Posts Tagged ‘expenses’
19 Mar
Take Control Of Your Golden Years Financial Planning Final Part:)
Posted by smcinvestmentindia in Asset management, Banking, budget, Finance, financial planning, income, Insurance, SMC Global, SMC online trading, SMC Research Based Advisory Services. Tagged: budget, Buying a Home, children's education, CORPUS, expenses, financial goals, financial planner, marriage, medical expenses, money, Retirement, retirement plan, Savings, short-term goal. Leave a comment
19 Sep
Why to Invest ?? For Your Happy and Secure Future..Sir ;)
Posted by smcinvestmentindia in Asset management, Banking, Economics, Equity & Derivative Trading, financial planning, income tax, Insurance, Investment, Mutual Funds, Private Equity, securities, share market, SMC Depository, SMC Research Based Advisory Services, Stock, tax, Trading, Wealth. Tagged: ban account, Bank deposits, childâs education plan, deposit account, economic growth rates, expenses, Finance, financial goals, Inflation, Insurance, interest rates, invest in bonds, Investing, Investment, investment plans, investment strategy, investors, joint family system, Life insurance, marriage plans, Mutual Funds, nuclear family system, Planned expenses, provident funds, rate of return, reasons to invest, retirement plans, ROI, saving, savings account, stock market, tax saving investments, Time Value of Money, Wealth creation, What is Investing?, why invest. Leave a comment
Investing is the best way to secure your future. đ
There are many reasons to invest. You can beat inflation, achieve financial goals like buying a car and plan your retirement.
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Inflation Factor
Remember the days when you just got your first job â your father probably told you to open a recurring deposit account in a bank and make all your tax saving investments in provident funds.
You felt it would give you assured returns with a capital guarantee!
Guess what, not anymore. Times have changed and how!
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Money kept in a âsavingsâ account is earning interest at rates that donât even keep pace with inflation, so you need to find the best place to put your money to beat inflation by a substantial amount.
Today, inflation is eating into your returns even as you sit here reading this.
If your monthly expenses today are Rs 15,000 and annual inflation is at 5%, 20 years later, when you will probably retire, expect your monthly expenses to rise to at least Rs 39,000.
Bank deposits will give you a return of 6%, but post inflation and tax ; you will be left with a rate of return which runs into the negative.
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This means that while on paper your returns looks a healthy 6%, your capital is actually eroding in the real world.
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Average interest rates on savings account are currently less than 2%. Average annual returns for mutual funds are over 10%.
There is always risk in anything you do, but with education and research you can minimize that risk.
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Longer Life for you.
Thanks to increased life spans and advancements in medicine, research shows that you are now going to live much longer.
You will probably work almost the same number of years that your grandfather and father did, but in all probability live even longer !
Therefore, you have a lot more saving to do to plan and enjoy those extra twilight years of your life.
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Standard of living to be maintained :
Today, you drive in your own car, possess a flat in posh housing colony, you take your family for a lavish dinner at least once a week and do so many things to showcase your elite status.
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Do you ever shudder at the thought of how many of these luxuries will you be able to afford after you retire? :O
Wealth creation is all about making your money last in order to continue enjoying all of these luxuries.
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Families getting smaller and nuclear
Higher economic growth rates have resulted in widespread migration to urban areas and the proliferation of the nuclear family system.
Consequently, the number of households has increased substantially and the security provided by the joint family system is coming to an end.
So dependence on family members like earlier generation is not going to happen anymore.
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Planned expenses
Most of the larger expenses in life are planned expenses.
For instance, purchase of a home, your childâs education or marriage, your own retirement and so on.
These expenses will be incurred no matter what and you must create wealth to meet the same.
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The best thing to do, is to start saving money as soon as possible.
The younger you are, the more money you will have.
Yes, you should start thinking about retirement now. đ
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