claim after my hubby’s sudden death. I realized it was time I took life more seriously. I now needed to make a Will. I would have laughed, if a few months back, if he had asked me to make one. But now, life had taken a challenging twist.

Lessons learnt this hard way were meant to be shared. After all, why should the people whom we love the most suffer after we are no more?

Sorting some paperwork before we go will at least ease some of their grief.

1. Check all your nominations:

It’s a usual practice to put a name (i.e., in the first place if you
have mentioned it) and royally forget about it. Most of us have named one of our parents as a nominee for investments, bank accounts opened before marriage. We have not changed the same even years after they
are no longer there with us. Even your salary account usually has no nomination. Therefore, kindly check all your Nominations.

• – Bank Accounts
• – Fixed Deposits, NSC
• – Bank Lockers
• – Demat Accounts
• – Insurance (Life, Bike or Car or Property)
• – Investments
• – PF & Pension Forms

2. Passwords:

We have passwords for practically everything. Email accounts, Bank accounts; even for the laptop you use. What happens when your next of
kin cannot access any of these simply because they do not know your password. Put it down on a paper.

3. Investments:

Every year, for tax purposes, we do investments. Do we maintain a excel sheet about it. If so, is it on the same laptop of which the password is not shared? Where are those physical investments hard copies?

4. Will:

Make a Will. I know you will smile; even I would. Had I not gone through all what I did. It would have made my life lot easier, a lot less paperwork. I wouldn’t have had to provide an indemnity bond, get it notarized, ask a Surety to stand up for me, no ‘no objection’ certificates from others, etc.

5. Liabilities:

When you take a loan say for your house or car, check out on all the what ifs…..what if I am not there tomorrow? what if I lose my job? Will the EMI still be within my range? If not, get an insurance on the loan. The people left behind will not have to worry on something as basic as their own house.

My battles have just begun…But let us at least try and make few changes so that our loved ones would not suffer after we go. We do not know what will happen in the future. But, as the Scout motto goes: “Be prepared.”

Editor: I really hope this women is happy now where ever she is.

Well, at least now we can say that we must do the things in the right way and be prepared in life because its really unpredictable. The reason I shared this story is because I wanted all of you to learn from others & probably that’s the reason she wrote this article so please share this with your loved ones and friend as much as possible.