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- Tax Efficient Investments for Retirees
- Mutual Funds Speed Up Wealth Creation
- Different Asset Classes for investing
| Tax Efficient Investments for Retirees Posted: 08 Dec 2014 03:22 AM PST Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
Tax Efficient Investments for Retirees
Provident Fund is an ideal investment opportunity for the seniors. The downside however is that public provident fund investments are subject to a maximum eligible amount of Rs 1, 00,000 per annum
An elderly person who has just retired from active work has lived a life fulfilling various obligations. From his tax obligations to obligations towards his or her family, co-workers and life in general, retirement is the time to live a peaceful and content life. Investments for the retirees are significant as it can provide them with ample funds for a sustained living and an emergency corpus in case of any medical need or other emergency. There are many investment options available for retirees that cut out the unnecessary worry of tax obligations. Let us look at various investment options that retirees can explore to make their investment tax free and overall tax efficient.
Post Office Monthly Income Scheme: A Post of Monthly Income Scheme (POMIS) offers a secure investment option for the elderly. Post office Monthly Income Scheme is a risk free investment option which makes it lucrative for the elderly. Any individual can open a Post office Monthly Income Scheme (POMIS) account with a minimum investment of Rs. 1500 or its multiples thereafter. The rate of interest offered by Post of Monthly Income Schemes is usually better than fixed deposit interest rates. Unlike a fixed deposit investment any investment in Post of Monthly Income Scheme does not warrant for any tax deduction at source. However there is no tax rebate available for investments done under the Post of Monthly Income Scheme. Deposits under the scheme are exempted from wealth tax while giving the option of reinvesting of matured amount to the investor.
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
Leave a missed Call on 94 8300 8300
Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs Download Mutual Any Fund Application Forms ---------------------------------------------
Best Performing Mutual Funds
B. Large and Midcap Funds Invest Online
C. Mid and SmallCap Funds Invest Online
D. Small and MicroCap Funds Invest Online
E. Sector Funds Invest Online
F. Tax Saver Mutual Funds Invest Online 1. ICICI Prudential Tax Plan 2. HDFC Taxsaver
G. Gold Mutual Funds Invest Online
H. International funds Invest Online 1. Birla Sun Life International Equity Plan A 2. DSP BlackRock US Flexible Equity 3. FT India Feeder Franklin US Opportunities 4. ICICI Prudential US Bluechip Equity 5. Motilal Oswal MOSt Shares NASDAQ-100 ETF | |||||
| Mutual Funds Speed Up Wealth Creation Posted: 08 Dec 2014 02:28 AM PST Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
Mutual Funds Speed Up Wealth Creation
Disciplined investment over long term provides better returns than debt instruments
Every investor, whether conservative or aggressive, wants to see wealth to grow. A conservative investor would probably stick to bank fixed deposits, postal small savings, insurance policies, public provident fund (PPF), bonds etc. In contrast, an aggressive one would probably look at equity, real estate, etc. Although the investment style of each group is different, the objective is to accelerate wealth creation.
Investing through the mutual fund route over several years could accelerate the wealth creation objectives. And that too at a lower cost and with lower risks. This is because Sebi mandates that mutual fund schemes cannot charge more than about 2.75% of your assets each year, and in most cases the actual charge is lower than this figure. By paying this charge, you get access to professional fund managers with years of experience in investing. So your risk of losing money through investments is also lower compared to if you decide to invest directly in the market but do not have the requisite expertise. Also, the mutual fund industry in India is one of the most regulated sectors. This, in turn, leaves very low chance of you losing money through fraudulent or illegal means.
Financial planners and advisers say that the patience to remain invested over the long term can get you rich rewards. For example, an aggressive investor hoping to earn returns in the range of 15-20% per annum could look at investing through diversified equity , midcap or small-cap schemes, or a combination of the three. If you invest Rs 10,000 each month for 20 years and get an average return of 15% per annum, at the end of 20 years, the corpus will be nearly Rs 1.50 crore. Of this, your actual contribution is Rs 24 lakh. The balance Rs 1.26 crore is what your money has earned over these long period of investing. Here, one should note that the average long-term return on sensex is about 17% and a 15% return is in that sense a conservative one.
Consider a relatively riskier scheme that gives an average yearly return of 20%, that is three percentage points higher than the sensex return. In such a scenario, your monthly investment of Rs 10,000 would grow to about Rs 3.10 crore over the 20 year period --5% higher rate of return has more than doubled the total corpus size.
Consider a conservative investor who wants to play safe by investing in debt funds. Long-term income funds, a category of debt funds, over the last 10 years have given returns of around 8%. A similar return on Rs 10,000 monthly investment for 20 years would give you a corpus of nearly Rs 59 lakh -a growth of about 2.5 times your investment.
In the first two cases, your rate of return will almost surely beat the rate of inflation while in the third case too there is a chance that you can win the battle over price rise in the long run. In the first case, at 15%, your Rs 24 lakh investment has grown more than six times, while in the second case the growth is nearly 13 times. The third case, in case of a conservative investor, the growth is about 2.5 times. This is the power of compounding that you can take advantage of over a long period of time by investing systematically and in a disciplined manner. This is also how you can accelerate your wealth creation through the mutual fund route. For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
Leave a missed Call on 94 8300 8300
Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs Download Mutual Any Fund Application Forms ---------------------------------------------
Best Performing Mutual Funds
B. Large and Midcap Funds Invest Online
C. Mid and SmallCap Funds Invest Online
D. Small and MicroCap Funds Invest Online
E. Sector Funds Invest Online
F. Tax Saver Mutual Funds Invest Online 1. ICICI Prudential Tax Plan 2. HDFC Taxsaver
G. Gold Mutual Funds Invest Online
H. International funds Invest Online 1. Birla Sun Life International Equity Plan A 2. DSP BlackRock US Flexible Equity 3. FT India Feeder Franklin US Opportunities 4. ICICI Prudential US Bluechip Equity 5. Motilal Oswal MOSt Shares NASDAQ-100 ETF | |||||
| Different Asset Classes for investing Posted: 08 Dec 2014 12:52 AM PST Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
Different asset classes to consider for investing
Building a portfolio? Learn about different asset classes
Stocks - Stocks or shares are securities representing ownership in a company. The value of shares normally varies with general economic and industry conditions and with fluctuations in a company's profitability. Thus stocks carry more risk of capital loss than cash and debt as an asset class – though they offer the highest potential investment returns over time, they also involve risk to your principal. Stocks are considered as a long-term investment with an investment horizon of 5-7 years.
Debt/Bonds/Fixed Income securities – Fixed income assets include investment in Bank and Corporate FDs, Corporate or Government bonds/ debentures, etc. They are designed to protect the value of your money over a short to medium term and generally present a low risk of losing the principal amount. These instruments are considered safer than stocks and are suitable for investors with an investment horizon of 1-5 years.
Cash or cash equivalent– Cash assets comprise of near currency assets viz. government bonds, commercial paper, money market instruments, and short-term government bonds that can be converted to hard currency at short notice. These are generally considered relatively safe compared to other asset classes, providing a stable return with low potential for capital loss. These type of instruments are suitable for investors who want to park their funds for a short term i.e. between 1 day to 91 days.
Real Estate/Property – Investing in property generally involves buying a property directly, or investing in property securities or units in a property fund or property trust. Property is usually considered a medium-term investment, with an investment horizon of 3-7 years.
Commodities – Commodities include agricultural products such as wheat and cattle, energy products such as oil and gasoline, and metals such as gold, silver and aluminium. Commodities have evolved as an asset class with the development of commodity futures indexes. Of all precious metals, gold is most popular as an investment and is renowned for its hedge against inflation besides having limited downside risk.
Alternative Investments – Alternative investments are investment products other than traditional investments such as stocks, bonds or cash. They aim to produce positive investment returns under all market conditions. Some of the common alternative investments include hedge funds, managed futures, private equity, venture capital etc. Given their complex nature, alternative investments are best suited for investors who understand the risk-return proposition and other complexities involved with the product.
Why is it important to diversify with asset classes?
By investing in more than one asset class you can diversify your investments and reduce risk. Diversification is an important way to manage the risk associated while investing and entails spreading your money across different asset classes to provide consistent returns overall – underperformance in one asset class can be offset by encouraging performance in another asset class. The intrinsic differences in the nature of various asset classes indicate it is a good idea to combine them in a portfolio in spite of economic and market conditions.
Diversification can help you can stay in control of your investments during market changes and feel secure and confident about your financial decisions. Talking to an expert about your personal financial needs and goals can help you learn more about financial strategies that can benefit you. Contact your financial advisor to learn about investment strategies that suit your needs and take decisions that are right for you.
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
Leave a missed Call on 94 8300 8300
Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs Download Mutual Any Fund Application Forms ---------------------------------------------
Best Performing Mutual Funds
B. Large and Midcap Funds Invest Online
C. Mid and SmallCap Funds Invest Online
D. Small and MicroCap Funds Invest Online
E. Sector Funds Invest Online
F. Tax Saver Mutual Funds Invest Online 1. ICICI Prudential Tax Plan 2. HDFC Taxsaver
G. Gold Mutual Funds Invest Online
H. International funds Invest Online 1. Birla Sun Life International Equity Plan A 2. DSP BlackRock US Flexible Equity 3. FT India Feeder Franklin US Opportunities 4. ICICI Prudential US Bluechip Equity 5. Motilal Oswal MOSt Shares NASDAQ-100 ETF |
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