Why I bought Personal accident insurance policy

Personal Accident Insurance is seldom purchased. Lack of knowledge and utility are the primary reasons why people do not purchase it. Sharing my reasons, I purchased one for myself.

In my opinion, it is a necessary addition to every insurance portfolio, as it bridges the gap between term life insurance and health insurance. A few months back, I had an accident. I was on my way to a client meeting, and it was peak office hours traffic. The seat belt saved my life, and I had no injuries, but my car took a serious hit in the back. The Wagon R’s driver which hit my car from behind was likewise lucky enough to escape uninjured.

The accident could have been serious, with broken bones, injuries, and subsequent loss of income. My good fortune. Nothing of this sort happened. I had car insurance which took care of the damage and repair. This is where personal accident insurance comes into the picture.

Post the accident, reflecting on the accident and playing the worst-case scenarios in my head, Personal accident insurance came into my mind. I had, for the first time, heard about it during my B School internship program while doing a project with ICICI Lombard General Insurance.

Accidents can occasionally have deadly, temporary, and permanent consequences. In addition to physical injury, it may have serious effects on your financial and mental health. Accident-related injuries might hinder a person’s capacity to work and make a living for a temporary time period. Personal accident insurance can cover you and your family in such a situation.

Personal accident insurance provides you and your family with financial support in the case of an accident that results in death, physical injury, or temporary or permanent total/partial disability. If the accident causes the policyholder’s death, the nominee will receive full compensation (equivalent to the sum insured).

In addition, depending on the insurer and policy you select, the owner of a personal accident insurance coverage may get a number of additional benefits.

  1. Hospitalization,pre, and post-hospitalizationcoverage
  2. Daily cash allowance of up to 30 days
  3. Coverage for the loss of income for a certain period of time
  4. Education benefits for your dependent children up to a certain age.

Power of consistency

The secret to wealth creation is Consistency

Grand Canyon is on my travel bucket list. Do you know how the Grand Canyon was created? The Colorado River sculpted the one-mile-deep Grand Canyon over millions of years. This phenomenon demonstrates how consistent weathering and erosion over eons of time may drastically alter the earth’s surface.

Similarly, to how the Grand Canyon wasn’t formed overnight, our investments require consistent contributions and decades of appreciation to create wealth. The Colorado river chiseled away the rocks to form Grand Canyon over a period. Time is our best friend when it comes to investments. In fact, time is the greatest asset we have at our disposal, and it would be a shame to let it go to waste.

In this piece, I will discuss how powerful it may be for your wealth creation journey to do monthly SIPs consistently and have an investing horizon spanning many decades.

Mr. X became my first individual client in December 2003, the year I entered the field. When I met him for the first time, he was already investing in mutual funds. With his current portfolio, I inherited his Rs. 2,000 per month SIP in XYD MF (Equity Diversified Fund)which he began on December 3, 2001. I did not know that one SIP would educate me so much about wealth generation and become my favorite case study. The most talked about SIP.

Lesson 1

Invest for the long term and let compounding work its magic.Most investors commit the error of trading and timing the market. When investing over the long term, market timing is impossible. Time spent in the market is more crucial than market timing if one wishes to experience compounding rewards. Examine how investing more time in the market may dramatically increase your wealth.

Sharing a screenshot of Mr. X’s portfolio statement from the XYD MF . You can observe that the longer you let your investment grow, the better the chances of getting inflation-adjusted returns and wealth creation.

Lesson 2

Start with any amount.A lot of times, people don’t start investing, thinking one needs a large amount to invest with. That is a myth.

Whether you have 1,000 rupees or one million rupees, it makes perfect sense to invest right now and let your money work. Wealth is created over time, not overnight. To create wealth, one must be patient and consistent. The Key is to start early.

Investing is a journey, and there are always new landmarks to reach and previously undiscovered insights to uncover. Investors should continue to focus on sticking to the basics of the prudent investment.

Received Cash Gifts This Diwali

Have You Received Cash Gifts on Diwali?

During the Diwali celebrations, family, friends, and acquaintances exchange presents. In addition to chocolates, sweets, and trinkets, there is also an influx of cash – Diwali bonus and cash gifts!

After Diwali, when we exchanged notes, my nephew informed me that his parents had given him cash gifts. I informed him that his grandfather also handed me cash this time:)

His next inquiry was about what I intended to do with the financial gift. It sparked my interest as I intended to purchase HOKA Speedgoat 5. I have been on the lookout for trail running shoes and Hoka Speedgoat has been rated as one of the best trail running shoes for 2022.

The Personal Finance Expert in me kicked in: Rather than spending money on materialistic ambitions, I ought to consider investment options that will aid me in my retirement planning.

As a shoe enthusiast, it is easy and enticing for me to purchase another pair of shoes. If I want to maintain a healthy financial status, I must practice delayed gratification.

In addition, my nephew was observing me. To teach him the value of investing and delayed pleasure, I was required to take the initiative.

There are numerous intelligent uses for my financial gift:

  1. To invest in mutual funds, both with lump sums and SIPs.

Mutual funds can earn inflation-beating returns in the long term and are ideal for wealth creation. The selection of mutual funds will depend on suitability based on my risk profile, investment horizon, and objectives.

  1. Increase my health insurance coverage, which I’ve been contemplating for some time.

Covid has emphasized the need for affordable but adequate coverage. Medical inflation is double-digit, cost of hospitalization and procedures is exorbitant.

  1. Obtain home insurance, which has been a priority for me.

If you’re wondering why Home Insurance is a priority, it compensates you for your losses. This is especially vital in the event of damage caused by natural catastrophes such as earthquakes, storms, cyclones, floods, etc. These are unpredictable and unpredictable events.

  1. Contribute to my Emergency Fund

An emergency fund is the critical sum of money that you should set aside to deal with life’s unforeseen financial curve balls. It serves as a safety net, covering you in the event of an unexpected, unanticipated event.

You are probably curious as to what I and my nephew Yash did with our respective financial presents. Mutual funds were our chosen investment vehicle.

Why You Should Invest At Young Age

My upcoming 45th birthday will be my first 😉 I am pleased with the fact that my list of regrets is relatively short. But one major regret I have is not beginning my investment journey early.

When you start investing at a young age, you gain a head start, you have a high risk appetite, which allows you to take more risks without putting your ability to achieve your long-term financial goals at risk, and you have the potential to earn returns from the investments that are adjusted for inflation.

Young investors have the freedom and time to study the market, learn from their successes and failures, and grow as investors as a result. With time on their side,they have time to study the markets and hone their investing strategies. Investing is known to have a fairly lengthy learning curve.And I can vouch for it based on my experience.I have matured as an investor over the years and I am still learning.

Investing in one’s future at a young age offers a number of advantages.Sharing few learnings from my investment journey:

1.Discipline in Spending

If you start saving and investing at a young age, you will be able to control your spending later on. Here’s how it works, and I will show you.

If you want to save a predetermined sum each month from your predetermined salary, you will need to limit your outlays by making a monthly budget. Keeping a monthly budget of your spending on necessities like food, utilities, housing, entertainment, etc. is the best way to improve your spending habits. Also, after many repetitions, this easy action turns into second nature.


When you start investing at a young age, you buy yourself more time, which is a significant advantage. If you begin investing when you are in your twenties, your wealth will have more time to grow, putting you in a better position to easily achieve all of your financial goals. If you begin investing when you are in your thirties, your wealth will have less time to grow.

3.High Risk Taking ability

Studies have shown that younger investors are more willing to take risks than their more seasoned counterparts. Adult investors typically have a conservative outlook and a preference for stability, which leads them to steer clear of high-risk investment avenues. There is an old proverb that goes, “The higher the stakes, the greater the reward.” The ability to take more risks increases the likelihood of earning handsome returns at a younger age.

4.Time Value of Money

Wish the concept was taught in school 🙁

Returns on early investments tend to increase exponentially over time. The value of one dollar, when measured against the passage of time, rises as time passes. When it comes to retirement, having made consistent investments beginning at a young age can result in significant financial rewards.

Additionally, early investment makes it easier for you to enter the world of finance at an earlier age. Your wealth will continue to increase over time. Because of your early investments, you have the ability to purchase things that others your age may not be able to afford. You will have an advantage over those people who wait until they are older before investing their money.


Making investments at a young age increases the likelihood of achieving a comfortable financial position at a younger age. It is always a better idea to start putting money away for retirement when you are in your 20s rather than when you are in your 40s. Because life after retirement is currently more difficult than it has ever been, making preparations for retirement as soon as possible will result in a more enjoyable life after retirement.

Building wealth is easier if you get a head start. If you don’t have a lot of money, investing early in life can be challenging. However, you can’t sit around and wait for things to be more convenient.(There is nothing like Right time to start investing.) You should start by putting away a little bit of money. Allow your savings some time to grow.

The best choice a person can make early in life is to start investing. Don’t be shy about consulting a financial advisor or a seasoned pro like me 😉

Key Takeaways

  • When you invest early in life, your money has more time to compound as you reinvest your earnings.The biggest advantage a young investor has is TIME.

When you start investing early you can take on greater investment risk because you have more time to recover if things go wrong.