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Tips to help you frame investment strategies for 2009 – 2 January 7, 2009

Posted by dhirendra1972 in Children's Education, Equity-to-debt Ratio, Insurance Plans, Long-term goals, Substantial Funds, Take-home Salary, Tax Benefits.
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30 To 45-Year-Olds with Kids

The major long-term goals for this category are buying a house, funding children’s education and providing for retirement. “If you are planning to buy a house, it’s better to wait for six months as prices are likely to correct further by 25%.

If you do decide to buy one, ensure that you don’t overstretch yourself. For instance, if a 2BHK flat fits into your budget, don’t go for a 3BHK assuming that you will be able to manage the EMI payout,” cautions Mr Pandit.

If your take-home salary is Rs 1,00,000 per month, the EMI outflow should account for less than Rs 30,000-40,000. Also, go for a joint home loan with your spouse, if possible. Not only will it enhance the loan amount you are eligible for, it will also maximise the tax benefits under Section 80C on the interest amount repaid.

“For children’s education, one can consider child unit-linked insurance plans (Ulip) or high-growth equity funds,” advises Dhruv Agarwala, co-founder, iTrust.in. The longer investment horizon (assuming that the funds will be required after 8-10 years) makes equities a viable option. The equity-to-debt ratio for the purpose could be 75:25.

Same will also hold true for retirement planning. At this age, retirement will be nearly 15 years away, which means you can invest in equities. Investment in public provident fund (PPF) is also advisable – apart from being a safe avenue, it also offers a return of 8% per annum. “You can consider real estate too, but only after parking substantial funds in equities, debt and gold,” adds Mr Pandit.

Besides, you shouldn’t forget life insurance, which is an important tool for providing for dependents in the event of an untimely demise, especially in uncertain times like these.

ref: thetimesofindia

Tips to help you frame investment strategies for 2009 – 1 January 6, 2009

Posted by dhirendra1972 in Blue Chip Stock, Economic slowdown, Financial Responsibilities, Health Insurance, Life Insurance, Long-term Capital, Long-term goals, Lower Interest Rate, Realty Price, Turbulent market.
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Good morning friends!  There are some tips which I read  with reference to The Times of India.  I want to share this to everyone and I’m sure it will also help you a lot.

 

Depending on how you choose to look at it, 2009 could either be the harbinger of more bad news or offer a plethora of opportunities.

 

While an economic slowdown, turbulent market conditions and job/pay cuts will, no doubt, test your resilience, opportunities may come knocking in the form of correction in realty prices, lower interest rates on loans and attractive valuations of blue-chip stocks.

To capitalise on the opportunities and tackle the challenges during the year, you need to stick to an investment strategy based on your long-term goals and risk profile. Here are a few guidelines to help you frame one:

25 To 30-Year-Old  Singletons

Irrespective of the age bracket you belong to,  health insurance should figure prominently in your must-have list.

The need for life insurance for this category, however, will arise only if you have dependents. “In addition, you need to create a contingency fund, because this year, increments will be hard to come by, and the sword of job cuts will continue to hang over employees’ heads,” points out certified financial planner Amar Pandit.

While this piece of advice will be applicable to all classes of investors, youngsters who have just started their careers need to take it seriously as unlike other age groups, they may not have the luxury of existing investments to cushion the impact of tough times. Also, you will need to be thrifty when it comes to spending on consumption needs.

You should strive to save around 40% of your  income and direct most of it towards investments — mainly equities. “Although the asset allocation depends upon one’s risk profile and other needs, generally speaking, youngsters can take advantage of their youth and relatively fewer financial responsibilities to take on more risk and participate in long-term capital appreciation,” says Kartik Varma, co-founder, iTrust.in, a financial planning firm.

 

 

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