Rich and Wealthy: Do they actually mean same?

3) Health insurance cover :-

This is one area if not paid attention to can reduce our wealth substantially in an unforeseen situation. Many of us salaried employees do not take a health insurance as we feel that we have a company cover. The question however is what if the person leaves the company and the new company does not have such provisions or what if the existing company changes its policies next year. Medical expenses today are very high and it can take away a substantial portion of your savings if there is no adequate cover.

4) Adequate life cover:-

Life insurance is needed to cover financial loss caused by death of an earning member. So it is important that we gauge what could be our family’s financial loss and is our cover is commensurate with the same. In the event of buying insurance products with returns we tend to ignore the importance of term insurance plans which is very crucial to secure the financial health of you're loved ones incase of any unforeseen events.

5) Financial commitments towards ones goals:-

Finally it is important that we give clarity to our financial goals and start working towards them. Postponing implementation of a plan would just lead to situation where things which are important become urgent, and most of the times things done in haste need not yield the desired result. So it is important to take the first step as soon as possible and reach our financial goals at the earliest.

Mukund Seshadri is a partner at MSVentures Financial Planners.