Equity savings funds are the latest type of asset allocation mutual funds introduced first in late 2014 when the government made the duration for debt mutual fund capital gains to be classified as ‘long-term’ from 1-year to 3-years. Equity savings funds are basically arbitrage+equity+ debt funds. They would hold a minimum of 65% equity (most…
Continue reading →In the last ten months, we have had three instances of credit rating downgrades in mutual fund portfolios. We had discussed these in some detail and also suggested ways to choose debt mutual funds with no credit risk and low volatility. In this post, let us look at how these funds have recovered and what we…
Continue reading →All long-term financial goals require periodic review to ensure that they are on track and in line with expectations and assumptions made while planning for the goal. Here are seven easy steps to review the health of your financial freedom or retirement portfolio. First posted on Mar 25 2014, now republished with updates. Retirement is…
Continue reading →The start of the financial year is the best time to plan for saving tax. For those who recognise the importance of tagging tax saving instruments with long-term financial goal portfolios, there is not much to do! Linking tax planning with goals is a one-time affair and all it needs is investing and review. In…
Continue reading →Facebook group Asan Ideas for Wealth (AIFW) is a fascinating micro ensemble for studying and understanding how investors think and act. Even if you don’t want to consciously study it, it is impossible to not observe a few common patterns. The group is famous for its abbreviations: MDBSC* – My dull and boring SIPs will continue (*…
Continue reading →Use this financial freedom calculator spreadsheet to answer questions like, “When can I retire?” and “When should I retire?” and hopefully understand the difference between them with minimal inputs. For a given age and life expectancy, along with other standard investment and inflation details, the years to retirement is calculated by determining when the monthly income…
Continue reading →Any keen follower of personal finance space would have encountered their fair share of ‘why you should invest in equity?’ articles and ‘why equity alone is capable of beating inflation over the long-term’ arguments. Things have come to such an end that fixed income investors are considered as not being financial literate. This kind of…
Continue reading →Why do people time the market? That is, why do they enter and exit the market based on certain signals (moving averages, PE etc.)? Is it for getting better returns? Or is it for getting risk adjusted returns? This is a poll I created in Facebook group Asan Ideas for Wealth. As expected, a majority…
Continue reading →If we ‘hold’ equity for the ‘long term’ are we assured of beating inflation with a real return? Will equity beat all other asset classes if we wait long enough? Will long-term equity investing always be successful? Equity as an asset class is sold to investors with an ‘yes’ to such questions. Sold either directly or…
Continue reading →A little over two years ago, an automated mutual fund & financial goal tracker was released. It was made with extensive beta testing by readers and is reasonably popular despite the availability of user-friendly online trackers. Update: This file does not work anymore since the historical NAV download from AMFI has been discontinued. I am working on a…
Continue reading →The withdrawal rules of the Sukanya Samriddhi Account has been modified with effect from March 18th 2016. Thanks to Muthu Krishnan for alerting me about it. They are discussed in this post in case you missed them like I did. Old withdrawal rule: (Source: Gazette of India 2nd December 2014) To meet the financial requirements of the account holder…
Continue reading →This is a triple update announcement – to two rolling returns calculators and to the Google spreadsheet for tracking financial independence. First two updates: The mutual fund lump sum and SIP rolling returns calculators have been updated with additional benchmarks. Rolling returns calculators provide a simple, easy to understand visual representation of how consistently a…
Continue reading →Tax-free bonds are purchased in the secondary market via a Demat account when either new ones are not available or not attractive. How does one decide between buying existing tax-free bonds and new ones? Should we just look at the coupon rate and choose the one which is higher? It depends on the purpose of the…
Continue reading →Anyone who has used a retirement calculator would tell you the primary input is current expenses that are likely to persist in retirement. I have always maintained that one should not assume expenses will decrease after retirement! Therefore, I will only exclude cash outgo like EMI and expenses related to children from current expenses. This is all that one can do…
Continue reading →Mutual fund investing is not like investing in an insurance scheme or buying term life insurance or health insurance. You cannot choose a fund based on past performance and assume that all you need to do is to invest in it from time to time. As mentioned several times before, one should not get married…
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