Financial Planning

What users are saying about our Automated Financial Planner

2010-01-22T12:33:42Z

“I am not at all good at managing money. In fact, I never filed my tax returns myself or took any other insurance policy or made investments. It seems to be too much of a hassle and it seemed very complicated. Through Investmentyogi's tool I got to know how we can have a large amount of money added in my savings account automatically. A tool worth considering seeing your dreams come true, be it your child's education, buying a house or retirement goals”

- Shweta Aggarwal, entrepreneur, New Delhi

“I had heard of financial planning but always thought that it’s an unnecessary expense and may not be worth the money. While googling I came across InvestmentYogi’s free financial planning tool and immediately tried. It was more like an eye opener for me. Never before had I looked at so many things at one place. It gives you the complete picture including cash flow, net worth, investments, liabilities and also recommendation likes savings, investment, insurance required to achieve certain pre-determined goals in life. You got to try it.”

– Puneet Rastogi, Marketing Consultant, Mumbai

“This tool is awesome! This is the best financial advisory tool I have seen so far. Easy to use, Easy to Navigate, Easy to interpret and it gives you the right information. A must tool for people to captures the risk exposure of various investments, and provides goal based investment plan”

– Dharmendra, IT consultant, Hyderabad

Be Your Own CFO: Understand Financial Planning and make it work for you

2009-09-17T05:00:00Z

November 1st, 2009

10:00 am – 5:00 pm, Conf Room : AC4MLT , ISB, Hyderabad.

You know corporate finance; now optimize your personal situation in terms of cash flow, analysis, investing and goal planning

-Why you need to plan your financial future now

-Free financial plan you can prepare yourself on our website

-One on one sessions to seek advice from finance professionals

For Registration please email us at yogi@investmentyogi.com with subject title: Be your own CFO,ISB

FREE Online Financial Plan Included

Start now at www.investmentyogi.com/isb

INTRODUCTION

10:00 -10:15

By Professor Amit Bubna, Ph.D. Assistant Professor of Economics and Finance,ISB

SESSION1

10.15 - 11:00

By Lovaii Navlakhi, CFP -Importance of financial planning for a successful life

TEABREAK

11:00 - 11:15

SESSION2

11:15 - 12:00

By Uday Dhoot, CFP- How critical is Insurance in this event called life

UPDATING YOUR FINANCIAL PROFILES

12:00 - 12:45

Students are requested to get their Laptops for updating& revising their financial profiles

DEMONSTRATION OF FINANCIAL PLANNING SOFTWARE

12:45 - 1:00

Live demo of how the software/ plan works

LUNCH BREAK
1:00 - 2:00

INDIVIDUAL SESSIONS

2:00 to 5:00

One on One meetings

Speakers :

Amit Bubna, Ph.D. Assistant Professor of Economics and Finance

Lovaii Navlakhi, Managing Director and Chief Financial Planner, is the founder of International Money Matters. With 26 years of top-notch industry experience, an MBA (Finance) from SP Jain Institute of Management, an ICWA, the distinction of being one of the first Certified Financial Planners (CFP®) from India and a stellar reputation in the world of personal finance, Lovaii firmly believes in continuing education as a way of life. He is oft quoted and widely read across publications and personal finance websites.

Uday Dhoot, , CFP^CM is also India's first CIPM Certificate holder and currently pursuing his international CFA (Level 3 candidate). He is responsible for the infrastructure that gives International Money Matters Pvt. Ltd. the edge in providing excellent service to its clients. Currently designated as COO, he plays an active role in training people.

Personal Finance in India for NRIs and Expats

2009-09-17T02:49:00Z

November 3, 10:30 - 2:30pm, Novotel ,Hyderabad. (Registration Charges: FREE)

Personal finance for Expats/NRIs wishing to invest in India

10:30 - 11:30

Speaker:

Lovaii Navlakhi

Certified Financial Planner

Opportunities

- Why invest in India?

-the economy

-the financial structure

Operations

-How can it be done? What are the rules?

-Q & A on bank accounts, planning, insurance, mutual funds and other queries on Indian Finance

Taxation and tax issues for Expats/NRIs residing/working in India

11:30 - 12:30

Speakers:

Rekha N S, B.Srinivas

Agarwal & Italia, Chartered Accountants

Opportunities

- How can you make cross border taxation work for you?

-Special tax issues when investing in India

Operations

- What are the rules?

-What do you need to know and to do?

-Q & A on taxation

Individual Sessions

1:00 - 2:30

15 minute one on one appointment available between 1:00 and 2:30 with a Tax Planner or Financial Expert subject to availability. Please sign up for your appointment by sending an email to Ariadne Horstman at ariadne@investmentyogi.com.

Registration for the Event : http://www.investmentyogi.com/common/event.aspx

Speakers:

Lovaii Navlakhi, Managing Director and Chief Financial Planner, is the founder of International Money Matters. With over 24 years of previous top-notch industry experience, an MBA (Finance) from SP Jain Institute of Management, an ICWA, the distinction of being one of the first Certified Financial Planners (CFP®) from India and a stellar reputation in the world of personal finance, Lovaii firmly believes in continuing education as a way of life. He is oft quoted and widely read across publications and personal finance websites.

Rekha N S is a Associate member of the Institute of Chartered Accountants of India and has been in practice for more than ten years. Rekha is associated with AGARWAL & ITALIA since 2005. She has been involved in providing various opinions on business modelling in India, taxation of International transactions in light of domestic tax laws and International Tax Treaties, preparation of long term financial business plans for domestic and International clients. Before joining Agarwal & Italia, she worked as a manager with P G Bhagwat & Associates, Chartered Accountants, Pune. During her association with P G Bhagwat & Associates, she has specialized in the field of statutory audits of manufacturing companies and educational institutions.

B. Srinivas, an Associate Member of the Institute of Chartered Accountants of India has been in the fields of Audit, Accounts and Taxation for a period of more that 8 years. He has been associated with AGARWAL & ITALIA since 2007. He has been involved in various Internal, Statutory and Tax audits in India. He has been more involved in developing and implementing of business processes and specifically towards setting up and evaluating the existing systems and internal controls and therby suggesting the improvement areas for the same.Prior to joining Agarwal and Italia he was associated with Deloitte Touche and Thomatsu in India. He was a part of the Process development departments which was instrumental in the development of various business processes considering all the tax and other regulatory requirement of india. Off late he has developed a keen interest in the areas of business modelling and tax requirements for business models being setup in India

Money Management in Tough Economic Times

2009-08-25T08:57:00Z

Financial Planning for South Asians in US and India

October 8th, @ 6:30pm to 9:00pm

Shiva's Indian Restaurant & Bar,800 California St #100,Mountain View, CA

Introduction: Financial Planning

Financial Planning in the U.S.

-why do you need a plan?

-strategies for uncertain times

-financial planning for South Asians

Investing in India

-why invest in India now?

-Indian economy/growth

-operational details: how to invest as an NRI?

Speakers:

Lovaii Navlakhi, Managing Director and Chief Financial Planner, is the founder of International Money Matters. With over 24 years of previous top-notch industry experience, an MBA (Finance) from SP Jain Institute of Management, an ICWA, the distinction of being one of the first Certified Financial Planners (CFP®) from India and a stellar reputation in the world of personal finance, Lovaii firmly believes in continuing education as a way of life. He is oft quoted and widely read across publications and personal finance websites.

Lavina Nagar, Financial Planner, President & Founder of Maya Advisors, has more than fifteen years of experience in the financial services industry. She has worked at corporations like Reuters, Sungard, and Misys, working on solutions for investment banks and other global financial institutions. She holds a dual Masters in Mathematics & Computer Science from Indian Institute of Technology (IIT) Delhi, India, and an undergraduate degree in Mathematics & Economics. She is a Candidate for CFP® Board Certification. As an independent financial planner, she believes that financial planning is not an end in itself; but a means to achieve personal goals and aspirations. It is a lifelong dynamic process and depends on the unique situation of each individual’s circumstances and priorities.

10 Reasons Why You need An InvestmentYogi Basic Plan!

2009-08-21T20:11:00Z

1. Achieve your goals

A financial plan is a road map to your future; it tells you where you are today, where you are going and what steps you need to take to get there. Our 'Basic Plan' will let you know if you are on track to achieve your goals, whether they are buying a car or house, funding your child’s education, your own retirement or even saving for a dream vacation.

If you are heading in the right direction, our 'Basic Plan' will tell you so. If not, you may need to readjust your goals, timeframe or other factors

Developing a financial plan is one of the most important steps you can take towards achieving your goals. It will tell you how much you need to save, invest or borrow and how long it will take to save enough to obtain what you want.

2. Prosper in good times

Good investments, solid planning, and diversification: these are the hallmarks of a good personal finance portfolio. When times are good, sock it away. We will let you know the appropriate debt/equity ratio for you and how much you should be saving for your. When you fill in your expenses, take a minute to evaluate if you are spending the right amount for your situation. Can you afford to save more?

3. Protect yourself in bad times

Life is not always a bed of roses. Be sure you are properly insured for medical, life and property when things don’t go as you plan. Our 'Basic Plan' can help you identify how much insurance you need to protect your family. Many people buy Insurance either to save tax or as an investment without knowing the quantum of insurance they actually need for protection.

It is important to have an emergency fund, an integral part of any financial plan. And if you planned right when things were good and have a balanced portfolio, it should help you get through the tough times and come out just fine.

4. Earn more from your investments

Make sure you have the right debt/equity balance. If you have too much in savings, fixed income and bonds, you may be losing money if inflation is outpacing these instruments. If you have put everything in equities, you may be setting yourself up for losses in a down market.

5. Free up your time

Stop worrying about your money and get a 'Basic Plan'. It will tell you your financial strengths and weaknesses, if you are meeting your goals, and more. If there is something you need to do, you will find out. Otherwise, relax and know your finances are fine.

6. Feel confident and secure about where you are financially

It is always good to see it in writing: How much are you worth? What is your cash flow like? Where is your money invested? Is it scattered in 10 insurance policies you may not need or tied up in accounts you had forgotten about?Just filling out our Financial Planning Profile will give you a better idea of where you are and help you get all your documents together. Once you view our 'Basic Plan' you will have it all spelled out on paper for you.

7. Be prepared

Knowing where you stand helps you be prepared at the drop of a hat for emergencies and opportunities. Is someone in your family suddenly selling a choice piece of land you would like to acquire? Does a special niece need money for a wedding? Did you just win the lottery and you don’t know where to put all this newfound money? Be ready.

8. Manage Cash flows

A good financial plan helps you to manage your cash flows in the most efficient manner. It also allows one to track net-worth, loan payments; and identify the best way to manage these effectively. Some people spend more than they earn with credit cards and easy availability of loans, and tend to lose focus on future needs. It is always better to be aware of what you need in the future so that you can balance your cash flows accordingly. Many of us have complex financial lives and lack time, expertise, discipline and objectivity to put our financials in order. Financial planning allows you to stay on track.

9. Manage change in your goals

As your needs and financial goals change over time, a financial plan gives you the flexibility to alter your financial strategy to meet new objectives. Therefore a review of your financial plan on a regular basis is very important. To be effective, you and your planner must weigh several factors like your objective, time frames, cash flows, and the potential for taking risk based on the goals.

10. Give your financial life focus, direction and organization. Get a financial plan today!

Becoming rich is all about starting early, better planning and being disciplined.

This article is written for InvestmentYogi by Shweta Jain, Certified Financial Planner, IMM.

The Road Out of Financial Mess

2009-07-17T09:43:03Z

Profession : Software Engineer
Salary : Good
Years in Job : ~10 years
House : Rented
Savings : Very low
Net Worth : Negligible

Without going into the story behind this, I can only say that this was me about one and a half years back. I realized I had to fix things up. The first thing I did was to read lots of articles, blogs and books on personal finance. Once I was comfortable with the basics of personal finance, I started looking for a financial advisor. But it was a long and slow exercise. I talked to many advisors, some independent, some working for financial service companies and some from banks. I didn't find anyone good enough. Luckily after a long search, I found an advisor who knew what he was doing. And better, he was not selling me any financial product. I sat with my advisor, gave him my numbers and finalized a financial plan. Though it was not a 360 degree plan, it was simple enough for me to understand & it confirmed to the basics of investment.

Knowing that I was prone to spending, I created a monthly budget. To keep it simple I marked three envelops with "Household expense", "Bills" and "Petrol". I would put a fixed amount in each envelop at the start of every month. Though it took time to stabilize the expenses, it impacted my expense pattern significantly. In fact, even today l use the same method for my monthly budget. As suggested by my advisor, I started investing thru SIP towards my retirement & house. I bought a term policy for protection. I also bought a ULIP child plan (I know that the purist out there will question it) for my son. After about a year, I was pretty comfortable about my finances.

What I learnt (and I am still learning) during this period can be summarized as -

- Personal finance is no rocket science.
- It is as much about human psychology as it is about numbers.
- It's very important to differentiate between needs & wants. Unlike wants, needs are mostly not very costly. As a thumb rule, if you plan to buy something pretty costly, the chances are that it is not a need but a want. This may not sound very logical, but believe me, it holds ground most of times.
- Invest every month, preferably a minimum fixed amount.
- Read everything on personal finance but don't follow anything unless you understand it.
- Don't invest in any product which you don't understand well.
- Get a financial advisor.
- Don't spend too much time trying to figure out your risk profile before you can allocate asset.

Follow this simple thumb rule if you like.
- 10+ years is for equity only.
- 5 years or less is for debt only.
- Between 5 to 10 years, well, no one clearly knows. You are free to invest it your way.

This article is sourced from Khotapaisa for InvestmentYogi.

The author of this blog and article is a software professional from Bangalore.

Financial Documents: What to do with all this paperwork?

2009-06-30T05:43:00Z

You must have often hesitated over what to throw away and what to retain while sorting through bills, receipts, old checks and all sorts of paperwork and documents that one accumulates.

Here are your answers!

Below is a quick checklist of what to keep, for how long, and where to keep it.

Read on and get organized.

Bank Locker

First things first, there are some documents, originals of which you should preferably keep in your bank locker:

Insurance policies
Birth, marriage and death certificates
Passports
HUF agreements, wills & trust documents
Property deeds
Titles to vehicles
List of household goods with details of those covered by insurance, if any
Certificates of financial instruments like bonds.

At your residence, you should have copies of these documents, one set with yourself at a location known to your spouse and/or child/parent and another person like your chartered accountant or lawyer and another set at a second location – with one of the above mentioned persons or your parents.

Filing of documents

In this computer age, most of our documentation comes via email and we may not print it most of the time. It may be filed in different folders in our inbox or hard disk. While this is fine, there should be a hard copy as well of all important document and they should then be filed in an organized and accessible manner.

Maintain separate files as follows:

Bank accounts – Keep bank statements for 7 years. Go through your checks each year and keep those related to your taxes, business expenses, home improvements and mortgage payments. Dispose off those with no long-term importance
Financial Assets

Mutual funds – Keep the first statement showing purchase and there after only the latest statement. Unless capital gains issues are there, the documents can be disposed 7 years after being sold.
Shares – Keep the contract notes and the dividend receipts; any communication regarding bonus/ rights issues received should be maintained as well.
Fixed Income Securities – Keep the original document during the term of the investment + 7 years
Insurance policies – Life of the policy plus 3 years.

Physical Assets

Land, property – besides the deeds, legal fees and commission paid claimed as expenses, cost of improvements and enhancements, lease agreement, rent receipts, house tax receipts should be filed and kept at least till 7 years.
Vehicles – titles, insurance papers, pollution checks, servicing booklet
Appliances – Keep the original bill definitely till the warranty period is going on. The manual should be retained always. If there is a service agreement that should also be retained for as long as the service period. File all the electrical appliances together.

Personal papers like educational and work certificates should be kept in duplicate.
Copies of birth certificates, marriage certificates and passport.
Copies of wills and power of attorneys
Tax – all returns filed till date. All documents supporting tax deductions for the last 7 years.
Credit Card Statements – Keep statements if you are claiming any tax deductions against expenses made through the credit card else latest statement is enough unless some entry is under dispute.
Medical records – all details and records to be maintained for each family member.

REMEMBER…

To write on the cover of each file, the name and contact details of the person whose help you took for those particular transactions – your tax consultant, chartered accountant, financial planner, agent, bank relationship manager or a friend/colleague/relative.

If there is a person whose advise you take regularly and constantly like your chartered accountant, your financial planner or a trusted aide, do mention that on the file cover so that if there is any ambiguity in the information, one knows who to contact to fill the gaps.

To write on the first page of the file an index – simply what is there in the file and order in which the filing has been done – either chronologically or alphabetically. Lastly file the papers in such a manner that the next time your spouse/family member sees the files without knowing what is in them can still make sense of the papers.

Services Offered

2009-06-15T06:45:00Z

Which Plan is Right for You?

Do you have a good grasp on your personal finances? Most of us don’t. With a financial plan you will have a better view of your financial strengths and weaknesses, where your money goes, how much you have, and what you should be doing with it to help you attain your goals.

1. BASIC FINANCIAL PLAN

Our Basic Financial Plan service includes:

Your financial strengths and weaknesses
Net worth and cash flow analysis
Analysis of goals: attainability and savings/investments required
Asset allocation: existing and recommended (summary)
Expense protection/insurance (summary)
Investment plan (summary)
1 Follow up conference call (approx 20 mins)

Cost: Rs. 5000

2. RETIREMENT PLANNING

Are you prepared for your retirement? Will you have enough to live comfortably? Whether you are already retired or just starting out in your career, a solid plan can ensure that your later days will be spent enjoying, not worrying.

Our retirement plan service includes:

Working out how much you will need and how you will save it up
Deciding which investments are appropriate for your situation
Action plan for investments and insurance
Cash flow plan for 12 months (if retired already)
Two conference calls with our experts to discuss/explain plan (approximately 20 minutes each)
Plan will be completed within 4 working days
Execution is optional

If execution is done through us, the following is also included:

Premium reminders
SIP reminders
Policy Updates
New product recommendations
Newsletters
Monthly Updates of Investments carried out by us

Cost: Rs.5000 (valid for 12 months)

3. FULL SERVICE FINANCIAL PLAN

Includes all services discussed above:

Financial Plan
Investment Planning
Insurance Planning
Retirement Planning
Personal meetings part of package in following cities: Hyderabad, Bangalore, Mumbai, Chennai, Delhi, Gurgaon
Conference calls at your discretion

Cost: Rs. 15000

4. NRI SERVICES

Customized
Please contact us for more details and costs at http://www.investmentyogi.com/feedback.aspx

For further information and assistance, contact us at http://www.investmentyogi.com/

Testimonials from our Customers

2009-05-24T19:06:00Z

“This is the best website ever I visited....It clears my all doubts regarding investment and reg home loan.....Thanks a lot” – Samit Katiyar, Kanpur



“Very informative and useful for each and every salaried person” - Zafar Ahmed Siddiqui, Hyderabad



“The articles and tools at your site are so useful for everyone. I have recommended your site to all my friends” - Saritha Reddy, Bangalore



“InvestmentYogi.com has been really life changing for me. I have learnt so much about how to manage my finances and take investment decisions. Highly recommended” – Mahesh Rana, Boston, USA



“The advise given through your articles have been very useful to me. Many thanks” – Purvang Mehta, Delhi



“I was in a financial mess before I contacted InvestmentYogi experts. They looked at my situation with patience and suggested some very practical ways to get out of it. Thank you so much” – Prabha Iyer, Mumbai



“What I like about your site is that everything is explained in such a simple language. I have no formal education in finance or economics but I have started making sense of so many things.” – Venkat, Chennai

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"I came through InvestmentYogi website when I was googling Internet to get ideas for planning my retirement and my son's education. I am really impressed with the details provided in the financial plan document. InvestmentYogi and International Money Matters helped me decide on amount to be invested, nature and period of investment to achieve my goals. Now I am a happy customer of International Money Matters. The main difference I find between other brokers/Investment advisers and InvestmentYogi/International Money Matters is that the latter is not biased towards one or two companies that pay them more brokerage fees but their investment advice is mainly based on customer's interests and needs."

Venkatesh

Bangalore

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"InvestmentYogi helped us save taxes by making a tax efficient investment for my wife at the 11th hour, just before the deadline. They handled the paperwork for us, making the effort minimal."
Prateek Sharma
Avaya India Pvt. Ltd., Hyderabad

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"When I finished ISB and was about to start a new job, I had InvestmentYogi prepare a financial plan for me. It clarified my situation and what I had to do going forward in terms of savings, insurance and debt management to meet my goals. The process has helped me gain a fresh financial start."

Madhu Kurian

Process Manager, JP Morgan, Mumbai

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"I am in the early stages of my career and was perceiving investment as a tax saving mechanism. Thanks to InvestmentYogi's financial plan, I changed my perception and started using investment as a key to achieve my short and long-term goals in life. It has helped me in leading a well-planned stress-free life." -Chidu, Bangalore

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"I now realize that I can budget, save, invest and watch my money grow. I wish I had done this 10 years ago" says Sheela Iyer, an entrepreneur from Mumbai.

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“Investment Yogi helped me manage my taxes through one of their specialized CA partners” says a Faculty member at a premier Business School.

What is a Will and Why do I need one?

2009-05-17T19:20:00Z

A will is a document containing your instructions and wishes as to how your property and assets are to be distributed after your death. Any person, of any age, should seriously consider a will at the earliest. A will should not only be for people who have reached an age where death is not far away. People die at all ages and a will is needed especially if you have assets and property to be allocated to those you wish to benefit. A will is an essential part of an estate plan, which may contain other documents such as Trusts, Insurance, Gift, Power of Attorney, transfer of property and partition.

Estate planning is the process by which an individual or family arranges the transfer of assets in anticipation of death or incapacitation. An estate plan aims to preserve the maximum amount of wealth possible for the intended beneficiaries and flexibility for the individual prior to death.

Significance of estate planning

Without an estate plan, one’s wishes may go unfulfilled. Family members may not get provided for financially as desired
One can plan and provide for one’s probable incapacity
Sufficient liquidity to cover one’s debts, taxes and costs of death.
Can ensure smooth and orderly business succession

Various Methods of Estate Planning

There are various modes in which one can plan his/her estate like Wills, Trusts, Insurance, Gift, Power of Attorney, transfer of property and partition.

Each of these can be either singly or jointly used based on the person’s need and depending upon the quantity and complexity of assets involved. However a will is one of the tools most commonly used for its ease of preparation and execution.

Wills

If a person dies without making a will, he is said to have died intestate. Then, the law of succession applies based on the religion of the deceased and its relevant law. In such a case the wishes of the deceased may not get fulfilled i.e the way in which he desired for the distribution of his assets.

However, estate planning through wills has certain drawbacks such as the probate process which is mandatory when either the deceased was residing in one of the following metros (Mumbai, Kolkata or Chennai), or one of his properties was based in one of those cities. Based on this, an alternative means of estate planning needs to be adopted (which can be Trusts- but there are costs to these).

Points to note while preparing a will

It is very important to note that though formulating a will is a simple procedure of writing down one’s desires in the way in which one wishes the distribution of assets, the selection of an executor of the will becomes very crucial. This is because it is the executor who finally ensures that the will is administered according to the deceased wishes. It is of prime importance that the executor selector is some one who is responsible and trustworthy. It is also important that a will must have been witnessed by two persons for it to be valid.

It is not mandatory to get it registered and also not mandatory to have it on stamp paper. However both are suggested to add more validity to the will.

It is always better to rewrite a will when you acquire additional assets since any asset acquired after a will is done shall be treated in the similar manner if the person had deceased intestate.

A will should be reviewed periodically to keep it updated.

Need a Will? Email us at yogi@investmentyogi.com

This article is written for InvestmentYogi by Shweta Jain, Certified Financial Planner, IMM.

Financial Planning Services - Pricing Index

2009-02-12T11:22:00Z

InvestmentYogi now offers the following financial planning services:

1) Basic Financial Plan for Rs. 5,000. This is a limited introductory offer. Get started or see a sample plan.

2) Retirement Planning for Rs. 5,000.

3) Full service Financial Plan is available for Rs. 15,000.

4) We specialize in a host of NRI services. Please contact us directly if you are an NRI.

All of the services listed above will entitle the customer to review their plan with a Certified Financial Planner, either on the phone or in person. The prices mentioned above are inclusive of all taxes.

What are the steps to ordering a Financial Plan?

a) Fill in the Financial Planning Questionnaire online or send us an email at yogi@investmentyogi.com with the specific service you are interested in

b) If you have any questions on your plan, we will contact you by phone or email within 3 working days.

c) Once you order and pay for your Financial Plan, the basic Financial Plan will be ready for your review in 2 weeks.

d) Our financial planner will set up a review session after you have received the plan.

e) You can renew the planning services next year for a nominal fee.

How do I pay for the services?

You may choose to pay through our online payment gateway.

The 5 Financial “DON’Ts”

2009-01-20T08:03:53Z

The inevitable never happens. It is always the unexpected!

John Maynard Keynes

In times such as the present, it is next to impossible to predict the immediate future. It is quite possible to get swayed by supposed expert opinions, by well meaning and ‘in the know’ friends or by the daily reports of what everybody is doing. Especially when there is so much that is being said, heard, read and seen.

So what should one do or rather not do?

The 5 Financial “DON’Ts”

When it comes to estimating the monthly expenses and the buffer for emergencies, one rarely hits the mark. Very often, there are unforeseen festival expenses or a sudden travel which makes all the calculations awry. And when one actually needs money for a medical emergency for example, you end up running from pillar to post arranging for funds. Don’t underestimate your liquidity requirements.

The opposite is true as well. Following the old adage wrongly ‘better be safe than sorry’, often people tend to hoard all their cash in savings bank accounts not realizing that at the paltry interest that savings accounts offers, one is actually losing money if you take the big bad inflation into account. Don’t leave your funds idle in the bank. Even if the equity market (and the equity mutual fund) is risky at the moment, look at other asset classes which haven’t been so badly affected like Debt instruments – debt mutual funds, gold, even traditional investments like NSCs etc which would give better returns then the savings bank.

Whether it is a long term investment or loan, Don’t ignore the interest rate on either. Often it may emerge that you are actually paying off a loan at a high interest rate while your investment is earning a low rate of return. Look at exit clauses and prepayment clauses of your investments and liabilities at the time of entering.

Don’t fall into the ‘Spend today what you will earn tomorrow’ credit card trap. It may seem very easy to acquire the Plasma TV, the expensive meals and exotic holidays through multiple credit cards and roll over the credit by paying the minimum balances till bonuses or incentives arrive or covert the outstandings into loans and pay EMIs. But at the end of the day you are acquiring loans you simply cannot afford. Interest on unpaid balances is as high as 36% - so use the credit card only when you are sure you can pay the unpaid amount on the due date.

Advertisements may promise attractive returns, quotes will claim high returns, but look at the fine print – Don’t forget the tax! Whether it is your balance in a savings bank, an FD with a 10+% return or churning your portfolio for profit booking – there is always tax. Always take into account post tax yields to take sound investing decisions.

For InvestmentYogi by Shweta Jain, Certified Financial Planner

Do I need a Financial Planner?

2009-01-20T05:38:00Z

Financial Planning is not rocket science, on the contrary it is just plain and simple common sense – where you sit down and take stock of your circumstances. Where do you want to be next year; 5 years from now; 10 years from now; and 20-30 years from now? Hence, what is it that you need to do to ensure that this is possible.

So if it isn’t rocket science, why do I need a financial planner – why not do this yourself?

Well, the answer to this is you can.

In fact you are your own best planner, provided you have the time every day to monitor your portfolios, track the markets, keep a close watch on the economy, political scenario, world indices, see what are the new options coming in almost every day AND do your regular job. Not only that - you need to have the knowledge and training to understand markets and economies and interpret and react to its changes appropriately and timely.

Markets and economies world over are becoming more and more global. It is not enough to know just what is happening in your own economy or what policy changes by your own government are likely. One has to be aware of market happenings, political scenarios and events in lands far far away, since something happening there can have major consequences on investments here. There are a myriad of investments and options opening up for investors from across different asset classes, your country and beyond.

Hence, the function of a financial planner is dual. First, to have an understanding of the economy and markets, such that to be able to correctly interpret their movements and the effect thereof. Second, to offer personalized and customized solutions to you, after understanding and assessing your unique situation and your goals, both long term and short term.

He should be able to do so keeping your interest foremost and in fact push you to take that much needed insurance cover and recommend only those products which are suitable for your needs, appetite and profile.

The first is a function of qualifications, experience and training while the second of personal integrity and ethics. Look for these qualities when you look at enlisting the help of a financial planner and you will be in safe and honest hands. You will get where you want to be and realize your desired goals.

Lastly, the onus for financial planning to work for you lies not only on the financial planner, but also on YOU as a client - to make your voice heard, to be clear on what your goals are, prioritize them and follow through with your planner what the changes in needs and circumstances are in your life from time to time.

For InvestmentYogi by Uday Dhoot, Certified Financial Planner

Promotional Offer from InvestmentYogi!

2008-12-17T10:49:00Z

InvestmentYogi has partnered with International Money Matters to offer a range of financial planning and advisory services. Read what our expert Lovaii Navlakhi has to say about Financial Planning.

Our promotional offer for a Financial Plan is Rs.1999. To apply you will need to register or sign-in and fill out your Financial Planning profile. You can have your own personalized financial plan ready in less than 2 weeks. We also have limited time introductory prices for various financial planning services.

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Insurance Planning

2008-12-17T08:30:00Z

Losing a loved one is one of the toughest things in life for anyone to face. When that loved one is also the one who provides for everything financially and if he has not had the foresight to protect those left behind, then this loss leaves behind a very large burden on the family.

We all have dreams and aspirations, some for our own future – a good house, secure retirement and some for our children – a good education, a good marriage. But life also has its own plans and does throw some unexpected events at us. Life Insurance is the only tool available to an individual who loves his family to protect his loved ones from such events and ensure that the dreams and aspirations are achieved.

Life insurance helps you address all these situations. It is a replacement for your income. When your income ceases or falls insufficient either due to death, illness, retirement or a major goal such as children’s education or marriage, insurance fills in the gap. On your death, the monies received from term insurance policies will provide a corpus with which the family can pay off debts, convert dreams to reality and still lead a comfortable life. The systematic, long-term and induced saving concept of an endowment insurance policy will help achieve the target of your planned future goals.

First and foremost you need to identify your needs and those of your family. Secondly, you need to quantify them as of today and lastly prioritise them. You then need to see how you are going to fulfil these needs with your present income and accumulated and future savings. Where there is a gap, you look at insurance.

Insurance is not just a product that provides security to your family and peace of mind to you; it is also a long term investment tool to save for goals.

For InvestmentYogi by Lovaii Navlakhi