Investment Planning
Rtn.K.Raghu
Past President
Rotary Bangalore Peenya
Investment Planning
Investment Scenario – 2005-2006
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Booming Indian Economy
Emergence of the Smart Investor
Investor friendly Capital Markets
Rewarding year for investors in capital
markets, mutual funds and real estate
Increased FII participation
Investment Strategy
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Develop a habit of small savings
Save for a rainy day since future is uncertain
Pay your liabilities as soon as possible
Plan for your retirement
Create a source for Passive Income eg.Rental
Income and Dividend income
Invest in Tax Saving Investment schemes
Spend less than what you earn
Take person interest in Investment decisions
Investment Mix
Your investment portfolio should take care of
your :
 Current needs of your family
 Children educational needs
 Children’s Marriage
 Buying a House
 Pension during retirement.
Tips for Investing Safely and
Rightly
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Don’t make your investment decisions on
hear say.
Understand risk factors linked to investments
Review and track your investments
periodically.
Buy Insurance for coverage and not tax
purposes.
Take the help of an Investment Consultant
Investment Tips for Beginners
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Start saving and investing early in life.
Prepare an investment roadmap.
Invest in a diversified portfolio.
Buy insurance for coverage and not tax purposes.
Invest in Stocks if you are prepared to take risks.
Invest in Mutual Funds if you are prepared to take
moderate risks.
Have an investment discipline.
Essentials requirements for
a Good Investment
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Safety
Liquidity
Return
Investment Options
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Life Insurance
Post Office Schemes
Equity Shares
Mutual Funds
Company Deposits
Bank Deposits
Real Estate
Gold and Silver
Equity Shares
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Capital Appreciation
Bonus Shares
Annual Dividend
Right Shares
Can be pledged as a security
Easy liquidity
Equity Shares - Problems
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Changing Market Value.
Uncertain government policies.
No guarantee of profits.
Need for constant monitoring
Oversubscription of IPO’s
Professional Guidance required for making
right investment in shares.
Life Insurance
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Protects you and your family
Promotes regular savings
Tax Benefits
Earn attractive bonus
Insurance – Do’s and Don'ts
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Keep your premiums affordable
Choose a right plan
Don’t over /under insure
Pay premiums on time since partly paid policies are
not eligible for bonuses.
Revive Lapsed policies
Keep your spouse informed about your Insurance
coverage.
File all the insurance receipts.
Ensure you nominate your spouse.
Consult a good insurance advisor.
Post Office Schemes - Options
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Post Office Monthly Income Scheme
National Savings Certificate
Kisan Vikas Patra
Public Provident Fund
Senior Citizens Saving Schemes
5 year Recurring Deposit
Time Deposits
Post Office Schemes –
Features
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Backed by Government of India
Tax Benefits
Suitable for small investors
Attractive rate of interest
Liquidity
Mutual Funds
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Professionally managed
Diversification of risk
Daily NAV
High Liquidity
Tax Concessions
Freedom of Emotional attachment
Automatic re-investment of Dividend
Freedom from Monitoring and housekeeping
Bank Deposits
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High Safety
Low Interest
High Liquidity
Easy to manage
Bank Deposits - Suggestions
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Keep Small Deposits – Less than One lakh
Deposits should be in Joint names
Renew Matured Deposits
New Tax benefits from FY 2006-2007 –
Rs.1,00,000 under Section 80 C
Mutual Funds - Options
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Equity Funds
Bond Funds
Balanced Funds
Tax Exemption Funds
Liquidity Funds
Mutual Funds - Dangers
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No guaranteed return
Risk of inefficient management
Real Estate
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Agricultural Land
Farmhouses
Urban Land
Residential Property
Real Estate -Advantages
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Emotional Satisfaction
Savings of Rent
Huge Capital Appreciation
Tax Incentives
Easy availability of Home Loans
Tax Benefits for Investments
Under Section 80 C – Rs.1,00,000
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Provident Fund
Public Provident Fund
Life Insurance
Pension Funds
Infrastructure Bonds
National Savings Certificate
Kisan Vikas Patra
Equity Linked Savings Scheme
Conclusion
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World of investments becoming more
interesting, exciting and complicated.
Proliferation of various Investment schemes
Investment Planning is a must for every
person..
Investment Planning thus involves Intelligent
analysis, judicious decision making and a
strong sense of visualisation.