OF YOU AND ME...

 Few Observations and lessons
The human mind and the body must never remain idle.
Last week I underwent what could be called as a culmination of a long delayed medical condition into a surgery.
Though it was what the doctors call a minor surgery but since it involved anesthesia it actually can have some serious connotations.
As soon as I knew about it before going to the hospital I made a few preparations and also during my stay in the hospital I realised some very important points that I would like to share with you. These points have nothing to do really with your financial independence or medical insurance as you may think, but they are definitely a big part of it.

First thing that I realised is that, during such times however your family may be whatever be the size and however well placed the relatives maybe only people who come helpful are your immediate friends near your house and your neighbours. Whether you are a Mariner or not, it is very important to develop good healthy circle and tolerate your neighbours even if they are not so kind in normal Times.
Having a good social circle and regular touch with friends is your blessing.
Next is the fact that do not hesitate to ask for help from your friends or neighbours.

Secondly what ever be your financial position, however big be your investment portfolio, however fantastic maybe your insurance plans, they mean nothing  if you have not familiarised your family with the procedures to be followed for getting that money.
Even if you have made the best arrangements your post survival but all that information is in your laptop or the cloud it means nothing. Ensure that all the login passwords for email accounts apps net banking are written down in a small diary and kept safely with the person who will look after you in case of an emergency.
Ensure that however young you may be  write out a will and have it attested by two witnesses who are known to your family . (As suggested by a friend of mine one of these witnesses should be a doctor.)
A simple hand written will in simple language without any ambiguity ,clearly mentioning the person or persons as your legal heir is sufficient, there is no need for it to be written on a stamp paper or be registered even though doing so it's desirable.
Thirdly ,I felt that one should make out one's survival kit having the necessary medication ,toothbrush ,spectacles, undergarments ,a spare charger, for such emergencies.a small amount of cash can also be kept with this emergency kit.
Fourthly, the diary that I mentioned above can be kept in this emergency survival kit and the first pages must have the entire information about yourself.
Fifthly: if you your spouse or family member is a diabetic ,or allergic to anything then this fact must be displayed in a small card and kept in the wallet or displayed on the emergency kit. you can have a small card printed out and laminated and stuck to the survival kit for the entire family if it helps.
Apart from these few things
you can add to this list which includes the card for cashless hospitalization or numbers that need to be informed in case the person is admitted in a different city.

Apart from this I realised the fact that I had been ignoring the medical insurance that we seek and take for ourselves is actually very minuscule.
Earlier I used to suggest super top up policies but having utilised my time in the hospital to search for better products I feel that the high sum insured products should be considered as they do not really  hike the premium.
I will wait for your feedback to update this article.

Journal 21st March 2020

This weekend presents itself with a unique opportunity!

Two days  of complete introspection;  two days when you can actually and officially cut yourself off from everyone around the world and dwell into your self.

You can check what and how things in your life are actually beyond your control.

You can also check your Financial preparedness and the effect that past 1 month has had on your reserves. When the market or any event is in action one is not able to think objectively.

Not able to plan for future.

The Friday that was yesterday was starkly different from the previous Friday the 13th.

If you like to make any inferences out of it and draw lessons out of it, it would be hugely rewarding in future.

Point 1 : when you see the market going up you normally only check the broad-based sensex or Nifty and declare when the market is up.

 However for broad based and an all encompassing rally or rise in the market you must check the other indices also like the mid Cap and small cap indices; Nifty 100, Nifty 200 and of course the Nifty 500.

If you will check yesterday's induce, all across the board there was a 5% + increment. This is actually very heartening. Because it shows that even in the face of such adversity there was an all round interest in the market.

 

Point 2: These incidents in the past month or even the past week give you an opportunity to to check the beta of your portfolio against the  market conditions. Beta means that  that for one unit of rise in the market how much did our portfolio rise or fall.

Point 3:

This is also the time to check the individual funds that you hold as to how the rise and fall on daily basis against the benchmark index that they follow. Mutual funds houses may adopt a benchmark which is more suitable to their results but from your point of view you have to see where you are getting better returns or are losing more money than others.

If you will check the various funds and how they gained yesterday you will find that index funds and the index ETFs did better than most of the funds.

Finally of course if you wish to interact with me  and other members of the group then this weekend is a better time to do it.

We can even hold video conferencing on WhatsApp for upto 4 people at a time.

Have a happy weekend and productive isolation.

A JOURNEY INTO LOSING MYSELF

My journey into losing myself

Yesterday was 16th November.

As I woke up I was staring at the ceiling... I remembered something and smiled to myself.

Slowly I made my way to the  drawer and took out the dusty folder and gingerly opened my CDC.

The Last entry declared 16th November 2014...5 years...

5 years is a long time in any human beings life and certainly in the life of a sailor who loses all relevance to the life that he has known for over three decades.

The journey started in a quest to lose myself and my ego .

It was certainly not any easy decision for a person who loves the sea as such and certainly admires the ship and its life on board.

It was certainly not an easy decision since people always heard me saying that I would sail till I can and then till I can't. 

Today , as I sit completely relaxed in my massage chair pretending to be 10 years older than I am...

I find these five years  to be an equally enchanting journey into completely different kind of self discovery.

There have not been many moments in these 5 years that I worried about earning anything or endeavouring  to earn money in any way.

Most of the days and hours were spent in working for people who are not related to me or my family.

I discovered the enormous and insightful world of of charity and living for others.

I can't claim that I ever dreamt or missed the life on ship or the bridge or the machinery of engine room.

I have forgotten the insides of the purifier and the crankcase but learnt more about the insides of human souls.

I have learnt more about human greed and selfishness and what it makes people do in their lives.

I have learnt and realised how difficult it was for my wife to spend those 24 years alone. I realised that she worked no less, rather much more, at home with my daughter and parents then I did on board.

I celebrated my silver wedding anniversary almost as if we were getting married and I renewed my vows with her and promised to be at her side finally...

... though this post is meant for my friends and colleagues on the financial groups of seafarers I must tell them that it is not about money alone...

It is certainly necessary that they gain financial independence as soon as possible but it is even more important  to gain understanding with their families. It is necessary that they develop understanding of life and develop hobbies and pastimes and passions which would keep them working past those golden years.

It will not matter when you will give up this enchanting ,charming and wholesome life at sea but it will matter how you will like yourself to be seen in those years.

Seafarers and Mental health

 Seafarers and Mental health

One of the key reasons which persuaded me to summarily give up my sailling career and venture out for some social service was the untimely death of three of my friends which included a batchmate due to to some or the other reasons related to mental health. All three deaths happened in a week’s time and due to natural causes.

As providence would have it I got associated with some social causes which helped me  look deep into to the human psyche and minds around me.

In neighbours I have seen 3 suicides in the last two years and some brain related problems in some seafarers.

The latest case that we all heard about Captain Khanna suffering from a unique syndrome is the latest in the series.

Similarly in 2005 my childhood friend contracted Julian berry syndrome which is sort of short circuiting of the nerves due to breakdown of the myelin sheath which acts as insulation otherwise.

I regularly offer my services at the Vipassana meditation centre and on the day of the  start of the course I regularly come across more than 15 to 20% of the participants suffering from some sort of mental disorder or addiction. This percentage is absolutely in line with what the UN has just declared as a percentage of Indians  who will suffer from issues of mental health by next year that is 2020.

The purpose of such a devastating introduction is that there are more number of people suffering from some sort of mental issues then they care to acknowledge. However due to a natural defensive nature in accepting such diagnosis very few people actually go for professional help.

We fail to realise that just like physical ailments,  the mental ailments could also be very very temporary but they have to be given the professional help as in the case of physical disorders.

Seafarers and mental health:

Usually it is a tendency for the Marine professionals to think that because of staying in relative  trouble-free environment ,fresh air and open sea they do not suffer from or cannot suffer from any mental stress and hence the question of any disorder cannot arise.

My wife had started a  marriage counselling service alongwith some social scientists and a psychiatrist more than a decade ago .

In the five year of its existence they interacted with almost 1470 couples who were undergoing marital stress. In most of the cases the reason was more of individual stress environment for the people and this included a sizeable number of seafarers as well.

Possible cause of stress to a Seafarer irrespective of his age or social status or professional rank:

1.      Extended stay away from home and familiar environment.

2.      Hectic deadlines both at sea and while a shore.

3.      Lack of sleep: this unfortunately is one of the biggest reasons of stress and depression in the seafarers. I remember in my junior time I used to treat almost everybody on board for insomnia. Bye I know everybody has read enough of it and knows that more than 2-3 days of lack of sleep can cause a temporary  breakdown in the mental status of a person. Release of cortisol the stress hormone increases and the secretion of insulin reduces. We all know what the state of mind is when we leave a port after hectic discharge operation, MOC inspection and superintendent's visit in the same port.

4.      Anxiety regarding one's future:

5.      Anxiety regarding one's finances:

6.      Anxiety regarding one's family:

7.      Anxiety regarding once interpersonal relations with the spouse: While the above three causes are self explanatory ,this in fact has been the most recurring of the reasons that I have found amongst the colleagues right from my first day at sea.

Nowadays I get more phone calls regarding this matter rather than even financial planning matters.

It is the general tendency for both the spouses to think that the other person is not being understanding. Which actually is the case because neither does the wife understand the physical and mental pressures while the spouse is at sea and neither does the sailor understand what the wife goes through every morning from the time that she gets up to the time that she goes to sleep at night.

The insecurities of shore life and the pressures from the peers and relatives cause a permanent twist in the nature and character of the wife.

So this is certainly not something that needs to be wished away.

Personally for me, I find that even the people around me who passed away due to some physical issue had the reason deeply entrenched in ones brain.

I remember a very funny incident that we had in school . Whenever we used  to make excuses for not going to school by saying that we are having a stomach ache, by noon at least I would get proper stomach ache. So strong was the working of the mind even at young age that just imagination could bring about a temporary situation in the body.

So what can we do to alleviate or handle it before we reach such a situation.

The few things that I have found out on my own but specifically by asking the expert around me:

1.      Relax: after coming home on leave and after a few days,  plan a vacation with your family . It doesn't matter even if you need to take few days of vacation for the children from school. Seafarer's children learn more while they travel than they do at school. This is my personal experience.

1.      Why on boar,d also try to to give up your mobiles and laptops for a period and just lie down .

2.      Exercise physically: this I need not teach the youngsters today because they are very active . But let not your exercise schedule become into a exercise syndrome which causes stress on the body and the mind.

3.      Exercise mentally by reading different kind of literature, playing different kind of brain games, learning new language from your onboard colleagues and designing quiz for the ship staff.

4.      Listen to good music: it has been found that the memory related to  music is deeply and permanently etched in the brain and remains even with the Alzheimer patients. This I have seen in a friends case.

5.      Meditate: this is the most important part and one must adopt it in one's daily routine. I would go as for as saying that if you adopt meditation in your daily routine you will be able to to overcome any challenge even if you do not do any of the above four things.

There are many kinds of meditations going on around us but please do not confuse this with Pranayam.

I have personally being doing Vipassana meditation for a decade now. But the true testimony to this is provided by the famous author of Sapiens and Homo Deus ,Yuval Noah Hariri . An Israeli national, he is not only a practitioner of Vipassana but also a teacher and visits India every year for 2 months to refresh his practice.

In India we have over 94 residential centres catering to at least one in each state. We are lucky to have one in Dehradun itself which is about to complete its 25 years.

Almost every fortnight when a 10 day course starts we have few patients of mental condition with various diagnosis of bipolar-ism, Schizophrenia, depression etc.

But mostly we get healthy meditators quite a few of them very young.

The feedback from most of these meditators indicates that after doing the course and regular daily practice they find themselves to be much sharper with the high level of concentration and the ability to take quick and logical decisions in times of crisis.

I am sure you will find all these qualities to be necessary at sea and also in your personal and family lives.

The basic and minimum course is of 10 days and gets over on the 11th day early morning. The boarding and lodging during the course is absolutely free as each course is financed by the donations of the previous meditators who have benefited from such courses.

The course is absolutely non-sectarian and devoid of any prayers, chantings, rituals and worships .

Apart from this I call upon you as fully aware and conscious colleagues to look around in the ship to see the condition of each and every of your shipmates. The empathy that you will gain by this exercise will help you when you come home to your family.

May all of you be blessed and Happy.

Managing risk aka IIFL,ESSEL and DHFL crisis

Whenever a crisis especially in the financial sector looms large or is indicated- what do you do?

Do you simply retract all your steps and go back to ground zero and start again on the drawing board.

At least this is what I observed in the recent IIFL, DHFL AND ESSEL debt crisis.

Most of the investors did not even have any Investments in the affected funds, still, the moment they heard Liquid funds are not safe - they pressed the crash landing button?

Why was that?

Did they even for a moment realise before investing that their fixed income schemes would be risk free.

Would anyone pay a higher premium over the normal rate of return if there wasn't any risk.

Isn't there a risk even in FCNR deposits- that of exchange rate. Or the fact that if they are forced to liquidate their deposit even a day earlier than 365 days- they get no interest.

Risk and return are two sides of the same coin whichever walk of life you move.

The same job that we do on board, carries lot less remuneration on land. Do we stop sailing? We just take risk mitigating factors .

So what steps should we have taken before investing in debt funds ?

Before that we must ask what the risks were.

The first risk was that of interest rate. Any rise in interest rates could have led to the returns falling.

And second risk was that of liquidity itself. Which means that the underlying papers could not have been sold.

In the same series third risk happened to be that of the default by the debt issuing company itself which finally happened.

But how could somebody not see such a big default happening?

To answer this I must tell you the story about a famous neighborhood Lala who was in the business of collecting money and paying interest on it and also lending money to the weaker section and charging interest on that.

Despite being well educated my father and grandfather followed his scheme and deposited weekly installments to get a return to the tune of 18% in 1970s. To cut the story short both the money and the Lala just vanished.

Add to this various chit funds and committees which are regularly defaulting in repayment of their debts.

So does that mean that we stop investing in the fixed income assets and stick to bank fds , Post Office schemes or other supposedly safe avenues.

No absolutely not.

We must realise that it is the our investment in the fixed income assets which actually form the backbone of the National  infrastructures projects.

In the same way the companies also fulfill the finance needs from these fixed income assets like the above 3 companies went to the mutual fund industry to get money.

It is not everyday that the companies are defaulting on their payments. But at the same time we cannot jeopardize our hard earned money by taking chance with even one such incident.

So what would I do?

I would most certainly go for a big AMC which has been in the business of managing debt instruments for long time. 

Then again we keep reading articles mentioning that the size of the fund does not guarantee safety or returns either.

Well it doesn't but when we put our money in a fund of the size of about 15000 crores then most certain its exposure to any single company would not exceed 2to3 percent. And this would certainly protect its downside in case of any such default.

If you will see carefully you will not miss the fact that two of the largest AMC are not there in the list of affected mutual funds.

So it automatically follows after selecting an old big and reputed AMC the second thing that I will select is a debt fund of reasonably large size.

The third selection criteria which I will apply to my entire portfolio is...

I will opt for overnight funds liquid funds or Ultra short term funds. The underlying securities or debt papers of such funds have a very short maturity which in essence means that the the borrower has promised to pay the money at his earliest which is within 6-12 months.

So by following these three steps I would reasonably secure myself.

After following such a course of action if I am still faced with a company defaulting then my entire risk would not probably exceed 2 to 4 percent which means that for an investment of 1 crore I would stand to lose a maximum of 2 to 4 lacs.

Apart from the fixed income plans we had also seen prices in the equity sector on account of PNB earlier last year. But even with that a good fund house like HDFC did not suffer more than 2.3 % on the NAV.

But unlike the debt papers, the fund manager went into bye buy additional PNB at the lower rates and benefited once the market and the PNB stock moved up.

So the mantra should be- don't avoid risk.

Manage it.