Frugality or a frugal way of life is often misunderstood as being miserly, devoid of the joy and pleasures of life where one tries to save as much money as possible for the future. Talk about frugality and personal finance and you are often met with criticism, especially by guys in their early 20s :…
Continue reading →This simple Monte Carlo simulator gives you the probability of a debt fund, with variable annual returns, outperforming a fixed deposit. If you are thinking about investing in a debt mutual fund, but are worried about fluctuating returns (volatility) – especially after the recent crash in bonds, this tool could answer a pertinent question: What…
Continue reading →XLFinplan is an extraordinarily comprehensive Excel based financial planning application developed by Satish Mistry of Money Care Financial Planning Services. This commercial software has many interesting applications that will be useful not only for financial planners but also for individual investors. I requested Satish to send me a write up of the main features of…
Continue reading →It is now seven months since direct mutual fund plan were introduced. Using NAV history of HDFC Top 200, I have calculated the actual difference in returns between the regular-plan and direct-plan (growth option) obtained so far (Excel sheet attached). Let use recall that regular funds will have a higher expense ratio than direct funds. …
Continue reading →I am ashamed to say that although I teach and research for a living, I hate giving analogies. Even if I think of a potentially good analogy, one that can drive home the point better, I get uncomfortable and think it is deliberate and artificial and don’t use it. Someone like Ashal Jauhari is so…
Continue reading →This is a guest post by Jitendra Kumar, Sr.Business Analyst- Fiserv. Mr Kumar is a certified financial planner. His additional qualifications include MBA and Certification in Investment & Portfolio Mgmt. (IIMB). He is also a certified associate of the Indian institute of bankers (CAIIB). ~~~~~ Traditional Financial Planning works on certain assumptions on returns, risk, inflation, savings growth…
Continue reading →There are many articles on the web that talk about the difference in the way debt mutual funds and fixed deposits are taxed. Almost all of them (including the ones by self-proclaimed beacons of financial literacy) talk about post-tax returns typically over 3-5 year periods. To my knowledge there is only one article, written by…
Continue reading →Warren Buffet, in a letter to his shareholders said, ‘do not ask a barber if you need a haircut’. This applies to many situations in life. In the present context, ‘never ask someone in the financial advisory business, if mutual fund selection is hard’. Selecting a mutual fund is not rocket science. It can be…
Continue reading →“This is a guest post from Abhinav Gulechha. Abhinav is a Certified Financial Planner and writes at www.sohamfp.com. Views expressed are personal.” ~~~~~~~~~~~~~~~~~~ In today’s credit-driven economy in which we live, one can buy anything provided you have the income to support it. Owing to an easy availability of home loans and rising salary levels, it…
Continue reading →Does this question sound familiar? Bet it does. This is probably one of the most popular questions asked in any investor meet or television show. The answer is surprisingly simple and the reaction to the answer, in most cases, unsurprisingly indifferent. In academic circles we have a saying. ‘No question is silly. However, some answers…
Continue reading →I love movies. Before I started taking freefincal seriously, I averaged about a movie every two days. I tell my students that I am cursed: If I do not watch some portion of a new movie every day, I will turn into a vampire! Movies make me happy, sad, think, exhilarated and devastated in equal…
Continue reading →When gold prices fell steeply earlier this year, we were flooded with ‘told you so’ articles. No one seemed bothered at that time to emphasise that gold is meant for long term investing only, and that such volatility is natural. Before the crash everyone was saying, ‘buy golf ETFs’, ‘allocate 10% of your portfolio to…
Continue reading →A long term investor should: recognise all the risks associated with the financial goal estimate the monthly investment needed (estimate not determine) understand the need for spreading the investment risk (asset allocation) understand the need for diversification within an asset class, choose investment vehicles wisely initiate investments as quickly as possible without worrying about perfection…
Continue reading →Here is a list of available mutual fund calculators and resources. (Updated Mar. 31st 2014) Flagship Calculator: Track your mutual fund and stock investments with this Google Sheet! Mutual Fund Calculators/Resources How to select mutual fund categories suitable for your financial goals? Step-by-step Guide to Choosing a Mutual Fund Mutual Fund SIP Returns Analyzer Mutual…
Continue reading →Here is the online version of recurring deposit calculator on Microsoft’s Exel Web app. Thanks to reader Srinivas, I was able to correct a minor bug. I tried to convert it to Google Docs, but some cells showed incorrect values. This is quite disturbing because if one does not check each cell carefully then the…
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