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Type your summary here Type rest of the post here Let's answer this important question: Most of us think that financial planning is only for the very rich or poor. There are others who think that people need to plan only when they grow old as they need to save for their retirement and old age. I would however say that this is not a right way to think about finances as it is required for all phases of life. It would be smart and prudent to embrace financial planning to realize all our dreams and goals in life. Financial planning makes life easier than what we could imagine life without it. Some may consider risk is the spice of life and may enjoy it. However it is always good to plan and provide for our short, medium and long term goals of life and for those unexpected contingencies that crop up from time to time. The written word is more powerful, so it is best to have a written financial plan than just thinking it just over in the mind. The written word creates focus to pro...

Type your summary here Type rest of the post here Let’s begin learning: The safest way to double your money is to fold it over once and put it in your pocket. ~ Kin Hubbard Kin Hubbard is right in saying that if we do not spend money unnecessarily we would be able to save money and double it. However most of us like to spend and would find it difficult to not spend at all. We feel that it could stress us further. Accepting the3 financial challenges could help you in controlling unnecessary spending. Once you control and avoid unnecessary spending you can save more and invest more. So you can achieve your financial goals easier and earlier. Here are the challenges: A Day Away from spending The challenge of not spending for a day could be difficult, but could help save and render some important life lessons. It is true as most of us have regular daily expenses on coffee, tea, lunch, and snack at regular intervals and fuel to travel to and from work. Effective planning w...

Company Deposits are simply nothing but fixed deposits in companies that earn a fixed rate of return over a period of time. Company deposits are really down-to-earth products. The influential advantage of the company deposits is its plain simplicity. Company deposit is understood even by the most novices among the investors community. Have you ever wondered the logic behind why pure vanilla flavored ice cream sells more than any other flavor? Similar logic is just as true when it comes to the company deposits vis-a-vis many other modern investment options. With the meltdown of NBFCs almost a decade ago, company deposit market had a major slow down, but volumes still remain significant and there are loyal investors who prefer company deposits to other investment products. Advantages of Company deposits: Assured return. Higher interest when compared to bank deposits. Low risk when compared to stock market investments. Service at your doorstep. Lock in period in most of the cases is 6...

Increasing inflation, shift to nuclear families, and the fast track change in life style patterns throw a financial challenge which can be addressed only by life insurance. Your financial plan needs to be in sync with your life stage and the requirements that are very particular to your specific stage in life. The need for life insurance coverage changes with the change in your life stage. The same amount of coverage may not be sufficient when there is a change in your life stage. So whenever your life stages change, you need to re-evaluate your need for life insurance coverage. The following are the different life stages which demands for a revision in your life insurance coverage. Dependent Parents: If you are single and you have financially dependent parents, then you need to take life insurance even before your engagement. You can’t compare yourself with other singles whose parents are not financially dependent. You are in a unique life stage. In case of any mis-happening to ...

Best Performing Mutual Fund - A Frequently Asked Question During my TV interviews, in each and every show, either the anchor or one of the callers will ask this question. Which is the Best Performing Mutual Fund now? There is not a single show in which the question about Best Performing Mutual Fund is not asked. Also, as a guest speaker, whenever I deliver a speech in Rotary, Lions, Jaycees or Round Table, during the Q&A Session after the speech, definitely there will be a question on Best Performing Mutual Fund. Everyone is interested in knowing which is the Best Performing Mutual Fund now. The reason behind this is they would like to check whether the scheme in which they have already invested is part of the best performing mutual fund schemes or not. If it is not part of best performing mutual fund, they would like to switch their investments to the current best performing mutual fund. There are so many websites which rate the mutual fund schemes, list down the best ...

A question to be questioned: When a person should become health conscious? After becoming sick or before becoming sick or always… There are some questions like this, though at the sub-conscious level we know the answer, our conscious mind somehow acts as if it is ignorant of the obvious answer. When to start planning for our retirement is one such question, though we know the answer at the much deeper level, somehow on the surface, we act as if we are unaware of the answer. The problem of ignoring the obvious answer: As we ignore the answer and behave as if we are unaware of the answer, actually the problem magnifies. A recent research study reveals this truth in black and white. Though the retirees and pre-retirees who have been surveyed were well aware the fact that they may live longer, and also recognized that they did not want to run out of money, only a very few of them were REALLY planning financially to live longer. For example, only one-third of the pre-retirees...

Most of us tend to think that planning on investment portfolios for attainment of goals is a one time job. However it is not true; we all need to review our investment portfolios on a regular basis and also take the help of professional financial planners. What does a Professional Financial Advice mean in portfolio management? Making a habit of rebalancing financial portfolios: Most of us make smart financial plans that are based on the number of earning years, financial commitments and the level of risk we can take up at the time of planning. But it is found that our financial commitments and the level of risk we could take up with age changes. Our financial commitments may increase with increase in family commitments, increase in standard of living and disability or otherwise of a family member. Age could also make us in a position to take lesser risk as also the level of inflation could dictate a rebalancing of our portfolios. Believe me, life is a process of change and t...

In the digital age, the current affairs reach our living room 24*7. The power of internet and social media makes the news and rumours spread like a wildfire. Because of this information overload we become so focused on details that we begin to ignore the overall situation. If we are unable to see the wood for the trees, then we need to take a step back from the situation, to regain a wider perspective. Many investors change their long term investments based on the short term sensational current affairs. They switch from risky investments to safe investments the moment they hear this. They ‘Act first and Think later’. This is very dangerous as far as investment decisions are considered. Thailand and Europe: In fact today, the investor’s biggest worry is not Indian market ; but the problem in the Eurozone. Thailand faced a major natural disaster in 2011. Severe flooding occurred during the monsoon season. The World Bank’s estimate for this disaster means it ranks as the world’...

Do you book profit or book loss? You have bought the shares of ABC Ltd at a rate of Rs.100 per share. The current market price is Rs.150 per share. Also you have bought the shares of XYZ Ltd at a rate of Rs.200 and the current market price is Rs.125. Do you book profits by selling ABC or book losses by selling XYZ. Warren Buffett said, “Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.” This quote from Warren Buffet is the essence of selling loss making investments as a part of wealth management. However to the contrary most of us tend to sell those investments that makes us money and prefers to hold on to those that is already making losses. It is just probably a feeling that we could not have gone wrong and the investment would revive, or on the other hand a feeling that we have been fooled and do not want to be fooled again and do not want to take action. What to do with loss making investments? It's not whether you're right or wrong that...