Last Updated on November 10, 2020 at 10:54 am
A look at how young earners, middle-aged earners or impending retirees can improve their financial life and make better decisions with a study group consisting of like-minded co-workers or friends.
When you join an organisation, you become friends with some batch mates. These relationships can last a lifetime. I have seen 30,40-year friendships that originated from being trainees together in our national labs. There is often an inner circle in this group that you are most comfortable with.
There are many ways such a tightly knit group can help in improving each other’s financial life. There would be no hesitation to talk about investment decisions and other purchases because the compensation and net worth levels are similar.
In my corporate presentation, I ask, “how many of you have faced a hospitalization (as patient or caregiver) before?” Then I ask, “what is the group health insurance coverage offered by your company?”
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Often, only the two or three people who have faced hospitalization know about how much health cover they have! If one or two employees with some experience like this or just interest in money matters can nuclear a circle they can change things in the following ways:
- Get those who have used the group cover to talk about “what they did” or should have done better to the entire team or just the group.
- Get the HR to speak about health cover, life cover, disability cover.
- Lobby for add-on cover. For example, a company could cover 5 lakh of group cover and another 5 lakh as an optional add-on (so the base policy for those who opt would be 10 lakh)
- Help people in trouble. Support this kind of struggles: My Corporate Health Insurance Claim was rejected! Here is how I fought back
- Educate employees of lesser-known nuances such as this: Group Insurance Portability to Individual health insurance cover
- Collectively research a purchase: Health insurance buying is one of the hardest purchases in personal finance. Lakshminarayanan’s incredible work – Health Insurance Policy Comparison Spreadsheet – could be updated regularly if each member took one policy to dissect each weekend.
- Get unbiased experts to speak on money management. Mutual fund and insurance distributors (agency or individuals) contact HRs for “awareness” sessions. Then they flatter the HR with a nicely framed citation. A study group can lead the fight against conflict of interest by inviting SEBI registered fee-only advisors
- Discuss the pros and cons of products and purchases: RE, MFs, ULIPs, stocks, crypto, trading, p2p lending etc.
- Support each other’s family in the time of trouble like hospitalization.
Like everything else in life, a study group can result in confusion, conflict and friction. Members will have to respect each others privacy, appreciate the “personal” of personal finance. If done right, a study group can help process information and developments (eg. budget announcements) and help keep each other calm.
Do you have this kind of circle in your workplace? What are your experiences? Share in our YouTube community tab (link below).
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Dr M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter(X), Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
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