Financial Planning

Can I buy your one hour One day, father was doing some work and his son came and asked, “Daddy, may I ask you a question?” Father said, “Yeah sure, what it is?” So his son asked, “Dad, how much do you make an hour?” Father got a bit upset and said, “That’s none of your business. Why do you ask such a thing?” Son said, “I just want to know. Please tell me, how much do you make an hour?” So, father told him that “I make Rs. 500 per hour.” “Oh”, the little boy replied, with his head down. Looking up, he said, “Dad, may I please borrow Rs. 300?” The father furiously said, “if the only reason you asked about my pay is so that you can borrow some money to buy a silly toy or other nonsense, then march yourself to your room and go to bed. Think about why you are being so selfish. I work hard every day and do not like this childish behaviour.” The little boy quietly went to his room and shut the door. The man sat down and started to get even angrier about the little boy’s question...

WHY I AM NOT BUYING SUKANYA SAMRIDDHI FOR MY DAUGHTER Interest Rate is not fixed, change in interest rate  will be notified from time to time whenever applicable, very much like PPF. It Can not beat inflation ( if you get 8% return and inflation is high as 6%, real figure of inflation comes more than 8% per year, you will not get enough money to fund the education / marriage) Play school Education fees cost is around 1-3 lac per year. Lock In Period is too high compare to almost no lock in - in Mutual Funds Premature Withdrawals not allowed DETAILS YOU CAN READ ON :- http://www.sukanyasamriddhiaccountyojana.in/

Pradhan Mantri Jan Suraksha Bima Yojana Policy (PMSBY) Insurance is not a newer concept to India; however, its reach is still much limited.  In spite of so many insurance companies operating in India with their products and services, there are a majority of people in rural areas, who are not at all covered under any kind of insurance. Pradhan Mantri Suraksha Bima Yojana is for them. These people are those who are mostly below the poverty line and insurance is an unaffordable service for them.  PMSBY aims to reach such people with its benefited insurance schemes after the successful performance of Jan Dhan Yojana. Suraksha Bima Yojana Benefits The death benefits are up to 2 lakhs In case of irrecoverable and total loss of both hands, both eyes or sight or one leg or foot, the insurance cover would be up to 2 lakh In case of lost of one leg, hand, foot, eye or sight, the sum assured would be Rs 1 lakh Suraksha Bima Yojana Premium The premium for PMSB...

Impact of PPF Rate reduced from 8.7% to 8.1 %  As expected, government do not want to take burden on it's own balance sheet, so they are going to pass it on to consumer by linking it to Gsec Rates in India. Example :- if someone is investing with a view that one will get return of 8.7% compounding returns over a period of 15 years of tenure of PPF, now that charm is gone as PPF rates are volatile. Someone having 20,00,000 Balance in PPF which were earning around 1,74,000 per year (tax free) will result in earning 1,62,000 (tax free) i.e loss of Rs. 12,000 loss every year from this time. above all, no one understand the Inflation scenario when investing in PPF.

In recent past we have seen many NFO's because some infra themes were not there so one needs to add one. but in past 1 year so many big and some small fund houses/ mutual funds have started business of asset gathering, everyone are in league of becoming the 1st prize winner, they are in race.  some of them feel NFOs are growth engines to build their assets and profits. What happens when you have more and more schemes? what happen in recent time - all people associated with mutual funds get more incentives as new offer comes in, fund houses can spare more money as fund sizes are small initially. some of the fund houses / mutual funds have similar schemes in their portfolio but they are still not merging it because everyone earns more on small funds. in this race of earning or making company big, who suffers is investor. So what should investor do? 

The first common reaction in seeing market 800 points down in red is, oh my god! it is the end of the world - It feels like it’s going to go down further, I should have waited some more time to make an investment. ask yourself (how much money is in equities of your total net worth ?) So let us understand what share market (sensex) is:- When you buy Equities- you buy a SHARE/ Partnership / Holding / Business by investing in particular stock / company / equity mutual funds (equity mutual funds consist of around 20-40 stocks in one particular fund) Let us understand that equities are for appreciation, it takes time to build businesses, it may not give you 8%-9% yearly returns like your FD’s / PPF or Post office money, but it gives you inflation adjusted returns in long term as the businesses grows / makes profits – it reflects in balance sheet of the company & stock prices goes up or down.

BEGAANI SHAADI ME ABDULLA DIWANA Many years ago I was working in a Foreign Company. At that time U.S. was dropping bombs in Afghanistan. There were reports that many a time bombs were being dropped waywardly and were hitting unintended targets. One day I get a call from an overseas colleague of mine checking if we were all safe in Mumbai as the US bombing was hitting unintended targets. To my well-meaning friend distance of more than 2500 KM was not good enough to stop a wayward bomb being dropped in Kabul from hitting us in Mumbai. May be he was influenced by the map proximity. This kind of incidence shows the reaction to events in faraway places. When 9/11 happened, Indian interest rates jumped up significantly as a risk of sell off. It took strong intervention by RBI to bring sanity in rates market. Irrationality can prevail in short term.