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What do investors expect from a Financial Advisor? The straight forward answer for the above question will be “unbiased advice”. Investors expect the advice given by the financial advisor to be unbiased, neutral and independent. What do they really get from Financial Advisors? Most of the investors get only “misselling” in the form of financial advice. Most of the financial advisors or investment agents/brokers are following the commission based model. That is, they will recommend (sugar coated misselling) an investment scheme and you need to invest in that scheme through them. The investment company will give them commission. As an investor if you invest in a mutual fund or any insurance scheme through the financial advisor, the advisor will get commission from Mutual Fund Company or insurance company. The origin of Misselling or Biased Advice: If the income of the financial advisor is based on the commission which he gets by selling investment products, then there is a po...

One of the popular, preferred, and preeminent tax saving investments is PPF – Public Provident Fund. We all know about PPF. Do we know all about PPF? Let us discuss in detail about PPF in this article and understand it comprehensively and completely. 1) Where to open the PPF account? PPF accounts can be opened in a post office or in selected bank branches. The regular KYC documents need to be submitted for opening a PPF account with a minimum investment of Rs.500. 2) What is the interest rate? The current interest rate for PPF is 8.8% p.a. The interest rate will change every financial year in accordance with the average bond yield of the previous year. The interest rate will be fixed 0.25% above the 10 year government bond yield. 3) How is the interest calculated? For the balance amount in your PPF account the interest is compounded annually. However, the interest calculation will be done each and every month. If your contribution to the PPF account is credited on or befo...

WATERMELON JUICE Nothing can beat the summer like a tall cool drink of watermelon juice. A watermelon contains about 6% sugar and 92% water by weight. As with many other fruits, it is a source of vitamin C. Watermelon is mildly diuretic and contains large amounts of beta carotene. Watermelon with red flesh is a significant source of lycopene. Researchers believe that beta-carotene and vitamin C are capable of preventing heart disease, cancer, and other chronic conditions. No matter which way you cut them, when it comes to nutrition, melons are number one. Ingredients Watermelon - 1 seedless watermelon Powdered sugar or honey to taste Cold water and ice cubes Method Wear an apron over your clothing when cutting watermelon. Place your watermelon on a cutting board. Peel the watermelon and slice it into 1"chunks using a sharp knife. Place the watermelon chunks into a bowl. Use a fork instead of using your hands to avoid dripping of th...

Direct Investment In Mutual Fund: Now if you are investing in mutual fund schemes directly, you will be charged less management fee by mutual fund. Therefore your returns in direct plans will be slightly better than the investments you make through an agent. That is why this question arises. Should I invest directly in mutual fund or through an agent? Mutual Fund Agent Vs Mutual Fund Advisor: Before proceeding further on investing through an agent or directly, we need to understand the difference between mutual fund agent and mutual fund advisor. Mutual Fund Agent facilitates the mutual fund transaction and provides you after sale/investment services like regular reports, supports when you withdraw… We will discuss more about these services later. For providing these services Mutual Fund Agent is not supposed to charge any fees, because he gets a decent commission / brokerage from mutual fund companies. On the other hand, Mutual Fund Advisor provides advice on your mutual fun...

It really hurts to see a large pie of the salary cut towards tax. So the obvious question in everyone’s mind is ‘How do I reduce my tax?’. Every year we are forced to invest in something which reduces our tax liability. It may be NSC…it may be PPF…it may be ulip…it may be Mutual Fund ELSS. Tax Planning: A New Perspective These tax saving investments are at times taken based on advice from colleagues or friends. Generally investors tick the scheme if it helps to reduce tax liability. Apart from reducing tax, there are some other questions to be asked. What is the risk involved? Are the returns from the scheme taxable? Do I need to make investment in this scheme every year or just a one time investment? Does it support my financial goals? Apart from tax saving investments is there anything to be considered in tax planning? Tax Planning in your Financial Planning: Tax Planning is also a part of your overall financial planning. When tax planning is done in your financial planning...

An investor will prefer to invest in mutual fund through a power of attorney under some special situations. Let us see a few examples of those special situations: • When you are a frequent traveler, • When you are not well, • When you want your investments to be managed by your spouse or a well wisher, • When you become an NRI. Giving Power of Attorney: You need to give power of attorney only to a right person. It is generally not advisable for an investor to give POA to his mutual fund agent. In many situations, the mutual fund agents have used this POA to their advantage. So you need to be extra cautious about selecting the right person to give POA. You can give restricted POA. That is you can specify that the POA holder can only transact in mutual fund and not in any other assets. Some of the older format of POA will not have the signature of the POA acceptor. It will carry only the signature of the POA giver. This format of POA without the signature of POA acceptor is ...

Where do we invest our long term money? Where can I get better returns which can beat inflation? The answer for both the questions is investing in stock market. Once you decide to invest in stock market, you have got two options. The option one is to invest directly in stock market and the option two is to invest through mutual funds. Which Option to Choose? Each of the options has got its own pros and cons. Depending upon your requirement and situation, you need to choose the right option. The following points will enlighten you on both the options and will also help you understand and check the factors to be considered before choosing the right option. Knowledge and Expertise: Investing directly in stock market definitely demands a good amount of knowledge and expertise. You should know how to read a balance sheet, analyse a company, choose a right company to invest, analyzing the sectoral trends, constructing a portfolio, stock valuation… If you are comfortable doing a...