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Vivek

Vivek Lala  |301 Answers  |Ask -

Tax, MF Expert - Answered on Jun 20, 2024

Vivek Lala has been working as a tax planner since 2018. His expertise lies in making personalised tax budgets and tax forecasts for individuals. As a tax advisor, he takes pride in simplifying tax complications for his clients using simple, easy-to-understand language.
Lala cleared his chartered accountancy exam in 2018 and completed his articleship with Chaturvedi and Shah. ... more
Asked by Anonymous - Jun 18, 2024Hindi
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Hello sir, I am 23 years old, just graduated and starting my first job next week. I will be earning around 90k per month and I live at our own house (so no rent). I am planning on investing in MF but don't know where to start or how much to invest. Our monthly expense is roughly 20k and I also have an education loan which I have to start paying soon. I have a goal of saving 1 cr before 30. Kindly let me know where to invest and how much to invest.

Ans: Hello, glad to know that you are interested about investments at such a young age
Assuming 90K is your pre tax income , you will get around 80K in hand post taxes and post EPF
If your house expenses and education loan is 20K + 20K ( assuming ) = 40K , you have an investable surplus of 40K
You can follow the below strategy that I often use for young investors :
Mid cap - 30%
Small cap - 30%
Multi cap - 20%
Emergency Fund ( Payment of term insurance premiums , medical insurance premium and travel fund ) - 20%

If you keep doing this for the next 7yrs and utilise the entire emergency fund on the way, you shall accumulate Rs.44L by the age of 30yrs at 13% XIRR.

Please note that these suggestions are based on your stated goals and the information you provided. It is always a good idea to consult with a financial advisor in person to better understand your risk tolerance, time horizon, and specific financial goals.

Do let me know your thoughts on the same
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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |7002 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 06, 2024

Asked by Anonymous - Jun 06, 2024Hindi
Money
I am 26 years old. Right now my salary is 21000/month. My total expenses is around 9~10K per month. So i need an help about investment. I don't have knowledge about MFs so can u tell me how to invest in it or can you suggest me good mutual funds??
Ans: Investing in mutual funds is a great way to grow your wealth over time. At 26 years old, you have a significant advantage: time. Starting early allows you to benefit from compounding returns. Let's explore how you can start investing in mutual funds and suggest some general strategies.

Understanding Mutual Funds
What Are Mutual Funds?
Mutual funds pool money from multiple investors to invest in various securities like stocks, bonds, and other assets. Professional fund managers manage these funds, aiming to achieve the fund's investment objectives.

Types of Mutual Funds
Equity Funds: Invest in stocks, aiming for high growth. Suitable for long-term goals.
Debt Funds: Invest in bonds and fixed income securities. These are less risky and provide steady returns.
Hybrid Funds: Combine equity and debt investments, offering a balanced approach.
Index Funds: Track a specific market index. Less actively managed and often have lower fees.
Steps to Start Investing in Mutual Funds
Assess Your Financial Situation
Your monthly salary is Rs 21,000, with expenses around Rs 9,000 to Rs 10,000. This allows you to save Rs 11,000 to Rs 12,000 per month. It's crucial to utilize these savings efficiently to build a robust financial future.

Define Your Financial Goals
Identify what you want to achieve with your investments. Common goals include:

Emergency Fund: Save for unexpected expenses.
Short-term Goals: Save for travel or a gadget.
Long-term Goals: Save for a home, retirement, or children's education.
Risk Tolerance
Understand your risk tolerance. At a young age, you can afford to take higher risks for potentially higher returns. However, it’s important to balance this with your comfort level. This ensures you don't panic during market downturns and stay committed to your investment plan.

Choose the Right Mutual Funds
Based on your goals and risk tolerance, you can choose different types of funds:

For Long-term Goals (5+ years): Equity funds and aggressive hybrid funds.
For Medium-term Goals (3-5 years): Balanced hybrid funds and conservative equity funds.
For Short-term Goals (1-3 years): Debt funds and liquid funds.
How to Invest in Mutual Funds
Through Asset Management Companies (AMCs)
Visit the websites of mutual fund companies (AMCs) to invest directly. This approach offers lower expense ratios since there are no intermediaries. However, it requires you to have some knowledge about mutual funds and the discipline to manage your investments.

Through Online Platforms
Online investment platforms and apps provide a user-friendly interface to invest in mutual funds. These platforms offer tools to track and manage your investments, making it easier for beginners to get started. However, be aware of any additional fees they might charge.

Through Mutual Fund Distributors (MFDs)
Consulting with a Mutual Fund Distributor (MFD) ensures you get professional advice tailored to your financial situation and goals. They can guide you in choosing the right funds, managing your portfolio, and making adjustments as needed. MFDs are well-versed in the market and can provide valuable insights, helping you avoid common pitfalls and optimize your investment strategy.

Investment Strategies
Systematic Investment Plan (SIP)
A SIP allows you to invest a fixed amount regularly (monthly or quarterly). This approach helps in averaging out the purchase cost and instills disciplined investing. SIPs are particularly beneficial for young investors with a steady income, as they automate the investment process and reduce the impact of market volatility.

Lump Sum Investment
Investing a large sum of money at once is suitable when you have a substantial amount saved. It works well in a bullish market but carries higher risks. Lump sum investments require a good understanding of market conditions and timing, which can be challenging for beginners.

Diversification
Diversify your investments across different types of funds and sectors. This strategy reduces risk and increases the potential for returns. By spreading your investments, you protect your portfolio from the adverse performance of a single asset class or sector.

Monitoring and Reviewing Your Investments
Regular Reviews
Review your portfolio regularly (at least once a year). Ensure it aligns with your financial goals and risk tolerance. Regular reviews help you stay on track and make necessary adjustments based on market performance and changes in your financial situation.

Rebalancing
Adjust your portfolio periodically to maintain the desired asset allocation. Rebalancing ensures you are not overly exposed to any one type of asset, helping you manage risk and optimize returns. This process involves selling some assets and buying others to maintain your target allocation.

Tax Implications
Tax on Equity Funds
Long-term capital gains (LTCG) from equity funds (held for more than one year) are taxed at 10% if they exceed Rs 1 lakh in a financial year. Short-term capital gains (STCG) are taxed at 15%. Understanding these tax implications helps you plan your investments more efficiently.

Tax on Debt Funds
LTCG from debt funds (held for more than three years) are taxed at 20% with indexation benefits. STCG are taxed as per your income tax slab. Proper planning and choosing the right investment horizon can optimize your post-tax returns.

Building a Robust Financial Plan
Emergency Fund
Set aside 3-6 months of expenses in a liquid fund or savings account. This fund acts as a financial cushion during emergencies. Having an emergency fund ensures you don't have to dip into your investments for unexpected expenses.

Insurance
Ensure you have adequate health and life insurance. These policies protect you and your family from unforeseen events. Insurance is a crucial part of a comprehensive financial plan, providing peace of mind and financial security.

Retirement Planning
Start planning for retirement early. Investing in equity mutual funds can help build a substantial corpus over time. The earlier you start, the more you benefit from compounding, making it easier to achieve your retirement goals.

Conclusion
Investing in mutual funds is a smart way to grow your wealth. With a salary of Rs 21,000 and monthly savings of Rs 11,000 to Rs 12,000, you are in a good position to start. Understand the types of mutual funds, assess your financial goals, and choose funds that align with your risk tolerance. Regularly review and rebalance your portfolio to stay on track.

Remember, investing is a journey. Patience and discipline are key. Consulting with a Certified Financial Planner can provide personalized guidance and ensure your investments are well-aligned with your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

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Nripen

Nripen Bhatt  |6 Answers  |Ask -

Start-Up Expert - Answered on Nov 10, 2024

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Sir, I have got your contact from RediffGurus. I approach you to guide me in my present situation. I have more than 30 years experience in export sales and also import procurement. Have been successful in developing new export markets and also importing quality material from abroad at competitive prices. All these activities have been under employment only, Where employers earned a lot, and brought me only wah wah, shabash, but no financial gains. Now I am retired, but still quite active mentally and physically. I have an idea which if backed with right financial background, can be a money spinner . The idea is to deal in metal import export trading. I can source international standard quality copper, aluminium, stainless steel etc., from China and other countries at 20 to 30% below market price. These can be sold to hungry Indian buyers here. I can assure, subject to investment, a profit of approx. Rs. 5 to 10 crore in first year itself. And of course a huge, unlimited market exists for these metals in vast Africa, where I have travelled many times and understand how business is conducted there . Now may I request you to tell me if it is possible to get a silent investor. For security purpose, I am ready to conduct entire business in investor's or his company's name, provided my interests are safe. Wahaj Nuri.
Ans: Dear Wahaj,

Your proposition is definitely sounding interesting, but as you have laid your idea and thoughts randomly here, it is not translating into a viable business. Have you prepared a comprehensive Business Plan? Have you worked on Business Frame work?
I would suggest to complete your offerings on papers, write/overwrite/correct/cut/revise and then bring a conclusive business proposition which none can refuse.
Regards

...Read more

Nripen

Nripen Bhatt  |6 Answers  |Ask -

Start-Up Expert - Answered on Nov 10, 2024

Asked by Anonymous - Nov 08, 2024Hindi
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Career
Hi Nripen Sir, I am started my own market research(Secondary Research) firm bootstrapped without team and working on it. I want to know how to do customer or client acquisition. I have 10 years of market research experience. I am sole person to handle this. Also, I want to know do i need investment for this type of firms.
Ans: Let me congratulate you first, it is an excellent initiative you have taken, there are several firms in Market Research but there is always a demand for a genuine data driven research firm.
Initially you do not need a big team, you can handle solo, and when you require first go for management undergraduates as interns.
If you work smart client acquisition and retention will be really easy and smooth you can go step by step:
Create a one-page professional website, keep your clients’ segment in view and develop the content accordingly. Define methodology and tools in such a way that potential clients should relate immediately with their requirements. Don’t write lengthy content. Be precise be crisp.
Use business email id only.
Get very smart stationary printed, letterheads over 100 GSM, nice envelops, attractive business cards etc.
Search the websites where startups are registered such as startup India, start in up, istart etc., you will find a lot of startups who are in Launch phase or in Growth Phase, both look for secondary market research.
Exporters can be your potential clients.
Tourist planners.
Medical startups.
You have huge market for your service, start from here and you may ask time to time for further steps.
All the best

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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