Comprehensive Financial Planning Process

• Making relationship with the client,
• Gathering relevant financial information,
• Discussing and setting life goals,
• Examining your current financial status
• Making strategy and plan for you to meet your goals given your current situation and implementing them,
• Monitoring and making timely changes to the PLAN.

Goal based Financial Plan

Investment Concerns

Major Investment concerns for every individual while thinking of investments are Inflation, Tax and Risk

Impact of Inflation

• Inflation is the long term rise in the prices of goods and services caused by
  the devaluation of Money.
• The average inflation per year for last 40 years is around 7%. It means the value of Rs. 10,000/- in 1980 is worth Rs. 680/- now as indicated below.

• In other words, due to inflation, the future value of rupee will be reduced considerably and the goods you can buy today cannot be purchased few years down the lane for the same amount.
• For example at 7% inflation you require Rs 76123/- thirty years from now, for buying goods which can be purchased at Rs 10000/- today. Money requirement for various years are as below.

• You cannot avoid inflation but overcome it buy making investment to beat the inflation so that your investment is sufficient to buy the goods and services at a later date.

Tax Implications

• Every income is subject to tax as per the prevailing tax laws and tax is to be paid to the government based on your income.
• Currently there are two types of Tax regime – 1. New Tax regime and 2. Old Tax Regime making more complex for a common man to select the suitable scheme.
• Tax planning is therefore one of the important aspects of investment.

Risk

• Everything in life is uncertain. No one can predict the future perfectly and the people seek avenues to cover the risk.
• Insurance covers the risk on life. Medical Insurance covers the risk on health. Vehicle insurance covers the risk on damages or accidents to the vehicle or people.
• Everyone should take a TERM Insurance for their life and a Health Insurance for suitable value. The life and health is more important than a vehicle.
• Inflation and Liquidity are the major risk associated with investments. Higher the return higher the risk and every investor is in a dilemma where to invest and how much to invest.
• Selection of portfolio is the insurance to cover the uncertainty on return, inflation and Liquidity. A registered MFD can guide you for selecting your portfolio of investments in Mutual Fund.

Investment Options

Each individual’s requirements are different and vary from time to time and therefore will have to take proper decisions in investment. There are various types of investment for day to day needs.

Fixed Income Securities

• Savings Bank Account, Fixed Deposit and Recurring Deposits in Banks and post offices are basic investments considered by many.. The return on investments may not cover even the inflation, however one of the most safe investment options who cannot take any amount of Risk.
• Investments in PPF, NSC, National pension scheme etc. are long term investments options and also eligible for income tax benefit up to 1.5 Lakhs per year and an additional Rs. 50000 in NPS. This may change every year.

Investments in Commodities

Gold, Silver, Petroleum Products and similar goods are good investments for protecting the capital during uncertain times. Liquidity and transaction are problems being faced in Physical commodity apart from the quantity legally allowed for holding. God Bonds are better options now.

Investment in Real Estate

Real Estate is another option and the amount required for investment will be very high and the liquidity is the critical problems.

Investments in Security Markets

• Shares and Bonds of listed Public ltd. Companies and other securities are traded in the security markets. The investors can invest their money during initial public offering of these companies or can be purchased and sold through stock exchanges.
• The return is very high in investments in shares and many people made a fortune in investing in them. However this is high risk investments and huge number of investors had lost their money by investing in them. Seasoned and highly knowledgeable traders make huge money and novice lose their money.
• BSE Sensex is widely talked index of stock market and is a measure of 30 highly traded stock of Bombay stock exchange. In 1979 the Sensex index was 100 and Jan 2020 it was 42000 and in July 37000. The growth of SENSEX is represented below. No other investment has given such a high return. But the Risk in investment is highest among these asset classe.

What is a Mutual Fund?

• A Mutual Fund is a vehicle to invest in all these 4 asset Classes – Fixed Income Securities, Commodities, Real Estate and Equity Shares/ Securities.
• A Mutual Fund is registered as a TRUST which pools money from many investors and invest in various securities.
• The money collected from investors is invested in capital market instruments such as shares, debentures, Government securities, Gold, Real Estate etc. by professionals as per the investment objective of each scheme.
• The income earned from these investments and the capital appreciation realized is shared by its unit holders in proportion to the number of units owned by them.

Regulations

• All the mutual funds are regulated by SEBI and they function within the provisions of strict regulation designed to protect the interests of the investor.
• AMFI is continuously making awareness campaigns and also register Mutual Fund Distributors and Registered Investment Advisors for the benefit of investors and monitor their functioning to protect investor interest.

Types of Mutual Funds

• SEBI classified Mutual Funds in to various categories and the major ones are as below. All the fund houses are having Schemes in different category of investments as below.

• There are different schemes under each category and thousands of schemes are available for all the Fund houses put together.

Mutual Fund Portfolio Selection

Hard earned money is being invested to create wealth and to satisfy his financial goals. What are the Tax implications of your investments? What is the impact of Inflation? How much return is expected from your investments?

• The attribute of good Investment is Liquidity, Tax saving, Risk Protection and High return.
• The Risk appetite of each investor is very important while selecting the portfolio. Higher the return higher the risk.
• The return should be able to cover the inflation and tax implications. Tax adjusted return to offset the inflation is the minimum expectation of any investor.
• An investor can select his investments to fulfill his aspirations based on the surplus amount he can invest.
• Investments can be made in suitable schemes depending risk profile and financial goals of the Investor.
• AN MFD can select the appropriate scheme as per need after assessing the profile of every client.
• We are registered with AMFI as MUTUAL FUND Distributor and empaneled with Mutual Fund Houses for distribution of their various Schemes to the prospective investors. We have no preference on any of the partners.

Advantages

• Debt Mutual funds schemes are schemes which provide stability more or less similar to fixed deposits or Bonds but with similar or higher return than FD along with better taxation benefits and also avoid concentrations risk.
• A Mutual Fund is one of the most suitable investments for the common man as it offers an opportunity to invest in a diversified professionally managed basket of securities at a relatively low cost.
• Can start investing small amounts as SIPs at fixed intervals or when they have fund available with them as lump sum.
• This also avoids the timing of when to buy and when to sell complexities of share market which require enormous knowledge and expertise.
• The investor can reap high returns of equity markets and reduce general risk associated with stocks.
• The investments decisions of mutual Funds are handled by highly qualified professions and the risk in investing directly in shares are avoided.
• An investor can invest in few stocks or bonds with the available surplus income whereas investing in mutual fund can spread its risk by investing in diversified portfolio of sound stocks or bonds across sectors.
• Mutual Funds also provide complete portfolio disclosure of the investments and also the proportion of investment in each asset type and clearly layout their investment strategy to the investor.
• Mutual Funds regularly provide investors Transparent information on the value of their investment.
• The units can be sold at any time to the mutual fund and the money will be credited within 2 days and provide high liquidity.
• Registered as Mutual Fund Distributors are mandated by SEBI to provide help to investors to select the right mutual Fund scheme to create wealth.

How to make Investments

KYC is the most important process to start an Investment in Mutual Fund or share market. The following documents are required for KYC.

• Copy of Pan card, cancelled cheque, Photo, Aadhar card, Mobile number, Email ID, Nominee details, Place of birth etc.
• Copy of Pass port and Foreign address proof are additionally required NRI Investors.

If KYC is not done earlier, this software can help you to complete the KYC online. We can also arrange KYC on providing the above documents.

Customer can register by login to the investment section or you can WhatsApp the required documents to us and we will register your account with the exchange. You will receive email from the exchange with your complete details filled in and you have to check, verify and approve the same and the account is created.

Now you are ready to start Investment in Mutual Fund and monitor your
investments through Mobile app being provided to you.