A significant number of us purchase health insurance policy just to spare expense and frequently neglect to refresh ourselves on the different highlights of the policy. Picking a health policy for you and your family is a genuine choice and it expects you to be completely mindful of the policy and its advantages. Here are some significant highlights you should know before purchasing a health policy:

Pre and Post Hospitalization Costs: Many don't know about Pre and Post Hospitalization benefits that an insurance organization offers to their policyholders. According to pre-hospitalization costs, the insurance organization repays every one of the costs before hospitalization. Post hospitalization cost covers all costs brought about by the safeguarded after the release from the clinic. Clients get repaid for the costs like, discussions, symptomatic tests, medications and so forth caused before and after hospitalization for which real case has been made. The quantity of days that fall inside the ambit of pre and post hospitalization may shift from safety net provider to back up plan.

Room Charges Restrictions: Some Health Insurance Policies accompany this condition which has topping or sub-limit on room lease. In such cases, every one of the costs brought about for the room lease are not repaid. Subsequently, to abstain from paying extra, safeguarded ought to be very much aware of the room lease limitations while choosing the kind of room during their stay in hospital which would likewise keep away from problems during discharge at the hospital.

Reclamation Benefit: Many health insurance policies accessible in the market gives inbuilt restore benefits. On the off chance that the entirety protected is depleted towards the treatment of disease, the insurance organization reestablishes it with no extra premium.

Deductibles: It is the measure of cash clients should pay in an insurance claim before the insurance inclusion begins paying. Deductibles change for various conditions, ailments, and medicinal methodology. Despite the fact that high deductible health plans have the upside of littler premiums, clients may wind up paying substantially more out-of-pocket. To keep away from this, clients can quit and choose the better plans without deductibles or decide on low deductibles insurance policies

Waiting Periods: This health insurance policy clause may influence the likelihood of accepting advantages from the very beginning of the insurance policy. Previous conditions are typically secured after a waiting period of 4 years. Notwithstanding, some insurance policies give the inclusion to these conditions after a waiting period of 2-3 years. Inclusion for certain careful conditions is given in the wake of waiting period of 1-2 years. It is prudent that clients should peruse the policy terms and conditions cautiously before obtaining the policy and evade obstacles during cases.

To get the best advice on health insurance policy, get in touch with us!

We all know that with the rise of inflation in today’s era, it is difficult to sustain and have a well-balanced life with all the luxuries and amenities. If we adults, at this stage are facing an issue with the elevate in price hikes, what would be the future of our children? Ever given it a thought? Whilst we keep ourselves updated about the importance of investment and personal finance for security, then it is also equally important for us to educate our children about this topic at an early age. It is very rare, especially in India that parents discuss about various elements of investment, income, expenses, etc. to their little ones. We assume that they are not yet matured and leave this topic for the future. But you never know, sometimes it’s too late! Providing your children with adequate knowledge about personal finance and investing in the right solutions can avoid any future financial problems. As a parent, these are few of the reason why you child should be aware and educated regarding investment.

 1. Open a bank account: Just like how you would inculcate the habit of saving in a piggy bank, open a savings account in your nearest bank for your child. When you give your child pocket money, make sure you teach him/her to maintain a balance between spending and saving up. Creating a bank account is more like a piggy bank which trigger the child to automatically inculcate the habit of saving a very early age. Guide him/her on how to go about with depositing the money given by relatives or as gifts, in the bank account.

2. Start Early Savings: As it is important to start earning at an early age, it is equally of utmost importance to educate your son/daughter to be financially independent by starting saving. Any form of investment calls for starting early as time is a completely dependent factor. The millennial age people must also be taught to invest at an early age so that they can gain the benefits of compounding. Moreover, it is not necessary to you need to have a job or have an earning to start saving. Kids can also start saving from their pocket money. 

3. Setting Goals: You can achieve your goal only if you be idealistic and dream big. Maintain a goal and work for it. The children, especially teenagers should be taught this part of investment at a young age so that they adapt to this pattern when they are grown up. They tend to understand the concept and idea of investment over a period of time when they are constantly made to save so that this habit is built over time. 

4. No Debts: Make sure that you kid spends within the given limit when he or she starts to earn. Spending overboard can drive to kids into debt by exhausting their credit card limits or leading to no balance in their bank accounts. And if such a situation arises, they will remain in debt for the coming days and might hinder their future financial growth. Therefore, it is very important to explain and educate your child on how to keep a track on his/her spending limits.

5. Teach them to spend considerately: When you encourage your children to start saving or investing at an early age, it automatically drives a vibe which makes them independent over a period of time which can help them with a sustained living for the future. Ultimately, it is their choice on what they wish to spend, a bike, a car or a house. But ensure that they spend considerately.

To know more about investment options for your children, get in touch with us.

When you first begin to design your accounts and finances, almost certainly, you are overpowered with the alternatives there are. There are various tools that will enable you to develop your cash, yet how would you pick which ones are suitable for your needs? We'll give you a brief on the well known investment roads and tips on how you can settle on your choice.

To get this, the accompanying will enable you to place interests in context. Speculations are altogether part into "resource classes" – basically these are value, obligation, gold, and land.

Presently, on to the primary venture item alternatives accessible and what they are:


Gold has generally been utilized as an investment funds road. Yet, physical gold isn't a investment due to difficulties emerging in purity, stockpiling costs, wastage expenses, and liquidity. Money related gold is increasingly powerful in catching development in gold costs without managing physical gold. These incorporate Gold ETF and gold common assets. Gold sovereign bonds issued by the administration are likewise another method for putting resources into gold, and comes furthermore with a little intrigue segment and tax collection benefits.

The positives: Its low connection with stock costs and its counter to inflation makes it a decent fence against market risk.

The negatives: Gold as a venture does little to your general portfolio. Their costs move exclusively dependent on worldwide value showcase estimations and the swapping scale. Gold costs can and have remained dormant for extensive stretches of times.

National Pension Scheme (NPS)

NPS is an annuity plot which puts investments into equity and corporate bonds. You can choose the assignment between every yourself, or you can enable the framework to pick it for you. The plan develops when you divert 60 or 10 years from the season of record opening, whichever is prior. Around then, up to 60% of the sum can be withdrawn and the rest is mandatorily put resources into annuity. Despite the fact that premature withdrawal is feasible for a specific sum, it accompanies a great deal of inflexible conditions.

The positives: NPS gives an extra tax deduction of Rs.50,000 under 80CCD. Like PPF, the long lock-in period guarantees that there is a retirement fund is set up. The expansion of value improves returns contrasted with PPF or EPF.

The negatives: For trained financial specialists who don't need such requirements, NPS is a bit excessively unbending. Mandatory transformation of an enormous part of the end corpus into an annuity isn't impose effective nor appealing as far as returns.

Fixed Deposits

FDs issued by banks are progressively normal, yet corporates issue FDs also and regularly with higher loan costs. FDs have fixed maturity and can extend from 7 days to even 10 years. A couple of bank FDs have turned out to be increasingly adaptable with untimely leave choices yet to a great extent they are secured for the maturity period. Winning interest rates in famous banks is around 6.5%-7% per annum while the higher hazard partner corporate deposits offer around 8.5%-9%.

The positives: FDs are generally safe, offering an ensured return. Setting up repeating stores and utilizing your bank's compass offices are an incredible method to grow investments. FDs guarantee that your cash isn't sitting in investment account procuring negligible interest.

The negatives: For longer timeframes, FDs aren't extraordinary. Generally, they haven't given inflation beating returns. Interest income is likewise exhausted at your tax slab. Contingent upon FDs alone for every one of your needs implies you have to set aside a high aggregate or you may miss your objective.


Insurance in its actual sense is a hazard spread. In any case, some life coverage arrangements like endowment and cash back policies place themselves as investments. This is on the grounds that they offer a few advantages on maturity even on survival. ULIP is a half breed item where a piece of the sum gets invested and a section goes for the insurance cover. ULIPs have various plans which puts resources into equity and debt market.

The positives: Insurance gives an assurance. Premium payments meet all requirements for deduction of taxes.

The negatives: They are not investments. Variations which give lumpsum sums at the season of maturity may look alluring, yet the profits are poor since its getting late you stayed contributed. ULIPs give you a life cover and comes back from your investment. Shockingly, the life cover you get for the premium paid is negligible, when contrasted with plain term insurance. In a ULIP, you get neither sufficient insurance nor investment. Liquidity, transparency, and comparision of ULIPs are likewise poor.


Public Provident Fund (PPF) accompanies a fixed loan fee for every year, which is pegged to winning government security yields. With a maximum point of confinement of Rs.1,50,000 every year, it is intended to teach little sparing propensities. The investment sum is secured for a long time and is qualified for tax deduction under 80C. Current rate of interest on PPF is 8% per annum. EPF is like PPF.

The positives: With a long lock-in period, PPF guarantees that you set aside some cash as long as possible. Aside from being qualified for assessment findings, the enthusiasm on PPF is likewise tax-exempt.

The negatives: Being an obligation item, its profits are constrained and notwithstanding contributing the most extreme sum every year may not be sufficient for your retirement corpus.

Mutual Funds

Wouldn't you say it is a smart thought to remain invested for a long-term? Truth be told, it is ideal on the off chance that you can earn the utmost benefits of compounding. In any case, in the event that you don't have plans for a long-term investment, you can always pick a short-term or mid-term investment plan from the accessible numerous plans to browse that suit your need. May it be short, medium or long haul, mutual funds have always given a positive outcome and are to give an ongoing positive outcome even in 2019.


By putting investment in shares of an organization, you become a shareholder. The returns you harvest will originate from the development of the organization which will reflect in the cost of the stock. There is no top to these profits and stock costs can rise multi-overlap. A modest quantity, in this manner, can develop in exceptionally enormous entireties. You need an exchanging and demat record to execute in stocks.

The positives: Equity has verifiably been the most noteworthy returning resource class. Higher returns mean you can contribute lower sums – so a huge corpus target can be attainable regardless of whether your investment funds limit is lower.

The negatives: Picking stocks accompanies high hazard. It requires showcase aptitude. Stocks can be unpredictable and along these lines require both hazard craving to stomach fast change in qualities just as conviction to clutch the stock. While instability levels out over the long haul, regardless it needs time. It tends to be securely said that value contributing isn't for all and you should abstain from putting legitimately in stocks on the off chance that you don't comprehend the value market well.

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In spite of Life Insurance being a very important aspect of financial planning, only 10% of Indians are insured! We have heard a lot about life insurance. But what is Life Insurance? Regardless at what position you work or how much money you earn, no one is aware of what the future holds. Loads of individuals die consistently from sickness or accidents and, in the event that you happen to be the sole provider in the family and you were to pass away, it could have destroying ramifications for your friends and family their capacity to pay family expenses, obligations and keep up their way of life.

The best you can do to ensure that your family’s financial future is safe is buying a life insurance policy. There are multiple benefits of having a life insurance policy. Shree Investment states some crucial benefits which every individual needs to be aware of and understand the importance of having a life insurance policy:

1. Safety of Family & Friends after you’re gone: This is the most significant part of life insurance coverage that one needs to factor in. Your family is subject to you even after you're gone and you positively would prefer not to disappoint them. Regardless of whether it's for supplanting the lost income, paying for children's education or ensuring your husband or wife gets the truly necessary monetary security, life insurance could make all the difference for your enduring wards.

2. It aids to your retirement goals: Wouldn’t you want your retirement saving to last as long as you do? Who wouldn't care for their retirement reserve funds to go on until they do? With a life insurance policy, you can guarantee you have a standard stream of pay each month. Placing cash in an annuity resembles a benefits plan-put in some cash routinely in a life insurance cover and appreciate an enduring salary consistently even after retirement.

3. Paying your debts: After you are gone, you don’t want to leave the burden of any financial liabilities in the court of your family. To ensure that this is dealt with, it proves to be a very crucial point to have the right insurance policy that will take care of any forms of liabilities such as any home loans, car loan, personal loan, etc.

4. Purchasing insurance is cheaper when your young: Not each millennial needs a life insurance policy. On the off chance that you haven't made a secret stash or regardless you're living off your parents' money, protection shouldn't be a need. In any case, in the event that you do have wards or you have co-marked an advance with your family (or some other individual from your family or companion), regardless of whether it be an understudy advance or a home advance, you have to begin considering purchasing a life insurance cover policy. Plus, inclusion expenses are much lower when you're single. Protection specialists may attempt to offer you an arrangement that you probably won't require. Accordingly, do your due tirelessness or approach a financial advisor to decide how much insurance you need considering different resources you may claim. Regardless of whether you're single, there might be different wards and you have to guarantee they're dealt with.

5. It can help you save on tax: Regardless of what plan you purchase; you can save a chunk of money on taxes. The premium you pay on an insurance policy is eligible for a maximum tax benefit of Rs 1.5 lakh under Section 80C, and for tax-free proceeds on death/maturity under Section 10 (D) of the Income Tax Act, 1961.

6. It takes care of your business: Life insurance isn't just for yourself and your family. Some protection policies likewise deal with your business. In the event that you claim a business, at that point your business partner can buy your part of the business without issue. Your business partner will enter a purchase sell understanding and the payout would go to the expired accomplice's chosen people, yet without giving them a stake in the organization. There are two kinds of extra security strategies a term protection approach and a life coverage strategy. While we are altogether mindful of the passing advantages these life cover policies give, we think minimal about the different choices they spread out that could help fortify your financial position. A term protection gives insurance to a predetermined timeframe (10, 20 or 30 years) and pays out the advantages just in the event that you kick the bucket during the term. The approach will lapse, and inclusion will end on the off chance that you outlast your strategy. A venture cum-security plan then again offers you a singular amount sum on the fruition of the term of the approach. These plans additionally offer you assurance, yet the spread is typically not as high as offered with term plans.

Get your life insurance cover with Shree Investment today. Contact us!

Incredible investor, Warren Buffett has frequently proposed that discipline is a standout amongst the most significant qualities of fruitful financial investor. While contributing conduct of most investors is impacted by covetousness and dread, fruitful investors don't enable insatiability and dread to abrogate discipline. Order versus avarice and dread recognizes investors from theorists. Examiners settle on their speculation choices dependent on how they anticipate that the market should drift in the close term. Speculators then again, settle on venture choices dependent on their hazard hunger and monetary objectives.

Move in investor demeanor

Truly, venture conduct or mentality of retail investors in India was generally theoretical in nature. Investors expanded their interests in value in positively trending markets and left out of value in bear markets. In any case, in the course of recent years we saw a move in investor frame of mind towards instability.

According to AMFI information, in 2015, when we saw a sharp adjustment in the market, net inflows to value common finances expanded on year on year premise. The stock market has been genuinely unstable this year as well, however we have not yet observed a profound amendment up until now. Keeping with the pattern seen in 2015, net inflows to value shared finances year to date in 2018, have expanded on a year on year premise. This demonstrates a move in investor conduct from theoretical to long haul objective based contributing. This is a declaration to expanding investor development and is extremely promising advancement for the investment ecosystem in our nation.

Disciplined Investing via SIP

One of the principle contributing components to this adjustment in investor conduct is the rising prevalence of Systematic Investment Plans (SIP) in our nation. Taste removes hypothesis from the condition in putting in light of the fact that in SIP, there is no value focus for contributing. You are contributing at various value levels through SIP venture. Since securities exchanges are inherently unstable in nature, you will contribute both at high costs and low costs – this is known as Rupee Cost Averaging.

Each rupee put by you will acquire returns in the long haul and the more you remain contributed, you can win higher returns. Since you can begin SIP with little measures of month to month reserve funds, you can begin contributing early. Keep in mind, each SIP portion will enable you to acquire great returns later on and returns earned on every one of your portions will thusly win returns (benefits themselves). Profit for profit or benefit for benefit is known as the intensity of aggravating. The intensity of exacerbating in SIP is high on the grounds that a large portion of your SIP portions will be remain contributed for quite a while gaining exceptional yields for you.

The most significant property of SIP is disciplined investing. You don't have to stress over market levels or having a huge corpus to put in at the correct dimension. By contributing from your standard month to month reserve funds through ECS from your bank, SIPs puts your budgetary anticipating auto pilot. Over some stretch of time, discipline turns into a decent propensity – your optional spending will be in charge and as your pay increments after some time, you will most likely spare and contribute more for your money related objectives.

SIPs in unstable and bear markets

Warren Buffett broadly said once that, "lone when the tide goes out do you find who is swimming stripped". What he is suggesting that, everything looks hunky dory in buyer market and cash can be made reasonably effectively. Anyway it is in the bear showcase, which is unavoidable, that tests how great a speculator you are. Cash made in 2 - 3 years of a buyer advertise in theoretical ventures can be lost in a couple of months of a bear showcase – this is the thing that Buffett implies when he says, "you find who is swimming stripped". Bear markets are unusual – you won't probably think about when it will strike and how much will it fall.

Attempting to time the market is a vain undertaking. Give us a chance to get why. Right off the bat, you can never make certain of the market pattern course except if there is a noteworthy one path development, by which time the value harm has just been done - on the off chance that you frenzy and sell, you will sell at significantly beneath the highs. After you sell (recover) you will hang tight for the market base – base is much progressively hard to foresee in light of the fact that in a bear showcase different bottoms are made. So you will hang tight for an affirmation that a base has been. What is this affirmation - fundamentally you need to see strong proof of a recuperation. This implies a more drawn out pause. Recuperation from bear advertise has truly been enraged – we have seen various occasions that the market recoups a great deal of ground from bottoms in only a couple of exchanging session. Be that as it may, you can't make certain, if this is economical, so you need to see more proof. As the market ricochets back, section turns out to be progressively troublesome and speculators need to hold up longer. At long last, investors for the most part end up re-contributing at a lot more elevated amounts and there is huge open door misfortune.

Taste in great value shared supports will guarantee that you are failing to swim exposed regardless of how solid the tide is. Truth be told, bear markets are incredibly favorable for trained investors in SIP since rupee cost averaging in a bear market will extraordinarily diminish your general normal securing cost and in the long haul, you can get great returns. Unpredictability is upsetting for investors on the grounds that nobody needs to see their well-deserved cash going down in esteem. Be that as it may, on the off chance that you comprehend the crucial standard of rupee cost averaging and pointlessness of endeavoring to time the market, at that point instability is very favorable for SIP investors.

To know more, get in touch with Shree Investment.

Health Insurance is gradually however clearly picking up fame in India. Given the increasing expense of medicals, it just appears the coherent decision for individuals falling in the low, center and upper center level of pay. Since a heft of the population has a place with that classification, a wide assortment of insurance products from various insurers are accessible available, each offering an alternate arrangement of advantages, greater coverage or access to a wider health care service network.

Anyway, Health Insurance, being a moderately new item for the blossoming people, is something calm a couple of endorsers and non-supporters stay new to. Ask an insurance agent and he is well on the way to give you the inclusion fundamentals which you can at any rate gather off the arrangement wording with an easygoing look.

Be that as it may, when you get tied up with a health care policy, you shouldn't confine yourself to just realizing what benefits are accessible to you. It truly pays to go somewhat more profound, do some homework and make the most out of your health plan. Let’s look at some of the ways you can manage to achieve:

1. See what riders your insurance carrier offers

Riders at some point come less expensive than additional coverage and the additional premium you'll have to pay against it will by and large be considerably more moderate than getting tied up with a different plan for a particular coverage. Critical illness cover riders are particularly gainful since they offer singular amount pay outs on the off chance that a case is made dependent on its condition. A few insurers likewise offer prescription drug riders which spread the expense of a wide range of both nonexclusive and brand name drugs laid out in the policy.

2. A few policies ensure preventive care so you should take complete advantage of them

Preventive consideration incorporates things like mammograms, immunizations, GYN arrangements and yearly physicals and are generally led for nothing out of pocket through system care providers under the terms of the policy. The upsides of picking preventive consideration is twofold – leading you don't need to pay anything out of pocket for administrations rendered, and second, preventive care implies that you are considerably less prone to meet a genuine condition down the line which will finish in a claim, thusly raising your yearly premium.

3. Have a secondary medical coverage strategy set up

As a rule, as is regular for a great deal of salaried individuals, businesses by and large give medical coverage or health insurance to representatives as a piece of organization standards. As an individual, you will be secured under this arrangement to the degree of the whole guaranteed every year. You can moreover enhance this by purchasing another, progressively far reaching approach. In the event that you find that your hospital expenses are just being secured to a degree by the full furthest reaches of one approach, you can conjure your optional arrangement to deal with the rest. Simply make sure to uncover the insights regarding every one of your insurers to the next since that is an obligatory necessity.

4. Remain inside the service provider network that your health policy buys in to and recognize what precisely is covered under your plan

Setting off to a non-network care provider will imply that you should pay the doctor's visit expense out of your own pocket. Additionally, going for medications and methods not covered under your policy likewise converts into paying out of pocket. Keep in mind that insurers will likewise decline to cover you for any medical procedures performed which did not have any association with the real hidden condition.

5. Make use of cash and pay out of pocket for charges which don't add up to noteworthy medical bills

Each claim free year entitles you no-claim bonus determined against the aggregate guaranteed by the policy. These bonuses can go from 10 percent to as much as 50 percent and is generally paid up as limits on premium and reestablishment/renewal or is beaten up on the sum assured. Therefore, making claims against small medical expenditures cost more over the long haul than what you can pick up from a claim free year.

Got any questions regarding Health Insurance or any other financial services? Don’t hesitate to ask our experts!

It is well said “An investor uses his money and invests the rest, but a Good Investor invests him money and uses the rest”. Invested in undoubtedly a risky game. Some make millions while some loose really bad. But, if you know the tricks and tips of the investment market, you can emerge as a winner. Here are some characteristics which define a so called “Good Investor”:

Setting an Objective

A good investor will always have a targeted objective. Along with the objective comes planning. It is very important to have a plan laid in order to achieve the goal or objective. Multiple choices in the market tend to confuse an investor and divert an investor from the decided agenda. But if you have a plan of action within a given timeframe for a return on investment, it can help you remain firm with your objective. This is a sign of a good investor. They are prepared for all the fluctuations of the market while the plans are made considering that the coin has two sides.

Sound Market Knowledge

When you know better, you automatically tend to do better! This mantra holds good for an investor who possesses immense knowledge of the market trends. This means that he or she has done a complete homework of investigating and researching about the company’s investment strategies and has intact knowledge of current fund position. Basically, you need to know where you put your money and in what way it is utilized. The sign of a good investor is that he/she always tends to entirely analyze the growth pattern of a given investment company over the years. An active learner makes a good investor who to always open for opportunities and makes the right choice on the basis of knowledge.

Makes the Right Decision

A good investor knows not only the value of money, but that of time as well. They are very observant about the current market trends. They keep their knowledge about market, shares growth and falls continuously updated. Having a sheer understanding of the market trends allows investors to overlook their plans and decide the term of investment. Having a complete understanding and awareness of current market trends and company growth not only makes you a good investor, but it helps you make the right decision. It basically helps you put your money in the right place. No doubt we all make mistakes! Good investors accept mistakes as a part of the market game and ensure that they don’t repeat it. It is not necessary to follow a trend; it is necessary to do what is right.

Patience is the key

The abundance wealth creation outcome lies in the hands of only a good investor because of the key characteristics of patience. No one becomes rich over a night! Patience is probably the finest quality one can have when it comes to investment. A good investor trusts his plans. They do not cry over a 10% downfall. Instead they would rather hold on, stay patient and celebrate the 100% uptick. They are consistent and stick to their plans as per their objective. They usually don’t adapt to the buy and sell trend.

Risk Aversion

The more you try to avoid risk, the lesser benefits you will receive. Good investors always accept the inherent risk involved in investing. They build full-proof plans before investing, analyzing the expected returns. Being risk averse is a characteristic that is shaped by knowledge, experience and confidence as a building block and over all the other characteristics that a good investor may possess.

The sharp and continuous rise in education costs, whether in India or abroad, is a clear indicator of the need to financially plan for your child's higher education. Though most parents prioritize saving and investing for their child’s education, they often miss on starting early and end up with inadequate funds.

An efficient financial plan is of little use if not implemented timely, especially due to inflation's ability to reduce the value of accumulated corpus over time.

Why an early start is important?

The famous saying “early bird catches the worm” fits aptly for achieving any financial goal in life. The earlier you begin investing towards the target corpus, the more time your money would have, to grow over time, maximize benefits from the power of compounding, and assist in the timely creation of the desired corpus.

As you keep on delaying the investment, the chances of non-accumulation of the desired corpus continue to rise, since your finances may be highly strained in order to achieve the target corpus within a shorter span of time.

Moreover, with the continuous rise in education costs, it’s vital for parents to begin investing towards their child’s higher education, as early as possible. The below-mentioned example would assist you in understanding the importance and monetary benefits of an early start:

For instance, you need to save Rs 70 lakh for your child's MBA from a University abroad when he/she turns 21. Now, if you start investing when your child is 5 years old, you need to invest a monthly SIP of close to Rs. 12,000, with an expected return of 12% p.a. to sufficiently accumulate the target corpus. However, if you start investing for this when your child is 15, you need to invest through a monthly SIP of a whopping Rs. 66,000.

Evident from the above example, an early start would lower the monthly SIP investment amount required to sufficiently accumulate the target corpus, and also enable you to comfortably focus on other financial goals such as retirement corpus, purchase of a home, child’s marriage etc.

Include inflation cost while estimating the corpus amount

Most parents commit the mistake of taking the existing cost of higher education as the corpus amount, without paying heed to the effect of inflation, resulting in accumulation of insufficient corpus.

Remember that, over time, inflation reduces the purchasing power, implying that the future cost of a course would be higher than the current cost, after factoring in the inflation costs. For instance, a medical degree's cost from a private institute was Rs 60 lakh five years ago, today it costs about Rs.80 lakhs. So if your child is currently 8 years old, 10 years later when he/she is ready to take up their medical degree, you need to have a corpus of close to Rs.1.5 crore to sufficiently fund his/her MBBS degree.

Where to invest?

Instead of investing in traditional investment avenues such as PPF, FDs, NSC etc. which are, more often than not, incapable of providing inflation-beating returns, parents must consider investing in equity mutual funds, preferably through the SIP (Systematic Investment Plan) route. Equities have consistently proven to be the most suitable asset class for long-term investments and have been outperforming its peers by providing inflation-beating returns.

SIPs ensure disciplined investing and can help you accumulate big corpuses over the long run.

Also, unlike lump sum investments, SIPs relieve the investor from the worry of timing the market well, thanks to the presence of rupee cost averaging concept, which averages out the cost at which investor purchases mutual fund units, over a period of time.

If you are a risk-averse parent, consider investing in balanced mutual funds, instead of entirely investing in equities. Balanced funds invest in a mix of debt and equity funds and are aimed at balancing the risk-reward ratio for such conservative investors. But before beginning to invest towards your child’s higher education corpus, make sure you have the following pre-requisites covered:

Term insurance

Make sure you have adequate term insurance which would financially protect your loved ones in case of your untimely demise. The cover should ideally amount to at least 10-15 times your current annual income and must proportionately increase whenever your income rises in future. Presence of term insurance would also assist your family to continue existing investments and debt payments, thereby preventing them from being financially burdened in case you are not around.

As compared to the offered benefits and huge cover amount, the premium for term insurance plans is relatively very low, making it an even more obvious part of each individual's financial plan.

Emergency Fund

Secondly, to refrain any financial exigency from hindering your investments towards child’s education corpus, make sure you have an emergency/contingency fund in place. This fund assists an individual in handling financial emergencies such as sudden job loss, severe illness or accident.

Creation, as well as maintenance of this fund, should be one of the priorities before beginning investment towards any goal, whether short or long term. No matter at what stage of life you are, ensure you maintain an emergency fund amounting to least 5-6 times your monthly recurring expenses. Have this fund parked in highly liquid instruments such as high yielding savings accounts, providing up to 7.25% per annum interest rate, along with the highest form of liquidity and convenience in times of urgent needs, due to the presence of ATMs as well as online banking.

Credits: Business Standard

As parents, it is your responsibility to provide the necessary education to your child. Not only the basic elementary education, but to also ensure that your children get the best education so that they are employed with a sustainable firm with a bright future. As Indian parents, we want our children to attend top schools, graduate from the best universities or study abroad. Along with this comes the stress of saving up so much revenue to keep in par with the fees of the educational institutions. Shelling out so much money at once, can be a major concern. And considering the inflation rate in today’s market, it seems nearly impossible to pay for the best of best education.

However, you definitely don’t want a barrier against your child’s education. Hence, here is the best way to start planning financially for your child’s education and make sure you help them achieve their goals: 

1. The Timing is Important

The first step is to calculate the time for your child to reach the graduation/post-graduation stage. Based on the approximate number of years for this, you can decide on the time-horizon. The longer the time-horizon, the sufficient time you have to make a better financial plan for you child’s education. You need to consider many other factors like inflation, cost of education, etc. which might also be influential factors. However, make sure that you don’t wait for the last moment. Planning early, especially when your child is young, is the key to the problem.

2. Calculate the Cost of Education

The second step is to calculate the gross cost of education. This will help you move a step ahead in planning your child’s education. Before you reach to the core, you need to consider several factors involved in calculating the cost. Firstly, does your child want to study in India itself or does he/she have the aspiration of studying abroad? Along with this, does your child want to undergraduate and then postgraduate or how he/she wants to complete his/her education? Based on the place of education, India or Abroad, which school/college is apt for their career? Last but not the least, what could be the overall cash outflow? While calculating total expense you need to consider the effect of inflation as well. Inflation could be upto 8%-10%.

3. Track Existing Assets and Liabilities

Jot down all your assets and liabilities to know where you stand financially to your your child’s education accordingly.  This can help you plan better. You need to first analyze any investments that have previously made which might help you accumulate the desired corpus. For example, if you have invested in your child’s PPF account or diversified equity mutual funds or fixed deposits with a view of utilizing these savings for your child's education, you must first assess the current value of these investments before going ahead and making any further investments. An important thing to remember is that you must avoid dipping into the investments made for other financial goals, especially your retirement corpus, while planning for your child's education. Also, you should not drive into the investments made for your child's education for other low priority expenses such as renovating your home, etc.

4. Plan Smart Investments

The most intelligent way of investing is by designing asset allocation and investing accordingly. Once you have made an account of the already existing investments which can be mapped towards your child's educational plans, you will need to save and invest on a regular basis to fill in the gaps. You need to invest this hard-earned money in a suitable investment avenue depending upon your asset allocation pattern and risk appetite to counter inflation and increase the value of your preposition. Make sure your asset allocation is just right to achieve your child's education goal. For an investment time horizon of greater than 5 years, it is smart to keep the money in equity mutual funds as they have the potential to provide higher returns over the long run. But as you reach your goal, rebalance your investment portfolio gradually towards fixed income or debt. A well-planned asset allocation scales up your portfolio returns in an exponential manner. It can also act as a shield to protect its value during uncertain economic conditions and market fluctuations. 

5. Get Insured

Have you well-thought-out what will happen to your dream of giving your child the best possible education, in case you have an untimely death or meet with an accident that impedes your physical ability to earn? One of the biggest potential hindrances to a child's education is the decease of the breadwinner in the family and the absence of insurance. Guarantee that you have enough life and health insurance to at least cover the tuition fees of the school and college your child will possibly attend. You see, there are ways to reach your family goals even in your absence. But that can only happen if you have the right amount of insurance to balance your family's financial goals and regular expenses. To know the suitable amount of insurance cover you need to have, you can use Personal FN's Human Value Calculator (HLV) calculator. Likewise, optimally stay insured for health. Not having a satisfactory Mediclaim cover or one at all can possibly disrupt your financial goals if medical emergencies get to your feet.

Plan your Child’s future today..Get in touch with us to help you take your child’s education to the next level.

Early job opportunities with very high pay packages have enabled today's young professionals and amateurs to make smart investment decisions right at the beginning of their career, which can support them for a lifetime of financial bliss. Unfortunately, most youngsters don't realize its importance. When you are in your 20s, saving & investment usually is the least of your priorities; you feel it is the time to enjoy the financial freedom you are having and living a lavish lifestyle that you worked hard for when you were a student. Many of us also have education loans to pay off, and hence, focus on investments much later in our working life. However, what youngsters don't really understand is that even the smallest delay in beginning their investments counts and is a missed opportunity that could impact their future as a whole

Here is why early-investment in the 20s is the best and the most suitable time to begin your investment journey:

You will receive Greater Retirement Corpus

Your retirement corpus must be good enough to cover your regular household expenses along with the medical expenses that usually come along with the old age. So, if you're planning on retiring at the age of 60, and expecting a life expectancy of 80, your corpus ought to cover your expenses for at least these 20 years. Creating such a substantial corpus in the later part of your work life could be a challenging task and may not only adversely affect your other investment goals and overall lifestyle, but may also impact the basic needs of your family. For example, assume that you start investing Rs 10,000 every month in a SIP at the age of 23 years. Assuming that your mutual fund delivers 12% compounded growth per annum, your retirement corpus will be more than Rs 2.38 crores when you reach 60 years. However, if you start investing for your retirement from the age of 35 years, you will need to invest Rs 47,640 each month in that SIP to accumulate the same amount.

More the time equals more Compounding

Compounding means making money on the interest or gains made from the original investment. Assume that you invest Rs.1 lakh on an annual interest rate of 10%. At the end of the first year, you will earn an interest of Rs 10,000. However, when the interest is calculated next year, you will earn interest on Rs.1.10 lakh and not Rs.1 lakh. Therefore, in the second year, you will earn an interest of Rs 11,000 instead of Rs 10,000. The difference may seem to be small for the initial few years, but it will increase substantially over some time. So if you remain invested for 20 years, the value of your investment will increase to over Rs 6.72 lakh while under simple interest, it would have been just Rs 3 lakh. Thus, the longer your money stays invested, the higher the gains through compounding.

Debt-free purchase through goal-based investing

Most people tend to fund their big purchases by taking debt and incurring interest cost, thereby increasing the value of purchases. For example, if you buy a car worth Rs 5 lakh on a car loan with 20% down payment. At 12% interest rate for a 4-year loan tenure, the cost of purchase will increase by Rs 1.06 lakh, paid in the form of interest. Instead, if you start investing Rs 8,000 each month from the age of 23 in a balanced fund SIP, offering 12% average rate of return, you can easily reach the Rs 5 lakh target by the time you turn 27. Thus, with little forward planning and financial discipline, you can easily make your big purchases without incurring debt and additional interest cost.

Helps improve money management skills

Ideally, a person should plan his investments commitments first and then, accordingly adjust his expenses. Unfortunately, most young professionals do the opposite. Investing early inculcates financial discipline by forcing you to prioritize your investment over purchases and thereby, keep your expenses in check. The lessons learned from your early years of investment will also reward you in the long run. Over time, as your income increases, you will have a more significant amount to spend, and it is here when restraint and financial discipline is required. So, simply put, the earlier you start investing, the better will be your financial position in the future. The small sacrifices and discipline during the early years of your professional life will place you better to afford the luxuries in the longer run. It will also help you secure the future of you and your family, even during unforeseen circumstances, and ensure you comfortably accumulate a retirement corpus without compromising on your lifestyle.

Best time for greater risk-taking capacity

Investment instruments with higher risk deliver higher returns. In your 20s, usually, there are lesser responsibilities and higher risk appetite. At a later stage, your finances are generally stretched by higher cost of living, family responsibilities, EMIs on the house, car etc. and hence, risky investment choices may not be viable.

As we all know, Systematic Investment Plan (SIP) is a mutual fund facility which allows investors to invest their money in mutual fund schemes on the basis of a fortnight, monthly, quarterly or annually. SIP has always proven to be advantageous to investors as it not only protects them from the fluctuations in the market but also enables them to create wealth in the long term, without much of a hassle. Even though SIP has many benefits, but sometimes certain miscalculations and mistakes due to improper guidance can lead to overall losses, and this has been the main reason why people avoid investing SIP. Remember, SIP is the most secure form of investment if done with complete guidance and by avoiding the below 5 mistakes:

Know your financial status before you start a SIP:

SIP investments allow you to start investing with small amounts. However, many investors sometimes commit to investing huge amounts in SIP without realising their current financial status, which leads to a loss of interest in future investments.

On the other hand, some investors invest a very small amount in SIP with an expectation of very high or instant returns. Everything good takes times, and so does SIP. You need to evaluate your current financial status and risk profile before you set your goal while investing in SIP such that it does not create a financial burden in the future.

 Always choose SIP as a long-term investment plan:

A prevalent SIP mistake that many investors make is that they invest in SIP for a short period. As a result, they received minimal returns. This is because they do not realise that SIP is not only dependent on the amount that they invest but is also proportional to the time period. The longer you stay invested in a SIP, higher are the returns. For example, if you decide to invest Rs.5,00 every month in a SIP for a period of 5 years, the total value invested would be Rs.3 lacs, while the total revenue created would sum up to Rs. 4.12 lacs in 5 years assume an interest of 12% per annum. Thus, by investing in SIP, you have gained an additional amount of Rs.1.12 lacs over a period of 5 years. However, if you had continued to remain invested for a total of 10 years, the total invested amount would equal to Rs.9 lacs, while the total revenue earned would sum up to Rs.25.23 lacs considering an interest of 12% per annum. This entire process of investment value being created over a period of time is dominated by the power of compounding which implies that the longer you stay invested, the more revenue you tend to receive. Therefore, if you choose to invest in SIP, let it be a long-term goal.

 Keep increasing the SIP amount:

One secret ingredient to reach your wealth creation goals via SIP is increasing the amount you invest in a SIP over a period of time. It is a good practice to start a SIP at a very early age with small amounts, considering that salary or income that you might be receiving at that age. However, as you tend to grow professionally, so does the income grow along with your dreams and aspirations. Then why doesn’t the SIP commitment grow? Say you had a goal to purchase a bike worth Rs.50,000 and therefore you started with a SIP of Rs.1,000 per month for 2 years. As time passed by, you realised that you have a greater aspiration of buying a car instead of a bike. But, Rs.1,000 a month will definitely not be sufficient to fulfil your dream. Therefore, it is wise to fuel up your SIP as you grow professionally and financially so that you can reach your desired goal.

This investment is for ‘small’ needs is false:

A common misconception concerning SIP is that it is meant to be invested in small amounts as it is generally presumed as a low-ticket size investment scheme. Apparently, it is to bring in mass participation of investors in SIP who wish to benefit from the prosperity of the equity market with as low as Rs.1,000. Your commitment to SIP should be determined by your current financial status and the goal for which you are starting the SIP. There is no well-defined upper threshold to SIP investment. For example, if you wish to buy a luxurious bungalow in the next 10 years, then you are free to invest as much as Rs.2 lacs in a SIP which would grow to a revenue of Rs.4.65 Crs. at an assumed rate of 12%.

 'Growth' is always a better option:

Before investing in SIP, an investor is always presented with two options, ‘Growth’ and ‘Dividend’. A dividend is nothing but a withdrawal from the corpus, and so the effect of compounding is subsequently reduced, thereby affecting the growth of your target corpus while if no dividends are paid or declared, and thus the corpus would grow and benefit from compounding. A better way of investing in a SIP is by choosing the ‘Growth’ option wherein, there is a minimal effect on your corpus. Even if you have previously opted for a dividend option, you can, at any point switch to growth option or go for a dividend reinvestment option, which can offer you the same benefits as the growth option in SIP.

Avoiding these 5 mistakes can help you yield maximum benefits from a SIP. If you continue to have any issues regarding SIP or any other mutual funds, it is always ideal for getting in touch with a financial advisor who can further assist you by evaluating your current financial status, risk profiles and helping you reach your goals with the right SIP investment.

Mutual Funds are investment tools regulated and sold to general public. They are controlled by professional funds managers who invest the capital and strive to produce capital gains, profit and income for the fund’s investors.
The main misconceptions with regards to investment in mutual funds are as follows:-

1. Mutual Fund Investment ask for a huge amount
Many investors think that they need a large amount of money to invest in mutual funds. This is the most common misconception. But the fact is exactly the opposite. One can always invest as low as Rs. 500 per month via Systematic Investment Plan (SIP) and Rs. 5,000 through lump sum mode. Moreover, no monthly or annual maintenance charge is incurred even if you do not transact further.

2. It is not easy to quit or leave mutual fund investments
Another misconception which hinders investors from investing in mutual funds is that they think if they start SIP for 5 yrs, and they wish to discontinue in between, they will face some kind of penalty. But, the truth is that SIP has the feature of liquidity once it is started, it can be stopped at any point of time. .

3. A Demat account is required for Mutual Fund Investments
Mutual Fund investors can receive the units either as a written statement or dematerialised form. This means that it is not at all necessary to own a demat account to investing mutual funds. However, if you are investing in mutual funds for the first time, you need to complete the Know Your Client (KYC) form and submit it along with your investment application form and documents.

4. Mutual Fund Investment required too much of Documentation
KYC (Know Your Customer) is a one-time procedure and it can be completed via a SEBI- registered intermediary. You don't have to go through the same procedure again while approaching a different intermediary. As per the KYC rules and regulations, all you need to submit to your financial advisors is an address proof, identity proof, and a latest photograph to start off with your mutual fund investment. However, KYC is mandatory.

5. Mutual funds are assumed to be meant for the long term
When we are asked to invest in mutual funds, the first question that pops up is whether it is a long-term investment. Don't you think it is a good idea to stay invested for long term? In fact, it is best if you invest for a very long term as you can earn the benefits of compounding. But if you don't have plans for a long-term investment, you can always choose a short-term or mid-term investment plan from the available multiple schemes to choose from that suit your need. May it be short, medium or long term, mutual funds are very much useful.

To know more about Mutual Fund Investments, get in touch with me today!

A lot has already been said about long term equity gains taxes on equity schemes. Considering the potentially high returns, Rs. 1 lakh annual gains taxation threshold and the grandfathering of returns till 31st January 2018, equity schemes still hold the edge over competing investments. This also holds true for ELSS funds that investors choose for making tax saving investments. In case you are still worried regarding if there are any benefits of opting for tax saving mutual funds over traditional tax saving investments, the following are the reasons to choose ELSS over any other schemes.

1. You Can Choose Your Investment tenure:
The versatility of mutual fund schemes is unique even in case of tax saver investments as you have the option to determine your investment tenure beyond the 3 year lock-in. In the case of most other tax saving investments, you ought to invest in blocks of 5 years or more exceeding the initial lock-in period. This is not in the case with ELSS schemes. You can stay invested for a day or even for years after completion of the first three year lock-in period. Usually, staying invested in a high rated ELSS mutual fund for a more extended period offers you exceptional compounding benefits.

2. Shortest Lock-in Period:
All tax-saving investments emphasise a lock-in period which currently varies from 3 years to 15 years. Throughout this lock-in period you are not permitted to redeem your investment or make withdrawals except for some specific emergencies. As per existing rules, among the available tax saver investments in India, ELSS i.e. tax saver mutual funds have the shortest lock-in period of 3 years. This allows you the ability to shift to a different investment option within a relatively shorter period of time in case your chosen investment is not performing as per your expectations. Obviously in case of tax saver schemes with longer lock-in period, you do not receive the same flexibility.

3. Compounding Benefit:
Compounding is what makes today’s investments more valuable in the long term and equity linked savings schemes can potentially deliver superior compounding benefit when compared to traditional tax saving investments. This is because the returns offered by traditional instruments such as tax saver fixed deposits and PPF tend to offer a lower rate of return than the average ELSS. This causes the compounding of the initial investments to grow slowly and reduces the overall benefit of compounding for you in the long term. In case of mutual funds such as ELSS, the potential returns being higher, these compounding benefits tend to add up faster for investors. It must however be pointed out that ELSS returns do not have a fixed ROI, hence during some periods, returns will be considerably higher than during other periods with historic long-term average returns of equity schemes recorded at 12% per annum.

4. Ease of Investment:
The advent of Internet and related technology has significantly eased the pains related to making tax saving investments. However, many traditional tax saving schemes such as PPF still require you to physically queue up at a designated bank or post office so that you can subscribe to the chosen instruments. Not in case of tax saver mutual funds. After having adopted Aadhaar-based eKYC, the industry as a whole allows investors to start investing online without having to leave the comfort of their home or office. You can of course still complete an in-person biometric KYC at designated RTA locations, but the advantage of a completely-online cKYC for tax saving investments is currently only available to mutual fund investors.

5. Potentially Higher Market Linked Returns:
ELSS are market-linked diversified equity schemes, this gives them an edge over fixed return investments that offer tax benefits. The main problem that fixed rate tax saving schemes such as PPF have is that inflation reduces the actual returns generated by these investments over time. Luckily, being market-linked, tax saver mutual funds can provide potentially higher returns that can beat the adverse impact of inflation in the long term. This is the key reason why many individuals who make investments with the intention of planning for retirement or other future expenses have moved away from old school options such as fixed deposits and PPF to mutual funds and ELSS instead.

Each one of us has high aspirations in life. With great ambitions come greater dreams. While you dream big, it is necessary to find the right way as to how you will fulfil them. The ultimate solutions that can build a strong foundation for your dreams to grow bigger are Equity Mutual Funds. Let’s have a look at how Equity Mutual Funds claim to be the best solution for you and your goals.

Here are some benefits of Equity Mutual Funds:

1. Wealth Creation    

When you regularly invest in equity mutual funds, it can help maintain a balance between the cost of living and future goal planning. With this investment, you do not have to worry about tackling the present as you save for your future. One primary advantage of equity mutual funds is the potential of capital appreciation which makes it an excellent way to create wealth.

2. Diversified Investments

If the market is falling, a single stock might go up or might drop if the market is rising. In such cases, experts suggest adopting a strategy of portfolio diversification. Portfolio diversification means merely that buying stocks of multiple companies. You can diversify your investments by investing in an equity mutual fund with just Rs.1000 (in the case of SIP)

3. Quick & Easy access to Money

Equity mutual funds possess the feature of liquidity, i.e. they provide you with an opportunity to redeem your investments or money at any point of time (in the case of open-ended schemes). This implies that you can revoke a part or the entire investment when you need money, giving you better control over your investments.

4. Professional Money Management

Investing in equity funds means putting your money in the right hands; hands of the professionals. Your investment is not only backed by a dedicated research team, but you are provided with a dedicated service of a highly experienced funds manager who will take care of your investment decisions. You don’t need to hire an additional expert to manage your investments.

5. Tax Benefits

One such equity mutual fund is the Equity Linked Savings Scheme (ELSS), which offers you a simple way to gain tax benefit. With ELSS, you can easily save on tax and grow your wealth. You can claim up to a sum of Rs. 1,50,000 as a deduction from your gross total income in a single financial year under the section 80C of Income Tax Act, 1961.

So go on and dream bigger. Don’t let anything come your way. Empower and achieve your dreams by investing in Equity Mutual Funds. 

Valentines Day is special for all couples. So, I am sure you will are all set to celebrate this Valentines with a full-swing with lovely gifts and beautiful flowers. But are you sure you’re not missing on something very critical? Of course, you are not! Money… They say money is not everything, but the fact remains that “Money is something that you need every day”! So, how to make sure that you and your partner are financial assured? Here are some tips:

1. Don’t feel bad about discussing Money Matters

The key to any relationship is trust and transparency. Therefore, make sure you don’t hesitate to discuss money matters with your partner, may it be big or small. This is the first step to family financial planning. Make sure you discuss about home loans, personal loans, child’s education, wedding and honeymoon expenditure, etc.

2. Share your Money Secrets

It is excellent if you’re planning a birthday or valentine’s surprise for your partner. But, don’t go hiding or not sharing things beyond this point. Be truthful to one-another about how much you earn, how much you spend and how you save and how and when do you invest. This will better assist you and your partner to set long term goals and expectations, and put the family planning in place, beforehand. Share your plans and try to find out how much of it match with your partner’s goals.

3. If you plan for a Short Term Goal, go ahead

You might want to gift your loved one a diamond necklace or a diamond right. Or, you might want to plan for a short vacation with him/her. All these count under short term goals which need investment too. It is better to invest today so that you save yourself from the hassle of last minute saving. In this manner, you can get a smile on the face of your loved one, without much stress!

4. Don’t Miss out on Long Term Goals

At the end of the bargain, all want to marry and settle down with the best; the best home, the best car, so on and so forth. For this, you will need to think long-term. You and your partner might dream a having your own home, and you can make this dream into reality only when you start investing at an early stage. Nothing could be better than a Valentine Day dinner at your own little home!

Therefore, making financial planning as your first priority this Valentine. Don’t hesitate to discuss this topic with your partner. It will help you avoid unnecessary arguments and misunderstandings in the near future. Early investment and financial planning can help you settle better!

We at Shree Investment will help you plan your future, without much of a hassle. We will do all that it takes so that you and your partner get the right form of investment, may it be SIP, mutual funds or loans, we do it all! Leave it all in our hands, spend less time in worrying and more time in love.

Happy Valentine’s Day