Tuesday, August 25, 2009

Why do you need a Bank Account in Joint Names?

I believe that this blog post may help you to understand significance of “Name” or “Account Holder” in YOUR bank account. Although this is technically a vast subject involving various laws (Acts) such as Hindu Succession Act, Indian Contract Act, Banking Regulation Act, etc., I have tried to pen down couple common cases applicable to most of us.
The objective of this blog post is to recognize benefits of having a bank account in joint names and with or without ‘Either or Survivor’ operating instruction.
Case 1 – Mr. Vinayak Deshpande (name assumed), age 30 years, Project Manager at Dattu Software Ltd. (hereinafter referred as DSL) Mr. Deshpande joined DSL 2 years ago and opened a bank account in AAICHIAAICHIAAY Bank. Bank’s representative (wearing a tie) took his signature on Account opening form, 2 photographs and copy of passport. Mr. Deshpande travel frequently outside India. He has a wife (not working/housewife) and a minor son. Mr. Deshpande is a careful person and never forget to sign 2 blank cheques before he leave his residence for foreign travel. His wife can use these cheques for household expenses during his absence.
In July, 2009, Vinayak went to Australia for a business trip. His wife made a mistake in writing the first cheque. She therefore, torn it and used the second cheque to withdraw cash. In last week of July, Vinayak was required to extend his travel and hence was unable to return till mid of August, 2009. Mrs. Deshpande who consumed all her cash during July, 2009 had no other option, but regrettably forced to borrow money from her neighbor.
Now, the question is – Do you want your spouse to face such situation? Of course NO (unless you had a dustup with her/him before travel).
Next question is – what would have avoided such scenario for Mrs. Deshpande-
Answer – A Bank Account in Joint Name with “Either or Survivor” feature. Such type of bank account is operated in joint names – Mr. and Mrs. Deshpande. Even though Mr. Deshpande goes to Australia directly from office…no worries for Mrs. Deshpande as she can also sign cheque and withdraw money.
Similarly, if Vinayak is not married, his parents can use his money and bank account without any dependence on him for signatures.
Another advantage is that – both Mr. and Mrs. Deshpande can use bank account passbook as his/her address and/or ID proof.
Case 2 – Mr. Marutrao Dagdogi Kamble (name presumed for example) , age 39 years, Purchasing Clerk at YZ International Corp. He has a bank account operated in his single name at Bank of Daroda. On 13th July, 2009 he died due to a massive heart attack, when his bank balance was INR 190,000. He has one minor daughter , wife and his elder parents. About a month after his death, his wife went to bank to withdraw money for an emergency use. Unfortunately, she returned with empty hands since bank officers asked her for few documents for compliance purposes. This includes marriage certificate, her ID proof and death certificate of Mr. Kamble. These documents help bankers to ensure authenticity of Mrs. Kamble as legal heir. As per most followed practices, every bank categorizes legal heirs in blood relation into six level categories such as First Level – Wife and Minor Son, Second Level – Son and daughters, Third Level – Parents and so on…. In case where a deceased person married to more than 2 persons (women or men and now Sec 377 also), death claim may move into the court of law.
If Mr. Marutrao Dagdogi Kamble had opened his Bank of Daroda Bank Account in Joint name with his wife, Mrs. Bakulabai Marutrao Kamble would have found it easy to comply with Bank’s Death Claim process. Note – It is mandatory for Joint Account Holder to inform bank about such death case.

To Sum up –
1. Joint Account – This is the type of bank account where more than one persons hold authority on the funds lying in the account.
2. Either or Survivor Feature – This feature/operating instruction on any joint bank account helps any of the account holder. The funds can be withdrawn by anyone of the accountholder with his/her sign only, whereas in case of death of any account holder, survivor can withdraw funds with his/her sign easily.
3. Bank Account Types – Typical deposit account types are Saving Bank Account, Current Bank Account (for businessman/traders), Fixed Deposit Account and a recurring deposit account. All such accounts are operated with account operating instructions as referred in #4 below.
4. Account Operating Instructions – a) Single: Only one person can operate the account b) Joint: More than one persons together can operate this account and c) Joint with E or S: More than one persons, where anyone or survivor can operate the account.
5. It is advisable to always open a bank account in Joint names for operational ease and may tick the box ‘Either or Survivor’ in account operation instruction section of application form provided you keep enough faith on the joint account holder.
6. Joint Bank Account does not entitle any of the holder or survivor for complete and exclusive rights on the funds. In case of dispute, the court of law may direct settlement/distribution of funds to survivor party or other party based on the facts and evidences of a court case.

Disclaimer – This blog post carries generic information on the subject. Every bank follows their own Death Claim Settlement process and anything contained in this blog post do not carry any legal meaning. Please consult your lawyer before relying on the information of the blog post. Objective of this blog post is to educate my followers on benefits of a joint bank account only. A complete technical guide on Joint Bank Account may be available in the market and/or website of country’s Reserve Bank or Central Bank.

Monday, August 17, 2009

EAT PUNE - Part 02

Welcome to “EAT PUNE” series. Part 02 of EAT PUNE will taste out another 4 items – Pav Patis, Kacchi Dabeli, Vada Pav, Pav Bhaji- Pulav and Cold Coffee. Here we go –
Pav Patis –
1. Dangi Pav Patis – This is probably the only location where a Pav-Patis is exclusively served, with a specialized taste of pav-patis. This spot offers ONLY Pav-patis. Located at Dip Bungalow Chauk Road, off Senapati Bapat Road. I guess this shop opens only in the evening.
2. Bipin Snacks – Undoubtedly a good taste of Pav-Patis at a popular snacks/breakfast stall, located next to Garware School.
3. Heaven Snacks – Nice taste. It tastes even better when served hot, most of the times it is served hot here. Located near More Vidyalaya, Paud Road.
4. SS (SP College canteen) – Well….all hardcore SPians die for Pav-Patis served in SS and I don’t know why really!! Taste is not bad, but may not be great. Try out, all except SPians may agree with my rating.
Kacchi Dabeli-
1. Dabeli stall at Hongkong Lane corner (Deccan Bus Stand side) – Good dabeli served with cheese or shev. Hot selling spot (not because of the girls roaming here). Open throughout the day.
2. Corner stall on Dnyanprabodhini Road – Tricky location to explain – If you are coming from Two Wheeler’s bridge – Poona Hospital - New English School Road – come straight 100 meters for dnyanprabodhini road. Before you take left on the T, your left a stall crowded with school children. That’s the spot. Good taste of dabeli. Exclusively instruct him to toast more - dabeli bread. I tasted dabeli here about 15 years ago, when one of my mentors- Ameya Kunte (super gem of Income Tax law) treated me.
3. Corner stall next to Bedekar Ganpati Mandir – Important – this stall is run by a Marathi man!! Of course, his stall reference comes here due to quality content in Dabeli.
4. Stall next to Gadgil Jewelers, Paud Road - Cheese…cheese dabeli. I liked it a lot. I do remember that once me and my wife started a 1 week diet program- called “GM Diet”. While my wife could finish it successfully, I ended up my challenge on the evening of Day 1 with two Kacchi Dabelis with extra cheese J J. This was the spot where I enjoyed Kacchi dabelis with cheese, otherwise I am not a big cheese fan.
Vada Pav-
Important Note – I am not a great Vada Pav fan. Hence my knowledge about Vada Pav spots may be challenged. But, still here I attempt to list down some popular spots –
1. Yenpure Wadewale – Good taste. Located near New Friends Society (opp. Union Bank) on Paud Road, chauk before Kinara Hotel, Vanaz.
2. Prabha Vishranti Gruha – Kelkar Road, near Kesariwada – Good quality batata-wada.
3. Bipin Snacks – Next to Garware school.
4. Stall near Garden Café, off Moledina Road – Always crowded with Vada Pav fans.
5. New Sweet Home – Kumthekar Road – only batata wada – excellent quality.
6. Stall next to Bank of Maharashtra, Bajirao Road branch.
7. Khatri Wadewale – Nice Vada-pav. Located on Ahilyabai Holkar Bridge.
8. Bharti Wadewale – Opposite Balgandharva Rangamandir
9. Joshi Wadewale - Opposite Balgandharva Rangamandir (tastes well if served hot only)
10. SS (SP College canteen) – Special Bun-wada with tomato ketch-up. Taste is okay but inserted here to keep respect of Mr. Kaustubh Vaze and Mr. Nikhil Ukidwe.
11. BMCC Canteen – Bun-wada with tomato ketch-up. Canteen always flooded with cigarette smoke.

Pav Bhaji and Pulav-
I believe that my father and my wife are the best Pav-bhaji cooks in the world. However, due to public demand, I will try to list down some of the popular spots for Pav-bhaji in Pune. Typically, it is observed that the Pav-bhaji spots are also appended with Pulav which you may enjoy after the Pav-bhaji.
1. Relax Pav-bhaji – Sahakar Nagar. Very popular spot. Good quality of Pav-bhaji with reasonable rates. Veg. Pulav is also good. During prime hours (7.30 to 9.30pm), at least 40 minutes waiting if you are in a group. Otherwise, place for two is easily accommodated. Peaceful place despite of being a popular spot.
2. Supreme Corner – J. M. Road – Heavily popular. You need to build a solid patience to get table and this is applicable even for week-days. I remember that once I went there at 8.00pm on Saturday and the waiting number was 79 and the current running number was 8. Looking at the crowd around the hotel, I guessed that at least 50 of the remaining 70 must have left the waiting lobby (which is actually a parking area of next shop). The average waiting period on any day may not be less than 1 hour. Typically, Marwari crowd can be seen here. Pav-bhaji tastes good, but I like Pulav more than P.B.
3. Hotel Mayur – Next to Pratignya Mangal Karyalaya, Karvenagar. Good Pav-bhaji. I haven’t tried out Pulav yet.
4. AJUBA – Karve Road, near Nalstop. The complete name is Anand Juice Bar which used to be a famous Pav-bhaji tapri, but now a class quality standard hotel. Still same pav-bhaji taste even after about 15 years.
5. Hotel Durga (Original)– Paud Road, near MIT College Road. Old Pav-bhaji spot and always surrounded with collegians (includes good looking girls of MIT MBA College many times).
6. Hotel Shivsagar – Aundh – Excellent taste maintained over past many years.
7. Kasturi Mastani – Opposite Kothrud Stand (Opp. Das Electricals, Kothrud) – Another old spot. Good spot for Kothrudians for a quick dinner in Kothrud. Pulav is also okay here.
Cold Coffee –
Although cold doesn’t suit me, I love cold coffee. I keep on hunting places for coffee flavor desert.
1. Hotel Durga (Original) - Paud Road, near MIT College Road. Highly popular spot for Cold coffee. Most of the people do not know that Hotel Durga (original) was famous for Espresso Coffee about 20 years ago. My brother and I used to enjoy Espresso Coffee here after school exams. Cold coffee topped with coco taste really good. You may ask for extra coco after 3 syrups. This spot used to serve coffee throughout the night about 10 years back, but now only till 12.00pm. After 10.30pm, this spot is surrounded only with ‘Datta’ kind of youngsters. They come in group, in a open jeep, wear gold chains and bracelets, hold high-end mobile phones, imported cigarettes, vehicle number plate with ‘DADA’, ‘NANA’, ‘RAJA’ etc., written by cheating numbers and occasionally fight between themselves. Do try out a special dish ‘Masala Pav’ with coffee. Masala Pav is a compact or a showcase version of Pav-Bhaji.
2. Hotel Durga (Duplicate) – Duplicate Durga has got two branches – MIT College and Mayur Colony. Duplicate Durga was formed by ‘Pandya’ and ‘More’ who used to work for original durga for 10+ years. I don’t like and recommend this spot since they do not wash glasses sincerely.
3. KANEPE Tapri – Opens only in the late evening. Located next to fruit stall/sunil tea stall near Kamla Nehru Park. Pav-bhaji served here also tastes good. Nice Cold Coffee too.
4. Stall on Symbiosis Distance Learning College Road – Good Coffee. But the waiters and the owner shows unnecessary arrogant stance. I have tried here cold coffee only once.
5. Relax – Sahakar Nagar – Good Hotel and undoubtedly good cold-coffee.

Disclaimer: The purpose of this blog is to provide reader with interesting food spots in Pune. The spots referred in the blog have only been recommended by writer and unfortunately, he does not hold any control on reader’s tongue ;). It also does not mean that writer never eats at home or writer’s wife cannot cook the food. Please talk to writer before making any perception in this regard.

Monday, August 10, 2009

How much Life Insurance (Maut ka Sauda) do you really need?

Time – 7.15am – a sunny Sunday morning in July…. I finished second cup of tea and both newspapers too.. I had nothing better to do in a peaceful morning and hence switched on TV. While I was watching a crazy bolly movie – Maut Ka Badla Maut ! on Zee Cinema, an old friend of mine – Mahesh (name changed) called me up on my cell and wished for appointment to take me through INSURANCE needs of mine. Mahesh (name changed) – is an Electrical Engineer, left job in Bharat Forge and started a full fledged practice as Insurance Agent and Investment Advisor. Since he is my old school mate, I invited him to my residence at 10.00am on the same day.
Mahesh being a true professional came sharp at 10.00am while I wasn’t really ready since Maut ka Badla Maut with another 2 cups of tea kept me busy for 2 hours. Mahesh and I exchanged greetings and few words before he started with his business script. I was smart enough to set the objective that if I am convinced completely with Insurance schemes, then only I may think of buying it.
He didn’t open the file containing insurance scheme broachers, but said – “Lets figure out HOW MUCH INSURANCE DO YOU NEED”. He asked me about following details –
1. My current salary (monthly and annual)
2. My Monthly Expenditures (I wasn’t aware of the figure, but confidently said Rs. 15000).
3. Date of Birth
4. Remaining expected years of salary (He assumed it as 32 years, although I want to retire after 15 years from now).
5. Highest Educational Qualification and other details
He then opened some ready-reckoner (handbook) and did some heavy and complex computations, used calculator, plain paper, inflation-deflation factors (while I was busy watching famous Cat-fight in Maut ka Badla Maut), he said 1 Crore 5 Lakh!!!! 1.05 Crore is the Insurance Coverage you need, Mr. Vaidya. That reminded me story of bolly movie “Judai” where Sridevi sold her husband Anil Kapoor to Urmila for 1 Crore. I thought she would have achieved this by buying an Insurance Policy.
Now I was surprised, felt proud with my life worth of 1 Crore and then shocked with the insurance premium amount. When I asked explanation, Mr. Mahesh gave me dozens of reasons on why I need Insurance coverage of 1 Crore. Some of the reasons were –
1. If you are earning X salary today, you would be earning 10X salary on your retirement and hence, if you die today, your family (dependents) should survive without your salary for another 32 years.
2. In case of any misfortune with you, your house which is bought on Home Loan may get seized.
3. Even after your retirement, you need at least Rs. 60000 for monthly expenses (considering my expenses will grew in same proportion to my income and multiplied with inflation factor).
4. Returns on your investment – Mr. Mahesh’s Insurance company gave returns of 289% on investments made since past 8 years and 130% since past 4 years.
I believe most of us (who are not investment advisors or insurance agents) meet Mr. Mahesh through some friend’s reference. The purpose of this blog is to educate you and think about “HOW MUCH INSURANCE DO I REALLY NEED?”.
Trust me…I have seen my friends crying to pay insurance premium. Rs. 1 Lakh Insurance Premium per year for self and another Rs. 50000 for his/her spouse – Total Rs. 1.50 Lakhs is a common figure since inception of private insurance companies in Indian market.
Let me explain you a basic partition in the insurance products offered today. Type 1 is Insurance only and Type 2 is Insurance + Investment. Any Insurance product offered by any Insurance company must be categorized into above two types. I really love to read names of Insurance Schemes – Jivan Rekha, Jivan Sangharsh, Jivan Paripurnata, Akela Jivan and so on…. However, I would always name any life insurance policy in the world as “Maut Ka Sauda” and Iife insurance company with “Maut Ka Saudagar”. This may sound sarcastic or offending, but I do not intend to assault Insurance Companies. All Insurance companies are doing a useful and a great business of life insurance.
Importantly, in the types referred above, “Insurance” is the common item. Life Insurance means Promise of reimbursement in the case of loss of life (as per a web definition). Therefore, it is the risk of reimbursement undertaken by an Insurance company for your life. Why would they insure you if they can’t make any money of it? It is a source of income for them and a source of expenditure for you. Where Insurance and Investments are coupled in premium, it works out as below.

Assume - Insurance premium quoted for your life is Rs. 10,000 annually. Insurance company takes this sum from you and then distribute your Rs.10,000 as below-
1. Insurance Premium (your cost) – Rs. 2000 and then
2. Balance Rs. 8000 will be invested in the market.
Now, I have personal objection here for coupling your investment with insurance. Why do you need to give Rs. 8000 to insurance company to manage your investment? Can’t you buy stocks, can’t you put 8000 in bank FD?. If yes, then why do you need to walk with liability of Rs.8000 payment to insurance company. I can write with my (virtual here) blood that INSURANCE IS EXPENDITURE FOR YOU. No one in this world will provide insurance free of cost to you.
Having explained concept of insurance business, following are the 4 important factors which may decide how much insurance do you need –
1.Your Life Stage and Your Needs: One need to think about himself/herself before arriving at figure of insurance coverage. For example, your current salary is Rs. 30,000 per month – with average expenses about 20,000 per month. You manage your income-expenditure nicely. Your spouse and other dependants live happily with life standard suitable to your income. In case of any misfortune, your dependants should get at least Rs.20,000 to maintain same standard of living. Same standard of living means same kind of expenditure like one movie in a month, Bata shoes, Lakshmi road for clothing needs etc. Therefore, in this example, your Insurance coverage amount should be enough to yield Rs. 20,000 per month. I know a gentleman earning salary of Rs. 50,000 per month, but insured for Rs. 2 Crore paying some lakh premium every year. He may need to ask question to himself - do his dependents need Rs. 2 crore for survival after his death. Will they start using BMW after his death when they are using Wagon R when he is alive? Of course..NO NO. They only need enough money to sustain. I do not see any reason why you should think of using insurance proceeds for sustaining your son after 21 years of son's age. Your liability should end at his 21 years.
2.Investment: With all high respect to Investment Advisors, I personally hate investment option coupled with Insurance. As said above, I advise not to go for Insurance policy with Insurance +Investment type. Typically, Insurance Agent keep shouting returns of 200% etc. are not fixed returns, but happened due to fast rise of Indian Stock Market since year 2000. If you would have put same money in stock market, you may have earned returns of 300%. Hence, please apply second mind while letting insurance companies to plunge your funds. Investment is a business and Insurance is an emotion. Do not mix emotion with business.
3.Life Standards of your dependents when you leave them: You may need to give a deep thought on life standards you may want to provide your dependants after your death. If your wife dreams of a diamond necklace, please do not plan it with your death and insurance. Your wife needs a diamond necklace along with you. You also need to look at the inheritance you would leave to them and their significant foreseeable expenses.
4.Who are your dependants – This is widely ignored question by most of us. I know a husband who earns Rs. 1 Lakh per month and his wife earns Rs. 1.20 lakh per month. In my opinion, neither of them are dependent on each other. However, assuming their high standard of living, the insurance coverage needs to be equally distributed. Another case – Wife is a housewife. Husband earns Rs. 20,000 per month, but inherits a huge property which earns Rs. 80,000 per month for him through rent. Even if he dies, by law the entire property will rest in the hands of his wife and thus she can continue earning same level of income. In my opinion, even she do not need life insurance.

To sum up –
How much Life Insurance do you really need? –
1. Life Insurance Policy with an appropriate coverage to maintain same standard of living, in case of your sudden misfortune.
2. INSURANCE IS EXPENDITURE FOR YOU (written in virtual blood). Investment is the additional facility offered by Insurance Companies to manage your funds. Where you buy only insurance, such insurance policies are known as "Term Life Insurance" and I always advise to go for the same.
3. Amount of Life Insurance coverage depends on your current life standard. Do not buy life insurance to gift a diamond necklace to your wife after your death.
4. Dependent – Amount and use of Life Insurance proceeds after death are useful only to real dependents.

Disclaimer – The writer of the blog aims to help you out in decision making on buying an insurance product. The views expressed by writer of the blog are his personal views and do not necessarily construed as “Expert Advise”. Anything contained in the blog do not intend to offend any person or any business or any institution. Reader of the blog may apply his own discretion while buying an insurance product or deciding on amount of life insurance coverage for the policy.

Friday, August 7, 2009

EAT PUNE !!! – (Part 01)

Heavy demand….heavy demand….to pen down all popular eating points in PUNE. The special blog chain hereafter attempts to analyze these famous spots. Here you go with Part I with your hungry tummy for ‘SABUDANA KHICHADI’, ‘KACHORI’, ‘SABUDANA WADA’ and ‘FRUIT PLATE’.
Sabudana Khichadi –
1. Janaseva Dugdhamandir: My favorite…. Lovely khichadi… I am ready to give you company anytime. Typical Puneri Bramhin style (Konkanastha). This should be called as a ‘Perfect Khichadi’. Note – Keep your ego outside on Lakshmi Road. You cannot expect the owner to give you special importance. It is your duty to speak clearly (“Spashta ucchar”) before you buy token. Self Service…enough quantity for your breakfast. Add up special “Janaseva kharvas” after khichadi. Located on Lakshmi Road, opposite Bombay Dying, near Garud Ganpati. Parking for two wheeler should not be a problem here.
2. Gujju brothers’ stall at Ravivar Peth: Recently tasted by me. Excellent taste. This is located near Bohri Ali in Ravivar Peth. Park your bike outside Bohri ali (lane) and instead of turning to Bohri Ali, walk 100 meters ahead towards a chauk and you can easily find crowd near a tapir. They serve two types of Khichadis – sadhi & special. Special Khichadi includes sabudana khichadi + batata chivda + kachori… mixed perfectly and hence taste is interesting. You may try out some cold-drink like Wala Sarbat, Limbu Sarbat, Khaskhas Mastani on an adjustant stall here.
3. Shree Snacks (Misal): Good Khichadi. Again a bramhni taste. I rate it as better than Bedekar Misal’s Khichadi. Located off Kumthekar Road (behind Chitale Bandhu).
4. Shri Krishna Bhuvan: This belongs to my uncle’s best friend. Nice taste. Try out fresh (always) buttermilk after Khichadi. Misal is also famous here. Located in Tulshibaug. Close between 1.30 to 5.30.
5. Stall next to Bedekar Ganpati Mandir: Good khichadi. Open only for morning breakfast. Located near Bedekar Ganpati Mandir on Paud Road.
6. Appachi Khichadi: Old spot. You may try this out because of its name. Thik-thak taste. But very popular. Located behind PYC Hindu Gymkhana, Deccan.
7. Janaseva Dugdhamandir: Coconut (wet) made Kachori. Good Taste. Read other details referred in #1 above.
8. Shegaon Kachori: Famous Kachori of Shegaon (Maharashtra) Station. Located next to PMPML Deccan Bus Stop (main), near Pulachi Wadi.
9. Hotel Vaishali: Popular for Kachori (wet-coconut made) for Breakfast J.
10. Purohit Sweets: Located at Ravivar Peth, Bohri Ali.
Sabudana Wada
11. Sreenath Sabudana Wada: Always surrounded with Sabudana-wada fans ! Located at Bohri Ali, Ravivar Peth
12. Prabha Vishranti Gruha – Narayan Peth – good old place near Kesari Wada.
13. Manohar – Good one… typical Konkanastha Bramhin style sabudana wada. Located near Mehendale Gaur age, Nalstop.
14. Mahila Udyog – Nice taste. This shop is run by Anath (senior) Mahila. You may also try out Pohyacha Chivda & Besan Ladu here. Sabudana Wada has got a decent taste.
Fruit Plate-
15. Kamla Nehru Park – Two choices – Full consist of 4-5 fruits whereas Half consist of 2 fruits. Interesting spot located outside Kamla Nehru Park (next to my favorite Sunil Tea House). You may top your fruit plate with Delhi Chat Masala. Parcel facility available. Full plate good enough for 1 person’s lunch. Typically Half plate contains ‘Papai’.

The special blog chain on “EAT PUNE” will limit each blog for 15 spots only, categorized food-wise.
Please forward me your suggestions/inputs/YOUR SPOTS.
Next in Action – EAT PUNE - Part 02 may bless all with ‘Samosa’,’Pav-Patis’, ‘Pav-Bhaji’, ‘ Vada-Pav’ and ‘Cold Coffee’….stay tuned !!!!!!!!!!

Disclaimer: The purpose of this blog is to provide reader with interesting food spots in Pune. The spots referred in the blog have only been recommended by writer and unfortunately, he does not hold any control on reader’s tongue ;). It also does not mean that writer never eats at home or writer’s wife cannot cook the food. Please talk to writer before making any perception in this regard.