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Anil
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| 26 November 2008, 19:10:14 |
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Wow after reading all those posts from all you it was very enlightening and mind opener.
The person who posted this thread just asked one single question and we had different answers for him.. If he is an investor he might get confused as he got many versions. In the end he will not do anything till someone who is really close to him convinces him of buying what his/her advisor sells to him.
I still observe this many times when my clients ask too many questions and they get confused in what to do. Well i will add one more solution to the question asked by "Unsavvy".
Make a financial goal of yours for e.g that you will need money after X no. of years for education, marriage etc. and how much money you can put aside from your income for savings purpose.
Now first calculate your income annually and multiply it by 20. Now that is the amount of insurance your family needs to survive in case of your early death/ disability etc. But all cannot afford to have that huge amount of insurance (except for some) so at least take some percentage (depending on your ability to pay premium)and then upgrade, buy more when you start saving more.
Now divide your savings into 4-5 options-
1. Amount you can afford to pay premium for insurance till you are at certain age. Please do not buy a policy where your agent says "pay for 3 yrs then you can stop paying". That is the continued current MANTRA for selling ULIP's.If you're buying insurance think of long term and then buy. Short term investment are good for Mutual funds. Buy policy as per your need. Term, Endowment, ULIP are various options. Term is always good if you want big amount of insurance. The charges in endowment plans are hidden and in ULIP's it is transperent.(Long Term)
2. Invest in Mutual Fund diversified equity, debt/ liquid fund, FMP's. SIP / STP will be also a good option. (Short - Medium Term)
3. Invest a little amount in blue chip stocks. Please do not always try to time the market. Book profit on regular intervals and recycle that money into another market segement or buy different stock.(Medium - Long Term)
4. Buy Gold in dematized or in physical form as bullion. (Medium - Long Term)
5. Fix deposit (Short - Medium)
I think I covered enough ground to give you an idea how to go about saving money. Insurance and Tax plans in mutual fund will give you benefit for your tax planning as well.
Also do keep your self updated with happenings in the market via news/internet/t.v.
Cheerss. |
