The New Rules of Financial Planning for Dummies in India

How you can effectively do the Financial Planning for your Retirement & for your Child’s future and build enormous Wealth for you & your future Generations in India by SIMPLE Financial Planning?

[For Resident Indians & NRIs]

Today I am launching my Second eBook which is about Financial Planning for Dummies in India.

You can Download RIGHT NOW for FREE without any annoying registrations.

Many readers have asked me since past couple of weeks that, why you have suddenly stopped posting on MJ2BC in the new year? Is everything alright?

Well, yes. Everything is alright. Basically I was working on writing a Comprehensive financial planning eBook (PDF) for Indians and NRIs since the beginning of 2011.

This is because I wanted to give my readers a new gift in the new year. In this eBook, I have cover everything that an Indian needs to know before doing a successful financial planning.

I have avoided undue long sentences. This is basically a quick guide to financial planning. This guide contains all the information about all the financial products available in India which are useful for most effective financial planning.

Not only this, but to make this eBook interesting, I have also added one great mind exercise section in which I have describes Top 14 most common financial planning mistakes that the people do. I have explained all of these mistakes by giving you the real time examples.

In the end, I have also given 5 model portfolios of the Intelligent Indian investors for various age groups.

This time, I have also included the separate section for NRIs at the end.

Thus, I am sure that this comprehensive eBook will be helpful to both the Indians & NRIs. Anyways, so now no more self-promotion. Just Download this eBook and start reading it. I am sure that this eBook will boost your Financial IQ by several folds.

If you are a traveler or don’t like to read books on the computer than you are free to print this book. You can also carry this book in your iPhone or Palmtop and read whenever you are free.

Download The New Rules of Financial Planning for Dummies in India NOW for FREE and without any annoying registrations…!!!

SBI Life Unit Plus Super ULIP Review

SBI Life Unit Plus Super is one more unit linked insurance plan offered by SBI Life insurance company. Let us review this policy today. The plan claims to meet the changing requirements of your life. Let us review that weather this plan really offers what it claims or not?

Key Features

•Guaranteed Additions of up to 75% of one annual regular premium on a regular premium policy, for a 30 year policy term, subject to the Policy being in force till the maturity date.

•No Policy Administration fee for first 5 years for Regular and Limited Premium Paying Term (LPPT) plans, thereby boosting your fund value

•No Premium Allocation Charge from 11th year onwards

•Guaranteed Additions starting as early as 10th policy year onwards

•Enhanced investment opportunity through 9 varied Fund Options including P/E Managed Fund, Index Fund & Top 300 Fund

•Option to pay Regular/Limited/ Single Premium; Switch or Redirect your premiums

•Flexible product with an option to increase/decrease your Sum Assured from 6th year onwards

•Life Insurance coverage, with minimum Sum Assured, based on your age

•Liquidity through Partial Withdrawals.

•Option to customize the product with a wide range of riders: SBI Life - Criti Care 13 Rider, SBI Life - Accidental Death Benefit Linked Rider, SBI Life - Premium Payor Waiver Benefit Rider and SBI Life - Income Sustainer Rider.

The minimum age of entry is 7 years and the maximum age of entry is 65 years. Age of maturity is 75 years. Premium payment term is 10, 15 and 30 years. Premium mode is Single or yearly. The minimum Single premium is Rs.65000 and the maximum single premium is Rs.1.5 lakhs. The Sum Assured is 20 times the annual premium. So for Rs.1 lakh of annual premium, you will get Rs.20 lakh of sum assured.

My Opinion -

In my opinion, this is a highly opaque financial product and the investors should avoid this plan in any way. What I don’t like about this plan is that, in their policy brochure available online they have nowhere mentioned various types of charges associated with this plan such as premium allocation charge, fund management charge and many other types of charge.

Second thing is that, there is not any information available like in which types of assets the fund will invest means equity, debt, money market or all and in how much proportion.

This is really important to know when you are going to lock your money for more than 10 years. This is because there is no sense of investing in debt/money market instruments when you are going to invest for more than 10 years.

And suppose if we assume that the policy will invest your money in equity than in which kind of stocks – Large, mid or small cap stocks? The risk appetite of all the investors is not the same.

Another thing I don’t like about such types of policy is, you can’t exit from it without paying huge exit/withdrawal charges. While this is not the case of mutual funds. In case of Mutual funds the entry load is 0% and the exit load is also 0% after 365 days. So if you think that your mutual fund is not performing well, you can exit from it without paying any exit loads/penalties. But this is not the case of ULIPs.

In my opinion, Term Insurance + Equity Diversified Mutual Funds (2-3) + PPF is still the best financial planning combination to protect your life and build some serious long time wealth.

What if you have already invested in SBI Life Unit Plus Super Plan?

Get out of it Right now.

Many people argue that, but exit will be associated with huge withdrawal charges. But well, still I will advise you to exit from this plan or at least stop paying more premiums in it. Rather than that I advise you to invest that money in some good equity diversified mutual fund carefully selected from the websites like Valueresearchonline.com with 5-10 years of time horizon.

This is really a costly policy and you should get out of it as early as possible. It’s the highly opaque financial product.

SBI Life Smart Performer ULIP Review

SBI Life Smart Performer is the Unit linked insurance plan which offers 5% higher returns than the Highest NAV Guaranteed.

Recently I have received lots of queries about this plan because of its mouth watering offer. So let us review this plan. Should you really invest in SBI Smart Performer ULIP?

Key Features of the plan

•Guarantee at maturity based on ’5% Higher than Highest Guaranteed NAV’ during the first seven years or prevailing NAV at Maturity, whichever is higher, subject to conditions.

•Enjoy the best of both worlds -  Guarantee only or Guarantee and Market Upside through our unique Plan offerings - ‘Secure Plan’ and ‘Secure N Grow Plan’ respectively

•‘Automatic Rebalancing’ to Lock-in your gains

•Convenience through single premium (SP) or 5 year Premium Paying Term (PPT)

•Life Insurance coverage with minimum Sum Assured of 10 times or 7 times of your Annualised Premium (AP), based on your age.

•Liquidity through Partial Withdrawal(s)

•Option to customize the product with Accidental Death Benefit

•Attractive Tax benefits under the Income Tax Act, 1961, subject to conditions.

How this plan works?

Well, the plan invests higher proportion of your money in equity in the initial years but later on to protect your wealth, it increases the debt allocation so that you can achieve minimum highest guaranteed NAV.

Minimum age of entry is 9 years and maximum age of entry is 65 years.

Minimum annual premium is Rs.50,000 and half yearly premium is Rs.44,000 and monthly minimum premium is Rs.20,000.

On and average the plan offers life cover that is 10 times the annual premium so annual premium of Rs.50,000 you will get Rs.5 lakh of life insurance cover.

My Opinion -

Well, I am personally against all kinds of ULIPs because of their highly opaque nature. People mainly invest in ULIPs for following 3 purposes.

- To get Life Cover

- To Save Tax

- To Build Wealth

But well, the following simple combination can fulfill all of the above goals in very cost effective manner.

Term Insurance + Equity Diversified Mutual Funds (2-3) + PPF

Life cover that is 10 times the annual premium is really a peanut size of life cover in comparison to the life cover offered by the term life insurance plans. If you want to save more tax under section 80C than increase investment in PPF no need to go for ULIPs and if you want to build long term serious wealth than equity mutual funds are the best and cost effective financial products to build wealth.

On the top of this, we don’t know that how much premium allocation and other charges associated with this plan (They should mention it on their website. But on their website they have nowhere mentioned it.).

Thus, I will advise the readers of MJ2BC to stay away from this ULIP Plan.

What if you have already invested in SBI Smart Performer ULIP?

Get out of it as early as possible.

First of all stop paying any more premium and let the policy surrender no matter how much surrender charge you will have to pay.

Rather than that start investing in equity mutual funds via SIP. But in any way, stay way from this highly opaque financial product.

SBI Life – Saral Maha Anand ULIP Review

SBI Saral Maha Anand is another Unit linked insurance plan which claims to protect your life as well as save money and build wealth for the long term.

Let us review this plan in detail. I mean let us analyze that weather you should invest in this plan or not?

Key Features -

•No medical examination, Simple joining process

•Liquidity through Partial Withdrawals.

•Guaranteed Additions of up to 30% of one annual premium, for a 20 year policy term, subject to the Policy being in force till the maturity date.

•Option to avail additional rider benefit under SBI Life - Accidental Death Benefit Linked Rider.

•4 Fund options, to enjoy market related returns as per your risk appetite.

•Twin Benefit of Market linked returns & insurance cover.

The Minimum age of entry is 18 years and the maximum age of entry is 55 years. Policy term is 10, 15 and 20 years. Minimum premium is Rs.15,000 (Yearly), 9,500 (Half-yearly), 5500 (Quarterly) and Rs. 2000 (Monthly).

The Sum assured is 10 times the annual premium (AP) means for the annual premium of Rs.15,000 you will get the sum assured Rs.1.5 lakh.

My Opinion -

Term Insurance + Equity Diversified Mutual Funds (2-3) + PPF is the best financial planning solution.

No need to invest in this plan because of the following reasons.

- The amount of life cover it provides is a peanut size means for Rs.15,000 of annual premium, it will give you just Rs.1.5 lakh of life cover which is in comparison to the life cover provided by the term life insurance plans is a peanut size of life cover.

- They have nowhere mentioned in the policy brochure that in which type of stocks they will invest your money and in how much proportion means large, mid or small or mixed? This is really important to know as an investor. Because if your investment time horizon is more than 10 years than this makes a difference.

- They have nowhere mention the various charges associated with the policy means premium allocation charges, fund management charges…etc..

Thus, in my opinion, this is a highly opaque financial product and the investors should avoid this.

What is you have already invested in SBI Saral Maha Anand Plan?

Get out of it.

Because its not Saral (Simple), its not Maha (Big) and its not Anand (Joy) as it claims but you will surely cry after 15 years if you fail to build serious long term wealth.

Equity mutual funds are still the cheapest (Entry and Exit load is 0%) way to build the long term wealth and Term Insurance plans are still the best insurance products to get the adequate life cover. So go for it.

,

SBI Life Smart Elite ULIP Review

SBI Life Smart Elite is another unit linked insurance plan offered by SBI Life insurance company. This is one more ULIP which claims to build a long term wealth for you.

Let us review this plan.

Key Features -

•Maximum value addition through excellent allocation rates.

•Pay premiums only for a limited term of 5, 8 or 10 years or a Single Payment, as per your convenience and enjoy benefits throughout the chosen policy term.

•No Premium Allocation Charges from 6th policy year onwards, thereby enhancing your fund value.

•Two protection options available: Gold Option & Platinum Option

•Invest in wide range of funds and manage them as per your convenience.

•Life Insurance coverage with minimum Sum Assured of 10 or 7 times of your Annual Premium (AP), based on your age.

•Switch and redirection facility, to pilot your investments.

•Option to increase/decrease your Sum Assured from 6th policy year onwards.

•Accidental Death and Accidental Total and Permanent Disability (Accidental TPD) benefit automatically comes to you as an integral part of the plan!

•Attractive Tax benefits under the Income Tax Act, 1961, subject to conditions.

Minimum age of entry is 18 years and maximum is 60 years.

The minimum annual premium is Rs.1.5 lakh (Annually), Rs.75,000 half-yearly, Rs.37,500 (Quarterly) and Rs.12,500 (Monthly). The policy term is 5 to 20 years.

The sum assured is 10 times the annual premium. Thus, if your annual premium is Rs.1.5. lakh (which is minimum) than your sum assured is Rs.15 lakhs.

My Opinion -

I personally don’t advise anyone to go for this plan because its the highly opaque insurance cum investment financial product. They have nowhere mentioned in their product brochure available on their website that exactly where they will invest your money?

I mean they will invest your money in equity, debt or both? This is very important to know because you are going to invest for more than 10 years of time horizon.

Suppose if we assume that the scheme invests in equity (Because its ULIP), than also it is very important to know that exactly in which types of stocks this scheme invest – large, mid or small cap scripts?

Another thing I don’t like about the scheme is that, which are the various charges associated with the plan? I mean how much will be premium allocation charges, mortality charges, fund management charges and various other charges?

Also the 10 times life cover than annual premium is also too low in comparison to the term insurance plans cover.

So,

Term Insurance + Equity Diversified Mutual Funds + PPF is still the best combination to build some long term serious wealth for you.

What if you have already invested in SBI Life Smart Elite Plan?

Exit.

Yes, Get out of this plan as early as possible no matter how much money you loss. And start SIP in 2-3 good equity diversified mutual funds for 10-15 years. And also buy an adequate life cover by buying pure term life insurance plan. But get out of this policy as soon as possible if you have already invested in it.

SBI Life Smart Scholar ULIP Review

SBI Life Smart Scholar is the Unite Linked Insurance plan which claims to secure and build the future of your child. Well, let us review that how effectively this ULIP can build the fortune/future of your child?

Key Features of the Policy -

• Secure your child’s future by gaining from the financial markets and much more.

•Dual protection for your family, in case you are not around –

•Payment of base Sum Assured and

•Inbuilt Premium Payor Waiver benefit to ensure continuance of your benefits.

•Accident Benefit which includes Accidental Death benefit and Accidental Total and Permanent Disability (Accidental TPD) benefit, is an integral part of the plan.

•Free allocation of units by way of regular Loyalty Additions, giving periodic boosts to your investments.

•Enhanced investment opportunity through 9 varied fund options including P/E Managed Fund, Index Fund & Top 300 Fund.

•Twin benefits of market linked return & insurance benefit.

•Liquidity through partial withdrawal(s).

•Tax benefits as per prevailing tax laws.

The minimum age of child for entry is 0 years and maximum age is 17 years. Proposer should be minimum 17 years and maximum 57 years. There are varieties of premium terms starting from single premium to half yearly and yearly premium of various time horizons.

The life cover is on and average 5 times the single premium. Minimum Single premium is Rs.75,000. On maturity, you will get your money back with all the returns and then you can use it for various purposes of your child.

My Opinion & Concerns about this Plan-

Well, I am personally not comfortable with this plan because of its higher level of opacity and lack of transparency.

The product brochure provided by SBI life on their website is not sufficient according to me. I mean they have not mentioned following things anywhere in their brochures.

- The scheme has nowhere mentioned that where will they invest your money – Equity, Debt or Mixed and in how much allocation?

- They have nowhere mentioned that which are the various types of charges associated with this policy? Say premium allocation charges, mortality charges, fund management charges and many others.

- For a time horizon of more than 10 years Equity is the best instrument to build serious wealth. But in this plan they have nowhere mentioned that how much they will invest in equity and in which kind of stocks – largecap, midcap or small cap?

- The life cover that this plan provides (5 times the SP) is also a peanut size.

In my opinion, don’t go for this policy. Rather than that Term Insurance + Equity Diversified Mutual Funds (2-3) + PPF is the best and simple combination to protect life and build wealth for your child.

I will advise the interested parents to start regular SIP in 2-3 carefully chosen equity diversified mutual funds. Believe me, regular SIP in Equity diversified mutual funds will build a huge wealth for your child at the rate of 15-20% compounded annually. No need to go for such opaque insurance cum investment plans.

No need to rely on this plan to build the financial future of your child.

SBI Smart Horizon ULIP Review

I really don’t understand that why ULIPs are becoming more and more popular even after spreading financial awareness by many financial planners, advisors and bloggers all over the India?

SBI already has 5 ULIPs and recently it has launched one more ULIP plan and that is SBI Smart Horizon ULIP Plan.

So What does this plan offers?

Well, the plan mainly offers AAA type of asset allocation. Means it is some kind of computer generated model which is Algorithm based Asset allocation (AAA). This system is developed by testing over 5000 potential scenarios in the Indian Equity market and bond markets according to Economic Times.

Initially there will be higher exposure to equity and later on near the maturity there will be higher exposure to debt and money market instruments. The scheme is basically of two types – Plan A & B.

Minimum age at entry is 7 years and Maximum age at entry is 60 years. Policy is available in 10, 15 and 30 years. Minimum annual premium is Rs.24,000 and Maximum annual premium is Rs.74,000.

My Opinion -

Well, don’t go for this ULIP Plan as it is really costly. I will still advise you to follow the simple financial planning combination to build wealth as well as protect your life and that is,

Term Life Insurance + Equity Diversified Mutual Funds (2-3) + PPF

The above is the simple solution to build wealth. What I don’t like about this plan is, peanut size of life insurance cover provided by it. Means the plan provides approximately 10 times annual premium than the annual premium. Thus, if your annual premium is Rs.50,000 than your life cover will be Rs.5 lakh only which is a peanut size in comparison to the life cover offered by the term life insurance plans.

Another thing I don’t like about this plan is, I have personally read the entire product brochure of this plan but well they have nowhere mentioned that how much various charges they will charge for investing in this product.

I mean how much will be premium allocation charge, mortality charge, fund administrative charge and fund management charge. Thus, this is a highly opaque policy and investors should strictly avoid this policy as we don’t know the various charges associated with this policy.

Mutual funds have 0% Entry load and Exit Load (After 365 days of exit) and that’s why equity mutual funds are still the best best to build the long term serious wealth.

Investta – Personal Finance Forum India

Investta.com is the Personal Finance Forum India. I have launched this forum in June 2010. This is because I started receiving dozens of queries about personal finance and financial planning from readers from all over India that I could not reply them all via e-mail.

And That’s why Investta has born. Learn more about Investta here.

The main advantage of forum is that, people can discuss and share their knowledge, experience and mistakes and gain the financial knowledge.

You will never feel alone on Investta.com as I am full time available on Investta to discuss anything related to money, personal finance, investing, financial planning, business ideas, entrepreneurship, make money online and many more things about money.

I love to discuss personal finance, business opportunities and online money making opportunities. So you can ask me anything over there by starting a new Discussion topic (thread).

The main purpose behind launching Investta is spreading financial awareness to all over India and around the world. Anything that you discuss on Investta will be available for everyone to read in the future and this can benefit to several people having the same financial problem in the future.

As a one person, I can not cover everything on MJ2BC. This is because there are literally millions of issues in personal finance. So a single blogger/writer can not cover all of these issues and that’s why Investta is there where you can contribute your own experiences, knowledge and mistakes and share it to people around the world.

Anyways, So What are you waiting for? If you haven’t join Investta than join Investta right now & Start spreading the financial awareness to all over India and the world…!!!

I am waiting for you on Investta to discuss everything about Personal Finance, Business ideas, entrepreneurship & Make money online…!!!

Buy Mutual Funds Online using an online broker

Savings are prepared to work at the capital market building activity. Internet marketing technology has made the process easier with the facility of online brokers. Guiding one along the way to buy mutual funds online is done with the help of apposite online brokers who has got keen acquaintance and practice over investments through online mutual funds. A full time service broker can be a good decision as they are the best choice for beginner investors who need some more confidence and facts over investment.

There may be a list of question one has to clarify before investing into online mutual funds for a safe investment. Opt for the right online broker or brokerage service, which can channel you on a correct path of investment options.

Role of online brokers

Proceeding via broker or agent can help you to understand about balanced mutual funds, holding lists through the account entry on stock investment. They also offer certain mutual funds that are obtained with no fee on trade of various transactions.

Identification: Security exchange commission mark the dealer and broker as trustees who tend to take up the procedures and formalities of the security transactions on behalf of fund holders. Discount brokers are one who performs the orders without suggestion and advice over offers. Certain Online brokers help you in providing various details on consultation about the proffer and remuneration that are accessible in the process of investment.

Grip liability: Financial intermediary advisors and online brokers are brought into phase by the committee of financial industry regulatory authority, Federal Reserve board and Securities and Exchange Commission. These organizations take responsibility to hold up the trust over market functionalities.

Balanced Communication: Online brokers are the best source to disseminate over the real-time updates to investors. Stock quotes and news updates are being provided on a quick assess to familiarize with the mass market issues that are on quite balanced over the professional investment network.

Cost Effective: Online brokers are effective in utilizing integrate technology to cut down the cost and time spent on direct coordination over material research on trade. When compared to the work and energy spent on research over the mutual funds and investment plans one can spend over online brokers who can help you out with the legal research works.

Caution: It is recommended to look out for full-service agents or professional financial advisors for help when you run out of time to focus on the needful research over financial status and investment strategies that link to the current status.

Brokerage commission is chargeable on trading over balanced mutual funds. To buy mutual funds online one needs to acquire the right knowledge on investment at the right time to keep up the balance over the online mutual funds and saving plans to meet the current market trend.

TATA AIG Invest Assure II Plan Review

Let us today review TATA AIG Invest Assure II Plan.

Well, this is the insurance cum investment product (BEWARE…!!!). Here you can get the life insurance cover along with option to invest in different fund options. Thus, you can get the life insurance cover and at the same time invest in the markets and grow your money.

This is what they claim.

The term of policy is 15, 20 and 30 years and there is no penalty on surrender after 6 years of policy.

Here are the various charges under this policy.

(i) Premium allocation charge - deducted as a percentage of regular
Equity Government Money market premium, and varies with policy term and issue age.

(ii) Mortality charge - deducted from regular premium account
Fixed Income every month, towards life insurance cover available under policy.

(iii) Policy administration charge - deducted from regular premium
account on a monthly basis, and subject to a maximum of 5% p. a.

(iv) Fund management charge - varies between 0.90% to 1.75% for
equities above five funds.

(v) Surrender or partial withdrawal charge - calculated as
in G'Secs percentage of fund value of the withdrawn amount in case of full surrender or partial withdrawal.

(vi) Fund switching charge - of Rs.250 per switch, applicable for
every additional switch the first four 'charge-free' switches, and subject to a revised maximum Rs.500.

(vii) Premium redirection charge - of Rs.1000 applicable for every
premium re-direction, after the first 2 'charge-free' premium redirections, subject to a revised maximum of Rs.2000.
(viii) Premium holiday charge - of 3% of regular premium applicable
Each of the above funds will at all times be substantially invested in for the revival period in case the policy holder is unable to pay the regular premium within the grace period.

Thus, the policy is associated with lots of charges. In my opinion, you should go for Term Insurance + Equity Diversified Mutual Funds.

Term insurance will take care of your life insurance needs while the equity mutual funds will take care of your investment needs. So go for them. No need to buy this plan.

AEGON Religare Rising Star Child ULIP Plan Review

Let us today review AEGON Religare Rising Star Child ULIP Plan.

Download Brochure

This is one more ULIP plan which claims that it will secure the future of your child. However, I personally don’t think so. This is because Insurance cum investment products (especially child future plans and other types of ULIPs) are the wealth suckers. They slowly erode your long term wealth by charging lots of charges of various kinds for you.

According to the plan, the minimum annual premium is Rs.20,000 per annum. The minimum age of entry for the parent is 18 years (1 day for the child beneficiary), with 60 years (15 years for the child) being the upper limit . The minimum cover, depending on the parent’s age at entry, is 7-10 times the annual premium, while the maximum is 30 times the amount.

The plan offers you 4 types of options.

01) Secure Fund

02) Stable Fund

03) Debt Fund

04) Accelerator Fund

What I personally don’t like about child future plans is their high level of opacity and lots of charges. Let me explain you this in detail.

Well, say for example, Accelerator fund invest 80-100% of your money in equity. But well, they have not mentioned anywhere that in which stocks they will invest? – Large cap, midcap or small cap or mixed and in how much proportion?

While in case of Equity Diversified mutual funds everything is clear. Not only this but if the fund manager leaves the scheme than also you can know and suppose if the fund manager changes his investment strategy than also you can know because everything is very transparent.

But well, this is not the case of ULIPs and child future plans. In case of mutual funds, suppose if the fund doesn’t perform well than you can any time exit from that fund and invest in some other fund. But in case of child future plans suppose if the fund performs bad, you can’t exit and if you exit, you will have to pay lots of charges.

Let us discuss various charges associated with this plan.

01) Premium allocation charge – 4.40% for the first year, 3% for 2-5 years, 2% for 6-10 years and 1% from 11 years onwards.

Thus, during the entire tenure of the policy, you will have to pay this charge while mutual funds don’t have any entry load or any other recurring charges other than fund management charges (That is maximum 1.5% per annum).

But well, here the story doesn’t end. Even after paying premium allocation charges, you will still have to pay fund management charges (FMC) in this plan.

02) Fund management charges – 1-1.30% depending on the type of fund you select.

Thus, there is no sense of paying two separate charges here. Another drawback of Child plan like this is that, it gives you just 10 times insurance cover than the regular premium so it means that for 20,000 of annual premium, you will get insurance cover of just Rs.1 lakh. This is really a low life cover.

Pure term life insurance plans offer much better cover than this.

My Opinion -

No need to go for this plan. If you really want to plan your child’s financial future than buy a term insurance plan and invest rest of money in 2-3 equity diversified mutual funds carefully selected from Valueresearchonline.com via SIP.

Term Insurance + Equity Diversified Mutual Funds (3-4) is the best combination to build some long term serious wealth for your child.

It’s me, Asav Patel, The Founder of MJ2BC & Investta.com

Dear Readers,

If you are familiar with MyJourneytoBillionaireClub.com than you MUST be familiar with the Discussion Board/Forum – Investta.com

If not than let me explain you in brief about Investta.com.

Investta is the discussion forum where you can register and take participation in various discussions about money, personal finance, make money online, business and Entrepreneurship.

If you want to contact me in person or have any query/problem and want to discuss with me because you want a QUICK SOLUTION than you can anytime contact me on Investta.com

I am available on Investta for 24/7/365.

So the best and easiest way to contact me is Investta.

So Why you should join Investta and start discussion with me?

Well, This is because

A) QUICK

B) SIMPLE &

C) ACCURATE solution of all your financial problems and queries.

INVESTTA is my PASSION.

So Why you should join INVESTTA?

- This is because Investta is NOT a Business whose Bottom line is PROFIT.

- Investta is born out of the PASSION of its founder (Asav Patel)

- Bottom Line of Investta is not PROFIT but it is spreading the TRUE Financial Awareness and solve the financial problems of everyone

- We are absolutely focused on FINANCIAL EDUCATION and nothing else.

- We are NOT looking to sellout to investors

- We are here because discussing money, personal finance, business, investing and entrepreneurship is our PASSION.

- We love it here and we're all focused on spreading Financial Awareness. It's what we do. It's what we're good at.

- Selling some kind of Financial Product is not our purpose or business model. We are not affiliated with any Mutual Fund, Life Insurance or Financial Product company nor we any sell financial products of our own or any other company. The ABSOLUTE FOCUS of Investta is FINANCIAL EDUCATION & it’s what we are good at.

- And we are not FACELESS ROBOTS…!!!

- Even if you don’t have any financial problem that you want to solve than also visit Investta.com to see our PASSION. We are not inviting you to just solve your financial problems but we are also inviting you to see our PASSION.

JUST DON’T SEE HOW SMALL WE ARE BUT JUST SEE HOW BIG OUR PASSION FOR FINANCIAL EDUCATION IS…..!!!!!

Well, I am not an EXPERT nor I am any CFP (Certified Financial Planner). I am a Doctor. But well, following are the various areas where I have done lots of mistakes and learned lots of things from my own mistakes and read lots of things.

Here are,

Top 21 Reasons to start discussing with me on Investta.com

1) Do you Want to do FINANCIAL PLANNING?

2) You want to become FINANCIALLY FREE & RICH.

3) Are you fall in the trap of ULIP?

4) Do you want to invest in some Insurance Product but don’t know how that product is?

5) Do you want to invest in Mutual Funds but don’t know How to choose Best Mutual Funds?

6) PORTFOLIO ANALYSIS & REVIEW: You have already invested in Mutual Funds, FDs, Pension Plans, ULIPs & Money Back Insurance plans but you don’t know that which product is good and which is bad?

7) PORTFOLIO REBALANCING: You want to review your portfolio because you want to exit from the bad financial products.

8) You want to do RETIREMENT PLANNING

9) You want to MAKE MONEY ONLINE

10) You want to START YOUR OWN ONLINE/OFFLINE BUSINESS

11) You are a high school or college going student and want to make money Online

12) You want to GET OUT OF DEBT

13) You want a REVIEW of any Financial Product (Mutual Funds, Pension Plans, Term Insurance, Money Back plans, ULIPs, Endowment Plans, Bank FDs, Home Loans, Car Loans, Credit Cards…etc..)

14) You need a great BUSINESS IDEA.

15) You are a Student and want to discuss something about EDUCATION LOANS.

16) You are finding a GREAT INVESTMENT OPPORTUNITY.

17) You have some kind of FINANCIAL PROBLEM that you want to discuss.

18) You want to buy a Home & Car both but don’t know weather to first buy a Home or a Car?

19) Financial Planning for DREAM HOME: You want to buy your dream home but don’t know how to do financial planning for it?

20) TAX PLANNING: You want to save lots of tax but don’t know the different Tax laws and how to do tax planning.

21) CHILD FUTURE PLANNING: You have invested in child future plans offered by Insurance companies and now after few years you realize that you are not building any wealth for your child’s future and you want to do REAL CHILD FUTURE FINANCIAL PLANNING.

So if you want to discuss for any of the above purpose with me and many other people like you who are finding the solutions for the same thing than I am waiting for you on Investta to discuss all of the above things with you.

Agricultural Land Property in Maharashtra – Summarized Details

Download Now

This table (of information) [enclosed word file] is quite useful as a check list for those who desire to purchase “Agriculture Land” for the purpose of investment in Farming / Farm House etc… in MAHARASHTRA. This will serve as a bird’s eye view / information in nut shell about the Land. May prove to be quite useful (!) for the interested readers.

By: -- Mr. Prakash P. Joshi. E. Mail >>>> ppj_2001@yahoo.com

Deepika Padukone and Siddhartha Mallya in UK

As everybody knows that Siddhartha Mallya, the son of Vijay Mallya is having an affair with Deepika Padukone, the famous Bollywood actress.

Siddhartha Mallya is the son of liquor baron Vijay Mallya who is the chairman of UB Group.

The two have been spotted on many occasions since then and though they have maintained that they are merely friends, there is little doubt in the shrewd minds of the tabloid as to their brewing romance. The couple had an Indian Christmas which they celebrated in the town. But the buzz is that they are heading to London to celebrate theNew Year. So, they can look forward to a cosy UK celebration as they bid adieu to 2010.

What is the Name of Vijay Mallya’s Son?

Vijay Mallya is thee Billionaire liquor tycoon and the chairman of UB Group and Kingfisher Airlines.

You can see in the above photography that Vijay Mallya is with his son Siddhartha Mallya who has joined UB Group in 2010 only.

Siddhartha Mallya is looking after various aspects of UB Group and he is also a fond of lavish lifestyle just like his dad.

Internet Businesses are changing the Capitalism of India

The Internet is changing the capitalism of world and of course India. This is because the internet penetration in India is increasing day by day connecting more and more people.

Now, you will ask that how the internet is changing the capitalism of India? Well, this is because anybody from any age group can start his/her own business from the internet from any part of India and target the population of the entire world.

Take the Example of this Blog. I started this blog in March 2008 from my home in Ahmedabad and after that since May 2008, I am running this business from Kolhapur from my Hostel room only.

Right now I am in my hostel room and writing this article and educating people from all around the world about the internet businesses.

While those people who will follow the industrial age principles will still have to finish their education before start earning money.

With the help of the Internet, I can give job to anyone from any part of thee world. I can give a job to anyone for this blog even if he/she is in the college.

Isn’t it great? Because of the internet now college going students can also find a job and make money even before finishing their college education.

Than what is the need for such higher education? Students who follow the principles of industrial age will still have to complete their higher education before they start earning any money while students who follow the principles of information age have already started making lots of money by doing various types of online jobs and businesses.

In fact, because of the internet even a high school going kid can also start his own business from his home or a school library without noticing by anyone.

Isn’t it really great?

In fact, today from all around the world, many teen agers became self-made millionaires because of their internet businesses even before leaving their high schools. This means that students who have followed the old age principles (Going to school, get good job, work hard, invest in mutual funds and pension plans and retire at the age of 65) proved fooled.

So What I advise to the young generation that, the education system is no longer effective to ensure any kind of financial success in your life. Rather than that understand the internet and start your own online business as early as possible in your life. This is because there are enormous money making opportunities on the internet that can make you extremely rich in very young age of your life.

THE BEST (AMONGST BETTER) OPEN ENDED MUTUAL FUND SCHEMES AS ON 31^st December, 2010

Here are the Top Most Mutual Funds of India in various categories. Just print or save this page for your future reference and invest accordingly.

{Not necessarily, in the order of ‘preference’}

WHISHING YOU BEST LUCK FOR INVESTING!!!

By >

Prakash P. Joshi.

ppj_2001@yahoo.com

Cell No. +91 99203 34762

Ratan Tata’s Water Car India

Ratan Tata is the chairman of TATA Sons, the key holding company of TATA Group. Ratan Tata is passionate about car and his this passion has motivated him to innovate world’s cheapest car – TATA NANO.

Now, this time Ratan Tata will come with a car running on water (H2O) Only. Well, yes. This is not a joke or some kind of rumour. But this is a truth.

Ratan Tata has already invested US $ 15 Million on the research for making a car running on water. The well known old theory is that Water is H2O which contains Hydrogen (Energy) and Oxygen (to blow that energy). If somehow we separate hydrogen and oxygen from the water than we can run a car with this.

According to the Chairman of the Scientific Advisory Council to the PM of India the method comes from the brain child of a popular professor and scientist belonging to Massachusetts Institute of Technology. This professor is currently involved in splitting water straightly into Hydrogen and Oxygen. The news is that once the process gets into shape, Ratan Tata will be empowered to use the technology in his Tata Motors. The process can be made with any sort of water, the chairman added. Incidentally 2011 happens to be the International Year of Chemistry by the UN.

Flat Rate Vs Reducing Rate – Which is Better?

When you will go to the bank for personal loan, your bank/lender will ask you for two types of rate – Flat rate or reducing rate. In fac, your lender will advise you to go for flat rate and also tell you the advantages of flat rate interest loans.

But well, this is not the truth. You should not go for flat rate. This is because reducing rate is much better than the flat rate. Let me explain you how. But before that you will have to understand the difference between flat rate and reducing rate.

What is Flat interest rate & What is Reducing rate interest rate?

In a flat rate loan, the rate is calculated on the principal amount of a loan, while in a reducing balance loan, interest rate is charged only on the outstanding amount of a loan on a periodic basis.

Let me explain you by giving you an example.

In case of flat rate, suppose if you take a loan on Rs.5 lakhs and pay Rs.20,000 as a first EMI than from second EMI also the interest rate will be calculated on entire 5 lakh.

While in case of reducing rate, if you take a loan on Rs.5 lakh and pay Rs.2,000 as a first EMI than from the second EMI the interest rate will be calculated and charged only on Rs.4.80 lakhs and so on. So when you are about to finish the loan say just Rs.50,000 are remaining, you will have to pay interest on just Rs.50,000.

While in case of flat rate even if just 50k is remaining, you will still pay interest on 5 lakh…!!!

So get financially educated and always choose reducing rate option when you borrow money.

FMP Vs FD – Which is Better?

In India, the Bank Fixed deposits are very much popular because of one reason and that is - “SAFETY”. Fixed Maturity Plans (FMPs) however offer much higher returns than FDs but still they are not as popular as FDs.

But well, in my opinion FMPs are better and superior than FDs. This is because of the tax treatments for both of these financial instruments is different.

In case of Bank FDs, your interest income will be considered as income from other sources and will be taxed as 30% if you fall in the highest tax bracket. However, this is not the case of FMPs. The income from FMPs is considered as Capital Gain income because of its holding period of more than 1 year (typically 370 days).

One can earn higher returns from 370 days FMP than 500 days fixed deposit.

On the top of this the interest rates offered by FMPs is higher than FDs. In case of 500 days bank FD the interest rate is 8-8.5% per annum while in case of just 1 year FMPs the interest rate is 8.5-8.9% per annum.

Not only this but in the near future the interest rates are going to go up much higher than this. Don’t surprise if in the near future the FMP interest rates goes up to 10% per annum.

And that’s why in my opinion an investor should invest in FMPs rather than in Bank FDs. Tell me what do you think about it?

Know about Mutual Funds before Investing

Mutual funds are those that are made of gathered by number of investors who invest in a huge portfolio of stocks. This collection of money is managed by the personnel called fund managers. There are several types of mutual funds out of which three are basic. Before you can set out to invest in the mutual funds you need to be well versed with the mutual funds basics.

How mutual funds work?

The goal of every mutual fund is to generate maximum income for the investors. The income paid to the share holders are distributed in the form of dividends and capital gains. The mutual funds, like any other kind of investment have the risk too. It is the ROI or the return on investment that determines the performance of a mutual fund. This return is the rate of increase or decrease in the value of the stocks over a specific amount of time. While learning about mutual funds it is important that you learn their pros and cons too.

Classification of mutual funds according to the type of investment

• Stock mutual fund, also referred to as equity fund is those that have the highest amount of return not to forget that they are the ones that involve the highest risks too. Though there is no assertion about these mutual funds performing well, they work best when invested for a longer term.
• Money market funds are the mutual funds that are completely contradictory to the stock mutual funds as they are portrayed by the short term investments. Though having slower rates of growth, the main advantage of money market mutual funds is that there is least risk of running into a loss.
• The mutual fund basics include another type of mutual fund called the bond mutual funds which enable the investor to invest in the corporate and government bonds. Though the amount of returns is very low, there are consistent returns on the investment made in these mutual funds. Risks are inevitable in this type of mutual funds too when the value of the stocks drop and this takes place when the rates of interest drop.

Advantages of investing in mutual funds

• The chief advantage of investing in mutual funds is that there is an option for diversification in mutual funds. This aspect diminishes the amount of risk that is involved.
• Mutual funds are more affordable compared to other kinds of investments as you can also buy more units with small installments.
• Flexibility is another benefit that the mutual funds offer. You can switch between different funds that are managed by the mutual fund companies according to the conditions of the market.

Disadvantages of mutual funds

• There is no insurance against losses that are incurred due to mutual funds. It is the risk that is the biggest disadvantage of mutual funds.
• There are hidden fees collected from the investors by the mutual fund companies and there is no proper execution of trade. The transaction takes place only at the time of closing the market not considering the time you order for the buying or selling of the mutual funds.

Should You Break Your Old Fixed Deposit for Higher Interest Rates?

Inflation is rising in India day by day and to control this inflation, government is rising the interest rates. So how rising interest rates help to control the inflation?

Well, its simple. Rising interest rates means the loans/debt will be costly. Thus, the cost of borrowing money will be more and that’s why investors/individuals/businesses will take less loan and thus less liquidity in the circulation and thus less inflation.

I personally advise investors to invest in debt mutual funds rather than Bank FDs. This is because in case of rising interest rates, your interest rates of Debt funds will be automatically adjusted to the new level but in case of your Bank FD, it will be same for the entire tenure of the Fixed Deposit.

Say for Example, if your Bank FD rate is 7% per annum for 3 years and after 1 year suppose if the bank rises the interest rates to 7.5% than you will still earn 7% per annum for the entire tenure of your fixed deposit.

However, what you can do is, you can break this FD and re-do FD with new interest rates. But well, here keep in mind that premature withdrawal of your FD will attract the penalty charges of around 0.5%. So if thee interest rates have gone 0.5% higher and the premature withdrawal charges are 0.5% than there is no sense of breaking this FD.

Another thing is that, there will be 2% penalty charge on breaking the FD on interest earnings. Means suppose if your interest rate is 7.5% and after 4 months suppose if you break the FD than you will get only 5.5% interest rate. This is 2% penalty. So just keep in mind these facts before breaking the Fixed Deposit.

What is KYC Form for Mutual Funds?

If you are the mutual fund investor than you must have heard about the KYC Form. Well, if not than let me tell you that what it means. Well, KYC means Know Your Client Form.

Up to now, KYC Form was compulsory for the mutual fund investments above Rs.50,000. But from 1st January 2010, KYC Form is MUST for all kind of mutual fund investments – small or large.

Download KYC Form Here

Investors have to submit the KYC form, which is available with fund houses, along with necessary documents at the nearest investor services centre. They have to provide a photocopy of the PAN card , proof of address document and a passport size photograph.

From 1st January 2011, KYC Form is MUST for all kind of investments. So take a note of this. If you fail to submit this form along with your MF investment than your MF investment application will be rejected.

Parts of KYC Form -

KYC Form has 3 parts – A, B & C.

A. Identity Details – Name, Date of Birth, Nationality, Status, PAN

B. Address Details – Address of Correspondence, Address Proof…etc..

C. Other Details – Gross Annual Income, Occupation Details, Signature…etc…

So this form is compulsory now onwards. So kindly take a note of it.

Kotak Multi Asset Allocation Fund Review

Let us today review Kotak Multi Asset Allocation Fund. Well, as the name suggests, the fund invests in multiple assets means equity, debt and gold.

This is basically a debt fund which invest primarily in debt and debt related instruments. The fund will invest 75-90% in debt and money market instruments to generate regular income for the investors while 5-20% in Equity and equity related instruments for growth. The fund will also invest 5-20% of its assets into Gold.

Thus, over all this fund is the open ended debt fund. Very specifically speaking, the fund is open ended Hybrid fund (Debt oriented).

The fund will invest in Gold via Gold ETFs. Thus, this fund will invest in 3 primary assets – Equity, Debt and Gold.

Which type of Investors invest in this Fund?

Well, this is the fund in which investors who want to invest mainly in debt and small amount in equity and gold can invest. This fund is mainly for SAFE investors as it invests most of its assets into debt. While at the same time invests minor proportion into gold and equity.

Who should not invest in this fund?

The investors who want absolute growth of their capital should not invest in this fund. I mean young investors who are in their twenties and thirties should not invest in this fund. This is because in early age it is advisable to invest 100% of your money into equity for the growth.

The main advantage of this fund is that, you will enjoy all the 3 asset classes (Equity, Debt & Gold) in one single fund and that’s why it will be very convenient to you.