On this blog and other financial blogs, there is so much being talked about right products, allocating your assets, and all the high fundu stuff. But last week, I had an experience that actually made me realise why consumers have such a hard time planning their finances, and what restricts them from taking action.
What happened last week
Before telling that, I will tell you a bit about me, I am financial planner and a CA, so you can say I am a perfect “non-technical” person. So, you tell me to spot a good mutual fund or an insurance product, or to calculate how much income tax you have to pay for your let out property, I will be able to help, but when it comes to technology, I am the dumbest person you’ll meet.
This Dell laptop I am working on, I purchased three years back, which had an antivirus software Trend Micro installed in it. Every year, I would renew that software, as I was working fine for me, protecting my PCs from viruses etc., considering that I use a lot of internet in my day to day work.
Last to last week, I got a update message for renewal, and I just thought hey, lets check out how much others softwares cost…and to my surprise, I found out that while trend micro will charge me Rs. 1500 for renewing, other softwares like avg, avast, quickheal etc. were available in range of Rs. 500-1000.
Then, the question – why should I pay so much for trend micro if others are charging so less…
But then, I told myself, hey look, we have to do a feature wise comparison (for e.g. there are 2 insurance policies offering different benefits, you cannot compare by only price alone…)
And the horrific experience started from there…..
I visited websites of AVG, Avast, Quickheal, Norton, Mcfee, Kaspersky and compared the price and features. And my friend, let me tell you, it was a BIG PAIN to compare. And well, its understandable: how would a non-technical person know terms like Advanced DNS protection, sandbox, system watcher, optimised databases, PC tuner…in a way, I was completely lost….
Every time I used to sit on the computer, I thought TODAY was it, I will purchase the software and install it…but 1 time, 2 times, 3times, and the frustration kept on growing. Every time I zeroed in on a particular product, before purchasing I saw either a negative user comment on sites like flipkart or amazon, or a review that stated that there were better products than that product, and that stopped me to take a final decision to buy the product.
In between, I also called up my friend, and told him ki yaar please bata de what is the best product – he suggested AVAST to be a good one. But then, we think ourselves to be very intelligent, so I said OK, let me keep AVAST in mind and also do my own research…..
In between all this, the worst thing what happened is that the antivirus protection got over. This meant that today, if a virus attacks my system, my precious data can get lost, or personal confidential information stored on my PC may get compromised. And everyday I thought, what is this man? I am not taking a decision and EXPOSING my system of viruses and malware????
So, one fine day, I said no more playing around, I went to Avast website and downloaded their trial version. Knowing that Avast also had bad reviews, and the fact that it is not sold through flipakart etc. (meaning it will cost me more than other antivirus softwares), I finally installed it. The software ran an initial scan and gave a message – “Your computer is protected”.
And I tell you, I heaved a sigh of relief! And this was after exposing my PC to viruses and malware for 10 days. Nothing happened, but who could have told?
What I learned from the experience
Friends, I always believe if you keep your eyes and ears open, all problems in life are to give you an insight/ lesson.
And it happened in this case as well. Being a non-IT person, evaluating an antivirus software, I literally felt handicapped and suddenly realised that being a CFP and knowing about financial products, I write about good insurance plans, mutual funds, etc., but when an ordinary consumer goes in the market for buying these financial products, then he/she faces the same situation, and moreover, there it is not a small commitment of Rs. 1000/ Rs. 2000, it is a commitment of much more amount and repercussions are also much more.
This incident helped me in placing myself in shoes of a customer (say an IT professional who knows nothing about a insurance plan), and I realised what a difficult and frustrating experience it will be for him.
Some time back, a friend spoke to me about buying the right term plan and he said he is finalising Aegon religare as the guys at policybazaar.com told him its the cheapest, go for it. I told him no, also look at claims settlement record and suggested him hdfc click2protect. I did not get to speak to him later, but I guess he will also apply his intelligence, search different websites, get himself thoroughly confused, and then abuse the financial services industry for creating such difficult products and so many variants, and worst of all, NOT BUY term insurance at all…..
In my case, my computer would have crashed because of my delay, but for him, his family’s future can be crippled in case something happens to him and no financial net is there to protect his family…
Faced with such a situation, as a consumer what you should do?
When it comes to purchasing a financial product, there are 2 options – you can do the research yourself (this will need a time commitment and also some inclination/ interest) OR you can consult an expert/ trusted friend who you think is more knowledgeable in your area and who you trust will put your interest first.
Even there, I feel one should realise that all products have 80% same features and 20% variations. For example, if you are planning to buy mediclaim insurance, you will see every company offers health policy and they will have nearly same benefits. Yes, 20% difference will be in terms of cappings, waiting periods, range of network hospitals, but please try to understand that 80% will be same across policies.
So, for example, an Oriental or an Apollo munch policy, there will not be much of a material difference, except that Apollo does not have room cappings/ sub limits etc – so, while as a financial planner, I will suggest you go for Apollo, but if you are taking a decision yourself and you don’t have anyone to advise you, what will you do? – you will compare and compare and compare and will get confused.
My view: Are bhai ek koi bhi policy le lo kyo itna bhaav taav karte ho!!!! – no I am not saying that financial products are like onions, but what I am trying to say is that benefit of making a quick decision and purchasing the product is that at least you are getting your family protected for the 80%. Baaki you can do your research in free time and next year, you feel that yes, there is a better policy, there is nobody stopping you to shift to that policy, isn’t it?
But the problem is, people want the BEST INSURANCE POLICY….or the BEST MEDICLAIM POLICY….and they end up getting confused reading all the reviews and NOT buying anything…and thats the saddest part.
Also, there is much stress on the consumer from the media, from the blogs, everywhere to buy the “right product” and there is SO MUCH FREE INFORMATION on Google etc. that people just become too overwhelmed and don’t take action.
So to cut the long point short: Speak to people, Read the reviews, but DONT DELAY TAKING THE STEP. Because after all, you don’t improve your finances by procrastinating and endless research, you improve by taking an action, one step at a time..
I hope my story helps you in some way. Your thoughts/ suggestions are most welcome, do share in the comments section.