tag:blogger.com,1999:blog-40048722705398477562024-03-05T02:19:40.433-08:00KM WEALTH SOLUTIONS LLPTO PROVIDE FINANCIAL PEACE OF MINDKM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.comBlogger49125tag:blogger.com,1999:blog-4004872270539847756.post-22026552980482869962020-09-16T19:37:00.001-07:002020-09-16T19:39:40.681-07:00Science behind the Bad Investment… Part I<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgw4yU623d1Ho9CckHYQyygktNkkyxCJNL25CH0agyNKuhdqFnkK8tAAhAhFi38nMr6ZKA2TiVAPIBcfVLAVC96CEfLUkuUZgrOr_FkqJgYZZF0o03-HyL2b-vWF8umVT9o-7YCHLivpT4r/s275/Science.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="183" data-original-width="275" height="213" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgw4yU623d1Ho9CckHYQyygktNkkyxCJNL25CH0agyNKuhdqFnkK8tAAhAhFi38nMr6ZKA2TiVAPIBcfVLAVC96CEfLUkuUZgrOr_FkqJgYZZF0o03-HyL2b-vWF8umVT9o-7YCHLivpT4r/w320-h213/Science.jpg" width="320" /></a></div><br /> <p></p>
<p class="MsoNormal">While the numbers and the statistics play an important role
in any financial investing, finally it’s the human beings who are doing the
actual execution! Human psychology is an interesting science, but at the same
time it’s a dangerous thing. Many of the investors and even advisors are not
aware about the common psychological behaviors that can wreak havoc on your
hard-earned money invested into different instruments. (In fact, a few
investment advisors use this knowledge to their advantage by getting people to
invest in not ethically correct decisions but rather more convenient ones for
themselves.) How dangerous it could turn out to be for the financial future of
you and your families… Just Imagine!!<o:p></o:p></p>
<p class="MsoNormal">So today, our attempt is to educate you and share some
important pointers on science behind the investments and most essentially how
to avoid the bad investments. So here we go. The first part of this blog is
going to talk about few basic concepts and biases.</p><p class="MsoNormal"><span style="text-indent: -0.25in;">Let’s start with the most common one and what
people think is the best decision in the circumstances. The </span><b style="text-indent: -0.25in;">“Loss Antipathy
Bias”</b><span style="text-indent: -0.25in;">! </span><span style="mso-spacerun: yes; text-indent: -0.25in;"> </span><span style="text-indent: -0.25in;">People believe that there are
more bad things in the world for us than the good things happening and thus
it’s better to capitalize on anything positive at any given point in time.
Simple example is of investment that you have done in a couple of funds at the
same time. One was say: 1 Lac because of a “hot tip” given by your friends and
another one was a 15000 only in an investment which was well researched by you.
Imagine the 1Lac has gone down to 50000 only whereas a well-researched one you
did is now 50000 too. Which one are you likely to sell in a need? “The Loss
Aversion” mindset kicks in and says, sell the profitable one first, else you
may lose that one too!</span><span style="mso-spacerun: yes; text-indent: -0.25in;"> </span><span style="text-indent: -0.25in;">It’s the natural
psychological barrier which says you may lose this profit. </span><span style="mso-spacerun: yes; text-indent: -0.25in;"> </span></p><p class="MsoListParagraphCxSpFirst" style="mso-list: l0 level1 lfo1; text-indent: -0.25in;"><o:p></o:p></p>
<p class="MsoListParagraphCxSpMiddle">Well, we all should see that it’s not a
simple answer! That profitable 50000 may be only just tip of the iceberg and
the rally is expected to take it to 1Lac… But, psychology doesn’t let you think
like that. <o:p></o:p></p>
<p class="MsoListParagraphCxSpMiddle">A wonderful analogy is shared in one of our
earlier blogs with a story of Tamarind Tree.<span style="mso-spacerun: yes;">
</span>(Link: Why an Investor should never let a crisis go waste) The tree
which was feasted upon regularly and daily without letting it grow, dies soon
after. And the one where you let it flourish will continue to give prosperous
returns.</p><p class="MsoListParagraphCxSpMiddle"><span style="text-indent: -0.25in;">On similar lines, we can think of another
pitfall called </span><b style="text-indent: -0.25in;">“Lost Cost”</b><span style="text-indent: -0.25in;"> pitfall. This is as dangerous as the previous
one we talked about, if not more. Psychologically, we start protecting and
justifying certain decisions taken earlier (but not realistically), and its
catastrophic for the investment. It’s very difficult to accept that you made a
mistake or made a wrong choice of investment earlier! You continue to stay
vested into this loss making instrument, even though the best idea would be to
get out of it as soon as possible. This delay can prove to be fatal for any
positive returns. Emotional commitment to the bad investment makes things
worse.</span></p><p class="MsoListParagraphCxSpMiddle" style="mso-list: l0 level1 lfo1; text-indent: -0.25in;"><o:p></o:p></p>
<p class="MsoListParagraphCxSpMiddle">An ideal analogy here can come from
Mahabharata and the character “Karn”. He is actually the son of Kunti,
Pandava’s mother. He knows that he has sided with the wrong side during the war
and Duryodhana is the side of “Adharma”; but unfortunately to keep his
commitment to Duryodhana, was killed in the war along with other Kauravas.</p><p class="MsoListParagraphCxSpMiddle"><span style="text-indent: -0.25in;">Next one to talk about is a </span><b style="text-indent: -0.25in;">“Relativity and
Comparison”</b><span style="text-indent: -0.25in;"> pitfall. Each and every individual is different
psychologically. Each and every situation is different worldly. And each and
every opportunity looks different from an individual’s goggle or a lens. This
is a true reality! Not every investment and opportunity can be compared and
related to what others are doing. Especially, your closest friends and
relatives… Imagine there is a huge opportunity in the market because of a
certain global situation, whereas your best friend wants to put in additional
50Lacs investment to benefit from this opportunity, you may not be in a
position to do same thing! Multiple factors to be considered like family
responsibilities, financial liabilities, ongoing commitment to certain
investments already done (e.g. property loans or some electronic White Goods
purchased on EMI plan). Well, these are still simple but how about your mental
or psychological make-up??!! Every individual is different and so is the
risk-taking or risk-aversion ability. If investing these 50Lacs is going to
lose you a good night’s sleep, is it really worth it??!!</span></p><p class="MsoListParagraphCxSpMiddle" style="mso-list: l0 level1 lfo1; text-indent: -0.25in;"><o:p></o:p></p>
<p class="MsoListParagraphCxSpMiddle">But people do get into this, comparison and
relativity trap and thus losing a lot on investments in future (if they don’t
stay invested) or even on their comfort and mental well-being.<o:p></o:p></p>
<p class="MsoListParagraphCxSpMiddle">The analogy here can be of a copycat
syndrome in business scenarios. What the market leaders do, some businesses
blindly copy. They may not have the sustainability say in terms of marketing
dollars spend and thus eventually lose out on the entire business.<o:p></o:p></p>
<p class="MsoListParagraphCxSpMiddle"><b style="text-indent: -0.25in;">Irrational
Exuberance Pitfall</b><span style="text-indent: -0.25in;"> (Term popularized by US Fed Chairman Alan Greenspan):
So, what does it mean? Irrational exuberance is unsupported and unfounded
market optimism that lacks a real foundation of fundamentals, but instead rests
on psychological factors such as past performance. When investors start
believing that the past equals the future, they are acting as if there is no
uncertainty in the market and market will only continue to go up.
Unfortunately, in real world the uncertainty never vanishes. Just relate it to
the COVID19 scare we have been living through for past 6 months. It was never
expected and is a kind of Black Swan event that has crippled economies all over
the world. Irrational exuberance is actually synonymous with the creation of
inflated asset prices associated with bubbles based out of just sentiments and
emotions, which ultimately pop out.</span></p><p class="MsoListParagraphCxSpLast" style="mso-list: l0 level1 lfo1; text-indent: -0.25in;"><o:p></o:p></p>
<p class="MsoNormal">Well, the stories and examples are galore and we can learn from
many of those… But, these are only a few pitfalls being talked about. In the
second part of this blog let’s talk about few other psychological barriers. Are
you ready?<o:p></o:p></p>KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-11253543481014521592020-08-24T20:23:00.003-07:002020-08-24T20:26:58.688-07:00Creating a legacy, shouldn’t be messy!!<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9yjQTmM3Sf_dNTrKqBvL7V8D_ylFXhqdhpOJkCioTzCGRpiZqxnEb1v3BOaF2rV-heTzpHKLd0o0i2wgAkSORNT_TmPv9UpEyUWdkIuS9FDwufdVSyZjpMXGTq5UmAzQGMrZ8CmymM5-o/s275/Legacy.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="183" data-original-width="275" height="229" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9yjQTmM3Sf_dNTrKqBvL7V8D_ylFXhqdhpOJkCioTzCGRpiZqxnEb1v3BOaF2rV-heTzpHKLd0o0i2wgAkSORNT_TmPv9UpEyUWdkIuS9FDwufdVSyZjpMXGTq5UmAzQGMrZ8CmymM5-o/w344-h229/Legacy.jpg" width="344" /></a></div> <p></p><p></p><p class="MsoNormal">“Make a difference, change the game for the better, leave a
legacy, be a guide that someone else can follow and make better, and then
someone else will follow that and make that better.”<o:p></o:p></p><p class="MsoNormal">― Carlos Wallace<o:p></o:p></p><p class="MsoNormal">A beautiful quote that forms the basis of our today’s topic
and something that will serve as a guide for the families, head of the families
and the society as a whole who leave back their legacies. The unclear,
undecided, unattended and unprepared plans for continuing the family
inheritance is bound to play a spoilsport when everything is said and done. So,
lets discuss more about the why, the how and the when of Creating Legacy for
your successors.<o:p></o:p></p><p class="MsoNormal">Typically, the legacy or inheritance (in case of India) is
thought about only the materialistic things: such as the bank balance, real
estate, the business ventures, family ornaments and anything else that is
considered precious and valuable. And that in a way is correct too. But, it is
imperative to pay attention not just to the semantics of the word Legacy but
rather it’s much deeper and comprehensive implementation of it in the real
world. This means passing along the knowledge of values and the character.<o:p></o:p></p><p class="MsoNormal">Still unclear??!! Let’s talk about a wonderful example here…
I am going to talk about Mahabharata, the epic and the classic that was written
down almost 3000 years ago. We all know and remember the things from
Mahabharata that there was a war between Kauravas and the Pandavas that
continued for almost 18 days and eventually the Pandavas won. But, have we ever
thought about “the Why” of that war??!! The roots of this war were not just the
intentions of becoming the King of Hastinapur (between the Kauravas and the
Pandavas); but it ran much deeper than that. Their fathers Pandu and
Dhrutarashtra, their uncle Bheeshma had passed along to them the Throne of
Great Hastinapur Kingdom, but along with that the set of values and beliefs to
the Pandavas and Kauravas clan too. Earlier in the years, Kaurava’s father
Dhritarashtra being blind was sidelined by the elders and they made Pandu
(Pandava’s father) the King of Hastinapur. Dhritarashtra from that moment
onwards was emotionally hurt and very prejudiced and felt as if injustice was
done with him. Later, as Pandu passed away, Dhritarashtra became the King and
always wanted his sons to take up the throne next. He wanted the history not to
repeat itself… Just imagine, what was left in inheritance was not just the
throne but the acerbic values, behaviours and thoughts as well. Naturally,
there was a power struggle for the Throne and with multiple ethically and
morally wrong-doings such as attempt to de-clad Draupadi in front of the entire
raj-sabha, killing of Abhimanyu and mutilating his body during war to name just
a couple. The entire Kaurava clan was killed and Pandavas next generation was
wiped out by Ashwatthama after the war…
Was the war really worth all that??? It was not just legacy of the
throne but the wrong values and ethical conflicts passed along…<o:p></o:p></p><p class="MsoNormal">Now, why are we talking about this entire story in the
modern generation? The reason is exactly what we have been exploring and
obviously for the analogical reasons… The legacy means not just the valuables,
real estate and the money, but passing along the knowledge to earn, to retain
and to grow the financial independence. The earlier generation has really
worked hard for it and so the next generation should not just take it for
granted. Otherwise, in modern day context: the crores those have been earned
over many hardworking and smart-working years, could simply be spent and
flushed down the drain without much clarity of thought and absence of guiding
principles. You don’t want your Legacy to be “What could have been” but rather
become “What has been and will remain in future” too…<o:p></o:p></p><p class="MsoNormal">So, what can be done about it? How can it be done? The
answer lies into financial planning tools and sound advise, as well as making
sure your next generation stays on top of it too. They are to be made part of
this planning too and they are to be made aware about the perils of lackadaisical
attitude towards the money management. Let them understand it, let them earn it
and then let them enjoy the fruits! Imagine an 18 year old getting a new BMW or
a Mercedes car, without understanding the real value of it… Not price, but the
value! It would be an irony to think that in your own lifetime you have to
worry about your inheritance due to worrisome habits. So, then what can you do
about it? There are more than few ways to plan it and prepare it. Here are a
couple of thoughts and we definitely want to advise you to take professional
help to decide what is best for you. Thinking of doing formal “Will” is a great
way ensure that your legacy is secure. You can define and pre-decide certain
clauses based on time, based on conditions and based on situations in there to
protect your Legacy. A wonderful idea would be also to create a trust which
will manage the funds as well as help your heirs decide on the correct course
of action to preserve the wealth. Another suggestion could be to invest in an
instrument like Whole Life Insurance and ensuring that your hard-work, rewards
the next generation; no matter whenever your leave your earthly journey for
heavenly abode… Just a few ideas to consider for preservation of your Legacy in
cleanest possible way!!<o:p></o:p></p><p class="MsoNormal" style="line-height: normal; margin-bottom: 0in;">
</p><p class="MsoNormal">Finally, we come full circle to our question… What does it
mean to leave a legacy? It means putting a positive stamp on the future of your
family, and making a contribution to your future generations. People want to
leave a legacy because they want to feel that their life mattered. Let us at K
M Wealth Solutions help you do that… Are you ready to leave a mark on the
future to come?<o:p></o:p></p><p></p>KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-40565300958813289872020-08-07T20:36:00.007-07:002020-08-07T21:29:28.400-07:00Financial Planning - Does it really work for me? Part 2<p></p><blockquote style="border: none; margin: 0px 0px 0px 40px; padding: 0px;"><div class="separator" style="clear: both; text-align: left;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgntiMojfMoaRlhgTkcfnXoQx5TenlXjP6DlEEViN-RgmLXgtFty8M4yZqeSXrCOD12b-31WznSmmjn8gDjMvrBhSi85iKgL9hQFDqn1tVlDXV5zH-NA_5CIMJs8u9CtFvXz0B34I3Nems4/s328/images.jpg" style="display: block; padding: 1em 0px;"><img border="0" data-original-height="153" data-original-width="328" height="191" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgntiMojfMoaRlhgTkcfnXoQx5TenlXjP6DlEEViN-RgmLXgtFty8M4yZqeSXrCOD12b-31WznSmmjn8gDjMvrBhSi85iKgL9hQFDqn1tVlDXV5zH-NA_5CIMJs8u9CtFvXz0B34I3Nems4/w410-h191/images.jpg" width="410" /><span> </span></a></div></blockquote><p><br /></p><p class="MsoNormal">In our earlier blogs, we were discussing about couple of
very important concepts. The financial planning is about long term gains rather
than short term returns. It’s about the plan and goals, it’s not about only
impulsive investing. Financial planning is not about only investing but
focusing on the big picture. Financial planning is also about using the
expertise available (even at a certain cost) rather than focusing on individual
knowledge that you have and that you are planning to gain from the friends and
family. <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p>Well, sometimes people do feel that they do not earn enough
and they do believe that whatever smaller amounts they could save are just to
be put in the savings account. They might think their financial planning would
be very simple and straightforward. On the other hand, they might think that
the rich people require the all this planning as they have a problem of plenty.
They need advice on where, when and how to invest. Well, they are only partly
correct.</p><p class="MsoNormal"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p>Commonly heard statement: The rich people and high income
earners do have abundance and they would need advice on sound financial
planning to invest their riches. Whereas the small earners cannot afford to
even look at financial plan as they simply don’t have enough.</p><p class="MsoNormal"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p>Let’s look at it from a contrarian view. Though statement
above makes logical sense, it would be unwise to think only like that,
especially for the low income earners! Imagine you are getting a small income,
but you have a family to feed, future responsibilities of theirs to tend to; as
well as personal retirement savings that they should generate. Now, think who
needs the plan more??!! While the high income earners would eventually end up
having more money to spend on all the responsibilities and retirement, the
low-income earners need sound advice and constant hand-holding to reach all
their future saving and financial planning goals. Makes sense??!!</p><p class="MsoNormal"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p>Well, important point is even the high income earners,
business people and top management professionals would need to look at their
goals and planning. Have you heard about Mike Tyson, who earned more than 300
millions of dollars during his professional boxing career, but ended up being
bankrupt soon after due to bad spending habits (he once spent 400 Thousand
dollars on his birthday party) and not thinking about his future and retirement
life. Do you wonder even with all this money made during the careers, how this
no or little financial planning can break you badly… People who do not endorse
meticulous fiscal planning should learn from this and many such stories.
Aranxta Sanchez Vicario (14 times Grand Slam Winner in Tennis), Diago Maradona
(World famous footballer), Marion Jones (3 times World Champion Sprinter) are
just another few names who had to file for bankruptcy even after earning
millions during their illustrious careers. With bad or no financial planning,
you are simply trusting that everything will work out on its own.</p><p class="MsoNormal"><o:p></o:p></p>
<p class="MsoNormal">Now, interestingly enough some business owners think that
why should they even invest hard-earned money and profits into someone else’s
business. Isn’t it most prudent to invest in one’s own business to grow your
own business and reap all the benefits? No doubt this is a good thought and a
practical one too. But, this means you are spreading too thin or you are
actually putting all the eggs in one basket. It could become a very risky
proposition, if something goes wrong. Even when businesspeople preach about
diversification in their own business, and then why not think of diversifying
your own investments into multiple instruments and work on a definite plan to
achieve that??!! </p><p class="MsoNormal"><o:p></o:p></p>
<p class="MsoNormal">Haven’t we all heard the story of an Inattentive Deer?<o:p></o:p></p>
<p class="MsoNormal">One day, a deer is feeding on the coast. She is always
worried that some hunter will come through the field and shoot her, so she
feeds with her back to the sea so that she can keep an eye on the fields.
However, while she is so focused on the fields, she doesn’t notice some
fishermen come from the sea and throw their net over her. As she is captured,
she exclaims: “ I wish only if I had anticipated this and not ignored the
sea-side completely!”<o:p></o:p></p>
<p class="MsoNormal">There is no point putting the blinkers ON and think like the
race-horse does. While the race-horse has a very short term and clear objective
of winning that particular race, wouldn’t it be wise to think that we all are
rather in a long haul and possibly need a wider vision and definite foresight
into our financial future? Sometimes,
people get into a rut of a particular type of investment like gold investment
or a real estate investment over and over, because it has yielded them results
for an extended time span. But, it’s not practical to think that for your
life-span that same thing is going to be the trend. It’s not feasible that the
same instrument of investment will have absolutely no ups and downs, especially
when you require money for some contingencies and emergencies. Thus, concrete
financial plan and diversification in investments, through the expert’s advice
should be top priority. <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p>Financial Planning is a must for the better future and
better life. Now, doesn’t it sound appropriate? </p> <p></p>KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-7971278565545165532020-08-01T21:40:00.002-07:002020-08-01T21:42:59.070-07:00Financial Planning: Does it really work for me?<div dir="ltr" style="text-align: left;" trbidi="on">
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<b>Why do people avoid personal financial planning?</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span style="font-family: "Mangal",serif;">उद्यमेन</span> <span style="font-family: "Mangal",serif;">हि</span> <span style="font-family: "Mangal",serif;">सिध्यन्ति</span>,
<span style="font-family: "Mangal",serif;">कार्याणि</span> <span style="font-family: "Mangal",serif;">न</span> <span style="font-family: "Mangal",serif;">मनोरथैः</span>
<span style="font-family: "Mangal",serif;">।</span><o:p></o:p></div>
<div class="MsoNormal">
<span style="font-family: "Mangal",serif;">न</span> <span style="font-family: "Mangal",serif;">हि</span> <span style="font-family: "Mangal",serif;">सुप्तस्य</span>
<span style="font-family: "Mangal",serif;">सिंहस्य</span> <span style="font-family: "Mangal",serif;">प्रविशन्ति</span> <span style="font-family: "Mangal",serif;">मुखे</span>
<span style="font-family: "Mangal",serif;">मृगः</span> <span style="font-family: "Mangal",serif;">॥</span><o:p></o:p></div>
<div class="MsoNormal">
<span style="font-family: "Mangal",serif;"><br /></span></div>
<div class="MsoNormal">
As the antelope does not enter the sleeping lion’s mouth by
itself, In the same way we can succeed in our work only if we work hard, not
only from our desires. <o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
What a beautiful verse, also known as a su-bhashit in
Sanskrit or it literally means well-spoken or eloquent saying and this appears
in Hitopadesha written in 8th Century. The philosophy is applicable to anything
in life, anything you wish to achieve or obtain. Without any action, the
planning has no meaning. Without any deed, all the propositions have no value.
And such is its application to our topic of the day: Personal Finance or
personal financial planning.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Today, we are going to look at what are some common reasons
or beliefs that will stop people from taking the action towards personal
financial planning and most importantly take action upon it. The most common
reason is procrastination, exactly same as the above verse suggests. There can
be tremendous plan and thought put into the personal financial goals, but
without taking the concrete steps it’s all about wasting time. We have already
talked about capitalizing on opportunities, even in the most turbulent markets,
in our earlier blogs. (Refer: Why an investor should never let a crisis go
waste) And so, stop procrastination and take action!!<o:p></o:p></div>
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Many times, investors think: Investing = Financial planning!
It’s not the same; it can never be the same! It’s like only keep on shooting
the rifle and hope that every shot will hit the bull’s eye! Investing without
knowing the destination is obviously going to be a big disappointment if you
can’t think of: a) the destination, b) how far is the destination; and c) along
with that how many twists, turns and pit-stops you are going to need in this
journey. Let’s relate it to three particular age-groups and you will see the
difference.<o:p></o:p></div>
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Age group 20-30: The freshers from college, possibly single,
no additional responsibilities, in Indian scenario probably still staying with
parents… They can entirely lay out how the personal financial life can bring
them independence in life as soon as possible, by having more aggressive
approach.<o:p></o:p></div>
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Age group 30-40: Mid careers, recently married, young
children, additional liabilities and responsibilities, possibly Home loans…
They are a bit tied up currently on the liabilities front and thus the plan for
personal financial freedom looks a bit complex.<o:p></o:p></div>
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Age group 40-50: Seasoned professionals, children growing up
fast, possibly high monthly income potential, but limited number of years in
hand… The plan for personal financial freedom looks a bit more conservative
with low risk approach as you approach the retirement<o:p></o:p></div>
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For each of the scenario above, the investing is not as
simple as putting money into different instruments, but rather choosing the
correct path based on financial goals. This is where many of the investors make
an assumption that they can keep on investing regularly, without any advice or
help from the experts. The investing is just one part of it, but knowing when
to divest or secure the gains / booking the profits earned before the
opportunity loses its shine, is equally important. <o:p></o:p></div>
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The expert or an experienced advisor will play a crucial
role to help you understand your goals and financial planning objectives
better. They have been through this and done this numerous times with their
clients with plenty of success and thus it’s advisable to think of this option.
There is a very popular Akbar-Birbal story that we can relate this too. <o:p></o:p></div>
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Once Akbar’s wife (Begum) asks him that her brother should be
made a prime minister instead of Birbal. Akbar said that Birbal is there
because of his expertise and not just anyone can do the same job. Akbar’s wife
(Begum) got angry and asked him to give her brother the next available to
opportunity to prove his mettle. Akbar readily agreed and the opportunity just
came immediately. The next day, when Akbar was looking out from his Palace
window saw some settlements forming at the banks of the Yamuna river. He said
to the brother “Find out what it is” The brother ran out and reported back
after few minutes- “Your Highness, they are tents”. Akbar asked again “Where
are they from”?. The brother ran out again and reported back after some time –
“From Persia” Akbar asked again “How many people are there?” The brother once
again ran to find out and reported back “675 men”. “No women?” asked Akbar and
off went the brother again. Relentless questions and corresponding trips by the
brother followed! Begum’s brother was already getting irritated and started
wondering why the King cannot think cohesively and ask more questions in one go
rather than asking one question at a time.<o:p></o:p></div>
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Finally, Birbal appeared in the court. Hearing the King, he
intervened and said “Let us discuss what all we should know about that
gathering near the river” They went into a meeting for some time after which
Birbal went off to find out more. He was back after 2 hours. And what did he
bring after being gone for 2 hours?<o:p></o:p></div>
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“The tents at the banks of the river belong to a caravan of
traders from Persia. There are 675 men, 210 women and 85 children. The leader
of the group is …” Birbal also reported “they have 200 horses which they want
to sell and I have negotiated the price at…… I need your consent on this”. He
also explained on what all benefits the kingdom can accrue from the visit of
these traders etc etc. Beautiful, isn’t it!! Akbar’s wife (Begum) understood,
why it is “Expert’s job”…<o:p></o:p></div>
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If you feel it’s too complex to even think about how this
entire financial world works, that’s what the experts are for. It’s what they
do for living and they are good at it! Using available help and resources,
rather than relying upon self-help all the time, is what wise men do! Work with
experts, hire them to do work; which will in turn save you time and money!! <o:p></o:p></div>
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Finally, wisdom is not about education but about execution!
Let’s hear more in the next blog…<span style="mso-spacerun: yes;"> </span><o:p></o:p></div>
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(Part II of this blog is coming up)<o:p></o:p></div>
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KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-11678476857005953192020-07-12T22:09:00.000-07:002020-07-12T22:17:08.831-07:00Strategies to safeguard your Investment during Covid 19<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUKnlJuUXflojtuMJWnAKX4FIeZU5LGWBGolemJgyOI7PjoVvrwFzrx3kdr4jiGBaB2Dm6_ncPsb0ExM5Gb2hvKhVxGPuOmzYgFuIOsQewsUY4Jom9ZY5z8byoZ_b_2H5_Lfjp05GrvCdM/s1600/download.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="159" data-original-width="318" height="200" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUKnlJuUXflojtuMJWnAKX4FIeZU5LGWBGolemJgyOI7PjoVvrwFzrx3kdr4jiGBaB2Dm6_ncPsb0ExM5Gb2hvKhVxGPuOmzYgFuIOsQewsUY4Jom9ZY5z8byoZ_b_2H5_Lfjp05GrvCdM/s400/download.png" width="400" /></a></div>
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Today, first we will look at some key words of our title and
their Oxford dictionary meanings to start our blog. Just to establish the
context… <o:p></o:p></div>
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<b>“Strategy: A plan of action designed to achieve a
long-term or overall aim.”<o:p></o:p></b></div>
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Observe how the word “Strategy” is explained using the set
of words like action plan, achieving and long-term. <o:p></o:p></div>
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<b>“Safeguard: a measure taken to protect someone or
something or to prevent something undesirable.”<o:p></o:p></b></div>
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Keywords here are to protect and to prevent from something
undesirable.<o:p></o:p></div>
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<b><span style="mso-spacerun: yes;"> </span>“Investment: an
act of devoting time, effort, or energy to a particular undertaking with the
expectation of a worthwhile result.”<o:p></o:p></b></div>
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Whenever we think of investment it is imperative to
understand the term: act of devoting time, effort and energy.<o:p></o:p></div>
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Some amazing keywords to get us started today! Remember the
age old saying of “Every calamity brings with it, the equal or greater
opportunity.” Currently, Lock-down and the post lock-down phases have brought us
a similar opportunity when we are thinking of our investments. There are
turbulent phases in lifetime of any investment and as long as one is guided,
mentored and hand-held by sound financial principles and advisors, we should
still be able to comfortably deal with this scenario.<o:p></o:p></div>
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The story of “This shall too pass...” This is a famous adage
that finds its place in many religions of the world like, Hebrew, Arabic,
Christianity and Hinduism. Of course, pronounced differently, these four words
have a deep, philosophical meaning to the temp-orality of this world. Nothing in
this world is permanent, always changing. Same principle applies to our own
money and our own investments too. Here is little longer version of the story…<o:p></o:p></div>
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Once a king called upon all of his wise men and asked them,”
Is there a mantra or key-rule which works in every situation, in every
circumstance, in every place and in every time. In every joy, every sorrow,
every defeat and every victory? One answer for all questions? Something which
can help me when none of you is available to advise me? Tell me is there any
mantra?”. <o:p></o:p></div>
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All the wise men were puzzled by the Kings question. They
thought and thought. After a lengthy discussion, an old man suggested something
which appealed to all of them. They went to the king and gave him something
written on paper, with a condition that the king was not to see it out of
curiosity. Only in extreme danger, when the King finds himself alone and there
seems to be no way, only then he can see it. The King put the papers under his
Diamond ring. Sometime later, a neighboring king attacked the Kingdom. King and
his army fought bravely but lost the battle. The King had to flee on his horse.
The enemies were following him. And, they were getting closer and closer.
Suddenly the King found himself standing at the end of the road - that road was
not going anywhere. Underneath there was a rocky valley thousand feet deep. If
he jumped into it, he would be finished and he could not return because it was
a small road the sound of enemy’s horses was approaching fast. The King became
restless. There seemed to be no way. Then suddenly he saw the Diamond in his
ring shining in the sun, and he remembered the message hidden in the ring. He
opened the diamond and read the message. The message was “THIS TOO SHALL PASS”.
The King read it . Again read it. Suddenly something struck him- Yes! This too
will pass. Only a few days ago, I was enjoying my kingdom. I was the mightiest
of all the Kings. Yet today, the Kingdom and all my pleasure have gone. I am
here trying to escape from enemies. Like those days of luxuries have gone, this
day of danger too will pass. A calm came on his face. He kept standing there.
The place where he was standing was full of natural beauty. He had never known
that such a beautiful place was also a part of his Kingdom. The revelation of
the message had a great effect on him. He relaxed and forgot about those
following him. After a few minutes he realized that the noise of the horses and
the enemy coming was receding. They moved into some other part of the mountains
and were near him. The King was very brave. He reorganized his army and fought
again. He defeated the enemy and regained his empire. When he returned to his
empire after victory, he was received with much fanfare. The whole capital was
rejoicing in the victory. Everyone was in festive mood. Flowers were being
showered on King from every house, from every corner.<o:p></o:p></div>
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People were dancing and singing. For a moment King said to
himself. I am one of the bravest and greatest King. It is not easy to defeat
me. With all the reception and celebration he saw an ego emerging in him.
Suddenly the Diamond of his ring flashed in the sunlight and reminded him of
the message. He opened it and read it again: THIS TOO SHALL PASS. He became
silent. His face went through a total change -from the egoist he moved to a
state of utter humbleness. If this too is going to pass, it is not yours. The
defeat was not yours, the victory is not yours. You are just a watcher.
Everything passes by. We are witnesses of all this. We are the perceivers. <o:p></o:p></div>
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Well, an amazing story!! Though we can hold off on the
philosophical message for this moment (and off-course you can revisit it later)
and now focus only on practicality in the story, we have a strategy for COVID
19 situation. <o:p></o:p></div>
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1. Patience is the best strategy right now. Most business
owners are working to survive and wait for this tough phase to pass and
continue to stay in their business.<span style="mso-spacerun: yes;"> </span>The
same strategy you need for your investments. - this too shall pass. <o:p></o:p></div>
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Your portfolio may be showing lot of red and it may have
come down to original invested amounts wiping out any gains, the better days
are surely ahead. STAY INVESTED!<o:p></o:p></div>
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2.<span style="mso-spacerun: yes;"> </span>Have an asset
allocation – What this means is not keeping all eggs in one basket. It is
natural and easy to play safe and move all your investments into bonds and
safest options. But, this means that you may not be utilizing the opportunity
available. Sound financial advice suggests: to keep certain amount in safe
secure investment and certain amount has to be dedicated for growth
opportunities. E.g. Currently, pharma companies are showing a lot of potential.
<o:p></o:p></div>
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3. Sector leaders change. Just staying invested doesn’t mean
much. The times and tides wait for none. The opportunities keep on showing up.
Now, is the time to revisit your portfolio and restructure it if needed. And
it’s not a one-time activity but should be strategically planned one.<o:p></o:p></div>
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4.<span style="mso-spacerun: yes;"> </span>Have your core
portfolio<span style="mso-spacerun: yes;"> </span>- and a satellite portfolio –
Core portfolio is where you have a long term strategy in place and you only
tweak a few things to unlock it fully. Whereas, another wiser approach would be
to have a satellite portion of portfolio too. This is the part where you will
take short / medium term tactical calls. This will give you some alpha
(leverage and addition) in overall returns of your entire portfolio.<o:p></o:p></div>
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Well, COVID 19 has been a tremendous global impact event… It
has literally shook the foundation of entire humanity! Obviously finance and
economy are impacted as badly as anything else. But, with the trend already
showing upward curve and businesses slowly resuming its routine with the “new
normal”, we should be optimistic and opportunistic to capitalize on the India’s
Growth Story!!!<o:p></o:p></div>
<br /></div>
</div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-47101677532871487632020-06-27T21:26:00.005-07:002020-06-27T23:20:09.745-07:00Philanthropy – An art of giving<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh-r8-IMq4vgpd_9736TITTE4aC13giLkgiMRRgOBgrWbw9rAableU6QaErDzyXq5o2FzztGQIfAaanFk7BrSAqETnFYliR01shelTwNrpMnLXhf1BQeQpttTSCD5r2JEruikxHeoT4mcib/s1600/download.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="168" data-original-width="299" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh-r8-IMq4vgpd_9736TITTE4aC13giLkgiMRRgOBgrWbw9rAableU6QaErDzyXq5o2FzztGQIfAaanFk7BrSAqETnFYliR01shelTwNrpMnLXhf1BQeQpttTSCD5r2JEruikxHeoT4mcib/s1600/download.jpg" /></a></div>
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Just this weekend, a movie channel was playing a wonderful
English movie called “Evan Almighty”.</div>
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The hero of the movie Evan, who is a US
Senator in modern day Washington DC, is asked by the ‘God’ to build an ARK.
First few days, Evan is unable to understand why ‘God’ is asking him to build
that ARK in this modern neighborhood and in this era; and what does God want
him to do exactly. Well, most important portion of the movie is: when he
finally builds this ARK with help of his family and it helps to save the entire
neighborhood (and animals too) from a dam full of water (improperly built)
which breaks down in the climax. </div>
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The follow-up conversation with God is
wonderful:<o:p></o:p></div>
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God: How do you change the world?<o:p></o:p></div>
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Evan: One single act of random kindness at a time.<o:p></o:p></div>
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God: [spoken while writing A-R-K on the ground with a stick]
One Act, of Random, Kindness.<o:p></o:p></div>
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Brilliant isn’t it??!! <o:p></o:p></div>
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The metaphorical ARK and the real ARK building exercise is
something that teaches us plenty, even in this era. Art of giving, also known
as Philanthropy in modern day is something that every human being should learn.
It’s not called science specifically because there is not exact rule or a
guideline on when to give, how to give and how much to give. </div>
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Here is a humble
attempt to guide on answering these questions.<o:p></o:p></div>
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So, why should you learn Art of Giving. Let’s examine it
through different lenses:<o:p></o:p></div>
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<b>Philosophically:</b> There is always someone who is less
fortunate than you. The perspective of giving should be as simple as breathing
every minute. The giving action teaches the basic human values to your
children.<o:p></o:p></div>
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<b>Spiritually:</b> Giving to charity makes you feel good from
inside, it’s one of the objectives of human life as per ancient and religious
scriptures as well.<o:p></o:p></div>
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And practically speaking: Even small amounts can make a huge
difference in someone’s life. <o:p></o:p></div>
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Imagine a value of one simple meal in a life of homeless
person!! <o:p></o:p></div>
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Also, its <b>“Giver's gain”</b> principle - very often you find
that the more you give away, the more comes back to you. Whether it’s the
money, knowledge or even as simple as mental or emotional support…<o:p></o:p></div>
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When we are talking about any ancient scriptures, some of
the old practices and traditions prescribed talk about giving back to the
society. <o:p></o:p></div>
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When we talk about main religions of the world, here are
very interesting facts to know about:<o:p></o:p></div>
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In Christianity, a Tithe is 10% of your income given
specifically to your local church or the less privileged. (Fun fact: The word
tithe literally means tenth in Hebrew.) Because the custom of tithing is
biblical, many Christians and Jews practice it as part of their faith.<o:p></o:p></div>
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In Islam, the third pillar out of five pillars of Islam is
“Zakat” or alms giving or charity. By following this pillar, Muslims have to deduct
certain amount of their income to support the Islamic community, and it usually
about 2.5% of an individual’s income.<span style="mso-spacerun: yes;">
</span>Zakāt is obligatory for all Muslims who are able to do so. It is the
personal responsibility of each Muslim to ease the economic hardship of others
and to strive towards eliminating inequality.<o:p></o:p></div>
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In Hinduism, two of the most important beliefs are Karma
(good deeds) and Moksha (Liberation of Soul). Hindus believe that by acting
with compassion towards those less fortunate (good karma), they will gain good
merit, which may help them to eventually attain Moksha.</div>
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<o:p></o:p></div>
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In Sikkhism, the Gurudwara or the place of worship offers a
“Langar” (term used for the community kitchen in a Gurdwara where a free meal
is served to all the visitors, without distinction of religion, caste, gender,
economic status or ethnicity) and the kitchen is maintained and serviced by
Sikh community volunteers of all walks of life.</div>
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<o:p></o:p></div>
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<o:p> </o:p>In modern world, some of the most famous personalities who
believe into Philanthropy are: Warren Buffett of Berkshire-Hathway, has pledged
to give away 99% of his net worth. So far he has given away USD 34 billion from
his net worth to healthcare, education and sanitation.</div>
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<o:p></o:p></div>
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Bill Gates of Microsoft, has given away more than USD 35
billion from his net worth to healthcare, education and poverty eradication.</div>
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<o:p></o:p></div>
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Our own Indian, Azeem Premji of Wipro, has given more than
USD 21 billion for education and healthcare sector.<o:p></o:p></div>
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(*Reference: Wikipedia.org, list of philanthropists)</div>
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<o:p></o:p></div>
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For common people like us then what can we do and how can we
learn the art of giving? We all want to make a difference to the world and
those who really deserve this help. Its absolutely wonderful and a noble
thought! So here are some simple points that we all can consider, while giving
away:</div>
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<o:p></o:p></div>
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1.<span style="mso-spacerun: yes;"> </span>Ensure that it is
a legitimate and registered organization. Before giving, you should do the due
diligence and make sure your help is actually going to help the needy.<o:p></o:p></div>
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2.<span style="mso-spacerun: yes;"> </span>Know where the
money is really going. If you decide to work with an NGO or an organization
working for the under-privileged, its your right to know: how much of the money
is being spent of the organization staffing + operational expenses and how much
is actually spent on charity. In-efficiently run organizations usually end up
spending more on operations and very less reaches to the actual beneficiaries.<o:p></o:p></div>
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3.<span style="mso-spacerun: yes;"> </span>Consider the tax
advantages of your donations under Section 80G of the Income Tax Act. Its
something which is a small bonus or a token prize for you, while you are
thinking about others in the society and doing something for them.<o:p></o:p></div>
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<o:p> </o:p> </div>
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Finally, to sum up the thoughts again, how can we forget
that ARK – Act of random kindness!! In Princess Diana’s words who is known for
her kind gestures and philanthropic work even today after number of years of
her passing away:<o:p></o:p></div>
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“Carry out a random act of kindness, with no expectation of
a reward, safe in the knowledge that one day, someone might do the same for
you!”<o:p></o:p></div>
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KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-76234282446289779552020-06-15T05:48:00.003-07:002020-06-15T05:52:45.173-07:00Retire from a job – Not from Life!<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgH1maog5XMf3PSvOCRMBKz3iXVif0DC-V2RfS2ChjW7CVGXJ3_-NUSVyEDVHp3xSJKEhSgeAzRf9Mo0pFX4EfJYLUwvq4kn7kJulTjkw5PwWFL5g9nlVUrN_Lk3zwpQkxTDR0Ybiul503x/s1600/retire.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="170" data-original-width="297" height="228" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgH1maog5XMf3PSvOCRMBKz3iXVif0DC-V2RfS2ChjW7CVGXJ3_-NUSVyEDVHp3xSJKEhSgeAzRf9Mo0pFX4EfJYLUwvq4kn7kJulTjkw5PwWFL5g9nlVUrN_Lk3zwpQkxTDR0Ybiul503x/s400/retire.jpg" width="400" /></a></div>
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“Its more important to grow your income than to cut your
expenses. Its more important to grow your spirit that cut your dreams.”<o:p></o:p></div>
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-Robert Kiyosaki, American Author and Businessman<o:p></o:p></div>
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Robert Kiyosaki, the author or famous books like “Rich Dad,
Poor Dad” and “Cashflow quadrant – Guide to financial freedom” in no uncertain
terms shares this principle of getting financially independent. The right focus
should be on growing the income, rather than only cutting your expenses. Simply
means that you enjoy every beautiful thing that life has to offer like
vacations, spending precious time with your family and even every other worldly
pleasure. So, how do you do that? Precious little question, isn’t it?<o:p></o:p></div>
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The secret lies in the title of our small writeup here. Its
not about getting tied up to the mundane routine job that you perform, or even
when you are businessman its not about getting stuck into the day-to-day
transactions, but rather find the right balance of investment and income
growth, so that you can relax as grow further in your professional as well as
personal life. The key is very simple: Planning for your retirement from the
day one of your professional life. It is never too early to plan for
Retirement, as it gives you freedom and choices, to do what you want and not
what you have to do. The later you start the tougher it gets! <o:p></o:p></div>
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It’s not to scare anyone who has already crossed 40 of their
age, but early investors who have started in their 20s, are already on their
way to financial freedom near their age 40. A sound financial strategy (with or
without an advisor) and willingness to execute it for long periods of time with
fine tune-ups every few months, would get you set to retire early and enjoy the
riches that life has to provide. You don’t have to wait till age of 60 to
retire just like any other professionals do. <o:p></o:p></div>
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Our world-famous friend Albert Einstein once said: “Compound
interest is the 8th wonder of the world. He, who understands it, earns it; he
who doesn't, pays it.” Coming from a man who is famous for his brilliance in
physics and especially his tremendous work on philosophy of science, this quote
makes even more sense! For a man who also understood the importance of being
financially free, which would give him time and space to enjoy and follow his
passion in life. Isn’t it something that we all can learn and adapt?! <o:p></o:p></div>
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Haven’t you heard the story of a Chinese bamboo tree? It’s
like any other plant or tree with roots, stem, leaves and still its special!
Why is that so? Like any other three, the growth of the Chinese Bamboo Tree
requires initial nurturing. It requires water, fertile soil, sunshine. In its
first year, we see no visible signs of activity. In the second year, again, no
growth above the soil… The third, the fourth, still nothing. Our patience is
tested and we begin to wonder if our efforts (caring, water, etc.) will ever be
rewarded. <o:p></o:p><br />
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And finally in the fifth year – behold… a miracle! We
experience growth. And what a growth it is!<br />
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The Chinese Bamboo Tree grows 80
feet in just six weeks! <o:p></o:p></div>
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But let’s be serious, does the Chinese Bamboo Tree really
grow 80 feet in six weeks? Did the Chinese Bamboo Tree lie dormant for four
years only to grow exponentially in the fifth? Or, was the little tree growing
underground, developing a root system strong enough to support its potential
for outward growth in the fifth year and beyond? The answer is, of course,
obvious. Had the tree not developed a strong unseen foundation it could not
have sustained its life as it grew. The same principle is true for people and
their financial freedom goals. People, who patiently toil towards worthwhile dreams
and goals, building strong corpus slowly through conscious efforts by investing
regularly; while overcoming challenges and sacrificing a few wants in early
career years, grow the strong financial foundation. They reap the rewards and
can “Retire” early, while the spectrum of lottery winners, get-rich-quick
schemers and lavish spenders usually are unable to sustain the same wealth and
same lifestyle.<o:p></o:p><br />
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Compounding takes time, its all about building the initial
strong foundation. It’s all about being very patient in first few initial
years, where the principal building takes in own course. Though the compounding
and growing money to become financially independent makes a lot of sense, this
“Magic of Compounding” has to be accompanied by “Logic of Investing”. The basic
principles like inflation, depreciation; or even considerations like lifestyle
wants becoming needs in future (e.g. in recent past, everything running on
internet has changed the communication gadgets becoming a need rather than a
want) have to considered in your “Retirement Planning”. You cannot simply go
through motions and do like “other people” do!<o:p></o:p></div>
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Finally, to re-iterate the fact again: "PAY YOURSELF
FIRST” or in very simple words: pay in your retirement fund first. Rather than
thinking as retirement funds becoming a “liability” every month, it’s very easy
to visualize now that it pays for your dreams, allows you to follow your
passion and makes you financially independent. I guess you never imagined that
The Chinese Bamboo tree will teach you such a wonderful life lesson!<o:p></o:p></div>
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KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-88016421762634301042020-06-10T06:13:00.000-07:002020-06-10T06:58:07.953-07:00Why an investor should never let a crisis go waste?<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjGQ_eHTGkwRbCag8aJ0j2AT19w5ixBVm0FmGCLVHXF6kYNC5OX_XS-CwIatry6LqkieS64En8XbhVG4RhFV9mausfmltUKFpjkXPCVEhigNQKFWUnDG3aOZ9TuduXzm0_I5GxVVeSGBt0x/s1600/Crisis.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="183" data-original-width="275" height="265" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjGQ_eHTGkwRbCag8aJ0j2AT19w5ixBVm0FmGCLVHXF6kYNC5OX_XS-CwIatry6LqkieS64En8XbhVG4RhFV9mausfmltUKFpjkXPCVEhigNQKFWUnDG3aOZ9TuduXzm0_I5GxVVeSGBt0x/s400/Crisis.jpg" width="400" /></a></div>
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"Go get your mother and all her friends. They'll never
see a fire like this again. It’s alright Charles. We have just got rid of lot
of rubbish.”<o:p></o:p></div>
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Do you know these were famous quotes once uttered by a man who
is known worldwide even today! His office and years’ worth of work was on fire
and instead of crying or shouting in pain, frustration and anguish, he simply
chose to be a “Stoic Figure” advising this phrase to his son… What a balanced
reaction! Who was this man? It was Thomas Edison's Reaction to his factory
burning down, at his age of 67 and these quotes were directed at his son
Charles. It really shows why the great man was so successful… <o:p></o:p></div>
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After just three weeks, with a sizeable loan from his friend
Henry Ford, Edison got part of the plant up and running again. His employees worked
double shifts and set to work producing even more than earlier. Edison and his
team went on to make more than USD 10 million, just 4 years later in 1918. In
Edison’s own thoughts and expressions, when tragedy strikes, you must accept
that it has happened and that you cannot change the past. Finding the
opportunity to overcome the challenge ultimately makes you stronger. <o:p></o:p></div>
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How relevant these thoughts are even in today’s times post
COVID-19! As they say: Every calamity comes with equal or greater opportunity.
For investors instead of getting demoralized, its an opportunity to introspect
and review their investment plans and portfolios. It’s an opportunity to take a
step back and plan for future. It’s also an opportunity to arrive at learnings
to be applied to their investment strategies. <o:p></o:p></div>
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There are 2 major learnings in this time of lock down for
every investor:<o:p></o:p></div>
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1. Do have enough savings / liquid investments to
manage at least 6 months living costs. COVID-19 has been once in a century kind
of an event (also called as “Black Swan” event). It is unlikely that such an
event will happen at a global scale once again. But, can it happen at country
level, local level or even individual level. Likelyhood of that is much more.
So, when we have learnt and talked enough already about Emergency Funds for 6
months, but do we really follow this still remains a debatable question.<o:p></o:p></div>
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2. Do a spending analysis - In this time of lock
down, we can clearly define the needs and the wants. Majority of the
population realized that, most of what we were spending on was not necessary or
it was not a need. It was primarily a want or a luxury. Something that we
could have done without, something that we could consider as only “Good to
have” things…<o:p></o:p></div>
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Even though, it might sound very philosophical; it is this crisis
that has taught us to understand our basic needs and necessities. A need is
something you have to have to survive or complete a daily routine task. Our
day-to-day purchase of groceries, milk and routine supplies is a need. Whereas
a want is simply the desire for something, in many cases something to
satisfy a need. A want is not a necessity, a want is not a must-have
thing and a want is clearly not required to live a simple fulfilling life. <o:p></o:p></div>
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Applying the same principle that we have learnt in this
COVID-19 lockdown times to our investments and portfolios, we can clearly
arrive at the needs and the wants we have. A concrete foundation that you
create for your total portfolio is a need. Ability to build a strong core for
your investments is a need. Without paying attention to this need, you cannot
think of diversifying into your wants and let your portfolio run on high risk
just like walking on a thin sheet of ice. <o:p></o:p></div>
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A very simple story that we can have an analogy for. There
is an old man who owns a small farmland and he is worried that his son doesn’t
understand the principle of saving money one day and one year at a time for big
riches. He decides to ask his son to plant two small tamarind trees. After a
month or so, every day now the old man asks his son to bring tamarind leaves
for making a chutney / a dip for their dinner from one particular tree off
those two trees he had planted. After a year, the father asks the son: “Which
tree has grown taller and stronger?” Obviously, the tree which was allowed to
build its foundation for a year and no leaves were taken from, had become
stronger. Whereas the tree from which the son would keep on bringing the leaves
every day, couldn’t grow and had stayed a small and weak tree and it had almost
died. Now, even though the weaker tree had died, the stronger tree could
support their needs for years to come, even after taking away a small portion
of leaves every single day for their household needs. The stronger tree was so
strong that it could sustain loss of few leaves and twigs every single day.<o:p></o:p></div>
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The same analogy applies to the investments. Definitely,
look to have your portfolio fund your wants in future, but "Pay yourself
first". Allow the portfolio to grow stronger and taller, just like the
tamarind tree in our story. What do we mean by: “Pay yourself first”? It is a
phrase which was first used in a book called The Richest Man in
Babylon. But this simple statement has been converted into a profound personal
finance rule by Robert Kiyosaki, the author of “Rich Dad, Poor Dad”. 'Pay
yourself first' before spending a dime anywhere else means to build your
portfolio first and let that portfolio fund your luxuries. The stronger
the core of your portfolio, the longer it can sustain even in tough times.
Stronger it will stand to fund your wants!<o:p></o:p></div>
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Finally, whether you want to be the first tamarind tree or
the second tamarind tree from the story above, is anyone’s guess!!<o:p></o:p></div>
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KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-59760989792018767792020-06-01T22:27:00.000-07:002020-06-01T22:32:32.100-07:00Helicopter Money - Is this the Solution of the current crises?<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiIryMUb7WmAnHTEZv42v-x1c3N2IXlQbAG2SFCN_D_-WKhMi6YNqbRurhezw7mN_hVtocIlUyhUxX0HQRB-JsybBat639I3lk84MsuxUl8SwrUn9lkrMBJ9E1nmU5OmA6onzF-jILE3XfR/s1600/Helicopter.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="194" data-original-width="259" height="238" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiIryMUb7WmAnHTEZv42v-x1c3N2IXlQbAG2SFCN_D_-WKhMi6YNqbRurhezw7mN_hVtocIlUyhUxX0HQRB-JsybBat639I3lk84MsuxUl8SwrUn9lkrMBJ9E1nmU5OmA6onzF-jILE3XfR/s320/Helicopter.jpg" width="320" /></a></div>
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Hello and greetings of the day friends! <o:p></o:p></div>
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First of all a big shout out to all of you for making
through this tough time with plenty of aplomb and keeping your morale high
through series of lockdowns. As this situation has been unprecedented for
possibly even all three generations that co-exist in any given household, the
measures that have been employed by the government have been on a stricter and
safer side. The chicken and egg question of whether the economy comes first or
whether human life is more important has been decided for us in India, by the
decision-makers by preferring the second choice. Obviously the economy has
taken a hit and now with slowly releasing various stages of lockdown means we
will get to see a real picture emerging with businesses, business owners and
even professionals who are affected by it. <o:p></o:p></div>
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So, today we are going talk about “Helicopter Money” which
is a likely scenario of plenty of households with different packages being
announced by the government to support the spending in the market and the
consumption by the customers. So, what is exactly ‘Helicopter Money?” <o:p></o:p></div>
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Helicopter money according to technical definition is “New
money printed and distributed amongst the public to stimulate the economy
during a recession or when interest rates fall to zero.” Milton Friedman, a
famous American economist and a Nobel Laureate coined this phrase long back in
1969. Although the original idea of helicopter money describes central banks
making payments directly to individuals, economists have used the term
'helicopter money' to refer to a wide range of different policy ideas. <o:p></o:p></div>
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Currently the Post-Covid 19 stimulant schemes introduced by
Indian Government are such “Helicopter Money” schemes, primarily to introduce
stimulus in markets by making cash available for demand and consumption of the
end-users. The Government had to resort to an initial Rs 1.7 lakhs crore relief
package which included direct transfer to the poor. So, is it beneficial to us
as common man when we think of these benefits? <o:p></o:p></div>
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Typically, there are three pillars on which any national
economy runs: (a) Liquidity – This will be helped with the packages announced
by Indian government. Although most is through financing, but the market
liquidity should benefit. (b) Consumption - Putting more money in the hands of
the poor should ideally result in additional consumption. The other side of
equation is though; most of this consumption would be focused on survival and
related products and services. During this time of Covid 19, possible layoffs,
if not then expected cuts in salary and overall uncertainty for everyone
affected, not likely to happen. (c) Investment - As companies are not likely to
invest now looking at the lockdown post Covid19, the Government would have to
do the heavy lifting. Further, looking at the global news that nations across
the world wanting to divest out of China, obviously government wants to make
India an attractive manufacturing destination. <o:p></o:p></div>
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Though, Helicopter money like stimulus normally causes
inflation, it is not likely to happen in India in current scenario. Reality in
India though, that survival is needed and demand for nonessentials is at its
nadir. Many individuals are postponing or in certain cases permanently
canceling their discretionary spending budgets. Though, another effect of
Helicopter stimulus is also devaluation of the currency. This ideally should
have a positive effect on exports. <o:p></o:p></div>
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If this is implemented efficiently by government as well as
educating and enabling the people who are going to actually spend it, it could
results in transformation for Make in India as well. Recent speech by Prime
Minister Narendra Modi calling out us all to become “Aatma-Nirbhar” (or self-dependent)
can also add some fuel to this fire. <o:p></o:p></div>
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Finally, let’s talk about a story through which we all as
Indian citizens can take a message and make sure “India Shining” becomes a
reality. Here goes the story: <o:p></o:p></div>
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A king and his troops were going through a forest. The King
saw an old man cutting trees. Taking pity on him, he asked the Minister to give
that old man an acre of sandalwood trees. The Minister took care of that
instantly. <o:p></o:p></div>
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A couple of years later, the King and his troops were again
passing through the forest and in fact, they were passing by the area where
there were sandalwood trees given away to that old man. <o:p></o:p></div>
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The king noticed that most of the sandalwood trees were gone
and in one corner the old man was there. He was burning a couple of sandalwood
trees. Upon talking to him, the Minister found out that he was burning those
trees to collect coal BECAUSE that is what does – sells coal and makes money.</div>
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The true value of sandalwood was not utilized at all by the old man and it was
a simple question of awareness.</div>
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<o:p></o:p></div>
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To us all as Indians, the question is: <o:p></o:p></div>
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Are we going to burn these “sandalwood trees” or are we
going to be unlocking the real value?<o:p></o:p></div>
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KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-17493494973262192882018-11-25T20:46:00.001-08:002018-11-25T20:46:45.094-08:00Understand Your Mutual Fund More With the MF Fact Sheet<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjmT_1RSjm2hHT1R6YFHuQFFnWyXdRMrdWTGWKKLvjpaI52oMXlVsTUppqT6HONqngOLyPZuhAkdJjvYAopSjsmHIfneNGuqVo_FmNxiibND-F3RRhnDoINRk2U2Ma5no6CYr-ozMyAXxj4/s1600/Banner_Monthly_Fact_Sheet.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="200" data-original-width="960" height="66" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjmT_1RSjm2hHT1R6YFHuQFFnWyXdRMrdWTGWKKLvjpaI52oMXlVsTUppqT6HONqngOLyPZuhAkdJjvYAopSjsmHIfneNGuqVo_FmNxiibND-F3RRhnDoINRk2U2Ma5no6CYr-ozMyAXxj4/s320/Banner_Monthly_Fact_Sheet.png" width="320" /></a></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The Mutual Fund Fact Sheet is a statement
that gives a monthly review of the MF scheme across various performance
parameters. You can get a lot of useful information from the Mutual Fund Fact Sheet
to understand the scheme's performance. <o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Let us see the key nuggets of information
present in the Fact Sheet that can help evaluate MF performance - <b><o:p></o:p></b></span></div>
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<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">1) Portfolio Holdings</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Check the portfolio holdings to see which
sectors and which securities the MF is invested in. You can check the extent of
diversification and if the fund holdings satisfy the investment objective. If
it is a equity fund, you can make out if there are investments in very volatile
stocks and the extent of mid-cap and small-cap exposure. Check if there are
many securities that are vulnerable to macro economic factors.<b><o:p></o:p></b></span></div>
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<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">2) Portfolio Turnover Ratio</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"> <b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><span style="mso-tab-count: 1;"> </span>Portfolio
Turnover Ratio = Amount of sales or purchases / Net assets of the fund. </span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">A high ratio indicates a higher portfolio
churn. This means higher costs and therefore lower returns.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">3) Beta</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">It measures the volatility of the fund
against the volatility of the market. If beta is higher than 1, the fund is
more volatile than the market which means greater risk. If the beta is
consistently more than 1 and you are a conservative investor, you might want to
rethink your allocation to this fund.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">4) Sharpe Ratio</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The Sharpe ratio calculates the risk
adjusted returns of the mutual fund. It is the returns in excess of the
risk-free returns divided by the standard deviation of the excess return. A
higher Sharpe ratio means the returns are attractive. It is useful to compare
Sharpe ratio of a fund before and after significant changes in the portfolio.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">5) Performance</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">We can look at the past performance of the
Mutual fund. Though past performance is not a guarantee for future returns, it
gives an idea of the fund managers' effectiveness, the performance against the
benchmark, long-term and short-term returns and how it fares when there is
volatility. <b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">6) Rating</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">In case of debt funds, you can check the
ratings of the securities that they are invested in to get an idea of the
quality of the portfolio.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">7) Benchmark Index </span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">All Mutual Fund Schemes have a benchmark.
It can be the BSE 100 or NIFTY 50. They give a reference as to how the schemes
have performed compared to similar schemes and the market. If the benchmark has
returned 15% over the year and the MF Scheme has returned only 12%, the MF
scheme has underperformed. If the MF Scheme returned 18%, it has outperformed
the benchmark.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Here are some examples of MF Schemes and
their benchmarks -</span><b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";"><o:p></o:p></span></b></div>
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: 9.15pt; mso-padding-alt: 2.75pt 2.75pt 2.75pt 2.75pt; mso-table-layout-alt: fixed;">
<tbody>
<tr>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 250.4pt;" valign="top" width="248">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">MF Scheme<o:p></o:p></span></b></div>
</td>
<td style="border: solid black 1.0pt; mso-border-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 210.9pt;" valign="top" width="211">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Benchmark</span></b><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 250.4pt;" valign="top" width="248">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Aditya Birla Sun Life Equity Fund<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 210.9pt;" valign="top" width="211">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">S&P BSE 200 Index </span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 250.4pt;" valign="top" width="248">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">SBI Banking & Financial Services Fund <o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 210.9pt;" valign="top" width="211">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">NIFTY Financial Services Total Return</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr style="mso-yfti-lastrow: yes;">
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 250.4pt;" valign="top" width="248">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">ICICI Prudential Advisor Series-Debt Management Fund<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 210.9pt;" valign="top" width="211">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">CRISIL Liquid Fund Index</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
</tbody></table>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 9.0pt;">Rather than investing based on tips or
articles on top performing funds, look through the fact sheet to make a more
informed investing decision. You can go through the MF Fact Sheet with your
professional financial planner to decide the best course of action.</span><span lang="EN-GB"><o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-58344967455503304762018-11-11T23:01:00.003-08:002018-11-11T23:01:41.731-08:00Gold Funds – An Alternative to Beat The Market Volatility <div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><br /></span></b></div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjDRwp2AZlV2typ1ycIG3RlEnmym_05qMtTRKaqgv8IUmMQJSc_BCBvXmUqqd1-NbKJKDib1ecWlfmOfQJNHEJMFq3KONnImtZcAwFlCl37-Wv4dfoSNrAa2rtrgNE7wKfk0er1Nrw-MHA0/s1600/Gold.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="156" data-original-width="323" height="154" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjDRwp2AZlV2typ1ycIG3RlEnmym_05qMtTRKaqgv8IUmMQJSc_BCBvXmUqqd1-NbKJKDib1ecWlfmOfQJNHEJMFq3KONnImtZcAwFlCl37-Wv4dfoSNrAa2rtrgNE7wKfk0er1Nrw-MHA0/s320/Gold.jpg" width="320" /></a></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><br /></span></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The stock markets across the world has
been volatile in the last few months. The MSCI world stock index hit an
eight-month low in October. The Chinese economy shows signs of weakening. The stock
market in Australia is weak and the Nikkei (index of the Tokyo stock exchange)
has been falling in October. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">In India too, the stock markets are
volatile. The Sensex has lost about 4000 points between August 2018 and October
2018. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">How does a retail investor protect himself
from this volatility? He should diversify his investment portfolio. He can
consider gold as an alternate investment. If buying physical gold is not
appealing to him, he can invest in Gold Funds or Gold ETFs.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold ETFs –</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"> Gold ETFs are mutual funds that invest in
gold. They trade in gold to optimize returns. Retail investors can invest in
Gold ETFs vis-a-vis their demat account.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold Funds – </span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold Funds are mutual funds that invest
mostly in Gold ETFs and some other related assets. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Differences between Gold Funds and Gold
ETFs </span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The underlying asset in Gold ETFs is gold whereas for Gold
funds, it is Gold ETFs.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold ETFs are traded on the stock exchange. Gold funds can be
purchased from the Mutual Fund house.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold Funds have the option of SIPs but in case of Gold ETFs
there is no direct method of SIP. As an investor, you need to go to your
trading account and explicitly buy at regular intervals to follow the SIP mode
of investment. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold funds have higher expense ratio as they are managed by MF
managers.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">In Gold ETFs, you have to buy approximately equivalent to the
value of 1 gm of gold. If you are investing today, it would be around Rs.
3,200-Rs. 3,300. Gold funds have a minimum investment amount between Rs. 1000-
Rs. 5000<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Investments in Gold ETFs and Gold funds are considered as
non-equity investments. Short-term capital gains are added to investor's income
and taxed as per the relevant tax slab rate. Long term capital gains are taxed
at 20% after providing for indexation. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Where do Gold Funds score over Gold ETFs</span></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"> <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold funds are more advantageous over Gold ETFs as you can
invest using the SIP mode. You can invest small sums over a period of time in a
disciplined manner.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Golds funds are handled by fund managers who have the relevant
professional expertise.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Gold funds do not require demat accounts. You can invest in
them through the Mutual Fund house.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">When you invest in a Gold ETF, you invest in gold. When you
invest in Gold funds, you invest in the best Gold ETFs. A good fund manager
will protect the investment from volatility and optimise returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Here are examples of some Gold Funds <i>(only
for reference)</i>-</span><b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";"><o:p></o:p></span></b></div>
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: 2.75pt; mso-padding-alt: 2.75pt 2.75pt 2.75pt 2.75pt; mso-table-layout-alt: fixed;">
<tbody>
<tr>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 168.2pt;" valign="top" width="155">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Scheme Name<o:p></o:p></span></b></div>
</td>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 127.45pt;" valign="top" width="123">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">NAV ₹ (</span></b><b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 9.0pt; mso-bidi-font-family: "Trebuchet MS";">as
on 12<sup>th</sup> October)</span></i></b><b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";"><o:p></o:p></span></b></div>
</td>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 93.65pt;" valign="top" width="95">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">1 year returns (%)<o:p></o:p></span></b></div>
</td>
<td style="border: solid black 1.0pt; mso-border-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 92.6pt;" valign="top" width="94">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">3 year returns (%)</span></b><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 168.2pt;" valign="top" width="155">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">SBI Gold Fund Growth (G)<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 127.45pt;" valign="top" width="123">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">10.04<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 93.65pt;" valign="top" width="95">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">4.5<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 92.6pt;" valign="top" width="94">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">4.5</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 168.2pt;" valign="top" width="155">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Reliance Gold Savings Fund (G)<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 127.45pt;" valign="top" width="123">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">13.32<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 93.65pt;" valign="top" width="95">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">3.7<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 92.6pt;" valign="top" width="94">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">4.3</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr style="mso-yfti-lastrow: yes;">
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 168.2pt;" valign="top" width="155">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Kotak Gold Fund<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 127.45pt;" valign="top" width="123">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">13.22<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 93.65pt;" valign="top" width="95">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">4.8<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 92.6pt;" valign="top" width="94">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">4.5</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
</tbody></table>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 9.0pt; mso-bidi-font-family: "Trebuchet MS";">(Returns are annualised)</span></i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 9.0pt;">Gold is a good asset to invest in to
offset the risks in other investments. It is not easy to store physical gold.
So Gold funds are a great option for investments in gold.</span><span lang="EN-GB"><o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-47647077631191655562018-10-09T23:45:00.001-07:002018-10-09T23:45:20.609-07:00What Is Capture Ratio<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiMxEGE_InljPL4tQDvIWdLpjKfmJEylNG6igN5xBaZLb1F3MV0EEcExfDAtc7ESC8A63ApsWk8Bt2YJwfdkFb9ObGxoGAQMRUCFTizDQ98YVypWQ4YTElvabvTZdWzykNZs7MGz9QUiq1j/s1600/Capture+ratio.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="620" data-original-width="1144" height="173" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiMxEGE_InljPL4tQDvIWdLpjKfmJEylNG6igN5xBaZLb1F3MV0EEcExfDAtc7ESC8A63ApsWk8Bt2YJwfdkFb9ObGxoGAQMRUCFTizDQ98YVypWQ4YTElvabvTZdWzykNZs7MGz9QUiq1j/s320/Capture+ratio.png" width="320" /></a></div>
<br />
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">There can be many reasons to invest in
mutual funds – portfolio diversification, better returns, long term wealth
generation, tax savings etc. But before investing in a mutual fund scheme, you
need to evaluate it. There are different parameters for evaluation -<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Performance History (though past returns cannot guarantee
future returns)<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Risk v/s return <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Costs of investing<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">There are many ratios to determine the
performance of mutual fund schemes. One of them is Capture Ratio. Capture ratio
measures the consistency of a scheme. It shows how the fund has performed
relative to the benchmark. There are two components to the capture ratio -<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Upside capture – This value puts forward
the extent of the performance of the scheme in relation to the benchmark index
when the index is on an uptrend. It is calculated as follows -<b><i><o:p></o:p></i></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Upside capture<span style="mso-spacerun: yes;"> </span>=</span></i></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><span style="mso-spacerun: yes;"> </span><b><i><o:p></o:p></i></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Scheme's periodic return for a certain
duration </span></i></b><em><b><span lang="EN-GB" style="color: #222222; font-family: "Arial",sans-serif; font-size: 14.0pt; font-style: normal; mso-bidi-font-family: "Trebuchet MS";">÷</span></b></em><em><b><span lang="EN-GB" style="color: #6a6a6a; font-family: "Arial",sans-serif; font-style: normal; mso-bidi-font-family: "Trebuchet MS";"> </span></b></em><b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Benchmark return<span style="mso-spacerun: yes;"> </span>for same period during the same duration </span></i></b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></i></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">(when the benchmark has a positive return)</span></i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">It is expressed in percentage terms. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">For example, if the benchmark index
returned 8% and the fund returned 10%, the upside capture ratio would be 125%
which means the mutual fund scheme has performed better than the index by 25%.
In another scenario, if the benchmark index returned 8% and the fund returned
6%, the upside capture ratio would be 75% which means the mutual fund scheme
has under performed the index by 25%.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The higher the upside capture, the better<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Downside capture - This value puts forward
the extent of the performance of the scheme in relation to the benchmark index
when the index is on a downtrend. It is calculated as follows -<b><i><o:p></o:p></i></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Downside capture<span style="mso-spacerun: yes;"> </span>=</span></i></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><span style="mso-spacerun: yes;"> </span><b><i><o:p></o:p></i></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Scheme's periodic return for a certain
duration </span></i></b><em><b><span lang="EN-GB" style="color: #222222; font-family: "Arial",sans-serif; font-size: 14.0pt; font-style: normal; mso-bidi-font-family: "Trebuchet MS";">÷</span></b></em><em><b><span lang="EN-GB" style="color: #6a6a6a; font-family: "Arial",sans-serif; font-style: normal; mso-bidi-font-family: "Trebuchet MS";"> </span></b></em><b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Benchmark return<span style="mso-spacerun: yes;"> </span>for same period during the same duration </span></i></b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></i></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">(when the benchmark has a negative return)</span></i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">It is expressed in percentage terms.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">For example, if the downside capture ratio
is 75%, it means that the mutual fund scheme has outperformed the benchmark
index as it declined only by 75% of the total decline of the index. If the
downside capture is 100%, it means the decline in the performance of the MF
scheme is equivalent to the decline in the performance of the index.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">If the downside capture ratio is 110%, it
means that the mutual fund scheme has underperformed as compared to the
benchmark index.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The lower the downside capture, the better<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">The ratios help us understand the
volatility and the risk management of the scheme. Both the upside and the
downside captures have to be taken together to get a true picture of the
performance of the fund. If we take only upside capture into consideration, we
will know only how the fund performs in good times. We will not get a clear
picture. For example, we will never know how market risks are managed. If we
factor only downside capture, we will only know how the scheme performs when
the markets are down. We will not know the ability of the fund to beat market
returns. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Here is how we take them together and
evaluate the capture ratio -<b><i><o:p></o:p></i></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Capture Ratio = Upside Ratio/Downside
Ratio</span></i></b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">
<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">If the capture ratio is greater than 100%,
it means the fund has outperformed the index else it has underperformed as
compared to the index.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Here are the capture ratios of some MF
Schemes -</span><b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";"><o:p></o:p></span></b></div>
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: 2.75pt; mso-padding-alt: 2.75pt 2.75pt 2.75pt 2.75pt; mso-table-layout-alt: fixed;">
<tbody>
<tr>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 237.05pt;" valign="top" width="209">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Details<o:p></o:p></span></b></div>
</td>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 77.7pt;" valign="top" width="80">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Upside Ratio<o:p></o:p></span></b></div>
</td>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 82.85pt;" valign="top" width="91">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Downside Ratio<o:p></o:p></span></b></div>
</td>
<td style="border: solid black 1.0pt; mso-border-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 84.3pt;" valign="top" width="88">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Capture Ratio </span></b><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 237.05pt;" valign="top" width="209">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Kotak Nifty Exchange Traded Scheme <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Benchmark – S&P BSE 100<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 77.7pt;" valign="top" width="80">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">94<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 82.85pt;" valign="top" width="91">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">97<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 84.3pt;" valign="top" width="88">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">0.96</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 237.05pt;" valign="top" width="209">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Aditya Birla Sun Life Equity Fund Growth <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Benchmark – S&P BSE 500<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 77.7pt;" valign="top" width="80">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">98<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 82.85pt;" valign="top" width="91">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">94<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 84.3pt;" valign="top" width="88">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">1.04</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr style="mso-yfti-lastrow: yes;">
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 237.05pt;" valign="top" width="209">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">ICICI Prudential Bluechip Fund – Growth<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Benchmark – S&P BSE 100<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 77.7pt;" valign="top" width="80">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">94<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 82.85pt;" valign="top" width="91">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">91<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 84.3pt;" valign="top" width="88">
<div align="right" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: right;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">1.03</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
</tbody></table>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 9.0pt; mso-bidi-font-family: "Trebuchet MS";">(Data from </span></i><span lang="EN-GB"><a href="https://morningstar.in/"><i><span style="font-family: "Trebuchet MS",sans-serif; font-size: 9.0pt; mso-bidi-font-family: "Trebuchet MS";">https://morningstar.in</span></i></a></span><i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 9.0pt; mso-bidi-font-family: "Trebuchet MS";">)</span></i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">A upside capture greater than 100%
indicates that the fund manager has generated returns higher than the<span style="mso-spacerun: yes;"> </span>benchmark returns when market is rising. So
if you are an aggressive investor, you might want to look at funds that have a
high upside capture.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">A downside capture Ratio that is less than
100% indicates that the manager has protected the fund from risks when market
is falling. If you are averse to risk, you should target funds that have a low
downside capture.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">A capture ratio above one indicates good
risk adjusted returns. A capture ratio below one indicates that the MF scheme
has not underperformed the benchmark.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">As an investor, you can use these ratios
along with other performance indicators to select MF schemes to invest in and
to monitor your mutual fund portfolio.</span><span lang="EN-GB"><o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-44286617073320376632018-09-09T23:12:00.002-07:002018-09-09T23:13:06.564-07:00Have You Converted All Your Physical Shares Into Demat Form?<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgRVpES6GzFq8khSXuZSjtSJp-z739vA5hYMvwvhcWMYd7FFj4WXqnaAr7oHvHBz18slpVeOnaXpeMCmHYhBwGD7lg7eYzGwqvy1Z-D2AGJHfq17dJvLF1M4EHH1utjPjeIkVffxUyyJiND/s1600/Physical.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="168" data-original-width="225" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgRVpES6GzFq8khSXuZSjtSJp-z739vA5hYMvwvhcWMYd7FFj4WXqnaAr7oHvHBz18slpVeOnaXpeMCmHYhBwGD7lg7eYzGwqvy1Z-D2AGJHfq17dJvLF1M4EHH1utjPjeIkVffxUyyJiND/s1600/Physical.jpg" /></a></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Physical
shares are shares that are paper based share certificates that were issued to
you when you purchased shares of a company. In 1996, </span>Demat shares were
launched in India. Demat shares are shares that are virtual in nature.
They are electronic paperless shares. <o:p></o:p></div>
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<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">There were many reasons to launch Demat
shares -<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Reduce fraud and forgery due to IPO scams and fake shares being
printed<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Eliminate bad delivery or loss of physical shares<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Reduction in paperwork both for investors and companies<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Decreased costs of transaction<o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Though companies are now allowed to issue
shares only in Demat form, there are many shareholders who have the physical
share certificates that they had purchased when they were available. SEBI
issued a notification this year stating that with effect from 5th December
2018, all physical shares held by investors will be considered illiquid. They
will not be valid which means people cannot buy/sell shares that are in
physical format. So shareholders have to convert them into dematerialised form
if they need to preserve their wealth and to transfer or sell them. <b><o:p></o:p></b></span></div>
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<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">How does one convert Physical shares to Demat
form -</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Open a Demat account with any Depository Participant that is
registered with NSDL or CSDL.<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Complete the Demat Request Form (DRF) and submit it along with
original physical share certificates. You might be asked for other
documentation too like PAN Card copy. If you have lost/ misplaced the physical
share certificates, you can file an FIR and contact the company/ company's
Registrar and Transfer Agent (RTA) to get duplicate physical share
certificates. <o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">The share certificates are verified with the company registrar,
depository and other relevant parties.<o:p></o:p></span></div>
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<!--[if !supportLists]--><span lang="EN-GB" style="font-family: "symbol"; font-size: 11.0pt;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Upon confirmation of the validity of the share certificates,
shares are allocated to the Demat account of the investor. The physical
certificates are then considered invalid. As an investor, you might want to
keep a copy of the share certificates till the Demat shares are credited to
your account.<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Check your account if the right shares and the right number of
units are credited. The whole process takes from about 2-4 weeks. <o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">If the company whose shares you have does
not have an ISIN number and is not listed on any exchange, you will not be able
to convert them to Demat shares.</span><span lang="EN-GB"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">As a prudent investor, ensure that you
review your financial papers/files to check if you have physical shares. Check
with your parents/grandparents/siblings if they have physical shares. Ensure to
convert all of them to Demat mode. This will help you find forgotten
investments and also make sure the investments are relevant and you can use
them in the interest of your financial life.<o:p></o:p></span></div>
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KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-4859879546903538812018-08-20T03:05:00.001-07:002018-08-20T03:05:29.345-07:00Dynamic Asset Allocation Funds – A Hybrid Fund <div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhVoyHny5x6GOi66I9ptZI-ahi9GLIBRHGOCwMRsaXnlVm7LU_g0EylNoxoq7NcQDB_JdatXILsh4ImOiZxrzTxUi2bXhTmczmeltcmjsj9mSONE4muwo6YuVvWEgWfzqPEUiwDfIwe6hjw/s1600/Dynamic.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="232" data-original-width="350" height="212" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhVoyHny5x6GOi66I9ptZI-ahi9GLIBRHGOCwMRsaXnlVm7LU_g0EylNoxoq7NcQDB_JdatXILsh4ImOiZxrzTxUi2bXhTmczmeltcmjsj9mSONE4muwo6YuVvWEgWfzqPEUiwDfIwe6hjw/s320/Dynamic.jpg" width="320" /></a></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">In
2017, the Securities and </span>Exchange Board of India (SEBI) asked mutual
fund houses to re-categorise their mutual fund schemes so that there is
uniformity across MF houses and there will be simplification for
investors.<o:p></o:p></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
schemes are to be classified under five categories:</span><o:p></o:p></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Equity Schemes<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Debt Schemes<o:p></o:p></span></div>
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<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Hybrid Schemes<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Solution-Oriented Schemes<o:p></o:p></span></div>
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<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Other Schemes<o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">As you can see, '<b><i>Balanced Funds</i></b>'
do not exist anymore. They have been replaced as '<b><i>Hybrid Schemes</i></b>'.
Earlier many schemes with different investment rationale and objectives used to
get classified as 'Balanced Funds'. This left investors confused. Now there are
6 types of hybrid funds that will cover different types of schemes that were
earlier classified as 'Balanced Funds'. Let us look at them -<b><o:p></o:p></b></span></div>
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<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Type of Hybrid Fund <o:p></o:p></span></b></div>
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<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Investment Pattern</span></b><span lang="EN-GB"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Conservative Hybrid Fund<o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">10% to 25% in equity & equity related instruments<o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">75% to 90% in Debt<span style="mso-spacerun: yes;">
</span>instruments</span><span lang="EN-GB"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Balanced Hybrid Fund and Aggressive Hybrid Fund<i><o:p></o:p></i></span></div>
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<i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Balanced -</span></i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">40%-60% in equity & equity related instruments<o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">40%-60% in Debt<span style="mso-spacerun: yes;">
</span>instruments<i><o:p></o:p></i></span></div>
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<i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Aggressive -</span></i><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">65%-80% in equity & equity related instruments<o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">20%-30% in Debt<span style="mso-spacerun: yes;">
</span>instruments</span><span lang="EN-GB"><o:p></o:p></span></div>
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<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Dynamic Asset Allocation or Balanced Advantage<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 264.75pt;" valign="top" width="254">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Investments<span style="mso-spacerun: yes;"> </span>in<span style="mso-spacerun: yes;"> </span>equity/<span style="mso-spacerun: yes;">
</span>debt is managed dynamically </span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 217.25pt;" valign="top" width="214">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Multi Asset Allocation<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 264.75pt;" valign="top" width="254">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Investments in at least three<span style="mso-spacerun: yes;"> </span>asset classes<span style="mso-spacerun: yes;"> </span>with<span style="mso-spacerun: yes;">
</span>a<span style="mso-spacerun: yes;"> </span>minimum<span style="mso-spacerun: yes;"> </span>allocation of<span style="mso-spacerun: yes;"> </span>at least<span style="mso-spacerun: yes;">
</span>10%<span style="mso-spacerun: yes;"> </span>in each </span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 217.25pt;" valign="top" width="214">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Arbitrage Fund<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 264.75pt;" valign="top" width="254">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Minimum of 65% allocation in equity & equity related
instruments</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr style="mso-yfti-lastrow: yes;">
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 217.25pt;" valign="top" width="214">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Equity Savings<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 264.75pt;" valign="top" width="254">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Minimum of 65% allocation in equity & equity related
instruments<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 10.0pt; mso-bidi-font-family: "Trebuchet MS";">Minimum of 10% allocation in debt instruments</span><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
</tbody></table>
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<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Let us look at the features of Dynamic
Asset Allocation Funds - <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">They have <b>no restriction</b> on the investment structure.
The investment allocation to equity and debt can be managed dynamically by the
fund managers based on market conditions. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">When the market is on its high, exposure to equity can be
reduced. When markets look attractive to buy, the allocation for equity can be
increased. When interest rates are in a downward cycle, the MF scheme manager
can choose to invest in shorter duration debt instruments which are less
volatile to interest rate changes. Thus these funds can bring a <b>balance</b>
in your portfolio<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">These funds are good to bring <b>stability in your overall
portfolio</b>. If you want to invest in equity but do not want to risk your
money in the direct equity market, you can opt to invest in a dynamic asset
allocation fund.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Some of the Dynamic Asset Allocation Funds
available in the market are AXIS Dynamic Equity fund, IDFC Dynamic Equity,
Reliance Balanced Advantage, SBI Dynamic Asset Allocation etc.</span><span lang="EN-GB"><o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-1177086319056954172018-08-12T23:38:00.000-07:002018-08-12T23:38:58.337-07:00How to File Revised ITR<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
have filed your IT returns on time but have realized that you made an error in
the return. What can you do now? Well, you have the option to rectify your
returns and file a revised return if the mistake is genuine. You can file a
revised return for the financial year 2017-18 up to March 31st 2019. You can
also file a revised return for earlier years. <o:p></o:p></span></div>
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<br /></div>
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<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Steps to File a Revised Return <o:p></o:p></span></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-fareast-font-family: "Trebuchet MS";"><span style="mso-list: Ignore;">1.<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Login on the income tax
website - <a href="https://incometaxindiaefiling.gov.in/"><span style="color: black; font-family: "Times New Roman",serif; font-size: 12.0pt; mso-bidi-font-family: "Arial Unicode MS"; mso-bidi-font-size: 11.0pt; text-decoration: none; text-underline: none;">https://incometaxindiaefiling.gov.in/</span></a> with your
login credentials (PAN and password) and date of birth.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-fareast-font-family: "Trebuchet MS";"><span style="mso-list: Ignore;">2.<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Select the option – 'Rectification'
under 'e-file' tab.</span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjI7BuKdfMqmQV1OCHmaakwEnzOAkzZejP5LqoGzN6XUMfcq1DGOk3O2jClO03sIcbBZwVhQ8QGC_LgdcrCaWon0rdrK1pDaOOX_f_59Ma8aylX-nBdt7udU9lLKiXaLLauAqbxQw_ozhqj/s1600/X1.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="614" data-original-width="1600" height="152" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjI7BuKdfMqmQV1OCHmaakwEnzOAkzZejP5LqoGzN6XUMfcq1DGOk3O2jClO03sIcbBZwVhQ8QGC_LgdcrCaWon0rdrK1pDaOOX_f_59Ma8aylX-nBdt7udU9lLKiXaLLauAqbxQw_ozhqj/s400/X1.jpg" width="400" /></a></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You will get this screen -</span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhrjyVP34KcwRUKGZqzbp6vHeinGyyK2ax2okGQIHXhzCxmsd05yu6JzKJWfHijK8jpa4tkbnNBCdC3TKtqmC18PeIUyQ812N9b6_BVv8iu26FNglfXefS7akewJDrdaXXQMCAkAban_JvX/s1600/X2.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="643" data-original-width="1600" height="160" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhrjyVP34KcwRUKGZqzbp6vHeinGyyK2ax2okGQIHXhzCxmsd05yu6JzKJWfHijK8jpa4tkbnNBCdC3TKtqmC18PeIUyQ812N9b6_BVv8iu26FNglfXefS7akewJDrdaXXQMCAkAban_JvX/s400/X2.jpg" width="400" /></a></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">Select
the type of return, the assessment year and communication reference number. <o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">In
the next screen, enter the reason for revising the returns. You can select up
to four reasons.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">Then
select one of the two options - Tax Credit Mismatch or Tax / Interest Mismatch.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">Select
to view the Form 26AS to check the details and Tax Credit Mismatch option to
view the tax credit mismatch if any. You have to upload the revised XML
generated from the tax utility software if tax computation related data has to
be rectified. If you have to revise for tax credit mismatch etc, you need not
upload the revised XML.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">You
can then submit for rectification.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">If
the return has been audited already, the revised IT return has to be digitally
signed.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">Verify
the revised return.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">Other
online tax utilities also support revision of returns. The steps depend on
their software.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">Points to Remember while filing Revised Returns<o:p></o:p></span></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
can revise an ITR return any number of times provided the previous one for
the same assessment year is processed.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Revision
of IT return can be done with the same ITR form that was used for the
original return. You cannot change the ITR form during rectification.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
cannot file a revised return in paper if the IT return has been filed
electronically and vice-a-versa.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
can withdraw a rectification request within three days of filing by
logging in the account, selecting the ITR has to be withdrawn and
selecting to withdraw.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Rectification
can be done only for genuine mistakes and omissions. If there is any
suspicion of tax evasion, concealment of income etc. the revised return
may be ignored and a scrutiny can be initiated.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Losses
other than loss on property cannot be shown in revised returns.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">
</span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS", sans-serif; font-size: 11pt;">It
is important to file accurate IT returns. If you think you have made an error,
do make an effort</span><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">
to revise your returns. It is not difficult and it will save you from hassles.</span><span lang="EN-GB"><o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-61119065815282623602018-07-22T21:14:00.000-07:002018-07-22T21:15:26.504-07:00Understand the CIBIL Score <div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHhBkhZ4pXBr1p9xNCsj9FTqWD4ZJZ6LA-N82JNx67XJJIL8BgXDILdd6ELOS9Tqol8ErIjAfYiZiIfZYmS4WehFl-PLj7nXaNCaJrIz4VyOne_b8Zrxfr3DZNU7tPZfzIFwWC_2z8xfBF/s1600/CBILL.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="410" data-original-width="750" height="174" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHhBkhZ4pXBr1p9xNCsj9FTqWD4ZJZ6LA-N82JNx67XJJIL8BgXDILdd6ELOS9Tqol8ErIjAfYiZiIfZYmS4WehFl-PLj7nXaNCaJrIz4VyOne_b8Zrxfr3DZNU7tPZfzIFwWC_2z8xfBF/s320/CBILL.jpg" width="320" /></a></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">What is a CIBIL score? What is a CIBIL
report?</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">A
CIBIL score or CIBIL report gives a status of your financial history. It is
prepared by TransUnion CIBIL Ltd., formerly known as Credit Information
Bureau(India) Ltd. <o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">The
CIBIL score is a three digit number generated using information about a
person's credit history. The credit history is compiled from data taken from
financial institutions, banks and loan providers.<o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">The
CIBIL report has more details like loan history, repayment information and
status of current loans <o:p></o:p></span></div>
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<br /></div>
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<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">How is my CIBIL score determined?</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">The
organization takes into consideration many parameters to arrive at the CIBIL
score. It considers <o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Credit History </span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">–
Performance on past debt obligations is given a weightage of 30%
approximately<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Credit Type and Duration</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">
– The portfolio of loans (Secured/Unsecured) and how long the loan is
taken for is given a weightage of about 25%<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Credit Exposure</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">
– Extent of loans taken is given a weightage of about 25%<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Other Factors</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">
– Factors such as recent credit behaviour, credit utilization, credit
applications etc. are given a weightage of 20% approximately.<o:p></o:p></span></li>
</ul>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Using
the data on these factors, a score between 300-900 is given with 300 being the
lowest CIBIL score and 900 being the highest score. <o:p></o:p></span></div>
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<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">What is a good and bad CIBIL score?<o:p></o:p></span></b></div>
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<br /></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhWkLJLWMua-zEw5fFNzQGcR7TMiOUsJFyg6QxN2NP5aovBorATA19CKTmZ9hvj5KpDuDt_cjvVr4zL8g75_j-lVMG-htaMfIbdntORftXJNQhV8LLHwzioBdk4Ja6DrLBWtGfzUEQpHQgO/s1600/CBIL.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="111" data-original-width="736" height="57" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhWkLJLWMua-zEw5fFNzQGcR7TMiOUsJFyg6QxN2NP5aovBorATA19CKTmZ9hvj5KpDuDt_cjvVr4zL8g75_j-lVMG-htaMfIbdntORftXJNQhV8LLHwzioBdk4Ja6DrLBWtGfzUEQpHQgO/s400/CBIL.jpg" width="400" /></a></div>
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<br clear="ALL" style="mso-ignore: vglayout;" />
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">This table shows the CIBIL score and the meaning of the score. For
example, if you have a CIBIL score of 450, lenders will hesitate to give a loan
to you as it means there is a high chance that you may not repay the loan. If
you have a score of 670, you may get a loan but the interest rate might be
high. On the other hand if you have a score of 800, lenders would willingly
offer a loan to you at the most competitive rates. You can choose the loan that
best suits your requirements.</span><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
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<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">How can I get information on my credit
score?</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">You can request for a credit report from CIBIL. CIBIL provides one
CIBIL Score and Report without any charge once a year. If you need more
reports, you can opt from a range of plans that CIBIL provides. <o:p></o:p></span></div>
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<br /></div>
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<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">How can I ensure that I have a good CIBIL
score?</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; text-align: justify;">
<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">It is important to have a good CIBIL score. Some tips to ensure
that you maintain a good CIBIL score -<o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2; text-align: justify;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Ensure that you pay off your credit
card dues on time and in full.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2; text-align: justify;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Do not keep too many credit cards.
For example, if you have 8 credit cards, you give the impression that you
are always looking for credit.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2; text-align: justify;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Pay various bills such as telephone
bill, utilities bill on time. Pay the full amount.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2; text-align: justify;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">If you have joint loans or any
other such accounts, make sure the other person also maintains a good
credit history and payment schedule.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2; text-align: justify;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Do not apply only for unsecured
loans. You should have a mix of secured (with collateral) and unsecured
loans.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2; text-align: justify;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Review your CIBIL report regularly
so that you can manage it and also raise inaccuracies if any in the report
or score to the organization and rectify it.<o:p></o:p></span></li>
</ul>
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<br /></div>
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<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">There are other organizations that offer credit scores too. These
are Experian, Equifax and High Mark. A CIBIL score is a reflection on your
financial behaviour. If you have a low score, you can take steps to improve
your financial discipline which will improve your credit score as well as your
financial behaviour.<o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-75174669921215753942018-07-16T18:53:00.000-07:002018-07-16T18:53:09.692-07:00Do Not Forget These Tax Breaks While Filing Your Income Tax Returns <div dir="ltr" style="text-align: left;" trbidi="on">
<br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEizYjAoA2c20pmnfg5YRwutJL8PnJr3l2oKzber4QUIM7rxJnyLscvE8rs3VrSnIo3lmeIKs9aukx85QsAsD2gA2j-vTComsdWzea0HH6cEtULSFhYGvWtfYgyMGutY-E3XQsLdV-H5JGFL/s1600/Tax+breaks.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="400" data-original-width="1216" height="105" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEizYjAoA2c20pmnfg5YRwutJL8PnJr3l2oKzber4QUIM7rxJnyLscvE8rs3VrSnIo3lmeIKs9aukx85QsAsD2gA2j-vTComsdWzea0HH6cEtULSFhYGvWtfYgyMGutY-E3XQsLdV-H5JGFL/s320/Tax+breaks.jpg" width="320" /></a></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">It
is important to pay the right amount of tax and file your returns on time. It
is equally important to plan taxes efficiently so that the tax outgo is
minimized. Let us look at </span>the different tax breaks available so that you
reduce tax burden in a legal way -<o:p></o:p></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">1) <b>Capital Losses Incurred – </b></span><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If you make a loss on the sale of any of your assets such as real
estate, shares or mutual funds etc. you can set it off against capital gains ma</span>de
in that financial year thereby reducing the taxable income. If you cannot write
off the entire loss in one year, it can be carried forward and set off against
capital gains for the next eight years.<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">2) <b>Reinvestment of Long Term Capital
Gains –</b> The amount received on sale of a long term capital asset can be
invested in real estate or bonds issued by REC or NHAI to get exemption from
tax. This is proposed to change from the next assessment year.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">3) <b>Deduction for Interest paid on
Education Loan -</b><span style="mso-spacerun: yes;"> </span>Under Section 80E
of the Income Tax Act, interest paid on an educational loan can be treated as a
deduction. The loan can be taken for self, spouse or child. It can be taken by
a legal guardian for a student. The loan should be for higher education. It can
be claimed once repayment is started. It can be claimed for a maximum of 8
years. The loan has to be taken from a bank or a NBFC whose loan is eligible to
qualify under Section 80E for tax deduction.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">4) <b>Tuition Fees Paid for Child –</b>
Deduction for Tuition fees is available up to a maximum of 2 children for each
individual under Section 80C. A maximum up to Rs. 1,50,000 (maximum under
Section 80C) is available for each financial year for each parent. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">5) <b>Income of Disabled Child -</b> If
you invest on behalf of your child, the income earned from these investments
are clubbed with your income while computing taxes. But if the child is
disabled, the income is exempted from being taxed.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">6) <b>Tax Breaks for certain diseases
under Section 80DDB –</b> If a person is suffering from any of the following
specified diseases, he/she is eligible for tax deduction under Section 80DDB -<o:p></o:p></span></div>
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</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Hemophilia<o:p></o:p></span></div>
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<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Hemiballismus<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Malignant cancers<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Motor neuron disease<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Parkinson’s disease<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
<!--[if !supportLists]--><span lang="EN-GB" style="font-family: Symbol; font-size: 11.0pt; mso-bidi-font-family: Symbol; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";">
</span></span></span><!--[endif]--><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Thalassaemia <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">A person paying for treatment of any of
these diseases for dependent parents, spouse or sibling is also eligible for
deduction. A taxpayer can claim a tax deduction up to Rs 40,000. A senior
citizen can claim deduction up to Rs 60,000 and a super senior citizen can
claim up to Rs 80,000. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">7) <b>Deductions for disabilities under
Section 80DD -</b> A taxpayer who suffers from 40% disability can claim a
deduction of up to Rs 75,000 under Section 80U. If the taxpayer is responsible
for maintenance of another person who is disabled up to 40%, he is eligible for
deduction of Rs 75,000 under Section 80DD. If the disability is more than 80%,
the deduction is Rs 1,25,000. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-67768829957825570222018-06-27T21:50:00.001-07:002018-06-27T21:50:58.874-07:00Understand Your Salary Structure<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-xVpXgWv2J7sd2V941atekS1MI623NWaWXblM3Gp7aKtJ9M8MjJyCgkuto9arWIbdQT1atvg3xZqjcHHEjLEBbRXcBlJor2dzwy61-tnP0U5iv4qpTpCYo_WYLEk8WTcN0ukv-gkLR2LG/s1600/Salary.gif" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="685" data-original-width="1170" height="187" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-xVpXgWv2J7sd2V941atekS1MI623NWaWXblM3Gp7aKtJ9M8MjJyCgkuto9arWIbdQT1atvg3xZqjcHHEjLEBbRXcBlJor2dzwy61-tnP0U5iv4qpTpCYo_WYLEk8WTcN0ukv-gkLR2LG/s320/Salary.gif" width="320" /></a></div>
<br />
<br />
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">We
hear of people getting Rs.10,00,000 as Cost to Company (CTC). Some people get <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Rs.15,00,000
as gross salary. Others talk about net salary. There are so many terms and many
of us are overwhelmed by these terms to completely understand the salary
structure. Here is our attempt to simplify the remuneration structure -<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
total cost to company of an employee can consist of the following components -<o:p></o:p></span></div>
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: 2.75pt; mso-padding-alt: 2.75pt 2.75pt 2.75pt 2.75pt; mso-table-layout-alt: fixed;">
<tbody>
<tr>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div align="center" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: center;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Component<o:p></o:p></span></b></div>
</td>
<td style="border-right: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-top-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div align="center" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: center;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Definition<o:p></o:p></span></b></div>
</td>
<td style="border: solid black 1.0pt; mso-border-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div align="center" class="MsoNormal" style="margin-bottom: 4.25pt; text-align: center;">
<b><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt; mso-bidi-font-family: "Trebuchet MS"; mso-bidi-font-size: 12.0pt;">Taxable</span></b><span lang="EN-GB"><o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Basic
Salary<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">It
is the base income of the total remuneration. It is around 40% of the<span style="mso-spacerun: yes;"> </span>total remuneration.<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Fully
Taxable<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Dearness
Allowance<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
component that takes care of the cost of living depending on the city where
one works. It is usually paid in the Government sector<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Fully
Taxable<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">House
Rent Allowance<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Amount
paid to an employee to take care of his housing needs.<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
least of the following can be claimed as deduction -<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">-
Actual HRA<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">-
Actual rent paid – 10% of Basic salary + Dearness Allowance<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">-
50% of Basic + DA for the 4 Metro cities and for all other places 40% of
Basic + DA<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Leave
Travel Allowance<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Allowance
given to an employee for a trip with parents, siblings, spouse and children
within India. It can be availed twice in a block (specified) of 4 years.<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Tax-free<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Perquisites<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Some
companies give perquisites such as interest free loans, subsidised education,
food coupons or car.<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Monetary
value is fully Taxable in most cases. In some cases, it is exempt up to a
certain amount.<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Bonus<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Amount
given based on performance of the employee and company<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Fully
Taxable<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Employee
Provident Fund<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">12%
of basic salary is deducted as a monthly contribution to Employee Provident
Fund. An equivalent amount is contributed by the employer to the fund.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">For
new women employees, the contribution from salary is 8%.<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">NA<o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Superannuation
Benefits<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">A
retirement benefit fund in which the employer and employee contribute and it
earns interest.<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Additional
amount contributed by employee is eligible for deduction under Section 80C.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Interest
earned is tax free. The 1/3rd amount withdrawn at the time of retirement is
tax free but amount withdrawn before that is taxable unless it is due to
death/injury. <o:p></o:p></span></div>
</td>
</tr>
<tr>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Gratuity<o:p></o:p></span></div>
</td>
<td style="border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Amount
received by employee for 5 years or more of continuous service unless the
employment terminates due to death or disablement.<o:p></o:p></span></div>
</td>
<td style="border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Depends
on where the employee is working and the amount of gratuity.<o:p></o:p></span></div>
</td>
</tr>
<tr style="mso-yfti-lastrow: yes;">
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 75.8pt;" valign="top" width="111">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Medical/
Health Insurance Premium<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-bottom: solid black 1.0pt; border-left: solid black 1.0pt; border-right: none; border-top: none; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 198.2pt;" valign="top" width="177">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Employers
pay premium for insurance cover of health for employees and immediate family.<o:p></o:p></span></div>
</td>
<td style="background: #CCCCCC; border-top: none; border: solid black 1.0pt; mso-border-bottom-alt: solid black .25pt; mso-border-left-alt: solid black .25pt; mso-border-right-alt: solid black .25pt; padding: 2.75pt 2.75pt 2.75pt 2.75pt; width: 207.9pt;" valign="top" width="180">
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Tax-free
if employer pays directly. It can be claimed as deduction if employee pays
from own pocket.<o:p></o:p></span></div>
</td>
</tr>
</tbody></table>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Why
should you attempt to understand your salary structure?<o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
know your total income and take-home salary.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
can structure it in a manner that it is most tax-efficient.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
can create an appropriate financial plan and investment portfolio based on
your financial capacity.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Understand
the salary structure and if possible engage with your HR department to get a
tax efficient salary.<o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-9921525791812657702018-06-10T21:49:00.001-07:002018-06-10T21:50:04.484-07:00How should Small Business Owners/ Professionals Manage their Money?<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<br />
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhVcYXqP62_GLPlPFXdbPv1eKqUM6jt9Z9nReH5JHT92hoO42BVwhf6DNZS0inV9IH2XUDJPVUq5ZrxIqv-YlgT8k9dkhDNYdRk3ndeTBhKekK6TdFNBcHKnUw39BLuOp5pa1fswLtY3rkB/s1600/Small+Business+Owners.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="250" data-original-width="770" height="103" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhVcYXqP62_GLPlPFXdbPv1eKqUM6jt9Z9nReH5JHT92hoO42BVwhf6DNZS0inV9IH2XUDJPVUq5ZrxIqv-YlgT8k9dkhDNYdRk3ndeTBhKekK6TdFNBcHKnUw39BLuOp5pa1fswLtY3rkB/s320/Small+Business+Owners.jpg" width="320" /></a></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Rishabh
is a 28 year old software developer. A couple of years back, he left his job in
a top IT company and started working on a freelance basis. He gets assignments
via freelance websites and his professional network. He likes his freedom and
the fact that he can work on a variety of projects across technologies. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Nandika,
38 is a freelance photographer. She works with companies for corporate events
and photo shoots. She also takes up assignments for weddings and birthdays. She
used to work in the corporate world but quit when her children were born. She
is happy that she turned her hobby into a well-earning profession. She enjoys
the flexibility and freedom that her work gives her.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Being a Small Business Owner/ professional has its advantages but
there are a few challenges from the financial front -<o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Earnings
are not regular and they fluctuate. Sometimes a lot of money comes in and
in some months there is literally no income. For example, Nandika did not
get any lucrative offers at the beginning of the year and had no income.
Her household which usually operates on two incomes was forced to be run
on her spouse's income alone.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">When Rajiv
was working, he had health insurance for himself and his parents. He had
forced savings via Employee PF. But now, he has no health insurance and he
has no regular savings.<o:p></o:p></span></li>
<li class="MsoNormal" style="margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">As a Small Business Owner/Professional, you are not just working but also marketing, prospecting new
clients, following up on invoices etc. You get busy and may not have time
to focus on financial planning. Rajiv is not aware of how much he has
saved or if the investments he has made are appropriate for his personal
situation and risk profile.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Here are some steps to follow as a Small Business Owner/ Professional to ensure that your financial plan is on track -<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Develop a Proper Asset Allocation Plan –</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"> Devise a proper asset allocation plan.
Usually, younger people can invest more in high risk based assets. But in case
of self employed, whose income is irregular, a major portion of the income can
be in fixed income instruments. Some amount should be invested in equity-based
assets. It will be good to invest small sums regularly (for e.g. using the SIP
method) so that the wealth grows in the long-term. If you have just started
your self-employed profession, avoid huge loans. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Invest in a manner that your retirement is
taken care of. Invest in PPF, NPS and equity-based assets so that you build a
nice retirement kitty.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Create and Follow a Budget –</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"> Create a budget of income and expenses
and follow it diligently. Even if you earn a lump sum amount, resist the
temptation to splurge. If you are not able to be disciplined about financial
matters, you can open two bank accounts and designate one of them as a 'Salary
Account'. Use one account to receive remuneration for your assignments.
Transfer money from this account to your 'Salary Account'. Spend money only
from the 'Salary Account'. Transfer money for your living expenses, insurance
payments, EMIs and regular investments. You will not go on a spending spree and
will have cash for other purposes such as emergencies or learning to improve
your professional capacity.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Build an Emergency Fund –</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"> Keep an emergency fund equivalent to
living expenses for a few months. The money can be parked in savings accounts
and liquid or short debt-oriented funds.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Insure Yourself –</span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"> Buy a term plan if you have dependents.
Buy health insurance so that if you get serious health issues, the financial
aspect is taken care of. Ensure that the health insurance cover is adequate. A
cover of Rs.5,00,000 and more is good in normal circumstances.<b><o:p></o:p></b></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Tax Planning – </span></b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">When you were employed, the employer used
to deduct taxes and give you the Form 16. As a self-employed professional, you
have to ensure that you file your returns and pay taxes as required. You can
claim deduction for expenses pertaining to business and get some relief based
on total revenue earned and GST.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Small Business Owners/ Professionals have many benefits but ensure
that the financial plan takes care of uncertainties due to irregular income in
the short-term and long-term.</span><span lang="EN-GB"><o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-57996649245832518422018-06-04T23:04:00.001-07:002018-06-04T23:04:12.038-07:00Let us understand about Systematic Withdrawal Plans (SWPs) in Mutual Funds<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAv1bSUXY0YdNvKOPt9KK-8mZmRPoYicBxHzKBtJYcInPsjMuetgifEryEPka_QpaakBn-ah-DMaoaAGzZlR5hjIx5Wlyo9morXz4s-nW_Yrpr7Nnq2lY9TBFhQnBT-WmYkOd0CZmchK5p/s1600/SWP-Systematic-Withdrawal-Plan-copy.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="461" data-original-width="640" height="230" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAv1bSUXY0YdNvKOPt9KK-8mZmRPoYicBxHzKBtJYcInPsjMuetgifEryEPka_QpaakBn-ah-DMaoaAGzZlR5hjIx5Wlyo9morXz4s-nW_Yrpr7Nnq2lY9TBFhQnBT-WmYkOd0CZmchK5p/s320/SWP-Systematic-Withdrawal-Plan-copy.jpg" width="320" /></a></div>
<br />
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Many of you must be aware that Mutual Fund schemes have a feature
known as Systematic Withdrawal Plan (SWP). Investors can avail of SWP to redeem
a pre-defined amount from their investment in an MF Scheme on a regular basis.
It is a convenient way to withdraw from the investment in a systematic manner.
It is a great facility as -<o:p></o:p></span></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">- People can use it as a form of a regular income flow.<o:p></o:p></span></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">- Retired persons who do not have a regular income can use SWP to
take care of their expenses.<o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">SWP can be initiated in liquid funds, debt funds or equity funds.
It is a better form of income as compared to dividends as dividends are not
regular always. Moreover dividend distributed is taxed in the hands of the
Mutual fund house leading to lesser funds remaining to be distributed.<o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">There are two ways in which you can withdraw using this feature –<o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Fixed Amount Withdrawal – </span></i></b><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">A
fixed amount can be withdrawn on a regular basis – monthly quarterly or half yearly
or annually. For example, you can set up an SWP of Rs. 15000 on a monthly basis
which means Rs. 15000 will be credited to your account every month. The
advantage is that you know what your cash flow will be. The disadvantage is
that if the value has gone down, you will need more units to be redeemed to
generate the fixed amount<o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Appreciation Withdrawal – </span></i></b><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
can set up an SWP equivalent to the amount that has been appreciated on a
monthly or quarterly basis. The advantage here is that the capital stays intact
and only the gains are withdrawn. But, suppose there is very less appreciation
or the value has gone down, there will be no cash flow. <o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The tax applicable will be the same as that applicable for
redemption of units. It is important to note that exit load if any will be
applicable to SWP as well.<o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">When
should I make use of SWPs?<o:p></o:p></span></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">It
is a good investment strategy to use for generation of regular income in
scenarios such as loss of job, kicking off an enterprise or in the post
retirement age.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">It
is a good strategy to protect from risks. You can withdraw when your
redemption target is reached. <o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Gains
from Mutual Funds are being taxed. If you redeem using SWP in early phases
of investment, in growth based equity funds, the proportion of gains
redeemed will be less as compared to the capital redeemed. This means tax
outgo will also be less.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">When
is it not a good idea to use SWPs?<o:p></o:p></span></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">When
the market is falling or volatile, it is better to avoid SWPs. <o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
you have a regular cash flow, let your investments appreciate. Do not
withdraw from it unnecessarily.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">SWP and STP are different. STP stands for Systematic Transfer Plan
where you can set up an amount to be transferred from an MF scheme in one
category to another. <o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-90847422373298136632018-05-27T22:22:00.001-07:002018-05-27T22:22:16.495-07:00Protection and Liability in Case Of Fraudulent Electronic Transactions<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhoWO8g3_mhjIImkpAKMEAHYsNlgY5t_pg7Cj4j1JN7-yAxRZ2Em2Qh4CKk54A5oQlYg5NMEbHjwbweNcg9w9SQrmmVKN7NRQFr971p3rGYgApYGqBF6XmpHesLlP-xFchNUsWd4s5I_hw-/s1600/111.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="134" data-original-width="200" height="268" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhoWO8g3_mhjIImkpAKMEAHYsNlgY5t_pg7Cj4j1JN7-yAxRZ2Em2Qh4CKk54A5oQlYg5NMEbHjwbweNcg9w9SQrmmVKN7NRQFr971p3rGYgApYGqBF6XmpHesLlP-xFchNUsWd4s5I_hw-/s400/111.jpg" width="400" /></a></div>
<br />
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
digital transactions in the country crossed the 1 billion mark this December
2017 as per RBI data. Digital transactions include transactions done using
credit cards, debit cards, Internet banking, mobile banking, UPI, prepaid
instruments and unstructured supplementary services. It is convenient to
transact digitally as transactions can be tracked and people need not carry too
much cash in hand. But there is a new menace that is growing at a fast pace
which is the fraudulent use of credit cards and debit cards and online fraud.
Many people have been victims of such attacks. For example, some people get a
message late in the night that their card has been used in a faraway place in
China or U.S. In other cases, purchases are made in the names of credit card
holders who are registered users of online shopping portals. How can you
protect yourself from digital fraud? What can you do in case there are
fraudulent transactions in your account?<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Preventive Measures<o:p></o:p></span></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Use
your debit and credit cards only in trusted shops and online portals.
Check your bank account statement and credit card statement regularly and
report unauthorised transactions immediately to the bank.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Destroy
old cards or cards that you do not use.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Ensure
that you get alerts on monetary transactions made using your cards.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Ensure
that the bank has your correct contact details so that they can inform on
suspicious activities<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Use
websites and payment methods that have multiple security layers like SSL,
device confirmation, ID checks and transaction limits<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Do
not store user credentials online and do not write them down somewhere.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">What Happens When Fraudulent Transactions Occur <o:p></o:p></span></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><span style="mso-spacerun: yes;"> </span>A customer will have a zero liability if
the loss is due to negligence of bank even if the customer does not report
the fraudulent transaction.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
the loss is due to negligence or mistake on your part, then you will have
to bear the loss. Suppose you disclose the OTP or card details like CVV to
someone, you will be liable for the loss. It is important to notify the
bank about the transaction so that they can block the card and prevent
further losses. You should also file a complaint at the nearest police
station.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
the fraud is caused by a third party and neither you nor the bank is
responsible for the unauthorised transactions there are two possibilities
-<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
notify the bank within 3 days of the unauthorized transaction -<o:p></o:p></span></i></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Then your liability is zero. The bank will have to credit the
amount within 10 working days from the date of notification.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt; margin-left: .5in; margin-right: 0in; margin-top: 0in;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
report the fraudulent transaction within 4 to 7 days of its occurrence - <o:p></o:p></span></i></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Then
you are liable to an amount that is limited to the lower of the transaction
value or the amount mentioned by the RBI as per the table below for different
modes of transaction - <o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Rs
5,000 for Basic Savings Bank Deposits (BSBD)<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Rs.
10,000 for current accounts/ cash credit/ overdraft accounts of
individuals with annual average balance (during 365 days preceding the
incidence of fraud)/ limit up to Rs. 25,00,000 and credit cards with limit
up to Rs 5,00,000, ,pre-paid payment instruments, gift cards and for
current/ cash credit/ overdraft accounts of MSMEs.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Rs.
25,000 for all other current/ cash credit/ overdraft accounts and credit
cards with limit above Rs 5 lakh.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Banks
must ensure the following -<o:p></o:p></span></i></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Banks
must provide customers with 24×7 access via different modes of
communication.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Acknowledge
the reporting of the fraudulent transaction.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
burden of proof of customer liability in case of unauthorised electronic
banking transactions is with the bank.<o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Your
Responsibilities <o:p></o:p></span></i></b></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Provide
all details of communication such as address, mobile number to the bank.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Do
not indulge in negligent activities like sharing of CVV number or
passwords, OTPs with others<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Do
not download suspicious apps and games<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Keep
your cards and online credentials safe and secure<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Contact
the banking ombudsman if you are not satisfied with the bank’s resolution<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Update
anti-virus software and other softwares that you use regularly so that
your computer and mobile phones are protected.<o:p></o:p></span></li>
</ul>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-9650538122905732382018-05-01T22:58:00.001-07:002018-05-01T22:58:35.026-07:00How Will the New Classification of Mutual Funds Affect Me?<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhm-WdCal63s785dO2vh5LZGTdT0jSVZAKJh28PEA-WJE6VnePwo_pTAP5nqR-7_K001hD3BzDSt-T8TlWhwz4pzUpCrNgHfTZPIx7OqTwiorITROmFvN69jAYIxJM65LVLQuHo1TF-_wwx/s1600/NewClassifications_B16D0821-880B-11E7-8C71141877632E8F.webp" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="209" data-original-width="300" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhm-WdCal63s785dO2vh5LZGTdT0jSVZAKJh28PEA-WJE6VnePwo_pTAP5nqR-7_K001hD3BzDSt-T8TlWhwz4pzUpCrNgHfTZPIx7OqTwiorITROmFvN69jAYIxJM65LVLQuHo1TF-_wwx/s1600/NewClassifications_B16D0821-880B-11E7-8C71141877632E8F.webp" /></a></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You
might have received emails from some of the Mutual Fund Houses indicating that
they have merged some of their schemes or renamed their schemes. You might have
got emails on restructuring of your scheme. These mails might be due to the
recent changes mandated by SEBI on classification of Mutual Fund Schemes. Here
are some of the key changes that have been mandated -<o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">A
fund house can offer 10 types of equity funds, 16 different bond schemes,
and 6 hybrid funds. Apart from these, they can offer schemes based on
indices, solutions and fund of funds.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
the scheme is called a large cap equity fund, it<span style="mso-spacerun: yes;"> </span>should have at least 80% of the total
assets invested in large-cap stocks<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">IF
the scheme is a blend of large-cap and mid-cap schemes, the fund will have
to allocate at least 35% of its assets to each category.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
the scheme is a mid-cap equity scheme, it should invest 65% of its assets
in mid-cap stocks.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
the scheme is a small-cap equity scheme, it should invest 65% of its
assets in small-cap stocks.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">For
debt funds, sixteen new categories are provided. Fund houses will have to
align their existing schemes to these categories and launch new ones under
these categories. The categories are based on duration, maturity, credit
rating and others based on parameters like sector.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l0 level1 lfo1;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">A
corporate bond fund can invest only in AA+ and higher-rated instruments. A
credit risk fund can invest in AA and lower rated securities. <o:p></o:p></span></li>
</ul>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">What
is the impact of these changes on the retail investor? What should be his plan
of action?<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Impact<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Performance –</span></b><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"> In the short run, there
could be changes in the scheme's portfolio which could affect the performance.
Some might outperform and some may under perform. Many fund managers tweak the
portfolio to get higher returns. This may not be easily possible now. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Comparison of Schemes is easier –</span></b><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"> The
retail investor can now compare schemes with more accuracy. Earlier the fund
name could be misleading or unclear. Now the retail investor can clearly
compare schemes in a category as they will have similar characteristics. He
need not check how much has a large cap fund invested in mid-caps. He knows
what he is investing in.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Clarity on what the MF scheme is invested in </span></b><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">– The retail investor will have more clarity on how his funds are
invested as the categorisation is more accurate. The fund manager has less
leeway to drift to investments different from the MF scheme intent or
objectives. This means the investor need not worry if the portfolio of the scheme
has changed and if it still matches his investment objectives<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Plan of Action<o:p></o:p></span></b></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">As a
retail investor, check what changes are incorporated in the schemes you are
invested in. <o:p></o:p></span></div>
<ul style="margin-top: 0in;" type="disc">
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">As
of now, there have not been too many drastic changes. Some funds have
changed their scheme definitions. Some have renamed the schemes. Others
have changed the investment structure or brought changes to the portfolio.
Review your portfolio in case you have funds whose structure and portfolio
have changed significantly. Review the fund's objectives and evaluate the
role of that investment in your portfolio. If it does not match with your
objectives in the long run, bring a change to your portfolio.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">In
case of debt funds, there are many categories now. You can easily check if
it makes sense to have a particular scheme in your portfolio. <o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">When
you are evaluating the performance of a scheme, check if it makes sense to
compare with past returns. The past returns might not be valid if the
portfolio has changed significantly.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Do
not rush to make changes. Check how your investment portfolio is
performing. Check the expenses you will incur in case you exit out of
certain schemes and enter other schemes.<o:p></o:p></span></li>
<li class="MsoNormal" style="color: black; margin-bottom: 4.25pt; mso-list: l1 level1 lfo2;"><span lang="EN-GB" style="font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
new classifications will be useful to investors as they will have more
knowledge on their investments and there will be uniformity across
categories. <o:p></o:p></span></li>
</ul>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-14343611287430610912018-04-15T07:19:00.000-07:002018-04-15T07:19:07.665-07:00 Important Steps To Take Before Filing Your Income Tax Returns<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhdfrCSCZZUe-NHzOmAJBIBGdaog9Zq7xzMCOkGSgPLNHYGK2MDJadO8mahmOMKsyuOczIP37o320i64eo3UbsFnIlZyyI7zXiP9XGJ-rxNgINtSXAiujexjCO9PQuoiFElLfyQdLYXgWFX/s1600/IncomeTaxReturn-uptra.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="771" data-original-width="1043" height="236" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhdfrCSCZZUe-NHzOmAJBIBGdaog9Zq7xzMCOkGSgPLNHYGK2MDJadO8mahmOMKsyuOczIP37o320i64eo3UbsFnIlZyyI7zXiP9XGJ-rxNgINtSXAiujexjCO9PQuoiFElLfyQdLYXgWFX/s320/IncomeTaxReturn-uptra.jpg" width="320" /></a></div>
<br />
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
deadline for filing your Income Tax Returns for the Financial Year 2017-18 is
July 31. It is good to file the returns well in time so that you complete it
without any rush or stress. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Let
us have a look at what is to be done before the deadline of July 31st.-<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">1)
Assess if you are supposed to file IT returns by calculating your total income.
<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
you are earning income and below 60 years old and your income is greater than
Rs. 2,50,000, you have to file IT returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
you are a senior citizen and your income is greater than Rs. 3,00,000, you have
to file IT returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">If
you are a super senior citizen and your income is greater than Rs. 5,00,000,
you have to file IT returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">2) Check if you have invested in PPF and NPS before March 31st of the financial year. It is important to
deposit the requisite amount as per financial needs, goals and financial
capacity. Check if your bank account is debited on time. If not, you can lose
the tax benefits of investing in these products. <o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">3)
There are many provisions for deductions in Section 80C, 80CCCC, 80D and 80DDB
related to medical insurance, annuity plan, life insurance, school fees etc.
You should make sure you have invested in the right products or purchased the
appropriate products for you.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">4)
File IT returns if they are pending for previous financial year till the end of
the assessment year. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">5)
Submit your Leave Travel Allowance (LTA) claims if applicable. You can claim
LTA twice in a block of 4 years. The year block applicable now is<span style="mso-spacerun: yes;"> </span>2018-2021.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">6)
Get all appropriate documentation ready. Get Form 12B from previous employer if
applicable. Get the Certificate of Interest and Principal paid on Loans that
are eligible for making deductions. Check if Form 16 and Form 26AS are in place
and have the correct details. Get the details of all investments made and the
interest, dividend, profits and losses made in those investments. Be sure of the
ITR that you have to complete and submit.<o:p></o:p></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">7)
If you have deposited cash in excess of Rs. 2,00,000 during the demonetization
phase, you have to account for it in the tax returns document. If you have
deposited money in the bank which has not been accounted for during the
demonetization phase, you should add it to the taxable income and pay tax on
it. If you are not able to provide proper explanation for cash deposited in the
bank accounts over the Rs. 2,00,000 limit, report it in the IT returns and pay
60% tax and interest and penalty on it.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"><br /></span></div>
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">8)
Report assets that you have acquired abroad. Report all physical and financial
assets if your total income is in excess of Rs. 50,00,000.<o:p></o:p></span></div>
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<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
last date to file returns for the current financial year – April 2017-March
2018 is July 31, 2018. Prepare in advance and file your returns on time.<o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-56772644727453303762018-03-16T22:34:00.003-07:002018-03-16T22:34:56.708-07:00Why Should I file Income Tax Returns?<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS9xzshmSRquC5zOtWnJmZpBiCC9jeqmWjT_bmgH_1AbhnEmkZyrD9PwybUmhCA1kIiWjsrHOji1RzapWHv_nEWlfQaP25Uj5XizYAVlnkSeJFS4LndS7_w_Crg96hxuLU787Ic6X7YJu-/s1600/income-tax-return-due-date.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="339" data-original-width="534" height="203" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS9xzshmSRquC5zOtWnJmZpBiCC9jeqmWjT_bmgH_1AbhnEmkZyrD9PwybUmhCA1kIiWjsrHOji1RzapWHv_nEWlfQaP25Uj5XizYAVlnkSeJFS4LndS7_w_Crg96hxuLU787Ic6X7YJu-/s320/income-tax-return-due-date.jpg" width="320" /></a></div>
<br />
<br />
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<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Dhruv
is of the opinion that he does not need to get into income tax 'hassles' as his
employer has already deducted tax before paying him his salary. Shweta does not
file income tax returns citing that her salary is less than Rs. 2,50,000 per
year. Vishaka works abroad and therefore has assumed that she does not have to
file tax returns. Are they correct in their assumptions?<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Filing
of tax returns is important. You will know exactly how much you have earned, how
much losses you have made and whether you have to pay taxes or not. The
government also comes to know the income earned by people and the tax that is
due to them. The government needs this for tax planning and financial planning.
Here are 6 reasons as to why you should file your tax returns -<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">1) <b style="mso-bidi-font-weight: normal;">Your Total Income is greater than
Rs.2,50,000 per ye</b>ar – If your total income (salary and other income like
interest on bank account, rent received etc. comes up to more than Rs.
2,50,000, then you have to file your tax returns even if on computation, the
tax comes to nil. If you do not file your returns, it is an offence and you
will be liable for penalty.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">2) <b style="mso-bidi-font-weight: normal;">You want to file a revised return</b> – If
you<span style="mso-spacerun: yes;"> </span>made a mistake in calculating taxes
and later on realise that you are liable to pay tax for that financial year and
want to rectify your mistake, you will need to file a revised return for that
financial year. This is possible only if you had filed returns in the first
place. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">3) <b style="mso-bidi-font-weight: normal;">Tax is Deducted At Source</b> – Your employer
has deducted tax at source. The bank deducts 10% tax<span style="mso-spacerun: yes;"> </span>at source while giving you your interest
income. But that is not enough. You have to document the fact that you have
paid your taxes. This is done through filing income tax returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">4) <b style="mso-bidi-font-weight: normal;">You have a refund claim</b> – Suppose you
paid taxes more than payable by you for one financial year. You realise that
you have paid more than necessary. How do you get your money back? When you
file tax returns and it is verified, the income tax department assesses the total
amount payable by you and credits your account to the extent you paid more.
This is possible only if you file your returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">5) <b style="mso-bidi-font-weight: normal;">You need to offset capital losses</b> – You
have made losses while trading in shares or made other capital losses. Make use
of those losses. When you file your returns, you can set them off against
capital gains. The total tax payable by you is reduced. The losses can be
carried forward and set off against next year's gains too if you have filed
returns in both the years.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<b style="mso-bidi-font-weight: normal;"><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">You are an NRI but you earn income in India</span></b><span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;"> – If you are an NRI and and your income in India exceeds Rs.
2,50,000 through one of the following sources, then you are liable to file tax
returns- <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Interest
earned in NRO accounts<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Income
earned while being a resident for part of the financial year<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Capital
Gains on property in India<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">Income
Tax Returns are also required for visa processing, loan processing etc.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="color: black; font-family: "Trebuchet MS",sans-serif; font-size: 11.0pt;">The
last date to file returns for the current financial year – April 2017-March
2018 is July 31, 2018. Remember to check if you are liable to file returns and
do so on time.<o:p></o:p></span></div>
<br /></div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0tag:blogger.com,1999:blog-4004872270539847756.post-60262273583242158562018-02-14T21:09:00.001-08:002018-02-14T21:10:06.733-08:00Bad Mutual Fund Advice that is to be Ignored !!!<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi6S48wLVZyEtG1po4hCaDAox6IBZqgPpzOQEUFLD23bPLYajZ_w03piqJWkEuIHZAhJ274YHdBwcvMHOS0UPt-4i1qp6AzvDXaYrVIXIyHbOyikG-2ZVBuSPQYoaWT3T7LxQzFg38il2GQ/s1600/MF.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="331" data-original-width="649" height="163" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi6S48wLVZyEtG1po4hCaDAox6IBZqgPpzOQEUFLD23bPLYajZ_w03piqJWkEuIHZAhJ274YHdBwcvMHOS0UPt-4i1qp6AzvDXaYrVIXIyHbOyikG-2ZVBuSPQYoaWT3T7LxQzFg38il2GQ/s320/MF.jpg" width="320" /></a></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;">Many
Mutual Fund Schemes across categories have delivered good returns over the past
few years. You have to plan, research and analyse the funds before investing.
Here is some advice that you may hear and should stay AWAY from while investing
in MFs.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<ol start="1" style="margin-top: 0in;" type="1">
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Invest in a MF scheme that
has a Lower NAV than others<o:p></o:p></span></b></li>
</ol>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;">Many
times, there are advertisements or financial advisors trying to sell MF units
with a low price or NAV indicating that they are cheap. New Fund Offers are
sold in this manner too. But the NAV is determined by the value of the
underlying assets. NAVs are not like stock prices. When the value of assets
increases, the NAV will also increase irrespective of the current value of the
NAV. Suppose there are two MF schemes Scheme A and Scheme B with identical
portfolios and NAV of Scheme A is Rs. 10 and of Scheme B is Rs. 100. At the end
of 1 year, suppose the value of the underlying assets has appreciated by 10%,
the NAV of Scheme A will be Rs. 11 and NAV of Scheme B will be Rs. 110. You
would have gained the same in both. <o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<ol start="2" style="margin-top: 0in;" type="1">
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Invest in Dividend Option of
MF Schemes to get returns<o:p></o:p></span></b></li>
</ol>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;">Dividend
payouts in MF schemes are not bonuses or extra money earned. The dividend is
paid out from the portfolio itself. So when dividend is paid, the value of NAV
becomes lower. So there is no extra money earned in dividend MF schemes as
compared to growth. Dividend MF schemes help you in getting income (though it
is not guaranteed) and when markets are volatile, getting out some money from
your investment is helpful.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<ol start="3" style="margin-top: 0in;" type="1">
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">Invest in XYZ MF as somebody
else has made a huge profit on it<o:p></o:p></span></b></li>
</ol>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;">It
is not very prudent to blindly invest in a Mutual Fund Scheme that someone
earned good returns on. It is important to understand the MF objectives and if
they align to your financial plan. It is important to check the portfolio, the
expense ratio and current market condition. The other person may have invested
when the value was low. Now the value is high. It is not necessary that you
will earn similar returns.<o:p></o:p></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<br /></div>
<ol start="4" style="margin-top: 0in;" type="1">
<li class="MsoNormal" style="margin-bottom: 4.25pt;"><b><span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11.0pt;">If you have invested in
Mutual Funds, your Financial Planning is done<o:p></o:p></span></b></li>
</ol>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;">Mutual
Fund investment is NOT financial planning. It is a part of financial planning.
Yes there are different types of mutual funds which will help you to diversify
your investment corpus, but diversification is only one aspect of financial
planning. Financial Planning is a bigger exercise that involves budgeting,
saving, investing, setting up goals, tax planning and estate planning. <o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;"><br /></span></div>
<div class="MsoNormal" style="margin-bottom: 4.25pt;">
<span lang="EN-GB" style="font-family: "trebuchet ms" , sans-serif; font-size: 11pt;">Mutual
Funds are an important aspect of one's investment portfolio. Decide on the
schemes to invest in depending on your portfolio, financial capability and
financial needs. Look at the performance of the MF schemes as well. Select the
schemes that have a good track record and invest using the SIP way. Do not over
expect from the MF schemes and keep a long-term view. <o:p></o:p></span></div>
</div>
KM WEALTH SOLUTIONShttp://www.blogger.com/profile/17552708059488804156noreply@blogger.com0