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In a significant move, the <keyword id="19899810" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="keywords">Reserve Bank of India</keyword> (<keyword id="19899808" type="General" weightage="100" keywordseo="rbi" source="keywords">RBI</keyword>) has imposed penalties on <keyword id="19952948" type="General" weightage="20" keywordseo="axis-bank" source="keywords">Axis Bank</keyword> and <keyword id="19895995" type="General" weightage="20" keywordseo="hdfc-bank" source="keywords">HDFC Bank</keyword> for lapses in regulatory and statutory compliance. The fines, which amount to a total of ₹2.91 crore, highlight the central bank's ongoing efforts to ensure that financial institutions adhere to prescribed guidelines. The RBI levied a penalty of ₹1.91 crore on Axis Bank for violations that included contraventions of the <keyword id="19976511" type="General" weightage="20" keywordseo="banking-regulation-act" source="keywords">Banking Regulation Act</keyword> and non-compliance with specific RBI directions related to interest rates on deposits, Know Your Customer (KYC) norms, and collateral-free loans for agriculture. Meanwhile, HDFC Bank faced a ₹1 crore fine for failing to comply with directions concerning interest rates, customer service practices, and the use of recovery agents. <h2>Axis Bank: Key regulatory failures</h2>Axis Bank’s penalty stems from a supervisory evaluation conducted by the RBI based on its financial position as of March 31, 2023. Upon reviewing the bank’s activities, the RBI found several areas of non-compliance. One of the primary issues was the opening of savings deposit accounts in the names of ineligible entities, a direct violation of regulatory norms. Additionally, Axis Bank was found to have issued multiple customer identification codes to certain clients instead of assigning a Unique Customer Identification Code (UCIC), which is mandatory to avoid duplication and ensure proper monitoring of accounts. The bank also violated guidelines concerning agricultural loans. RBI regulations prohibit banks from asking for collateral for agricultural loans up to ₹1.60 lakh, but Axis Bank had obtained such collateral in certain cases. Lastly, a wholly-owned subsidiary of Axis Bank was found to be engaged in providing technology services—an activity that is not permissible for a banking company. This contravention added to the overall penalty levied by the central bank. <h2>HDFC Bank: Regulatory shortcomings</h2> In the case of HDFC Bank, the RBI’s investigation was based on its financial position as of March 31, 2022. The central bank uncovered several violations, including the offering of gifts, specifically covering the first-year premium for complimentary life insurance, which exceeded the permissible limit of ₹250. Moreover, HDFC Bank was found to have opened savings accounts in the names of ineligible entities, a violation similar to that of Axis Bank. Another significant failure was the bank’s inability to ensure that customers were not contacted by bank officials outside the permitted time frame of 7 am to 7 pm. <h2>RBI's Stance on Compliance</h2> While the RBI has been stringent in penalising both banks, it clarified that these penalties are based on lapses in regulatory compliance and are not reflective of the validity of any transactions or agreements between the banks and their customers. The central bank’s message is clear—financial institutions must adhere strictly to guidelines to maintain transparency, protect customers, and uphold the integrity of the banking system. The penalties serve as a reminder to all banks to stay vigilant and maintain high standards of compliance to avoid such financial and reputational damage in the future. Both Axis Bank and HDFC Bank have accepted the fines and are expected to take corrective actions to avoid future infractions. For customers, this action from the RBI is a reassurance that regulatory oversight remains a priority to ensure fair banking practices across the country.

RBI slaps fine of Rs 2.91 crore on Axis Bank and HDFC Bank: All details

“I started <keyword id="20024281" type="General" weightage="20" keywordseo="investing" source="keywords">investing</keyword> when I was 24, and had just taken up my first job. At first, it felt like a herculean task, setting aside Rs 15,000 every month for long-term investing. But now, at 29, I have a comfortable corpus with me, and I am able to even fund my sister’s education. I now realise how investing is the first step towards achieving some level of financial independence”. That was Yumna, a 29-year-old Delhi-based communication professional’s “tryst with her finances”. Tomorrow, India will celebrate its “tryst with destiny”, its 78th day of independence from Britishers. And so, it is certainly the right time to revisit our personal journeys towards independence, at least financially. If we heavily rely on our monthly salaries, being broke towards the end of the month, and desperately waiting for that end-of-the-month fund credit “ting”, then are we really independent? So, this Independence Day, consider gifting yourself (and your friends and loved ones) these five presents that promise you financial freedom. <h2>Start SIP-ing in Mutual Funds, stocks</h2>The British ruled India for almost 200 years, starting from the battle of Plassey in 1757, to when India finally ousted the British Raj in 1947. Nearly 200 years of tireless persistence, struggle and revolution was what it took to achieve freedom. Keep that in mind when you feel constantly investing for 10-15 years is “way too long!”. Consider this. Yumna started investing Rs 15,000 every month, five years ago. Assuming 12% p.a. in return, she has already amassed over Rs 12,00,000, out of which her investments are worth Rs 9,00,000, while her returns come to Rs 3,37,295. What if Yumna continues to invest at this pace for the next 20 years? If she invests Rs 15,000 (and assuming 12% p.a. return), she’d have invested Rs 36,00,000, while her returns would be a whopping Rs 1,13,87,219, making her total corpus worth Rs 1,49,87,219. The best time to start investing in the market was yesterday. So, if you’re yet to start investing, do so right away. But remember, it’s a marathon, and not a sprint, so remember to stay in and invested for the long run. <keyword id="20481917" type="General" weightage="20" keywordseo="index-funds" source="keywords">Index funds</keyword>, which basically mirror popular market indices like Nifty and Sensex are a good place to start. <h2>Insure yourself</h2>Getting a term and <keyword id="19894985" type="General" weightage="20" keywordseo="health-insurance" source="keywords">health insurance</keyword> should be at the top of your to-do list, immediately after you start earning. And no, don't rely just on your employer-provided <keyword id="19996817" type="General" weightage="20" keywordseo="insurance" source="keywords">insurance</keyword>. Plus, having term insurance can also help you save on taxes (an annual premium paid of up to Rs 25,000 for those aged less than 60 is tax-free under old tax regime), apart from saving you during medical emergencies. Says Sabyasachi Sarkar, Appointed Actuary, Go Digit Life Insurance, “a life insurance plan is a tool that provides a safety net for your family in case of unexpected events and for your need of savings or pension. Ideally one should take a term life cover that is at least 10-15 times your annual income. Moreover, adding riders like death benefits or disability coverage to your policy can offer protection and advantages beyond the basic coverage. Moreover, when picking a life insurance company, consider factors like the claim settlement ratio, returns etc”. Once you’ve insured your life, it's time to safeguard your health as well, with a solid health insurance policy. As Vivek Chaturvedi, CMO and Head of Direct Sales at Go Digit General Insurance notes, “Ensure the plan that you are picking does not come with any cap on the choice of room or ICU as this may impact your overall hospitalization bill. Second, make sure your policy provides a sum insured backup or reinstatement benefit.” Also, check for the pre- and post-hospitalization benefits in your health coverage. Ensure that expenses like diagnostic tests, doctor’s fees, medical check-ups, etc. that you might have to incur before you get hospitalized or after you are discharged are covered. A good plan should provide at least 60/90 days of pre- and post-hospitalization coverage. And lastly, check the coverage for organ donor expenses. While it is a low-probability event, any organ transplant is an expensive affair. This ensures such costs are covered by the insurer. <h2>Save for a rainy day</h2>“It can’t happen to us until it does”. When you are flooded with a daily deluge of news about accidents, deaths, fires, train wrecks and more, it’s easy to disassociate and think “Oh, this won’t happen to me”. But when emergencies arrive at your doorstep, they don't knock but rather break the door down. As such, it's best to be financially prepared for any contingencies, and the best way to do so is to have an <keyword id="20747810" type="General" weightage="20" keywordseo="emergency-fund" source="keywords">emergency fund</keyword> handy. For this, you can set aside 3-6 times your monthly income in a liquid mutual fund, recurring deposit (RD) or savings bank account. This will help you tide over a medical emergency, job loss and more. But remember, this is not to be broken into for funding those impromptu vacations! <h2>Upskill, Upskill</h2>Earning money is hard, but still easier than effectively managing it. Most of us run away from managing and investing our own hard-earned money because it sounds difficult and looks too complicated and jargon-y. This Independence Day, gift yourself a basic course on <keyword id="20762784" type="General" weightage="20" keywordseo="money-management" source="keywords">money management</keyword>, budgeting and investing. You won’t become <keyword id="19921921" type="General" weightage="20" keywordseo="warren-buffett" source="keywords">Warren Buffett</keyword> overnight, but it will certainly be a good start. Start with a basic budget and importantly, stick to it. Write and track how much you earn and spend on a monthly basis, so that you’re more in charge of your funds, and not looking (hopefully!), at maxed-out credit cards and empty wallets at the end of the month. <h2>Be free of anything that looks easy money</h2>These days, it’s super easy to get credit, a personal loan, and buy your favourite gadget, or your latest fascination via <keyword id="19985897" type="General" weightage="20" keywordseo="BNPL" source="keywords">BNPL</keyword> (Buy Now Pay Later). And in the short run, it can be incredibly satisfying as well. But then, when you get your monthly statements, and find a never-ending stream of interest charges, and penalties, which eventually pull you into a spiral of debt trap. If something looks too good to be true, it might really just be too good to be true. BNPL and instant credit are very much like that. So, the next time you want to buy something expensive, hold that thought for at least 48 hours, before revisiting it. Most of the time, you’ll find you don't even desire it anymore. If you still have the urge to buy it, try the saving and buying approach, instead of swiping your credit card or signing up for BNPL apps!

Five gifts you can give to yourself, friends, or family, towards achieving financial independence

It is no secret that women often outlive men. The global average life expectancy in 2021 was about 68.4 years for men. In contrast, this stood at 73.8 years for women. As such, it is far more important for women to begin planning for their golden years as early as possible. Perhaps realizing this, more women are getting into investing than ever before! Even better, women save about 5% more each month than men. A recent Max Life's India Retirement Index Study (IRIS 4.0) also highlighted a similar sentiment: women are increasingly taking charge of their retirement and finances. Per the study, urban Indian working women are now keeping pace with men, with 66% being confident that their current investments will guarantee a financially secure retirement life. In terms of health, 48% of urban Indian working women feel confident that they will continue to stay fit and healthy in their retirement years. Encouragingly, a whopping 68% of urban Indian women have already started investing for their retirement. Amongst their preferred investment avenues are life insurance (65%), bank FDs/RDs (45%), medical insurance (36%), and mutual funds and SIPs (14%). The awareness is not limited to women; young urban Indians are awakening to the realization that retirement planning should be kicked off as soon as possible. Per IRIS 4,0, 44% of Indians consider the right age to start planning for retirement to be before 35 years, a jump from 38% in IRIS 3.0. An overwhelming 93% of respondents aged above 50 regret delaying their retirement planning. Says Priyanka Bhatia, Co-Founder of Women on Wealth, "Women, by and large, live longer than men and may confront professional interferences, which influence retirement reserve funds essentially. Beginning in your 20s permits women to create strategies that account for longevity risks and potential income gaps. Investments like annuities and dividend-paying assets guarantee a consistent income stream post-retirement, permitting ladies to explore monetary freedom even in later years.". Not to mention, beginning early also permits individuals to take advantage of tax-efficient investments over a more drawn-out period. In India, instruments like the National Pension Scheme (NPS) offer tax benefits that develop over the long haul. By expanding these exceptions from a young age, women can grow their retirement reserve funds while reducing taxable income in each financial year. Bhatia notes that even if one is planning to retire early, it does not only mean putting something aside for your 60s. It is also about adaptability to pick semi-retirement choices, work in sectors driven by passion, or even pursue entrepreneurial ventures without financial pressure. "Beginning in your 20s allows you to amass funds that can allow for early retirement, empowering a change to lifestyle-oriented work or community contributions later in life," Bhatia signs off.

Planning for your retirement in your 20s? Here's why it is a smart move!

Shares of state-owned behemoth Life Insurance Corporation (<keyword id="19903588" type="General" weightage="20" keywordseo="LIC" source="keywords">LIC</keyword>) have outperformed rivals like <keyword id="20079495" type="General" weightage="20" keywordseo="HDFC-Life" source="keywords" meta.keywordsubtype="org" meta.entityname="HDFC Life" meta.hostid="261" meta.entityid="HDFC Life">HDFC Life</keyword> and <keyword id="21278696" type="General" weightage="20" keywordseo="ICICI-Prudential-Life" source="keywords">ICICI Prudential Life</keyword>, as it placed bets on India's growth sectors, including infrastructure, while the private sector concentrated its bets on tech, consumer and consumer-related <keyword id="19910880" type="General" weightage="20" keywordseo="BFSI" source="keywords">BFSI</keyword> companies. LIC's stock has gained nearly 79% from Rs 620 on June 18, 2023, to Rs 1,109.15 at the closing on Tuesday, according to stock exchange data. In contrast, HDFC Life gave a negative return with Tuesday's closing price of Rs 646.55 on the BSE as compared to Rs 666.55 a year back. ICICI Prudential Life Insurance Co delivered a return of 12%, considering its stock price rise from Rs 582 on June 18, 2023, to Rs 654.10 on June 16, 2024. Over the past one year, <keyword id="19898108" type="General" weightage="20" keywordseo="SBI" source="keywords">SBI</keyword> Life Insurance shares have risen from Rs 1,314 to Rs 1,621.20, delivering a return of 23%. Capital market analysts said <keyword id="19935977" type="General" weightage="20" keywordseo="insurance-companies" source="keywords">insurance companies</keyword> make money in two ways - charging premiums for policies and then investing the premiums into assets. It is the latter that generates the bigger delta in profits, thus impacting value creation and managing risks. Global majors, including Warren Buffet-owned Berkshire Hathaway, have been successful due to their ability to make superior investments. Most Indian insurance companies are yet to capitalise on the emergence of the country's <keyword id="19997284" type="General" weightage="100" keywordseo="infrastructure-sector" source="keywords">infrastructure sector</keyword>, analysts said. Indian insurance companies have concentrated investments in the BFSI, IT, and consumer sectors - all of which have been underperformers in the recent past. Only 8-10% of their investments are in the infrastructure sector. This is far less when compared to global standards. Large global insurance companies -- such as Allianz, Nippon Life Insurance, and Metlife, and other insurers like Berkshire Hathaway -- have much larger exposure ranging from 15 to 30% to the infrastructure sector, analysts noted. Over the past few years, global insurers have been increasingly considering infrastructure investments as 'core' investments as the stable and long-term cash flows of infrastructure assets naturally align with the liabilities of insurers. Additionally, infrastructure assets have defensive characteristics of high barriers to entry, strong pricing power, structural growth, and predictive cash flows, and listed infrastructure can provide investors with inflation-protected income and solid capital growth. <h2>Infra sector outperforming all</h2>For India, a strong government focus on the sector with large spending, supporting initiatives and encouraging policies, and improving governance has helped the infrastructure industry has come of age. This has helped the infra sector to outperform all other sectors, according to analysts. They said the high focus on retail loans, and the strategic reluctance to look at infrastructure for growth opportunities is proving detrimental for the shareholders of such companies. SBI, with its higher exposure to the infrastructure sector, has seen its stock gain 48% in the year (from Rs 592 to Rs 880.95 on Tuesday), while those of its private counterparts HDFC Bank, Kotak Mahindra Bank, ICICI Bank and Axis Bank have gained only in the range of (-)3%to 24%. Kotak and HDFC Banks with negligible exposure to the infrastructure sector are the worst performing, with their shares giving a negative return, stock exchange data showed. Kotak Mahindra Bank shares were at Rs 1,895 on June 18, 2023, and closed at Rs 1,805.20 on Tuesday. HDFC Bank closed at Rs 1,619.20 on BSE on Tuesday, down from Rs 1,679 a year back.

Exposure to India's infra sector helps LIC, SBI outshine peers

<ul><li>Analysts believe that a potential acquisition will improve lending capability and expand branch footprint <keyword id="46013" type="General" weightage="80" keywordseo="kotak-mahindra-bank" source="Orion">Kotak Mahindra Bank</keyword>.</li><li>Market unclear on such a large acquisition would play out if it leads to a merger eventually.</li><li>The end game should be full acquisition and amalgamation of <keyword id="6357560" type="General" weightage="80" keywordseo="idbi-bank" source="Orion">IDBI Bank</keyword>.</li></ul> <keyword id="6368369" type="General" weightage="50" keywordseo="life-insurance-corporation-of-india" source="Orion">Life Insurance Corporation of India</keyword> along with the government are looking to divest 60.72% in <keyword id="67881" type="General" weightage="100" keywordseo="idbi" source="Orion">IDBI</keyword> Bank. The process has already been kicked off and this will be a test case for the government as it will give it a blueprint for future divestments. So far media reports have speculated that Kotak Mahindra Bank was in the fray, but now <keyword id="3313307" type="General" weightage="40" keywordseo="nomura-global-markets-research" source="Orion">Nomura Global Markets Research</keyword>, a Japanese investment bank, has come out with a report that projects various scenarios of the potential acquisition and also explains how Kotak Mahindra Bank stands to gain if it acquires the bank. For starters, a possible IDBI acquisition could take KMB’s loan book to Rs 5 trillion plus along with a CASA ratio of 50%, which would be ahead of industry’s. The acquisition would also result in a sharp expansion in its branch footprint. Analysts at <keyword id="6354527" type="General" weightage="80" keywordseo="nomura" source="Orion">Nomura</keyword> believe that the acquisition would enhance its lending capability as the loan to deposit ratio will fall to 78% from 85% in Q1FY24. Analysts at Nomura have painted different scenarios of any potential transaction which will entail acquisition of a 61% stake in IDBI Bank. The first scenario could be a full cash-based transaction while the second would be stock-based and the third could be a hybrid one – entailing cash plus stock. According to the report, “While a cash-based acquisition is strongly EPS and RoE accretive, a stock-based acquisition is BVPS (book value per share) accretive (while being RoE dilutive). In all scenarios, the end-game for KMB should be the full acquisition and amalgamation of IDBI Bank, in our view.” The Japanese investment bank is of the view that scenarios which involve cash are preferable as they would bump-up to RoEs, which are currently depressed due to KMB’s low leverage of ~6x vs 8-9x for large private banks. But this deal may not be without its share of complications, says Nomura. The <keyword id="6354335" type="General" weightage="50" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword> has incrementally not been forthcoming in terms of allowing banks to pick-up stakes in other BFSI businesses, says the report. Therefore, it is unclear how such a transaction would be allowed. The central bank could make an exception Kotak Mahindra Bank is to be eventually merged with IDBI Bank. A merger also is not without its share of complication, even if it is allowed. There is no certainty on how this can impact the share price of Kotak Mahindra Bank even if the merger leads to better financial ratios.

What if Kotak Mahindra Bank acquires IDBI Bank, asks Nomura

<ul class="summary-list"><li>VO2 max is a trendy stat for measuring your fitness, and it can help improve longevity too. </li><li>Having a higher VO2 max is good, but more important for health is how the number changes over time. </li></ul>Forget about a big bench press or heavy squat. If you want to show off your fitness cred, a specific smartwatch screenshot is the new gym selfie.Once reserved for exercise science nerds, a stat called VO2 max — a measure of how well your heart performs during exercise — is trickling into the mainstream.Self-appointed anti-aging gurus like <a target="_blank" href="https://www.businessinsider.com/bryan-johnson-before-and-after-anti-aging-longevity-supplements-2023-8">Bryan Johnson</a> enthusiastically <a target="_blank" href="https://twitter.com/bryan_johnson/status/1665832291824975872">share</a> their VO2 max stats on X (formerly Twitter), ostensibly as proof that their lifestyle routine is working, and makes them fitter than most teenagers.Now, internet forums dedicated to longevity are filling up with people sweating over their <a target="_blank" href="https://www.businessinsider.com/guides/health/fitness/best-apple-watch-health-features">Apple Watches</a>, asking each other if their numbers measure up, or desperately seeking advice to fix less-than-impressive measurements to shore up their health.It's true: knowing this metric and working to improve it could, in theory, help you to unlock a <a target="_blank" href="https://www.businessinsider.com/tips-easy-simple-boost-longevity-live-longer-healthier-habits-2024">longer, healthier life</a>. It is also hard to measure — and that is a blessing for the growing health tech sector, with companies rushing to help the longevity-focused elite calculate and improve their own VO2 max."It's very similar to a 401(k) in a way. If you are lucky or smart and you start saving for 401(k) at the age of 20, you have a much better chance to save a lot of money," anti-aging researcher Gil Blander, who is also the founder and chief scientific officer at personalized health tech company InsideTracker, told Business Insider. "If you are starting at the age of 70, it's good, but it's much better to start earlier."Keeping tabs on your VO2 max, and especially how it changes over time, can help you <a target="_blank" href="https://www.businessinsider.com/how-to-make-the-most-gains-short-workout-science-2022-12">get the most out of your workouts</a>, and train for optimal heart health.However, putting too much stock in a single data point can backfire if you're not also taking into account other metrics and lifestyle factors, longevity researchers warn. There's a way to use VO2 max to improve heart health and fitness without getting too bogged down in the data.<h2>What is VO2 max and how is it measured?</h2>VO2 max refers to the maximum amount of oxygen your body can use during aerobic exercise — in other words, how well your heart can circulate oxygenated blood to your muscles, and how well your muscles can pull out that oxygen for energy."It's traditionally considered a marker of endurance. So you have a higher VO2 max, you have a better endurance capacity," Blander said.It was coined in 1923 by <a target="_blank" href="https://academic.oup.com/qjmed/article-abstract/os-16/62/135/1594478?redirectedFrom=fulltext">British physiologists Archibald Hill and Hartley Lupton</a>. The term derives from the quantity in volume (the "V"), oxygen (O2, the chemical symbol for the oxygen molecule), and the abbreviation of "maximum."It's typically described as milliliters of oxygen consumed per minute per kilogram of body weight.For instance, the VO2 max of an active woman might be around 35 mL/kg/min, according to<a target="_blank" href="https://health.clevelandclinic.org/what-is-vo2-max-and-how-to-calculate-it"> Cleveland Clinic</a>. Men tend to have a slightly higher VO2 max, so an example for an active man could be around 42 mL/kg/min. These numbers hold true to around age 45, after which they start to dip. Unless you take your exercise seriously — it's possible for <a target="_blank" href="https://www.businessinsider.com/longevity-tips-older-athlete-exercise-diet-2024-1">elite athletes in their 80s</a> or beyond to have a VO2 max as good or better than people decades younger. One <a target="_blank" href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4348610/">2015 case study</a>, for instance, found an 80-year-old man with a VO2 max of 50 mL/kg/min, comparable to a sedentary 20-year-old or active 35-year-old.But it doesn't just matter for working out. How well your body uses oxygen can point to <a target="_blank" href="https://www.businessinsider.com/key-factors-predict-heart-health-according-to-doctors-2022-6">how well your heart is functioning</a> overall, and how healthy it is under stress, according to Dr. Edo Paz, a cardiologist at White Plains Hospital and senior vice president of medical affairs at the digital health company Hello Heart.<div type="image" title="An athlete wearing as face mask and running on a treadmill as part of a VO2 max test" height="1257" width="2384" msid="108162902" hostid="261" sizebytes="67300"></div>Paz said VO2 max is most accurately measured with a stress test, which can also assess potential heart problems, such as issues with the valves.It can be tough to accurately measure VO2 max at any given moment without heading into a lab, according to Paz, but you may not need to. Noting changes over time can indicate if your heart health is improving, he said.<h2>Your VO2 max can tell you a lot about how your heart is aging</h2>VO2 max can be a shorthand to help assess and <a target="_blank" href="https://www.businessinsider.com/how-cardio-exercise-men-can-prevent-cancer-2023-7">lower your risk of dying early</a> from illnesses like heart disease, diabetes, and cancer."If you have higher VO2 max you have a much better chance based on our data analysis to live better, longer, which is amazing," Blander said.Put simply, it can be a single number that gives you a sense of where you stand in terms of fitness now, and the odds that you'll keep being healthy and fit in the future."I like to think of it as a 'score' of your cardio and fitness potential. The higher your score, the greater your longevity," Mike Thomson, personal trainer and run coach at Life Time Overland Park, told Business Insider.VO2 max also plays an important role in making sure you can keep up with the demands of day-to-day life even beyond your workouts, explained exercise physiologist Kate Baird. Your VO2 max tends to decrease as you get older, which over time can make it harder to do simple activities, according to Baird."If you're already at a low level, you'll start to feel those declines. Walking a few blocks down the street feels hard or a leisurely bike ride doesn't feel so leisurely," she said. "Keeping fitness high helps you maintain autonomy and translates to a longer life."<h2>How to diversify your training portfolio for a stronger VO2 max</h2>In terms of boosting VO2 max, Thomson also reached for money management as a metaphor for <a target="_blank" href="https://www.businessinsider.com/how-to-live-longer-lifestyle-habits-longevity-doctor-2024-2">heart health longevity</a>.If VO2 max is your fitness retirement plan, training it can be similar to investing with a combination of strategies for best results."I like to diversify my training portfolio," he said. "We need to do the majority of our investing at a lower intensity and some at a higher intensity to improve maximum efficiency," Thomson said.<div type="image" title="Mike Thomson, personal trainer" height="5221" width="3972" msid="108162903" hostid="261" sizebytes="319268"></div>A combination of both high and low intensity, in a ratio of around 80% easy and 20% hard, is often considered a "sweet spot" for maximizing the benefits of fitness.<a target="_blank" href="https://www.businessinsider.com/what-is-zone-2-cardio-exercise-training-benefits-2023-10">Low-intensity exercise</a> helps build a foundation for aerobic fitness — think 30 minutes or more of jogging or biking at a steady pace that doesn't leave you out of breath or unable to carry a conversation.<a target="_blank" href="https://www.businessinsider.com/guides/health/fitness/tabata-workout">Exercising at a high intensity</a>, near your physical limit, can train your body to use more oxygen. One example is doing one minute of an all-out sprint, then resting for two minutes, and repeating for eight total rounds, Thomson said.It's also a good idea to fit in some <a target="_blank" href="https://www.businessinsider.com/weight-lifting-and-cardio-may-help-you-live-longer-study-2022-9">strength training</a>, which can prevent injury and help you improve faster at cardio, while also boosting longevity in its own right, research suggests.<h2>How much should you worry about your VO2 max?</h2>The bottom line is that when it comes to <a target="_blank" href="https://www.businessinsider.com/longevity-tips-older-athlete-exercise-diet-2024-1">fitness and longevity</a>, VO2 max can be a useful metric to help you train for a longer life, but you don't need to spend too much time worrying about the data or comparing your scores to someone else, according to Baird.<div type="image" title="A man checking on smartwatch while riding a bicycle through a park" height="1414" width="2120" msid="108162906" hostid="261" sizebytes="140808"></div>"If you're someone who wants to just be healthy and exercise, you don't necessarily have to track VO2 max," Baird said.If you're not an elite athlete, you can improve your VO2 max over time just by focusing on your work capacity, such as how many miles you can cover before tiring. If you're able to do more over time, or once-challenging workouts start to feel easier, you're on the right track, no lab testing required.You can also take advantage of VO2 max training regardless of whether you're already athletic, or completely sedentary, just by adding more movement to whatever you're doing now. Every little bit counts, so <a target="_blank" href="https://www.businessinsider.com/how-five-hundred-extra-steps-per-day-live-longer-2023-9">making time for a few extra minutes of exercise</a> in your daily schedule is like putting money in the bank for the long haul."Everyone can improve their VO2 max. Maybe you cannot be the world champion of the marathon, but you can run and you can cycle," Blander said.

Your VO2 max is like a '401(k) for longevity' — here's how to invest in it for better heart health and a longer life

It was already a hectic day when my <keyword id="19996817" type="General" weightage="20" keywordseo="insurance" source="keywords">insurance</keyword> broker left a frantic voicemail telling me that my homeowner's insurance had lapsed. I felt nauseous and naked. Suddenly, any leak, fire, or tree branch falling onto the hundred-year-old Hudson Valley house that's been in my family for nearly 40 years could <a target="_blank" class="" href="https://www.businessinsider.com/stock-market-meltdown-rebound-fed-japan-interest-rate-decision-emergency-2024-8">wipe out</a> my bank account. I spiraled in shame. How did I let this happen? Did I forget to update a <a target="_blank" class="" href="https://www.businessinsider.com/credit-card-rewards-points-friends-fights-brunch-money-payment-venmo-2024-7">credit card</a>? Did I miss a bill? Did I do something wrong with the policy? But when I checked my records, even the <keyword id="20508386" type="General" weightage="20" keywordseo="Travelers" source="keywords" meta.keywordsubtype="org" meta.entityname="Travelers" meta.hostid="261" meta.entityid="Travelers">Travelers</keyword> website, there was nothing. A few hours later, my panic turned to bewilderment. When I finally reached my insurance broker, he told me the reason Travelers revoked my policy: AI-powered aerial <keyword id="19942081" type="General" weightage="20" keywordseo="surveillance" source="keywords">surveillance</keyword>. My finances were imperiled, it seemed, by a bad piece of code. I take privacy and surveillance extremely seriously — so seriously that I started one of the leading <a target="_blank" class="" href="https://www.stopspying.org/">think tanks</a> on the topic, the Surveillance Technology Oversight Project. But while I study <a target="_blank" class="" href="https://www.businessinsider.com/amazon-walmart-warehouse-surveillance-employees-oxfam-report-2024-4">surveillance</a> threats around the country for a living, I had no idea that my own insurance company was using my premium dollars to spy on me. Travelers not only uses <a target="_blank" href="https://www.travelers.com/about-travelers/technology-analytics/data-driven-and-powered-by-ai">aerial photography and AI</a> to monitor its customers' roofs, but also <a target="_blank" href="https://ppubs.uspto.gov/dirsearch-public/print/downloadPdf/20240005470">wrote patents on the technology</a> — nearly 50 patents actually. And it may not be the only insurer spying from the skies. This didn't just feel creepy and invasive — it felt wrong. Literally wrong: There was nothing wrong with my <keyword id="20715650" type="General" weightage="20" keywordseo="roof" source="keywords">roof</keyword>. I'm a lazy homeowner. I hate gardening, and I don't clean as often as I should. But I still take care of the essentials. Whether it's upgrading the electrical or installing a new HVAC, I try to make sure my home is safe. But to Travelers' <keyword id="19899640" type="General" weightage="20" keywordseo="AI" source="keywords">AI</keyword>, it appeared, my laziness was too big a risk to insure. Its algorithm didn't detect an issue with the foundation or a concern with a leaky pipe. Instead, as my broker revealed, the ominous threat that canceled my insurance was nothing more than moss. Where there's moisture, there's moss, and if you leave a huge amount of it on a roof for a protracted period, it can undermine the roof's lifespan. A small amount is largely harmless. Still, treating it couldn't be simpler. Sure, I could have knocked out the moss sooner, but life was busy, and so it kept falling (and growing) between the cracks. Finally, in June, weeks before I knew my roof was being surveilled, I went to the hardware store, spent 80 bucks on moss killer, hooked the white bottle of chemicals up to the garden hose, and sprayed it on the roof. The whole thing took about five minutes. A few days later, much to my relief, the moss was dying. I thought it was the end of an entirely unmemorable story. Who knows. Maybe if I'd done that a month sooner, Travelers' technology never would have flagged me, never would've said I was an insurance risk. But one of the deep frustrations of the AI-surveillance age is that as companies and governments track ever more of our lives in ever more detail, we rarely know we're being watched. At least not until it's too late to change their minds. While there's no way to know exactly how many other Travelers customers have been targeted by the company's surveillance program, I'm certainly not the first. In February, Boston's ABC affiliate reported on a customer who was threatened with nonrenewal if she didn't replace her roof. The roof was well within its life expectancy, and the customer hadn't encountered any issues with leaks; still, she was told that without a roof replacement she wouldn't be insured. She said she faced a $30,000 bill to replace a slate roof that experts estimated could have lasted another 70 years. Insurers have every incentive to be overly cautious in how they build their AI models. No one can use AI to know the future; you're training the technology to make guesses based on changes in roof color and grainy aerial images. But even the best AI models will get a lot of predictions wrong, especially at scale and particularly where you're trying to make guesses about the future of radically different roof designs across countless buildings in various environments. For the insurance companies designing the algorithms, that means a lot of questions about when to put a thumb on the scale in favor of, or against, the homeowner. And insurance companies will have huge incentives to choose against the <a target="_blank" class="" href="https://www.businessinsider.com/why-are-new-homes-ugly-construction-builders-design-materials-architecture-2024-7">homeowner</a> every time. Think about it: Every time the <a target="_blank" class="" href="https://www.businessinsider.com/ai-quietly-picking-your-pocket-with-personalized-pricing-2024-7">AI gives the green light</a> to a roof that actually has something wrong, the insurance company picks up the bill. Each time that happens, the company can add that data point to its model and train it to be even more risk-averse. But when homeowners are threatened with cancellation, they pick up the bill for repairs, even if repairs are unnecessary. If the Boston homeowner throws out a slate roof with 70 years of life left in it, the insurance company never knows it was wrong to remove it. It never updates the model to be less aggressive for similar homes. Over time, insurance companies will have every incentive to make the models more and more unforgiving, threatening more Americans with loss of coverage and potentially driving millions or billions of dollars' worth of unnecessary home repairs. And as insurers face increasing losses due to the climate crisis and inflation, the pressure to push unnecessary preventive repairs on customers will only rise. A confusing coda to this whole ordeal was what Travelers said when I reached out with a detailed list of fact-checking questions and a request for an interview. In response, a spokesperson sent a terse denial: "Artificial intelligence analysis/modeling and drone surveillance are not a part of our underwriting decision process. When available, our underwriters may reference high-resolution aerial imagery as part of a holistic review of property conditions." How did this make sense given what was written on Travelers' own website and patent applications? Then the precision and slipperiness of the language started to stand out. What exactly counts as the "underwriting decision process"? When Travelers boasts online that its workers "rely on algorithms and aerial imagery to identify a roof's shape — typically a time-consuming process for customers — with close to 90% accuracy," does that classification not count as the underwriting process? And even though Travelers has flown <a target="_blank" href="https://www.aloft.ai/wp-content/uploads/2021/05/Travelers-case-study-updated-5.14.21.pdf">tens of thousands of drone flights</a>, are those not part of underwriting? And if AI and drones aren't actually affecting customers, why file so many patent applications like "<a target="_blank" href="https://ppubs.uspto.gov/dirsearch-public/print/downloadPdf/20240005470">Systems and Methods for Artificial Intelligence (AI) Roof Deterioration Analysis</a>"? It felt like the company was trying to have it both ways, boasting about using the latest and greatest tech while avoiding accountability for errors. When I brought these follow-up questions to the company, Travelers did not respond. Thankfully, my own roof isn't going anywhere, at least not for now. A few hours after my panicked ordeal with Travelers began and I started to scramble to find new coverage, the situation resolved. Travelers admitted that it screwed up. It never conceded that its AI was wrong to tag me. But it revealed the reason I couldn't find my cancellation notice: The company never sent it. Travelers may have invested huge sums in neural networks and drones, but it apparently never updated its billing software to reliably handle the basics. Without a nonrenewal notice, it couldn't legally cancel coverage. Bad cutting edge tech screwed me over; bad basic software bailed me out. Part of what is so disturbing about the whole episode is how opaque it was. When Travelers took aerial footage of my house, I never knew. When it decided I was too much of a risk, I had no way of knowing why or how. As more and more companies use more and more opaque forms of AI to decide the course of our lives, we're all at risk. AI may give companies a quick way to save some money, but when these systems use our data to make decisions about our lives, we're the ones who bear the risk. Maddening as dealing with a human insurance agent is, it's clear that AI and surveillance are not the right replacements. And unless lawmakers take action, the situation will only get worse. The reason I still have insurance is simple consumer-protection laws. New York state won't allow Travelers to revoke my insurance without notice. But why do we let companies like Travelers use AI on us in the first place without any protections? A century ago, lawmakers saw the need to regulate the insurance market and make policies more transparent, but now updated laws are needed to protect us from the AI trying to decide our fates. If not, the future looks unsettling. Insurance is one of the few things that protect us from the risks of modern life. Without AI safeguards, the algorithms will take what little peace of mind our policies give us. Correction: August 9, 2024 — A previous version of this story cited a Travelers broker who said the company flew a drone over the author's house. After the story was published, Travelers clarified that any "high-resolution aerial imagery" it used did not come from a drone. <a target="_blank" href="https://www.businessinsider.com/author/albert-fox-cahn">Albert Fox Cahn</a> is the founder and executive director of the Surveillance Technology Oversight Project, or STOP, a New York-based civil-rights and privacy group.

My insurance company spied on my house from the sky. Then the real nightmare began.

<ul><li><keyword id="6362086" type="General" weightage="20" keywordseo="ulips" source="Orion">ULIPs</keyword> provide agents with higher <keyword id="52650" type="General" weightage="20" keywordseo="commissions" source="Orion">commissions</keyword> in the beginning making it attractive for them. </li><li>ULIP costs are front loaded as the majority of charges are levied in the initial five years. </li><li>Experts say that exiting from ULIPs after five years is a losing proposition. </li></ul>Kolkata-based Subimal Haldar (name changed), 75, was looking for a safe way to invest money. His <keyword id="35450" type="General" weightage="20" keywordseo="insurance" source="Orion">insurance</keyword> agent told him about Unit Linked Savings Plan (ULIPs), saying they're safe like a fixed deposit but also give good returns and insurance coverage. Haldar trusted this and thus invested a considerable sum. However, ULIPs are linked to the market and hence the returns are not guaranteed. Haldar’s <keyword id="6355120" type="General" weightage="20" keywordseo="investment" source="Orion">investment</keyword> was hit during the 2020 market crash and he lost a big part of his savings. Plus, he was not made aware that he could not pull out of his money once he had invested. Haldar, like many others, has been a victim of mis-selling. <keyword id="443223" type="General" weightage="20" keywordseo="misselling" source="Orion">Misselling</keyword> in investment refers to misleading or deceptive practices used by sellers or advisors when promoting financial products. It involves providing false information, not disclosing risks, or recommending unsuitable products, leading investors to make decisions which are detrimental to their financial well-being. <cmsannotation type="cmsannotation" annotationid="Why are ULIPs one of the most missold products?" comment="Subhead" text="Why are ULIPs one of the most missold products?">Why are ULIPs one of the most missold products?</cmsannotation> ULIPs provide agents with higher commissions in the beginning, encouraging them to sell new policies. In fact ULIP commissions can be as high as 40% in the first year. This leads some agents to misinform existing clients, suggesting that their current ULIP has a high net asset value (NAV), urging them to buy a new ULIP with a lower NAV. Not surprisingly, ULIPs are one of the most missold products in the market <cmsannotation type="cmsannotation" annotationid="The common ULIP sales pitches" comment="Subhead" text="The common ULIP sales pitches">The common ULIP sales pitches</cmsannotation> The agent or the intermediary who may be an individual or a bank is mostly someone you will trust. Hence it is more likely that people will fall to their sales pitch. “One of the key pitches is that ULIP is a five-year tax saving instrument as it has a lock-in period of five years. Costs in ULIP are front loaded as majority of charges are levied in initial five years making exiting from it after five years a losing proposition,” says Abhishek Kumar, founder and chief<a href="https://business.outlookindia.com/invest/investment"> </a>investment advisor at SahajMoney, a financial planning firm. Another significant selling point is that ULIPs are positioned as on par or possibly superior to bank FDs because they offer insurance coverage and higher returns. What clients aren't explicitly told is that, unlike bank FDs, ULIPs are linked to the market and do not assure guaranteed returns. <cmsannotation type="cmsannotation" annotationid="Mixing insurance with investment?" comment="Subhead" text="Mixing insurance with investment?">Mixing insurance with investment?</cmsannotation> While the lure of ULIPs lead to misselling, if one looks at it, the product basically is flawed. “When you combine insurance and investment you get the worst of both. The cost is higher. If you buy insurance and investment separately it is always cheaper, enables greater flexibility and a greater measurability of performance,” says Dhirendra Kumar, chief executive officer, Value Research, an investment research firm. When you buy an ULIP you cannot get out and have to stick to it. ULIPs ride on the mental framework that if you invest something, you need to get back something, the same way endowment plans work. ULIPs and endowment plans are similar. While in endowment plans the return is guaranteed, it happens to be a very low return. ULIPs, on the other hand, are market linked, and a little more transparent, but there are still got all the constraints of an investment where you get stuck. If you invest in a mutual fund and are not happy with the performance, you can get out of it tomorrow, but in case of an ULIP, you cannot. <cmsannotation type="cmsannotation" annotationid="Senior citizens: Be extra careful" comment="Subhead" text="Senior citizens: Be extra careful">Senior citizens: Be extra careful</cmsannotation> While the traps of mis-selling may fly thick and fast, if one follows a simple rule, it is easy to stay out of it. “One should not buy any investment policy that is linked with insurance. That is the only way not to be a victim of misseling,” says Kumar of Value Research. Not surprisingly, like Haldar, senior citizens are often the victim of mis-selling. “Senior citizens should also ask why they should buy life insurance in their post-retirement years as they are not earning any active income during retirement. Also, during retirement, retirees require regular income and ULIP doesn't offer it to them so they should ask about it as well,” says Kumar of SahajMoney. Even after all this if they buy the ULIP by mistake they can cancel it within 15 days of receipt of the policy documents. It is important to keep relations and emotions away from investment decisions. After all, it is a question of your hard-earned money.

Mis-selling trap – Why ULIPs are not for senior citizens

A unit of <keyword id="6437412" type="General" weightage="20" keywordseo="Qatar-Investment-Authority" source="Orion">Qatar Investment Authority</keyword>, <keyword id="119583" type="General" weightage="20" keywordseo="SBI-Mutual-Fund" source="Orion">SBI Mutual Fund</keyword>, and foreign investment funds <keyword id="6354527" type="General" weightage="20" keywordseo="Nomura" source="Orion">Nomura</keyword> and <keyword id="44473" type="General" weightage="20" keywordseo="Citigroup" source="Orion">Citigroup</keyword> were the biggest buyers of shares in <keyword id="19955648" type="General" weightage="100" keywordseo="Adani-Group" source="keywords" meta.keywordsubtype="org" meta.entityname="Adani Group" meta.hostid="267" meta.entityid="Adani Group">Adani group</keyword>'s <keyword id="22661797" type="General" weightage="20" keywordseo="power-transmission-unit" source="Orion">power transmission unit</keyword>'s USD <keyword id="22661798" type="General" weightage="20" keywordseo="1-billion-QIP" source="Orion">1 billion QIP</keyword>, according to a stock exchange filing by the company. The Rs 8,373.10 crore (USD 1 billion) qualified institutional placement (QIP) of <keyword id="19964750" type="General" weightage="20" keywordseo="Adani-Energy-Solutions" source="keywords" meta.keywordsubtype="org" meta.entityname="Adani Energy Solutions" meta.hostid="267" meta.entityid="Adani Energy Solutions">Adani Energy Solutions</keyword> Ltd (AESL), which closed last week, saw over 120 investors seek shares in the firm that is into power transmission, distribution and smart metering business. Billionaire <keyword id="22623487" type="General" weightage="20" keywordseo="Stanley-Druckenmiller" source="keywords">Stanley Druckenmiller</keyword>'s family office-led investment firms were among the companies that sought shares of AESL in the QIP. AESL in the filing said its board has approved allocation of over 8.57 crore shares to eligible qualified institutional buyers at the issue price of Rs 976 per share, reflecting a discount of Rs 51.11 (4.98 per cent) to the floor price of Rs 1,027. Giving details of allottees who got more than 5 per cent of shares, it said INQ Holdings LLC, a wholly-owned subsidiary of QIA, cornered 15 per cent of the shares sold. Two Mauritius funds of Citigroup bought 8.88 per cent of the shares sold while four SBI funds - SBI Infrastructure Fund, SBI Large &amp; Midcap Fund, SBI Long term Advantage Fund Series IV and SBI Magnum Children's Benefit Fund - together took home 7.93 per cent of the shares. Nomura Singapore Ltd ODI cornered 7.5 per cent of the shares, the filing showed. INQ had in August last year acquired nearly 2.7 per cent in Adani Green Energy Ltd - the renewable energy firm of the conglomerate run by billionaire Gautam Adani. In 2020, it had acquired a stake in Adani Electricity Mumbai Ltd, a subsidiary of AESL. The AESL QIP last week was oversubscribed six times and fetched demand of over Rs 50,000 crore against an issue size of USD 1 billion. <keyword id="22636516" type="General" weightage="20" keywordseo="Duquesne-Family-Office" source="keywords" meta.keywordsubtype="org" meta.entityname="Duquesne Family Office" meta.hostid="267" meta.entityid="Duquesne Family Office">Duquesne Family Office</keyword> and two other US-based long-only funds - Driehaus Capital Management and Jennison Associates - bought shares but AESL did not disclose the exact number of shares they bought since these were less than 5 per cent of the issue size, sources said. The QIP issue marked the debut of highly prestigious long-only investors Duquesne Family Office, Driehaus Capital Management and Jennison Associates which are known for their strong performance. These investors are known for investing only in companies with high governance and are known for staying invested for decades. The QIP was the first public equity raise by the conglomerate since a damning Hindenburg report last year wiped away billions in shareholder value. The demand generated made the AESL QIP the largest in the energy space. Duquesne was founded by billionaire Stanley Druckenmiller, who along with George Soros in 1992 broke the Bank of England by shorting the British pound, leading to its crash and earnings over a billion dollars. Adani Group has a history of introducing several long-only investors in the market. In the past years, it has brought large investors including GQG Partners and International Holding Company (IHC) besides QIA. Other major global names that participated in the QIP include Blackrock, Jupiter Asset Management, and Eastspring. Domestic mutual funds that have participated included HDFC Mutual Fund, Axis Mutual Fund, Bandhan Mutual Fund, LIC, WhiteOak, 360One among others. Insurance companies including SBI Insurance, SBI Pension and ASK Asset Management have also participated, according to sources. QIP is an instrument used by listed companies to raise funds from large institutions. The fundraise is the first after Adani group's flagship firm scrapped a Rs 20,000 crore issue in February last year, following the Hindenburg report alleging accounting fraud and stock manipulation. Though the group vehemently and repeatedly denied all allegations, listed companies of the conglomerate at one point saw over USD 150 billion of their market value being wiped out. While the group has largely recovered, a successful QIP is being seen as a powerful vote of investor confidence in the tycoon. Separately, Adani Enterprises Ltd, the flagship firm of the group, is looking to revive its first-ever public sale of bonds. It plans to raise as much as Rs 600 crore. The company has hired Trust Investment Advisors, AK Capital Services and Nuvama Wealth Management as lead managers for the issuances. The group had tapped the dollar bond market in March this year - the first time since the Hindenburg report - when its solar energy unit Adani Green Energy Ltd and associated firms got bids of about USD 2.9 billion.

Qatar Investment Authority unit, SBI funds, Citigroup biggest buyers in Adani Energy's USD 1 billion QIP

ULIPs are not for senior citizens: Here’s how to choose the right investments to secure the golden years of your life

<ul class="summary-list"><li>Mai-lan Phan and her husband Ryan Wagoner achieved <keyword id="20257332" type="General" weightage="100" keywordseo="financial-independence" source="keywords">financial independence</keyword> but chose not to <keyword id="20461816" type="General" weightage="20" keywordseo="retire-early" source="keywords">retire early</keyword>.</li><li>They amassed over $4 million by living modestly, investing wisely, and avoiding <keyword id="22369507" type="General" weightage="20" keywordseo="lifestyle-creep" source="keywords">lifestyle creep</keyword>.</li></ul>Mai-lan Phan, 37, and her husband, Ryan Wagoner, 36, reached <a target="_blank" href="https://www.businessinsider.com/gen-xers-financial-independence-retire-early-fire-started-saving-late-2024-6">financial independence</a>, but <a target="_blank" href="https://www.businessinsider.com/millennials-retiring-early-fire-movement-financial-independence-millionaire-savings-work-2024-5">neither wants to fully retire early</a>. They reached a total <keyword id="19985211" type="General" weightage="20" keywordseo="net-worth" source="keywords">net worth</keyword> of $4.1 million, including their two homes, from working <keyword id="21407046" type="General" weightage="20" keywordseo="high-paying-jobs" source="keywords">high-paying jobs</keyword>, cutting back on <a target="_blank" href="https://www.businessinsider.com/hate-spending-consumers-economic-sentiment-retail-sales-inflation-gdp-growth-2024-4">spending</a> for most expenses, and avoiding <a target="_blank" href="https://www.businessinsider.com/how-to-avoid-lifestyle-creep-income-increase-raise-2024-1">lifestyle creep</a>. Phan left dentistry full-time after experiencing nerve pain and having her son, working part-time while Wagoner works full-time. They live modestly and save for their family's future, though they still go on vacations and to Seahawks games. "<a target="_blank" href="https://www.businessinsider.com/financial-independence-retire-early-fire-millennial-income-wealthy-business-owners-2024-4">Financial independence</a> is not having to work full-time and the freedom to be able to send my child to full-time preschool, 40 hours a week, and come home and be able to do the things that I want to do," Phan said. Many Americans are working to achieve financial independence — or having enough savings or income to live comfortably for life. Some are hoping that will allow them to retire early, thus making them part of the <a target="_blank" href="https://www.businessinsider.com/fire-movement-financial-independence-retire-early-millennial-goals-saving-wealth-2024-5">FIRE movement</a>, though some like Phan and Wagoner <a target="_blank" href="https://www.businessinsider.com/early-retirement-overrated-financial-independence-fire-return-to-office-balance-2024-6">continue working</a> for extra financial security and personal satisfaction. "I want to be able to walk away from any job if it's not working," Wagoner said. "What I really care about is the financially independent part, so if I wanted to take a year off and go travel, or if I wanted to get out of a job that is really stressing me out and causing me mental difficulties." <h2>Working toward financial independence</h2>Phan was born an hour south of <a target="_blank" href="https://www.businessinsider.com/moving-to-seattle-leaving-georgia-atlanta-cost-of-living-millennial-2024-1">Seattle</a> to parents who "weren't wealthy by any means," though they took her on vacations and allowed her to participate in various extracurricular activities. Her parents taught her to live frugally and only spend on what's important. She worked at Subway, drove a used car, and got a phone as a senior in high school after most people in her grade. She got financial aid for her bachelor's degree and then enrolled in dental school. She rejected half the <a target="_blank" href="https://www.businessinsider.com/save-plan-student-loan-forgiveness-blocked-lower-payments-appeal-granted-2024-7">student loan</a> package offered because she didn't need it and wanted to live debt-free as soon as possible after graduation. Across eight years of school, she borrowed $140,000 — $80,000 was from the government, which she paid off two years after graduating, and $60,000 was from her parents, whom she paid back three years after graduation. Wagoner grew up in a small Michigan town and worked at his father's grocery store starting at 14, allowing him to buy a car before his 16th birthday. His accountant mom taught him how to set up a bank account and spend frugally — though he admits there weren't many places in his town to do so. He was the first in his family to attend college, and he chose Michigan State University with various scholarships paying for half his tuition. He paid for his living expenses through internships at Microsoft and drove his car until it stopped working. He read <a target="_blank" href="https://www.businessinsider.com/early-retirement-financial-independence-san-francisco-homebuying-fire-work-balance-2024-6">financial independence</a> books emphasizing spending on important things and cutting back on unimportant ones. He saved up enough to buy a condo, knowing his income was stable and growing, which he and Phan later paid off and rented to tenants. Phan and Wagoner met in 2015 while he was still at Microsoft — he had four more years of income, 401(k) matching, and no student debt. While dating, he told her he wanted to retire by 40. Phan was less convinced — she wanted to start a dental practice and knew it would take years to get it off the ground. "I thought he was crazy, and I said, I'm not going to eat rice and beans the rest of my life," Phan said. They decided to map out their family expenses and used Wealthfront, an automated investment service, which helped them build wealth through investments and high-yield savings. They both have kept their finances separate but share their numbers openly. <h2>Starting to strategize</h2>They didn't strategize much in their first few years of dating, instead just living below their means without sacrificing their quality of life. They paid for their wedding themselves in 2019 and then planned and paid for their honeymoon right before the pandemic. They also put 25% down on a home with an interest rate of 2.75%, which they chose not to pay off because of the low interest rate. "We got approved for a $1.5 million house, and I told my realtor, don't waste your breath showing us these houses; we're not going to spend it," Phan said. "We're choosing not to have a very large mortgage payment, so that positive cash flow has really propelled us above our colleagues." Over the last few years, they've <a target="_blank" href="https://www.businessinsider.com/fire-movement-how-to-hit-financial-independence-freedom-grant-sabatier-2024-4">kept expenses down</a> by driving a used car, investing in an e-bike instead of a second vehicle, and being intentional about food purchases. They've both maxed out their 401(k)s and IRAs and do everything they can to strategize their tax advantages. They also automated their savings and investments, which helped them keep expenses down and stay more organized. They had a son in 2020, and Phan transitioned from a full-time dentist to a stay-at-home mom doing part-time dental work. Nerve damage in her right hand prevented her from returning to work full-time. She said their finances were solid enough from not "keeping up with the Joneses" that she could work less while her husband continued to work full-time. Two years ago, Wagoner switched to a job paying a third less than his job at Qualtrics, though it's in the video game space, which he enjoys more. Phan made a spreadsheet to track her net worth, and she was surprised at the number: over $4 million in total assets, about two-thirds of which are liquid. It was enough for both to fully retire, though they chose not to so they could send their kids to college without worrying about the financial burden. <h2>Planning for the future</h2>They put almost $100,000 in their son's college fund, which they will continue to contribute to, though when he turns 16, they will encourage him to find work. They plan to enroll him in public school but are considering some private options. Phan said she's already toying with starting his financial education young by giving him a toy allowance. "I want him to understand the value of money, that he can't just get whatever he wants, but if he works hard and saves up, he can have his guilt-free spending," Phan said. "I just don't want him to have the pressure of paying for school like I did." They've discovered ways to parent without breaking the bank, such as using public resources like parks and getting cheap museum passes. Still, they prioritize spending on what they love, such as recent vacations to Mexico and Paris and season tickets to the Seahawks. They find cheap flights, such as $500 round-trip flights to Thailand, and other ways to reduce travel costs without sacrificing quality. They hope to take their son on a months-long trip to Europe or Asia to immerse him in different cultures. Phan recently hired an interior designer to redo the furniture in their primary home. Wagoner recently spent money on a new office setup, a gym membership, and eye surgery. Sometimes, it's hard for her to spend, as she has little desire for anything luxurious, though she said she's trying to feel less guilty about some higher-cost purchases. They have also loaned over $400,000 to friends as business loans. Recently, they've talked about combining their money and being more open about their finances, allowing them to make better plans for the future. "We are being more transparent and looking at all of the numbers and being able to talk about these things and say, looking at this account that will keep growing, I think we can do this," Wagoner said. They've considered what they would pivot to after full retirement — Phan would become a wedding planner, while her husband would consider being a football coach. "We've lived a very humble life and flown under the radar, which is how I think we've been able to all of a sudden catapult into this wealth just on hard work," Phan said. Are you part of the <keyword id="22369508" type="General" weightage="20" keywordseo="FIRE-movement" source="keywords">FIRE movement</keyword> or living by some of its principles? Reach out to this reporter at <a target="_blank" href="mailto:nsheidlower@businessinsider.com">nsheidlower@businessinsider.com</a>. Note: Correction — July 8, 2024: An earlier version of this story misstated the length of time it took Phan to repay her parents after graduation.

How a Seattle couple achieved financial independence in their mid-30s with a net worth over $4 million — and why they don't want to retire early

<ul><li>Return of premium terms insurance plans are a kind of term plan that pays all of your paid premiums back if you outlive your entire term policy. </li><li>Since they come with a return of premium benefit, such <keyword id="171063" type="General" weightage="20" keywordseo="term-insurance" source="Orion">term insurance</keyword> plans charge a <keyword id="3275990" type="General" weightage="20" keywordseo="higher-premium" source="Orion">higher premium</keyword> than a pure term plan </li><li>Experts say that such plans may not be ideal for most people as the opportunity cost of extra premium amounts remains higher </li></ul>When we hear the word term insurance, what comes to mind is a pure insurance policy which covers the policyholder for a certain term and offers benefits only in case of the demise of the policyholder during that term. In the case of pure term insurance, the policyholder does not receive any monetary payout if he survives the policy term. However, there is a type of term insurance known as the <keyword id="20955968" type="General" weightage="20" keywordseo="return-of-premium-term-insurance" source="Orion">return of premium term insurance</keyword> that offers to return your premiums. “Term return of premium (TROP) is a kind of term plan that pays all of your paid premiums back if you outlive your entire term policy. Usually, term insurance plans do not come with maturity benefits, but once you add the return of premium feature at the time of inception, the payback of premiums is counted as the maturity benefit.,” says Naval Goel, Founder and CEO of PolicyX, an insurance comparison portal. You can choose the feature of return of premiums only at the inception of the policy and it cannot be attached or detached mid-term. Further, the maturity benefit is only paid if you have paid all of your premiums in time. Return of premium term policies charge a higher premium Since they come with a return of premium benefit, its a given that such term insurance plans charge a higher premium than a pure term plan. “Due to the return of premium benefit, the premium for these term plans is usually 1.8 to 2 times the premium for pure term plan,” says Abhishek Kumar, founder and chief<a href="https://business.outlookindia.com/invest/investment"> </a>investment advisor at SahajMoney, a financial planning firm. In certain cases, it may be even higher. For a better understanding, let’s compare a typical case for both policy types. Following are the premiums for a 35-year-old, non-smoker male, who has chosen coverage for 65 years of age and a life cover of 1 crore. His geographical location is Delhi and the premium payment mode is annual. <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Insurer </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Plan Name </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Premium for Pure Term (₹) </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Premium for TROP(₹) </td></tr><tr><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ICICI PRU </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">iProtect Smart </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">17,647 </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">40,455 </td></tr><tr><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HDFC Life </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Click 2 Protect Super </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">18,934 </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">47,712 </td></tr><tr><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Max Life Insurance </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Smart Secure Plus </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">16,513 </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">30,734 </td></tr><tr><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Allianz </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Allianz Life eTouch </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">14,628 </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">25,888 </td></tr><tr><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Canara HSBC </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Young Term Plan - Life Secure </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">14,003 </td><td style="border-left:solid #000000 0.68181825pt;border-right:solid #000000 0.68181825pt;border-bottom:solid #000000 0.68181825pt;border-top:solid #000000 0.68181825pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">25,005 </td></tr></tbody></table> Source: PolicyX Should you opt for it? Return of premium term insurance plan may come with a feel-good factor as one gets back the premium at the end of the policy term. However, one needs to remember that the premium paid is a lot higher and that beats the purpose of a cheap term insurance plan which does its job of providing insurance coverage. “As the premium is higher than pure term plans, hence return of premium term plan is not beneficial as one could get other investment opportunities during the same tenure to generate higher return on the additional premium which they would pay in case of return of premium term plan,” says Kumar. However, people who are wary of sunk cost might go for these plans as they get the satisfaction of getting the premium back at the end of tenure in case one survives during the coverage period. Again, it may not make sense in the current financial circumstance, but for some, it may provide the comfort of assured return of the principal amount.

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