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<ul class="summary-list"><li>Burberry's CEO Joshua Schulman says the brand is undergoing an urgent "course correct."</li><li>The strategy aim comes as the luxury brand reports revenue plummeted 22% in its interim results. </li></ul>Things have gone from bad to worse at <a target="_blank" class="" href="https://www.businessinsider.com/how-burberry-became-fashions-biggest-fail-stock-drop-ceo-ousting-2024-8">Burberry</a>, the beleaguered British <a target="_blank" class="" href="https://www.businessinsider.com/most-valuable-luxury-brands-2011-5">luxury brand</a>.On Thursday, the company's CEO said he is "acting with urgency" to stabilize the luxury brand as it reported a 22% revenue decline in the six months ending in September in interim results. CEO Joshua Schulman said the company is implementing a "course correct" strategy to address its long-standing woes and "position Burberry for a return to sustainable, profitable growth.'"Dubbing the strategic shift "Burberry Forward," the market has responded positively, with shares rising 14% in early trading on Thursday.Schulman said the company's underperformance stems from its "inconsistent brand execution" and a "lack of focus" on its outerwear category and core customers.The report also indicated the brand's attempt to modernize came at the expense of its heritage and identity and suggested that it has priced out many customers in its bid to pursue "brand elevation." "They pushed the pricing where the brand didn't feel legitimate," Jelena Sokolova, a senior equity analyst at Morningstar, previously told BI. "I've heard from some people, with a $2,500 bag, you might as well just go for Louis Vuitton, you wouldn't buy Burberry."<div type="image" title="Cara Delevingne at Burberry Flagship Store Reopening Cocktail Party - Inside on October 16, 2024 in New York." height="853" width="1280" msid="115296336" hostid="261" sizebytes="72366"></div>Part of Burberry's new strategy to right the ship includes the appointment of new leaders across its marketing and product teams and the launch of new campaigns that show the brand is going back to its roots.These include the "It's Always Burberry Weather" outerwear campaign starring British and Irish celebrities like <a target="_blank" class="" href="https://www.businessinsider.com/barry-keoghan-saltburn-shocking-scenes-freak-child-man-2024-1">Barry Keoghan</a> and longtime ambassador <a target="_blank" class="" href="https://www.businessinsider.com/cara-delevingne-most-daring-red-carpet-looks-photos">Cara Delevigne</a>.Many brands are hurting from an industry-wide slump in luxury, fueled partly by <a target="_blank" class="" href="https://www.businessinsider.com/whats-behind-china-luxury-goods-slowdown-economy-changing-consumer-tastes-2024-10">waning demand in China</a>, but Burberry has been one of the hardest hit. In July, after reports emerged that the brand planned to cut hundreds of jobs, it then reported a decline in sales and said it would suspend its dividend payments to shareholders. Shortly after, the company announced it was ousting its CEO, Jonathan Akeroyd.Earlier this month, rumors swirled that the brand was facing an acquisition from Moncler. However, this has since been denied.

Burberry launches urgent turnaround plan to save the brand

<div type="image" title="Are Indians depositing less money in banks, or more in mutual funds? Turns out, it&amp;#39;s neither of those." msid="113663806" hostid="261" sizebytes="1121785"></div> Over the past few months, there’s been a lot of brouhaha about the lagging pace of <keyword id="20202062" type="General" weightage="20" keywordseo="bank-deposits" source="keywords">bank deposits</keyword> in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialisation of <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> in the country or the rising preference of Indians towards <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword> through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords" meta.keywordsubtype="org" meta.entityname="RBI" meta.hostid="261" meta.entityid="RBI">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by Franklin Templeton, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are household deposits really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. <div type="image" title="Yes, household deposits (as % of total deposits) have dipped, but the drop is far from significant" msid="113663882" hostid="261" sizebytes="306706"></div> Also, we can’t forego the fact that the share of Indian households in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and <keyword id="114757" type="General" weightage="20" keywordseo="savings-account" source="Orion">savings account</keyword> deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (Central Board of Direct Taxes) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of Securities Transaction Tax (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell <keyword id="6361918" type="General" weightage="20" keywordseo="equity-mutual-funds" source="Orion">equity mutual funds</keyword>, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by <keyword id="45369" type="General" weightage="20" keywordseo="equities" source="Orion">equities</keyword> can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in <keyword id="19998084" type="General" weightage="100" keywordseo="deposit-growth" source="keywords">deposit growth</keyword> we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the Fed recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next MPC (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day. Do you have insights or personal experience to share on your personal finances or money? Contact us at <a target="_blank" class="c-link" href="mailto:businessinsider@timesinternet.in">businessinsider@timesinternet.in</a>.

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<ul class="summary-list"><li>My plan was to save $100,000 by the time my son enrolled in college.</li><li>But I recently decided to stop saving for his tuition because there are other paths he could take.</li></ul><a target="_blank" class="" href="https://www.businessinsider.com/son-mother-college-across-country-dreading-empty-nest-2024-5">My son</a> is still young enough for me to save up quite a bit of money for his college tuition. My husband and I are both teachers and while we are anything but well-off, we make enough for what we need. The savings I was putting away for my son each month was all the money left after the bills were paid.Each year, I planned to save about $10,000 for his <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/student-loans/how-to-pay-for-college">college tuition</a>. By the time my son graduates from high school, I would have saved about $100,000, which would cover a large portion of a four-year degree — depending on where he chooses to go.However, my son is currently in the fifth grade and has little interest in his education. For now, I've decided to stop saving for his tuition and instead <a target="_blank" class="" href="https://www.businessinsider.com/millennial-coast-fire-saved-over-half-her-income-financial-independence-2024-10">invest in my future</a>.<h2 id="103c0f1b-4ac9-4950-949e-e2415bdd218a">I've given up a lot for my son and now want to focus on my future</h2>As a mother, I have sacrificed a lot to be available to my son, and I don't regret those sacrifices. For instance, I chose my teaching career because of him and gave up other <a target="_blank" class="" href="https://www.businessinsider.com/best-high-paying-fast-growing-jobs-careers">career paths</a> that would have taken up almost all of my time. I want to be present for my son while he's growing up, and I think he appreciates that.But I have recently started thinking about what I want out of my own life once he's older. I know for sure that I'll want to live somewhere else, so I've made the difficult decision to start putting those savings toward the <a target="_blank" class="" href="https://www.businessinsider.com/renting-housing-market-home-ownership-mortgages-affordability-real-estate-2024-5">forever home </a>I've always dreamed about.Our current home is not somewhere I'll live forever. The town we live in is just where we ended up; I don't love living here. Since my son's father is close by, I don't want to relocate just yet. Once my son <a target="_blank" class="" href="https://www.businessinsider.com/graduating-college-ceremony-high-school-pandemic-virtual-2024-5">graduates high school</a>, I want to buy that forever home in Gainesville, where I dream of living, so I need to start saving now.I do feel a little guilty about not thinking of that money as my son's college savings anymore, but I could always change my mind about paying for his college if he gets serious about his education.<h2 id="9325a6bc-ff16-40b9-9f2d-26984d955553">He has other options besides me paying for his tuition</h2>My husband pointed out that while I worked hard for a scholarship to pay for my schooling, he had to take out <a target="_blank" class="" href="https://www.businessinsider.com/daughters-take-student-loans-ivy-league-schools-2024-9">student loans</a>. His point is that if my son decides that he really wants to go to college, he could do either of these things — just as we had to.We each wanted degrees and didn't have parents who could pay for our tuition, so we found a way to pay for college on our own, as lots of people have to do.When I had my son, I wanted to give him everything I did not have growing up. Initially, that included helping him pay for college. But the college landscape has changed. It is more expensive than ever, and a degree is no longer a guarantee for a successful life.<a target="_blank" class="" href="https://www.businessinsider.com/gen-z-prefers-trade-school-tech-training-college-degree-2024-4">Vocational work</a> is now a viable path that many high school graduates are taking instead of heading to college, and I don't think there's anything wrong with that. What I want more than my son to go to college is for him to find work that he'll really enjoy doing.I would be more than happy to help him pay for trade school or vocational training if that is something he really wants to do. We are lucky enough to have high schools in our area that provide training for all of those career paths. Some <a target="_blank" class="" href="https://www.businessinsider.com/what-its-like-to-attend-alternative-high-school-2015-3">high school programs</a> even allow students to graduate with certificates at no cost to families.<h2 id="9435ffb9-d544-4f12-a6dc-6f84e5e3281e">I think my son would agree with my decision to save up for myself</h2>While I can't predict our future, I do feel like I'm making the right decision to begin investing in my own future. I feel better about working hard to save up for my forever home in a town I know I'll be happier in instead of saving up for <a target="_blank" class="" href="https://www.businessinsider.com/cost-us-universities-wildly-expensive-education-tuition-fees-america-2024-3">costly college tuition</a> that may not lead anywhere.I'm tired of giving up on my own dreams. While I'm happy to make sacrifices as a parent that I know are worth it, I don't think sacrificing that opportunity to move and make a better life for myself is worth it.I even think that when he is grown up, that's something he'll want for me, too.

I stopped saving for my son's college tuition. I decided to save for my forever home instead.

In the last few months, have you received a suspicious call from a stranger claiming that you have won a cash prize? Or has someone tried reaching out to you saying that a relative is in trouble and urgently needs money? If you answered yes to any of these questions, know that you are not alone. <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword> has reported a rise in scam calls in recent months and these calls seem to be increasing at a rapid rate. But not just calls, there are various other platforms that scammers try to take advantage of, to rob people of their hard-earned money. Read on to know about the top 5 <keyword id="22618205" type="General" weightage="100" keywordseo="personal-finance-scams" source="keywords">personal finance scams</keyword> that are surfacing in India and how you can stay safe from them. <h2>Fake <keyword id="20488964" type="General" weightage="20" keywordseo="job-offer" source="keywords">job offer</keyword> scams</h2>This is one of the most commonly reported scams. Over the last year, there have been many cases where people were approached for seemingly lucrative job offers via platforms like WhatsApp and Telegram. Some of these cases involved the victim making payments to certain accounts, while being made to believe that it is a part of the job and there will be a handsome return later. For instance, a PTI report in May this year revealed that a woman from Navi Mumbai found herself trapped in an online fraud and lost Rs 54 lakh. The victim wanted to earn some extra money by working from home and was reportedly offered freelance work by the scammers. She was also told that she would earn money after completing five tasks. And to receive these tasks, the woman claimed that she paid Rs 54.30 lakh in various accounts. When the woman asked for payment after completing the tasks assigned to her, the scammers stopped replying. <h2>Sweetheart scams</h2>Meeting the love of your life through an <keyword id="20167528" type="General" weightage="20" keywordseo="online-platform" source="keywords">online platform</keyword> seems too good to be true at times. And sometimes, this really is the case. Various cases have surfaced in the past where the victims were duped of their hard-earned money by their online lovers. Just last month, a man in Delhi was scammed of Rs 1.2 lakh when he planned to meet a woman he was talking to on Tinder. The two met at a cafe in Delhi to celebrate the woman’s birthday and ordered some snacks, cakes, and wine. The woman however, abruptly left in the middle of the date citing a family emergency. And the victim incurred a bill of Rs 1,21,917.70 for food that should have only cost a few thousand bucks. When he questioned the high bill, he was threatened and forced to pay. After investigating, the police found that the cafe split the high bills in a set way: 15% to the girl, 45% to the table and cafe managers, and 40% to the owners. <h2>Fake screenshots scams</h2>Another type of scam that is widely happening in the country is where you are shown a screenshot that gives the impression that your account has been credited with some money, when it actually has not. For instance, in March this year, a Delhi Uber driver was making headlines for overcharging a customer for a ride to the airport. A Moneycontrol report mentioned how a man described his experience in a Reddit thread. As per the report, the man said that he had booked a ride to the airport and the initial fare was Rs 340. However, when the ride was completed, the Uber driver showed him a screenshot which depicted that the fare was Rs 648. The driver had claimed that the fare increased due to more waiting time. However, that wasn’t the case and the driver had created a fake screenshot to demand extra money. After this post went viral, several other Reddit users reported similar incidents. <h2><keyword id="19925254" type="General" weightage="20" keywordseo="YouTube" source="keywords" meta.keywordsubtype="org" meta.entityname="YouTube" meta.hostid="261" meta.entityid="YouTube">YouTube</keyword> like and earn scam</h2>This one is similar to the completing tasks scam. In this scam, <keyword id="20013464" type="General" weightage="20" keywordseo="fraudsters" source="keywords">fraudsters</keyword> tend to tell the victim that they will have to engage with a YouTube channel to earn money. They then ask the person to make certain payments, promising a greater reward later on. Once the victim transfers the money, the fraudsters tend to disappear into thin air. In February this year, there were reports of a man losing Rs 16 lakh due to such a scam. <h2><keyword id="19957108" type="General" weightage="20" keywordseo="online-shopping" source="keywords">Online shopping</keyword> scam</h2>If you have ever shopped online, be sure to read this one. Many scamsters come up with fake advertisements on reputed platforms like Instagram to lure people into buying items online. In such scams, once the order has been placed and payment has been made, the victim doesn’t receive the products. In addition to this, scammers can also pose as bank employees and gain access to sensitive information of the victim’s account. For instance, a report by PTI last year revealed that a 70-year-old woman was buying six towels online for Rs 1,160. While making the payment, Rs 19,005 was taken from her account instead of Rs 1,160. She tried to contact the bank helpline but couldn't reach them. Soon after, she got a call from an unknown number. The caller claimed to be from the bank and offered to help with her payment problem. He asked her to download an app for the refund. The woman followed his instructions but ended up losing Rs 1 lakh from her account. When she saw the unauthorised transactions, she went to the police station. Meanwhile, another Rs 8.3 lakh was withdrawn from her account. <h2>How to stay safe from such scams</h2>Even though more and more people are being targeted by scammers, there are some ways that you can ensure that you stay safe. Keep these few points in mind in order to protect yourself against personal financial scams. <ol><li>Don’t share your personal information with strangers online or on the phone. </li><li>Don’t make any payments just because a stranger told you to. Verify the situation and the person’s credentials. </li><li>Don’t click on suspicious links that are sent to you on emails or text messages. </li><li>Avoid shopping for doubtful websites or accepting job offers from sites that appear dubious. </li><li>Before taking up any job offer, perform a thorough search of the company or the person who is claiming to recruit you. </li><li>Read up a bit about popular scams going on right now. At times, a simple Google Search can help you save up loads of money. </li></ol>

Top 5 personal finance scams in India and how to stay safe from them

<ul class="summary-list"><li>This post originally appeared in the Insider Today newsletter.</li></ul>Welcome back to our Sunday edition, a roundup of some of our top stories. Before we get into it, some weekend inspiration: This guy was a CEO with $1 million in his bank account before turning 40. Then he packed it all in to run <a target="_blank" href="https://www.businessinsider.com/left-ceo-job-pursue-passion-career-change-2024-9">a medieval Renaissance fair</a>.On the agenda today:<ul><li>We've been doing promotions in <a target="_blank" href="https://www.businessinsider.com/truth-promotions-companies-picking-managers-wrong-new-study-2024-9">the worst possible way</a>.</li><li>The biggest mistakes people make <a target="_blank" href="https://www.businessinsider.com/retirement-saving-why-half-retirees-could-run-out-of-money-2024-9">when preparing for retirement</a>.</li><li>Inside the island fortress of <a target="_blank" href="https://www.businessinsider.com/billionaire-bunker-miami-bezos-tom-brady-ivanka-trump-security-2024-9">America's mega-billionaires</a>.</li><li>Meta is winning <a target="_blank" href="https://www.businessinsider.com/meta-new-ray-ban-smart-glasses-apple-vision-pro-2024-9">the glasses wars</a>.</li></ul>But first: IsMrBeast the ultimate "founder mode" leader?If this was forwarded to you, <a target="_blank" href="https://www.businessinsider.com/subscription/newsletter/insider-today-sunday-edition">sign up here</a>. Download Insider's app <a target="_blank" href="https://www.insider.com/app">here.</a><h3 id="58506b3b-b008-4ead-9e90-71439c9e98dd">This week's dispatch</h3><div type="image" title="MrBeast" height="975" width="1300" msid="113787189" hostid="261" sizebytes="35876"></div><h2 id="2a7b4701-4b9e-48dd-b7c6-5bd656268197">MrBeast mode</h2>MrBeast is YouTube's biggest star, a <a target="_blank" href="https://www.businessinsider.com/new-mrbeast-trademark-filing-philanthropy-charity-project-team-water-2024-9">philanthropist</a>, and a <a target="_blank" href="https://www.businessinsider.com/youtube-star-mrbeast-expects-700-million-revenue-this-year-2024-6">snack entrepreneur</a>. You can now add Silicon Valley thought leader to the list.The social media star, real name Jimmy Donaldson, put together a handbook breaking down his <a target="_blank" href="https://www.businessinsider.com/leaked-mrbeast-guide-reveals-youtube-secret-weapons-for-success-2024-9">secrets to success</a>. The 36-page guide, intended for staffers at MrBeast Production, says Donaldson wants a team of obsessives who are coachable, don't make excuses, and "are the best in the goddamn world at their job."The guide includes lines such as "take ownership and don't give your project a chance to fail," and "own shit so we can address how to fix it and then move on."When the document leaked, fans and wannabe employees poured through the pages. But so did Silicon Valley, where techies likened Donaldson's approach to the hardcore "<a target="_blank" href="https://www.businessinsider.com/founder-mode-manager-dividing-silicon-valley-2024-9">founder mode</a>" style of leadership."I think this is resonating because it's so counter to the current trends in work culture today, which seem soft by comparison," one marketing advisor <a target="_blank" href="http://businessinsider.com/tech-world-captivated-with-mrbeast-training-document-founder-mode-2024-9">told Business Insider</a>.<div type="image" title="An employee in a spotlight that also acts as a megaphone" height="1500" width="2000" msid="113787188" hostid="261" sizebytes="39338"></div><h2 id="3fd3d286-9128-4fdf-98a7-cb928cbf9001">The truth about promotions</h2>We might be doing promotions all wrong. In a new study, researchers found that in some cases, the practices businesses use to hire managers are so bad that they'd actually be better off picking names out of a hat.Those practices, like hiring top performers or people who really want to be promoted, don't translate to effective managers. Instead, researchers found, selecting managers based on intelligence and decision-making skills can result in stronger leaders.<a target="_blank" href="https://www.businessinsider.com/truth-promotions-companies-picking-managers-wrong-new-study-2024-9">How to hire a manager</a>.<h2 id="fa1eb3c8-10a8-42fd-b4f7-5b00f5a61a5b">Retirement savings no-no's</h2>About 45% of Americans will run out of money in retirement — even those who invested and diversified. In particular, single women face a 55% chance of depleting funds, even higher than single men and couples.If you're aiming to retire at the standard age of 65, avoid these mistakes so you can keep your golden years golden.<a target="_blank" href="https://www.businessinsider.com/retirement-saving-why-half-retirees-could-run-out-of-money-2024-9?utm_source=Iterable&amp;utm_medium=email&amp;utm_campaign=campaign_Insider%20Today%20-%20Thu,%20Sep%2026,%202024&amp;Utm_content=LimitedPromo">The four biggest retirement mistakes</a>.<div type="image" title="Cameras and boats surrounding a residential island" height="1000" width="2000" msid="113787194" hostid="261" sizebytes="176844"></div><h2 id="2a39b74f-b08c-4bc8-9a21-ed6c87a6f9e0">Welcome to Billionaire Bunker</h2>Indian Creek Village is more than just a private island city in Florida. It's home to the elite of elites: Tom Brady and Jeff Bezos both have mansions there.But approach at your own peril. A large chunk of Indian Creek's budget goes to its police department, which patrols the island's sole entrance and perimeter 24/7. Through federal funding, the town has amassed an abundance of other security measures, making it the most gated community in a country of gates.<a target="_blank" href="https://www.businessinsider.com/billionaire-bunker-miami-bezos-tom-brady-ivanka-trump-security-2024-9">Inside America's wealthiest town</a>.<div type="image" title="a brain wearing Meta's smart glasses" height="1500" width="2000" msid="113787192" hostid="261" sizebytes="288714"></div><h2 id="83973c79-472c-4429-97bb-4d74e0dda2ff">Glasses rule, phones drool</h2>Meta CEO Mark Zuckerberg announced Orion, a prototype pair of augmented-reality glasses this week. The specs reportedly cost about $10,000 a pair to make, but aren't currently for sale.The glasses mark the latest attempt by a Big Tech company to break into a hard-to-crack industry: AR and VR wearables. And with Meta's smart Ray-Ban glasses doing better than expected, the company appears to be winning the glasses wars.<a target="_blank" href="https://www.businessinsider.com/meta-new-ray-ban-smart-glasses-apple-vision-pro-2024-9">What Meta got right</a>.Also read:<ul><li><a target="_blank" href="https://www.businessinsider.com/orion-meta-ar-smart-glasses-review-2024-9">I tried out Meta's Orion AR glasses. I'd buy them in a heartbeat — if they were actually for sale</a>.</li></ul>This week's quote:"We are not a normal company."— Sam Altman in a note to OpenAI staff <a target="_blank" href="https://www.businessinsider.com/sam-altman-openai-note-more-staff-exits-barret-bob-2024-9">announcing executive exits</a>.More of this week's top reads:<ul><li>The turmoil at OpenAI is a bad look <a target="_blank" href="https://www.businessinsider.com/openai-implosion-investors-vcs-2024-9">for its huge funding round, VCs say</a>.</li><li>Jamie Dimon isn't a fan of junior bankers with <a target="_blank" href="https://www.businessinsider.com/jpmorgan-jamie-dimon-junior-bankers-private-equity-jobs-unethical-2024-9">hush-hush private-equity jobs</a>.</li><li>Nvidia's days of absolute dominance in <a target="_blank" href="https://www.businessinsider.com/nvidia-competition-sambanova-groq-cerebras-show-faster-inference-speed-2024-9">AI could be numbered</a>.</li><li>Salesforce is going to <a target="_blank" href="https://www.businessinsider.com/salesforce-closing-hillsboro-oregon-office-amid-rto-push-2024-9">close its Portland office</a>.</li><li>South Korea is going big on American manufacturing. <a target="_blank" href="https://businessinsider.com/south-korea-companies-jobs-manufacturing-evs-chips-batteries-2024-9?sd">The Battery Belt could benefit the most</a>.</li><li>America's business giants are <a target="_blank" href="https://www.businessinsider.com/china-xi-jinping-recession-economy-american-companies-profits-trade-war-2024-9">starting to lose faith in China</a>.</li><li>Leaked email shows Twitch is <a target="_blank" href="https://www.businessinsider.com/twitch-not-following-amazon-rto-policy-2024-9">not following Amazon's new RTO policy</a>.</li><li>The Olivia Nuzzi-RFK Jr. story is still spinning out. <a target="_blank" href="https://www.businessinsider.com/olivia-nuzzi-rfk-jr-reaction-vox-media-new-york-magazine-2024-9">New York magazine staffers still have questions</a>.</li><li>Microsoft just punted on a big AI decision. <a target="_blank" href="https://www.businessinsider.com/microsoft-punts-365-ai-bundle-pilot-tests-copilot-2024-9">It could be a bad sign</a>.The Insider Today team: <a target="_blank" href="https://www.businessinsider.com/author/dan-defrancesco">Dan DeFrancesco</a>, deputy editor and anchor, in New York. <a target="_blank" class="" href="https://www.businessinsider.com/author/jordan-parker-erb">Jordan Parker Erb</a>, editor, in New York. Grace Lett, editor, in Chicago. <a target="_blank" class="" href="https://www.businessinsider.com/author/amanda-yen">Amanda Yen</a>, fellow, in New York.</li></ul>

Insider Today: Retirement savings mistakes

George Wilson learned the hard way that there's no such thing as a free lunch — or, in his case, a free dinner that cost him a chunk of his retirement savings.As a retiree, he regularly received postcards in the mail, offering to teach him about finance and how to make money in retirement. They usually involved a presentation at a nice restaurant, and he would go without acting on any of the investment advice.But on one occasion, Wilson did take the bait after a brochure he received in 2010 inviting him to an evening at Ruth's Chris Steak House ended up costing him $158,000."It was a very good restaurant. And so, of course, it caught my attention," Wilson said in an interview.At that fateful dinner, he enjoyed his favorite top sirloin steak, asparagus tips, and a "fabulous" chocolate cake. He also met David Escarcega, one of the hosts and a broker who would eventually advise him to invest in so-called non-correlated, fixed-income alternative products from the <a target="_blank" class="" href="https://www.investmentnews.com/alternatives/gwg-holdings-files-for-bankruptcy/220355">now-bankrupt firm GWG</a>.Years later, Wilson is still fighting to regain what he lost from that investment. An arbitration decision recently awarded him $267,252 in compensation, including emotional distress damages from the last broker who facilitated the transaction. But the respondent only paid approximately $103,363.40 toward sanctions and the award. After costs, Mr. Wilson will end up with almost no payout, according to his attorney.Fancy restaurants with presentations are a common practice in the industry, says financial planner Michael Murray, adding that there are services that provide mailing lists of people with a certain net worth, and retirees are often on them because it's where wealth tends to be concentrated.But those meals aren't really free, Murray said. They're predominantly set up to sell high-commission products. In GWG's case, brokers earned up to 8% in commissions. What advisors can earn from one of these events pays for the meals and more. Picture a scenario where an advisor signs up $500,000 worth of investments with an 8% commission rate; that's a $40,000 payout. The math is very favorable for those who do this regularly, he added.Meanwhile, invitees feel like the hosts have done something nice for them and there's an implication that they should do something back, Murray noted. "So I think certain people will go to these dinner seminars and almost feel an obligation to work with someone."They're referred to as "free lunch seminars," said Adam Gana, a securities attorney who worked on Wilson's case. They're common in the industry. But Gana says that when brokerage firms offer them, he tells clients to run the other way."We see them all the time," Gana said. "I've represented 3,000 investors over the last 15 years, and in so many of those instances when we're dealing with a horrific product, a non-traded product, a product that's just terrible for investors, it usually starts with a free lunch."<h2 id="74285f86-a363-43ff-b132-9ec411f82f14">Risky business</h2>After the dinner, Wilson and his ex-wife Jean followed up with Escarcega at his office to discuss alternative investment options."We sat down with him, and he went through various opportunities that he could present to us, and we asked for several," Wilson said. "And the one that seemed the most attractive and that he extolled the virtues of the most was GWG. And so we thought about it for several weeks and went back and forth and then ultimately decided to do it."The products were non-publicly traded so-called LifeNotes, high-yield debt securities that paid a 9% monthly interest rate by GWG Holdings, according to documents viewed by Insider. They were based on life insurance policies purchased on the secondary market, with the expectation that death benefits would be paid to GWG's bondholders when the insured died. One brochure, viewed by Insider, advertised them as a "secured investment backed by a large portfolio of high-quality life insurance policies""Escarcega had pitched them as a safer alternative to the volatile stock market that could provide steady dividend payouts while preserving the principal investments, Wilson said."Of course, we want to leave our equity to our children but have some kind of income coming from it while we're still here," Wilson said. "And so that was very attractive to us, that we preserve our equity."Wilson initially purchased $180,000 worth of the notes using funds from his IRA, according to documents viewed by Insider. He later reduced his investment to $158,000 and flipped it to GWG preferred stock. For the next few years, things were looking good. Wilson received payouts monthly. In 2017, he decided to renew his investment, according to documents viewed by Insider.What he didn't know was that by then, Escarcega had been barred from selling securities after misrepresenting investment risks, according to FINRA. So Escarcega used his brother Adrian's license to submit the transactions through AGES Financial Services, according to arbitration documents from Wilson's attorneys. The Escarcegas could not be reached for comment.It was one of many details Wilson wasn't aware of. Thus far, the payouts had always been timely, he said. So, there was no reason to suspect there were problems. But there were. GWG's balance sheet wasn't adding up. FINRA had determined that it hadn't been profitable in over a decade. The firm had been selling new bonds to pay dividends to existing bondholders. The underlying collateral wasn't generating an income and multiple accounting firms refused to audit it, according to the amended statement of claim.The doom loop would eventually come to a screeching halt due to GWG's accounting issues, an SEC investigation, and failure to file its annual SEC report. By 2021, it could no longer sell bonds which led to its bankruptcy by 2022 and the halting of dividend payments, according to the amended statement of claim.Craig McCann, a consultant providing expert testimony in investment cases, including this one, said that GWG's insurance contracts were being overvalued on its balance sheet and the firm was assuming that people would die earlier. As a result, they estimated receiving the death benefits sooner. Simply put, there were not enough benefits being paid on the insurance contracts to cover the interest and principal due."There were lots of signals," McCann said. "There were lots of problems with their SEC filings and lots of reasons to believe that it was imminently going to happen, but most investors were very unsophisticated investors."In 2019, <a target="_blank" class="" href="https://www.investmentnews.com/alternatives/clients-win-another-gwg-bond-claim-this-time-against-b-d/245442">AGES had ended its relationship with GWG</a> due to a change in the company's business model, according to the firm. But Wilson says he was not informed by the firm, <a target="_blank" class="" href="https://www.investmentnews.com/fixed-income/investors-claiming-emotional-distress-damages-win-lawsuit-involving-gwg-bonds/257068">preventing him from selling his shares in time</a> (AGES disputes this). An arbitration panel found that the investment scheme was so egregious that they awarded him $267,252.00 in compensation that included emotional distress damages, according to the order. AGES paid $103,000 for all claimants.<h2 id="9e594bc3-8860-404f-8b63-aeb5d0906705">Risk reward</h2>Wilson's situation is a cautionary tale. He used his IRA to make the investment, so he's also faced with a required minimum distribution, which includes the amount invested in GWG even though it's nominal. He told Insider he must withdraw from other investments to meet the minimum.His case isn't an isolated one. There may have been thousands of brokers selling GWG bonds, based on data pulled from ADV filings as reported by McCann. Wilson says he lives with the guilt of advising his ex-wife and a friend who also invested in the bonds and lost their principal.Truth be told, it's difficult for the average retiree who is not financially savvy to understand the mechanics of many of these alternative investments, even when there are red flags, Murray said. Non-publicly traded investments take time to build capital before generating free cash flow. For those with lower cash reserves, they don't make much sense because they lack liquidity, he added.But Murray also emphasized that not all alternative investments are bad. He just thinks that if you're considering them, you must be financially savvy and have the ability to dig into offering statements, look at fee structures, and related party transactions. Even then, investors should resort to a second opinion from a fiduciary advisor, a CPA, or an attorney.Finally, understand that risk and reward are always tied together. Outsized promises of yields that are much higher than, say, the 10-Year Treasury is a red flag and means there's elevated risk, Murray said.

How a free meal cost an investor his retirement savings

New Delhi [India], July 19 (ANI): Households are choosing the <keyword id="20033427" type="General" weightage="20" keywordseo="capital-markets" source="keywords">capital markets</keyword> over the <keyword id="19934118" type="General" weightage="20" keywordseo="banks" source="keywords">banks</keyword> to park or invest their <keyword id="25450" type="General" weightage="20" keywordseo="savings" source="Orion">savings</keyword>, highlighted <keyword id="64190" type="General" weightage="20" keywordseo="RBI-Governor" source="Orion">RBI Governor</keyword> <keyword id="3083263" type="General" weightage="20" keywordseo="Shaktikant-Das" source="Orion">Shaktikant Das</keyword> during his address at FE Modern BFSI (Banking, Financial Services, and Insurance) Summit 2024 on Friday. Governor Das highlighted that traditionally, banks were the primary choice for households to invest their money. However, there has been a noticeable change in consumer behaviour, with a growing preference for capital markets and other <keyword id="5869841" type="General" weightage="20" keywordseo="financial-intermediaries" source="Orion">financial intermediaries</keyword>. He noted, "Households and consumers who traditionally leaned on banks for parking or investing their savings are increasingly turning to the capital markets and other financial intermediaries." This trend indicates a broader diversification of <keyword id="22469312" type="General" weightage="20" keywordseo="household-investments" source="Orion">household investments</keyword> into <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and other savings tools, moving away from traditional investment tools. The Governor stated, "While bank deposits continue to remain dominant as a percentage of the financial assets owned by the households, their share has been declining, with households increasingly allocating their savings to Mutual Funds, Insurance Funds, and Pension Funds." Governor Das also pointed out that this shift in investment patterns has significant implications for the banking sector. Banks now need to explore alternative methods to bridge the gap between credit and deposits. He added, "On their part, banks have sought to fill the credit-deposit gap by increasing their reliance on other sources like short-term borrowings and certificates of deposit, etc. This increases their sensitivity to interest rate movements and poses challenges to liquidity management." The Governor further elaborated on the implications of the shift from CASA (Current Account Saving Account) deposits, stressing that banks must remain vigilant and adaptive. He stated that banks need to continuously focus on improving and refining their credit underwriting standards and the pricing of risks to maintain stability and profitability. Reflecting on recent global banking events, Governor Das drew attention to the banking crises in the US and Switzerland in 2023, which highlighted the risks and vulnerabilities inherent in certain business models. He emphasized the importance of learning from these crises to enhance the resilience of the banking sector. "The banking crisis in the US and Switzerland in 2023 has again brought into focus the risks to banking stability from certain business models and their inherent vulnerability," he added.

Household savings are choosing mutual funds over banks to invest savings: RBI Governor

What is the right time to make a <keyword id="20224622" type="General" weightage="100" keywordseo="motor-insurance" source="keywords">motor insurance</keyword> claim? While there are no right answers, you generally make a claim if your car or bike has suffered serious damages in an accident, which will cost a bomb to repair! But did you know that you could also make a claim if your car or bike was damaged by, well, a coconut? Surprised? <keyword id="20081892" type="General" weightage="20" keywordseo="Digit-Insurance" source="keywords" meta.keywordsubtype="org" meta.entityname="Digit Insurance" meta.hostid="261" meta.entityid="Digit Insurance">Digit Insurance</keyword>, which is backed by ace Indian cricketer Virat Kohli, recently released some interesting data in this regard. Per the company, by the end of FY24, it had paid out almost Rs 1.68 crore in claims related to over 1,500 cases where the damage was caused by an innocuous coconut! <cmsannotation type="cmsannotation" annotationid="Monkeys go coconuts!" comment="subhead" text="Monkeys go coconuts!"><keyword id="20243262" type="General" weightage="20" keywordseo="monkeys" source="keywords">Monkeys</keyword> go coconuts!</cmsannotation> Well, if you don't believe a coconut can wreak this kind of havoc, think again. The company reported receiving more than 350 cases of <keyword id="19986918" type="General" weightage="20" keywordseo="vehicle-damage" source="keywords">vehicle damage</keyword> in just 2023, where the good old coconut was the culprit! The maximum claims stemmed from Maharashtra. The average claim amount was around Rs 10,000. If you’re away from the coast, you’ll have to battle your neighborhood's dogs and monkeys! Monkey’s seem to have a special liking for motorcycles, given that Digit reported setting over 1,200 claims worth Rs 40 lakh towards damage to 2-wheelers caused by monkeys in FY 2023-24. The cases saw a 40% jump on a YoY basis. Since Digit’s inception in 2017, the company has seen more than 85,000 claims where the primary cause of vehicle damage was an animal. Out of these, dogs were the main reason behind 7% of such claims in FY 2023-24, triggering payouts of over Rs 30 crore. <cmsannotation type="cmsannotation" annotationid="The mayhem of dogs and goats" comment="subhead" text="The mayhem of dogs and goats">The mayhem of dogs and goats</cmsannotation> As per the company’s internal claims data, Indira Nagar in Lucknow seems to be the epicentre of dogs unleashing damage on vehicles. The company reported paying more than Rs 6.7 lakh towards 110 claims received from this location. If, on an unfortunate day, your bike ever gets in an accident, how much do you imagine the damage payout would be? Well, in some cases, like of a luxury bike, which was damaged upon accident with a goat, the <keyword id="22121817" type="General" weightage="20" keywordseo="accidental-damage-payout" source="keywords">accidental damage payout</keyword> went as high as Rs 6.75 lakh. <cmsannotation type="cmsannotation" annotationid="Motor Insurance on the rise" comment="subhead" text="Motor Insurance on the rise">Motor Insurance on the rise</cmsannotation> As per data from the annual report of insurance regulator <keyword id="6361421" type="General" weightage="20" keywordseo="IRDA" source="Orion">IRDA</keyword>, the motor segment saw a YoY growth of about 15.4% in <keyword id="21608709" type="General" weightage="20" keywordseo="premium-collection" source="keywords">premium collection</keyword>, from Rs 70,433 crore in 2021-22 to Rs 81,280 crore in 2022-23. The average <keyword id="19989676" type="General" weightage="20" keywordseo="claim-settlement-ratio" source="keywords">claim settlement ratio</keyword> of India’s motor insurance industry has also been on a steady rise, going from 81.3% in 2021-22 to 84.48% in 2022-23. Additionally, the incurred claims ratio, or the proportion of claims paid as against premium received also noted a marginal rise, from 81.30% in 2021-22 to 84.48% in 2022-23. All in all, save your precious cars or bikes from the terror of monkeys, dogs, coconuts and more. If you are yet to get a comprehensive vehicle insurance for your two or four wheeler, do so at the earliest!

Dogs, coconuts and monkeys: Insure your vehicles from their mayhem right now!

<ul class="summary-list"><li>Hurricane Helene victims used iPhones for satellite messaging amid power and cell outages.</li><li>Asheville residents praised Apple for the feature and its usefulness.</li></ul>In the wake of <a target="_blank" class="" href="https://www.businessinsider.com/hurricane-damage-port-strike-could-hurt-us-economy-2024-9">Hurricane Helene</a>, those left without power or cell service are transforming their iPhones into satellite phones.Several public service announcements on social media have urged those affected by Hurricane Helene to update to iOS 18 if they're able. For those who own an iPhone 14 or later, it could be a lifeline to loved ones or rescuers.An X thread by Asheville resident Matt Van Swol demonstrated just how helpful the satellite messaging iPhone feature has been for those without WiFi or cellular service. Van Swol said he's "never been more thankful to be an iPhone user," and more chimed in with their praise of the iOS 18 feature."Due to the lack of cell service, EVERYONE in Asheville NC right now on iOS 18 has been able to get messages out and in with the Satellite messaging feature," Van Swol, head of subscription growth at Wyze, wrote. Van Swol didn't immediately respond to Business Insider's request for an interview.He wasn't the only one who said the satellite messaging feature was a lifesaver. Another <a target="_blank" class="" href="https://x.com/timotheeej/status/1840855518434283771">user</a> said they could still communicate while stranded by fallen trees and power lines.Those who were unaware of the feature or didn't have access to it weren't as fortunate. Jeneane Nicodemus wrote for BI that she lost contact with her daughter in Asheville for three days when the <a target="_blank" class="" href="https://www.businessinsider.com/mom-didnt-hear-from-daughter-asheville-for-days-2024-9">hurricane hit North Carolina</a>.Around 370 of North Carolina's 1,452 cell sites were out of service due to a lack of power as of Monday at 9 a.m. ET, according to a <a target="_blank" class="" href="https://docs.fcc.gov/public/attachments/DOC-405943A1.pdf">report</a> by the Federal Communications Commission.As the storm tore north, how-to videos and calls to action began circulating on TikTok to ensure people in its path knew how to activate the satellite feature on iOS 18.And it's not an iPhone-exclusive tool. Some Google Pixel models also have access to satellite messaging.Many said they used it to let family members know they were safe, though Apple's official site advises against that in emergency situations. Instead, Apple said iPhone owners should use it to text emergency services if they need urgent help.Still, Van Swol said it's making a difference.

This iPhone feature is 'saving lives' during Hurricane Helene aftermath

Teacher's Day special: Essential money lessons to teach your kids

<keyword id="22053621" type="General" weightage="20" keywordseo="Insurance-regulator-IRDA" source="keywords" meta.keywordsubtype="org" meta.entityname="Insurance regulator IRDA" meta.hostid="261" meta.entityid="Insurance regulator IRDA">Insurance regulator IRDA</keyword> has introduced sweeping reforms for various <keyword id="19936531" type="General" weightage="100" keywordseo="life-insurance" source="keywords">life insurance</keyword> products. In its master circular dated 12th June, 2024, the insurance watchdog laid out a slew of customer-friendly directives for life insurance companies to follow with immediate effect. Read on to know all about how these new rules will impact you : <cmsannotation type="cmsannotation" annotationid="Customer information sheet" comment="subhead" text="Customer information sheet"><keyword id="22033784" type="General" weightage="20" keywordseo="customer-information-sheet" source="keywords">Customer information sheet</keyword></cmsannotation> Going ahead, all life insurance companies will have to mandatorily provide their policyholders with a CIS, or Customer Information Sheet. This will serve to explain to them the basic features of the policy in very simple terms, and will include essential details like sum assured, benefits, policy loan options, free-look period and procedures for making claims and redressing grievances. In addition, benefits payable to the policyholder if they survive the policy tenure (maturity benefits), upon death and surrender of policy should also be clearly spelt out. Along with this, the policyholders are also entitled to a customised illustration of how the policy will benefit them while they are being sold the policy. CIS should also be made available to the policyholder in their local language on request. <cmsannotation type="cmsannotation" annotationid="Free-look and grace period" comment="subhead" text="Free-look and grace period"><keyword id="22053620" type="General" weightage="20" keywordseo="Free-look-and-Grace-Period" source="Orion">Free-look and grace period</keyword></cmsannotation> Policyholders will now have a 30-day window from the day they receive the policy document to review and cancel the policy if they want. If the policy is cancelled within this period, they will be entitled to a full premium refund. Earlier, this period only lasted for 15 days. For grace period, which basically refers to the additional, penalty-free window given to the policyholder to make premium payment post due date to avoid losing coverage, the windows will differ depending on premium payment frequency. If you pay the policy premiums on a monthly basis, you will get a 15-day grace period. For premium payments made on a quarterly/half-yearly or annual basis, the grace period will be of 30 days. <cmsannotation type="cmsannotation" annotationid="Penalty on violating Ombudsman’s word" comment="subhead" text="Penalty on violating Ombudsman’s word">Penalty on violating Ombudsman’s word</cmsannotation> The insurer is bound to comply with the <keyword id="960887" type="General" weightage="20" keywordseo="Insurance-Ombudsman" source="Orion">Insurance Ombudsman</keyword>’s award within 30 days of receiving the same. In case the same is violated, the insurer will have to pay a penalty of Rs 5,000 per day to the complainant. <cmsannotation type="cmsannotation" annotationid="Higher value on early policy surrender" comment="subhead" text="Higher value on early policy surrender">Higher value on early policy surrender</cmsannotation> Often, policyholders ended up with a low, negligible amount as refund upon surrendering their insurance policy. This is set to change with <keyword id="21879234" type="General" weightage="20" keywordseo="IRDA" source="keywords">IRDA</keyword>’s latest directives. Now, policyholders will be eligible for <keyword id="885219" type="General" weightage="20" keywordseo="surrender-value" source="Orion">surrender value</keyword> even if they decide to surrender their policy after just one year. Previously, only 50% of <keyword id="2939473" type="General" weightage="20" keywordseo="policy-premium" source="Orion">policy premium</keyword> would be refunded, provided the policyholders surrendered their policy between years 4-7 of the policy tenure. Moreover, they would lose the entire premium amount if they surrendered their policy within a year. Customers will also be entitled to higher special surrender value (SSV) from now on. This SSV should be at least equivalent to the expected present one of the these three: <ol><li>Paid up sum assured, or present value of your sum assured after you stop paying premiums</li><li>Paid up future benefits</li><li>Accrued benefits</li></ol>Also, it will be compulsory for life insurers to offer loans to policyholders as per the eligible surrender value of the policy. Says Vivek Jain, Head, Investments, Policybazaar.com, "The provision for higher Surrender Value (SV), calculated at a prevailing 10-year government securities rate with a limited spread, significantly increases the value returned to policyholders in the event of a policy surrender, after the completion of first year. The mandatory facility of policy loans across all life insurance savings products and the allowance of partial withdrawals under pension products will provide vital financial flexibility, which will enable policyholders to meet liquidity needs and specific financial goals. These measures will certainly enhance trust and transparency in the industry." <cmsannotation type="cmsannotation" annotationid="Partial withdrawal allowed from pension products" comment="subhead" text="Partial withdrawal allowed from pension products">Partial withdrawal allowed from pension products</cmsannotation> Policyholders will be allowed to make partial withdrawals, provided they have 3 years of continuous coverage under their insurance-cum-pension plan. Also, these withdrawals cannot be more than 25% of the total premiums paid till date. The insurer cannot use this withdrawal towards making any adjustments in the policy's sum assured. However, this withdrawal will only be allowed for specific situations, like funding children’s higher education/marriage, constructing a house, treating critical illnesses, starting a new venture or for skill development purposes.

Here’s how your life insurance plans are set to change

Donald <keyword id="19906203" type="General" weightage="20" keywordseo="Trump" source="keywords">Trump</keyword> and <keyword id="19903807" type="General" weightage="100" keywordseo="Elon-Musk" source="keywords">Elon Musk</keyword> have apparently become great friends over recent months. Musk poured millions of dollars into Trump's successful election campaign and has been a vocal and visible supporter of the president-elect. In return, he's been given a new job, in joint charge of the new <keyword id="23593857" type="General" weightage="20" keywordseo="Department-of-Government-Efficiency" source="keywords">Department of Government Efficiency</keyword> (Doge), where he will be tasked with streamlining government operations and reducing bureaucracy. This "department"—actually an advisory group—will aim to cut unnecessary spending and make the general functioning of the US government more efficient. The idea is that within a federal budget of over US$6 trillion, there are opportunities to make some big savings. Musk's appointment—like many things he's involved with—has sparked controversy. The richest man in the world has already said he wants to cut spending by US$2 trillion (£1.6 trillion) and mentioned setting up a "leaderboard for most insanely dumb spending of your tax dollars.". Some are concerned about the impact he could have on public services. Others fear he will use his position to promote his own business interests. On the positive side, Musk has a very impressive CV when it comes to big organisations. He has created (or co-created) multi-billion-dollar businesses, including Paypal, <keyword id="19895433" type="General" weightage="20" keywordseo="Tesla" source="keywords" meta.keywordsubtype="org" meta.entityname="Tesla" meta.hostid="261" meta.entityid="Tesla">Tesla</keyword>, and <keyword id="19905255" type="General" weightage="20" keywordseo="SpaceX" source="keywords" meta.keywordsubtype="org" meta.entityname="SpaceX" meta.hostid="261" meta.entityid="SpaceX">SpaceX</keyword>. He has founded startups involved in AI (xAI), tunnelling (the Boring Company), and medicine (<keyword id="19985233" type="General" weightage="20" keywordseo="Neuralink" source="keywords" meta.keywordsubtype="org" meta.entityname="Neuralink" meta.hostid="261" meta.entityid="Neuralink">Neuralink</keyword>). And research suggests that much of Musk's success comes down to a relentless focus on efficiency. He has also been praised for the depth of his analytical thinking and innovative problem solving. Tesla's factory in California went from being the least productive car manufacturing plant in the US when it was owned by General Motors to the most productive under Musk's ownership. SpaceX has vastly reduced costs in the space cargo business. So he has form. And Musk is not the first American business leader to offer private sector expertise to the world of politics. Back in the 1960s, Robert McNamara, former president of the Ford Motor Company, served as secretary of defence under presidents John F. Kennedy and Lyndon B. Johnson. McNamara brought significant innovations to <keyword id="22668770" type="General" weightage="20" keywordseo="government-efficiency" source="keywords">government efficiency</keyword> that drew on his corporate experience. He championed cost-benefit analysis and a data-driven approach to decision-making and was keen on reducing bureaucracy and promoting accountability in complex governmental processes. To achieve this, McNamara recruited a team of experts from the worlds of academia and business. Known as the "Whizz Kids," they brought new perspectives to the White House. In the UK now, the Labour government's minister of state for investment is Poppy Gustafsson, a former venture capitalist and tech founder. Its minister for prisons is James Timpson, former CEO of the Timpson Group, a family firm renowned for hiring ex-offenders. These people—and there are many other examples around the world—were brought into the political sphere because of the knowledge and vision they have demonstrated in the private sector. The hope is their talent and leadership will improve policy and practice. <h2>Data-driven reform</h2>The same must be hoped for Musk: that with his co-leader, Vivek Ramaswamy—a biotech entrepreneur and former Republican leadership candidate—he will bring expertise in cost-cutting and innovative strategies. This will probably include comprehensive audits and data-driven approaches to reform. Critics refer to prior examples of Musk's approach, such as the mass layoffs and aggressive cost-cutting measures at Twitter (now X), with concerns that there could be similarly drastic reductions in the federal workforce and public services. But big job cuts were happening across the tech sector at that time. They came in the wake of reduced revenues and a need to reduce bloated workforces and ineffective functions—not unlike the challenges faced by the US government. Nevertheless, while proponents see Musk as an experienced leader capable of streamlining bureaucracy, sceptics fear the advent of harmful austerity measures that risk disruption to essential public programs. Concerns have also been raised about potential conflicts of interest, as Musk's business empire benefits from government contracts. However, since Doge will operate as an advisory body, concerns over him gaining advantage through any self-dealing seem overblown. Besides, two of Musk's companies (SpaceX and Tesla) have been awarded US$15.4 billion (£12.3bn) in federal contracts in the last decade. Perhaps then, success precedes influence rather than the reverse? Doge will also be governed by the Federal Advisory Committee Act, which maintains legal and ethical guardrails. And Congress will have the final say over any decisions. Fears of the worst possible outcome to Musk's appointment are a natural human response in the face of uncertainty. It is part of the reason that negative headlines get more clicks than positive ones. It is also true that Musk has aligned himself with a politician who divides opinion like few others. By leveraging his billions of dollars and 200 million followers on X to help Trump to victory, he made it clear which side he was on. And in a highly polarised US political landscape, the anguish about his governmental role may be little more than a knee-jerk reaction from the millions of people whose side he did not choose.

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