“If I have a lump sum, what is the best way to invest it in an equity mutual fund?”, is a question that I am asked repeatedly. In this post, let us discuss simple ways to invest a lump sum in an equity mutual fund. Lump sum in a debt mutual fund Let us first get…
Continue reading →Each financial year, we do our best to reduce as much income tax as possible. I am only referring to legal means (!)- the most common of which is investing in tax-saving instruments. We do this because income tax hurts. The thought of losing a significant chunk of our salary fills us with a sense of loss*….
Continue reading →Buying a house is often an emotional decision and as I have argued before, it makes no sense to use buy vs rent calculators. In this post, I discuss the pros and cons of buying a house as soon as possible vs later vs never. Regardless of what decision we make (or have made) it…
Continue reading →Deciding where to invest, when and how much in each instrument for a given financial goal is known as asset allocation – it is the key to successful money management. For a given financial goal, how do I determine the asset allocation? That is, how do I decide the amount of equity exposure and therefore, fixed…
Continue reading →You would be surprised as to how many people believe that by investing an additional 50,000 in NPS, they “instantly” get a return equal to their tax slab! This is a case of mis-accounting or innumeracy. In this post, I discuss what exactly is the implication of “saving tax” via investing in 80C and with…
Continue reading →This post is a response to a question posed to me by a PhD student: Everyone seems to be predicting that price of Bitcoin will increase by a lot in the coming years and it will become popular. So should I buy some (accumulate) now? To answer this, let us discuss the economics surrounding bitcoins…
Continue reading →There are times in life when you require money for a need in stages. The most common example is monthly income. Those who do not have much money to play with, cannot take risks and must rely on interest income which is always taxable as per slab. On the other hand, those who have some…
Continue reading →Readers may be aware that last month I had introduced a handpicked list of mutual funds and called in PlumbLine to accompany the freefincal robo advisory template. I was all set to write this months post, when SEBI announced its mutual fund classification rules, to be implemented by year-end. So I wanted to wait until…
Continue reading →When I announced the launch of Fee-only India, a coming together of SEBI registered fee-only financial planners to help clients and each other, Alok Singh, made this interesting suggestion: “It’s a good initiative to bring fee-only FPs under one roof. Would it possible to come up with a post describing as to what factor/points one…
Continue reading →In this post, I discuss how to calculate the annualized return from a stock investment after accounting for corporate actions like dividends, stock splits, bonuses, buybacks and rights issues. I have made a calculator that will compute the annualized return (CAGR for single investments, IRR for periodic investments and XIRR or investments on random dates)…
Continue reading →Yesterday, SEBI announced its new “Categorization and Rationalization of Mutual Fund Schemes”. In this post, I discuss the positive and negative aspects of this move. As with any change, it is a mixed bag, especially for existing investors. SEBI has made it clear that only one scheme per category will be allowed and that AMCs…
Continue reading →Here is a step-by-step guide for planning your child’s education and marriage. 1. When to start planning. The moment the pregnancy is confirmed! 2. What do to first? Evaluate your insurance cover and buy more if required. 3. How to evaluate insurance cover? Let us consider a couple with a two-year-old child. The male is…
Continue reading →What is the objective behind creating a financial plan? Who is it meant for? Do young earners or DIY investors need the services of a fee-only financial planner to create a professional plan? In this guest post, Vikram Krishnamoorthy, SEBI registered fee-only financial planner tackles these questions and discusses the real purpose of creating a financial plan…
Continue reading →You would be surprised as to how many people ask, Why not invest in multiple mutual funds to “average” out returns? and how often such an advice is provided in the media and in real life too! This post is in response to a question from S.B.Raajesh Kannan as it gives me a chance to cough up some portfolio…
Continue reading →Lump sum vs SIP investing: Which is “better”? You might have heard this question often in personal finance forums. Perhaps you have thought about this yourself. In this post, let us trace the month-by-month return from a SIP investment and a lump sum investment started on the same date. What is the point of this…
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