"Goal are guesses"

Investoshashtra!!!📜📜📜
ईन्वेस्टोशाष्त्र!!!📜📜📜

Start of academic session was most exciting time when I was a kid. The smell of new books📖, enjoyment of writing in a new notebook, wearing new uniform, meeting friends etc etc...

I used to make detailed time table for entire day...when will I sleep, when will be the play time and specially dedicated time for studies. Not only that within study time it was fixed which day which subjects needs to studied.

But within few days time table used to become just a show piece on my study table.

Similar is the case with financial planning. Lot of clients comes to us understanding need of financial planning , fully motivated and committed .

Within a year or two goals and motivation gets lost in between.. and they just remains guesses without any action.

Realisation and regret comes when actually goal falls due.

*"Your level of success is determined by your level of discipline and preservance"- Annonymous*

Being  kid we had liberty of taking resolution again for the next year to be more disciplined.. *but being adult we can't afford it.*

Have a wonderful weekend.

Regards,
Raj Talati
www.rajtalati-abminvestment.blogspot.com

Saluting most amazing Creation of God

Happy Women's day!!!

4 financial lessons world learnt from you

1) Creator - You taught us how from just a seed a whole new life can be created... *Power of compunding*

2) Securing what's achieved - You taught us how to create balance in family so that each one of us is happy and secured - *Power of asset allocation*

3) Keep growing - Being a mother you took care of us to help us grow and  to be a better human being - *Power of Investing*

4) Sharing is caring - You always taught us since our childhood to share whatever little we have with others - *Charity - to take care of less privileged*

*Saluting most amazing Creation of God.*

"Journey or Destination"

What is more important
"Journey or Destination"

Many a times in rush of reaching our destination we forget to enjoy journey....Joy in reaching destination is only when you relish journey as well.

Same way while Planning investments advisors and clients miss pleasure of journey.

*Don't forget In financial planning majority of time is spend in journey.*

In hurry of achieving goals or getting higher returns we miss to enjoy the moment. Make sure your journey is refreshing so that reaching destination delights you and doesn't strain you.

What is the sense of buying a Bullet at age of 55 with own funds which you wanted to buy at age of 25 with loan.

Having said that don't forget all of us *have to reach destination* but with pleasant memories of journey.

Happy journey!!!

What is Systematic Invetment Plan - SIP

Systematic Investment Plan (SIP) is not an asset class in itself, it is an option that will help you to accumulate money. In simpler terms you may say it is an recurring deposit in mutual fund.

What is a Systematic Investment Plan?

A Systematic Investment Plan or SIP is a smart and hassle free mode for investing money in mutual funds. SIP allows you to invest a certain pre-determined amount at a regular interval (weekly, monthly, quarterly, etc.). A SIP is a planned approach towards investments and helps you inculcate the habit of saving and building wealth for the future.

How does it work?

A SIP is a flexible and easy investment plan. Your money is auto-debited from your bank account and invested into a specific mutual fund scheme.You are allocated certain number of units based on the ongoing market rate (called NAV or net asset value) for the day.

Every time you invest money, additional units of the scheme are purchased at the market rate and added to your account. Hence, units are bought at different rates and investors benefit from Rupee-Cost Averaging and the Power of Compounding.

Rupee-Cost Averaging

With volatile markets, most investors remain skeptical about the best time to invest and try to 'time' their entry into the market. Rupee-cost averaging allows you to opt out of the guessing game. Since you are a regular investor,your money fetches more units when the price is low and lesser when the price is high. During volatile period, it may allow you to achieve a lower average cost per unit.

Power of Compounding

Albert Einstein once said, "Compound interest is the eighth wonder of the world. He who understands it, earns it... he who doesn't... pays it." The rule for compounding is simple - the sooner you start investing, the more time your money has to grow.

Example

If you started investing Rs. 10000 a month on your 40th birthday, in 20 years time you would have put aside Rs. 24 lakhs. If that investment grew by an average of 7% a year, it would be worth Rs. 52.4 lakhs when you reach 60.

However, if you started investing 10 years earlier, your Rs. 10000 each month would add up to Rs. 36 lakh over 30 years. Assuming the same average annual growth of 7%, you would have Rs. 1.22 Cr on your 60th birthday - more than double the amount you would have received if you had started ten years later!

Other Benefits of Systematic Investment Plans

· Disciplined Saving - Discipline is the key to successful investments. When you invest through SIP, you commit yourself to save regularly. Every investment is a step towards attaining your financial objectives.

· Flexibility - While it is advisable to continue SIP investments with a long-term perspective, there is no compulsion. Investors can discontinue the plan at any time. One can also increase/ decrease the amount being invested.

· Long-Term Gains - Due to rupee-cost averaging and the power of compounding SIPs have the potential to deliver attractive returns over a long investment horizon.

· Convenience - SIP is a hassle-free mode of investment. You can issue a standing instruction to your bank to facilitate auto-debits from your bank account.

SIPs have proved to be an ideal mode of investment for retail investors who do not have the resources to pursue active investments. Specially in equity funds as investors tend to stop fresh investment during bearish phase but SIP helps you to overcome that emotion as it is getting deducted every month directly from your account irrespective of market conditions.

So keep SIPing it will create a big wealth for you in long term.

Ensure chicken is not pecking up your investments...

There were Two grains lying side by side on the fertile soil. 

The first grain said: “I want to grow up! I want to put down roots deep into the ground and sprout from the ground. I dream to blossom in delicate buds and proclaim the coming of spring. I want to feel the warm rays of sun and the dew drops on my petals!”.

This grain grew up and became a beautiful flower.

The second grain said: “I’m afraid. If I put down my roots into the ground, I don’t know what they will face there. If I grow tender stems, they can be damaged by wind. If I grow flowers, they may be disrupted. So I’d rather wait for the safer time.

Thus the second grain was waiting, until the chicken that passed by did not peck it.

I found similar is the situation of Indian investor they are always fearful about their investments in equity. What would happen if market will go down, what if GDP growth would not be as expected, what if inflation rises, what if I would loose my hard earned money, why should I pay fees to advisor, why should invest in Mutual funds.

Now we are having almost 22 years of history of mutual fund investment, not a single fund has not given return lesser then market, inspite of seeing all the worst a economy can face in this 22 years. We have seen a government for 13 days, a communist supported 3rd front government, Asian Financial crisis,Kargil war, Sanctions imposed on us due to nuclear test, Tech Bubble,9/11 attack, Ketan Parekh scam, terrorist attacks of parliament and of Mumbai, Corruption/scams, Sub prime crisis and lot more.

Inspite, of that there are funds which has given annualised returns to the tune of 24%, which even god of investment Warren Buffet have not been able to generate consistently for such a long period. 

Which means if someone would have invested Rs.100000 in the fund 20 years back that would have been worth 80.00 Lakhs, i.e multiplied his money 80 times or have made an SIP of Rs.5000 (Total Investment Rs.11.80 Lakhs) per month would have transformed into Rs.2.51 Crores.

So let us try to reap the benefit of equity investments and not become like other seed waiting for inflation and taxes in the form of chicken to peck it.

It's your Life - Make It LARGE

Every individual's what he is today is result of small things which he/she did in past, same is very well narrated by Superstar King Khan in one of the recent commercial : I Quote -

"Large kab banta hain, Woh pehla break large lagta tha,

Woh pehla role, Woh pehli Gaadi,

Pehli Girlfriend?,

Bachpan ki galiya large lagti thi, theatre ka stage,

uh a - us waqt to small screen bhi mere liye large thi,

20-50 log taaliya mar dete, large lagta tha,

Lekin aaj wohi sab, CHOTA lagta hain,

Jo haanth lag jaye woh kya large,

Lekin LARGE banta hain UNHI CHOTI cheezo se,

Small Milate Jao large banate Jao,

Its your Life MAKE IT LARGE.

Unquote-

If we go through our past we will find above lines are very relevant for each one of us, what ever we are today is the result of the small small right or wrong things we did in past.

Each one of us can narrate a similar experience of their past, it looks like a dream that how by TIME this small decisions becomes so big for us. Every one of us must be at higher level from where they started. The people who are at start of their career will be at much higher position then at which they are today, if they continue giving there efforts sincerely.

Similar is the case of SIP (Systematic Investment Plan) - It is small small amount which you contribute regularly on monthly basis for years and without our knowing by time it grows much bigger then our expectation.

As an advisor I always advise my clients that every individual who has an asset need to write a will or every individual who is earning and having dependents needs to have a life insurance.

Similarly, I feel each and every individual who is not blessed by legacy of wealth needs to have an SIP. It will help them to achieve there goals and dreams by just contributing small amount over years effortlessly. So whether you wish to invest for your child's marriage or education, for a house or retirement or for a foreign tour or charity what you need is an SIP and time by your side.

Many a times investor feels SIP means equity/shares but they can do it in a fixed income or Gold fund depending on their risk profile and needs.

So if you have not started one yet, start it today aur aap bhi "Small milate jao or LARGE banate jao - It's your life, make it LARGE".