Money lying idle in your bank account is an opportunity lost. You should invest that money smartly to get good returns out of it.
Investments are important because in today’s world, just earning money and doing saving is not enough. You work hard for the money you earn. But that may not be adequate for you to lead a comfortable lifestyle or fulfill your dreams and goals. To do that, you need to have proper Investment & Financial Planning.
Investment Objective: should be predefined with proper planning and the same should align to the goals. For this proper client & risk profiling must be done for better analysis.
Investment Goals: can be either short-term or long-term. For a short-term goal, you should opt for a safer investment and use the return-generating potential of equities for long-term goals. Since there are so many types of asset classes, it is very difficult to choose the right kind of investment avenues, so therefore it is very important that you should choose/have right Advisor. Making the wrong investment choice can lead to financial losses, which is something that no one wants. The first step in planning your investments is to figure out the right investment that suits your profile and needs. Here are a few things to keep in mind when planning your investments:
- Choose investments carefully after doing adequate research
- Don’t fall in trap for those schemes that promise high returns in a short time
- Review you portfolio periodically
- Consider the tax implications on returns you earn from your investments
Diversification: is key to any investment: There is always a say “Do not put all your Eggs in one basket” Diversification between Asset classes. Diversification within Investment plans and pure risk Insurance plans.
Inflation: is silent killer so proper asset allocation to be maintained so that your portfolio is not badly affected.
Asset Allocation: Asset allocation helps investors reduce risk through diversification. This is an investment strategy that aims to balance risk and reward by apportioning a portfolio’s according to an individual’s goals, risk tolerance and investment horizon.
*Right mix of asset classes for returns
*Constructing a diversified portfolio
A simple rule can be followed is to invest (100 – your Age) in equities & rest in debt instruments.
For E.g.: If your age is 35, then 65% of the amount should be invested in equities & balance 35% in debt instruments. The younger you are, you should invest more in equities.
Power of Compounding: The Ninth wonder, the magic power of compounding works by growing your wealth exponentially. It adds the profit earned back to the principal amount and then reinvests the entire sum to accelerate the profit earning process. Suppose, you invest ₹ 1000 which offers 10% interest per annum. Your investment becomes ₹ 1100 after the first year, then ₹ 1210 after 2nd year and so on.
Human Life Value:
Human life value helps in identifying the life insurance needs on basis of income expenses, liabilities and investments and secures your family’s future. It’s very important that we don’t leave our dreams to fate in the event of an unfortunate incident. To ensure that our family is free from any financial burden, the first step is to calculate this financial value. Our Human Life Value or HLV calculator has been designed to help you calculate estimated amount that you need to keep aside for your loved ones and secure them financially.
*Invest as per your Goal
*Should have minimum life insurance cover 10 times of Annual Income.
* Should have minimum Health Insurance cover of 50% of Annual Income or 5 lakhs whichever is higher.
Risk Profiling: Carries Questionnaire’s and it helps in analyzing the risk appetite or risk tolerance level of
an investor and on the basis of that we advise on what would be the ratio of equity and debt.
Portfolio Review: we always do believe in reviewing of our client’s portfolio in every 6 months to
understand the funds behavior and suggest clients to hold buy or sell if required we meet to the clients
at his comfort and share the current situation his investments.
