SERIOUS HELP NEEDED REGARDING INVESTMENT !!
• Guys , i posted a discussion forum recently , about how LIC is very a bad investment … i explained how mutual funds are better than LIC , some people messaged me that it helped them and now they have stopped LIC ….
• But the thing is that , my father has been told by many of his friends , that SIP mutual funds is gamble and all , he can even loss his invested money , ( I am talking about blue-chip large Cap companies SIP , or you can take index funds too , that too for a very long period of time almost 30 years , risk becomes almost zero ) … I got his point , he wants risk free investment …
• We are paying , very big premium every year in LIC , as no. of LIC we had opted , are way more than i thought … i calculated we are getting only around 7% returns , which is really low as policies are for very long term ( around 30 years ) and principle money is also big …
• Guys what would be the best alternative now , I want an option which is almost risk free and give more than 8% returns … As of now i can only think of PPF , if you know better option , please please reply …
NOTE :-
a) Stocks and Mutual funds aren’t option as they aren’t risk free …
b) he himself wants to know if there are any other better alternatives , I am not forcing ( lol , as many thinks ) … we are family , please think before commenting …
If senior citizen go for senior citizen FD, although it has lock-in but you can consider it.
@gola78901939 You need to take your father to some reputed financial advisor. I don’t know where you live so I can’t recommend any. Google em.
Let’s talk about your father’s dilemma. You talk about safety. Where are you safe? There always will be risks. If you don’t take risks, you gonna live mediocre.
1)At banks your money is not safe. You are insured for upto 1 lakh per deposit per account. Even if you have 10lakhs deposit, and your bank goes caput you ll get just 1 lakh.
2)Are Government bonds risk free? In practice, government bonds of financially stable countries are treated as risk-free bonds, as governments can raise taxes or indeed print money to repay their domestic currency debt. For instance, United States Treasury notes and United States Treasury bonds are often assumed to be risk-free bonds. ( Copied from Wikipedia, Google yourself)
3) What about PPF, NCD, etc etc? They invest in securities. So we gonna treat them as derivatives ( not FnO). They are slow poison. How? Lemme explain. Take a hypothetical example, which is not very far from reality. Say you invested a lump sum of X in any above mentioned investment schemes for 5 years calculated from 2013-14 financial year, which are considered as safe. Let’s give you 8.5% interest, compounded per quarter. So, (1+8.5/400) raised to the power 20 is your net gain. After five years X became 1.52X. In 2013-14 cost inflation index was 220, now it is 289. So, in 2013-14 your x was equivalent to 1.31X( calculated as 289/220). Net gains (1.52-1.31)= .21X. It is a bad return. Let’s say you are doing these since a long period of time say from 2000. Then CII was 100. Now CII is 289. N let’s give you 9% interest. Your X became 5.42X. cost of X back then in terms of today’s price 2.89X. Net gains 2.89X. Net profit 189%.
Take some time to digest this. I ll say some more
Say you invested straight in any stock index( again hypothetical situation, you need to buy an index fund/ETF for the same). In 2000 Feb 11 Nifty 50 was at 1756. In 1 Nov 2002 it became 951( please Google Nifty 50. A chart will come. Set it to max. You ll get a chart showing these details). So your father’s friend was right. You lost 806₹ in 2 years. Ketan Parekh( I typed Harshad Mehta, apologies for the same) Scam combined with .com bubble burst wrecked everyone in the market. People thought, eh this market is pure gambling. People lost 50% of money if invested in our hypothetical Index fund. But they lost more in individual stocks. Some committed suicide. It was a heart breaking situation. Fast forward to 4th Jan 2008, it became 6274. Guess what? US Housing Bubble bursted. Yeah. Nifty became 2553 in 20 Nov 2008. 😁 If one had invested in 4th Jan 2008 6274 in Nifty, they couldn’t recover from their losses untill 2014. Six years of hopeless abyss of darkness haunted them. The Brave ones survived and today Nifty trades at 11234₹. 539% is your net return. 1756 @ 2000 costs around 3178 in today’s price. You have 253.4% gain. 🙂 Right!
Let me also know what you finalised, cause according to me SIP is the only solution after PPF
Bhai if you allow me to share my opinion, then first of all go to a finance consultant.
And it is wiser to diversify your investment. Some people do 80% traditional, 20% equity. Some do 50% traditional, 50% equity. Some fools like me do 70% equity and 30% traditional investment. Overconfident people n experts like Rakesh Jhunjhunwala do 100% equity. It is all about risk taking appetite. 🙂 And get insured. It’s as important as investment.
I missed one thing completely. LIC means life insurance/ endowment insurance, right? Do not ever confuse insurance with investment. That’s really bad practice.
Open a mis to Rd account in post office and u will get 8.9%+ interest….
Bro RD pe 8.9% ?
if you can handle risk management, invest in crypto
Bro if you want greater return, you should take risks. As per my knowledge in finance you should invest your amount in Debt mutual funds and Bank FDs in a proportion as per your risk taking capacity..
As FDs are risk free investments with low return and low liquidity
Where Debt funds are medium risk investments with medium return and better liquidity
Don’t go for equity funds or share market investments as they are very risky and you’ll get return as per market(sometimes you loose a lot sometimes gain a lot)
If you don’t want to invest a lumpsum amount at the begining, do SIP in debt funds for a short time and take that amount and invest some of that in FD
So, your risk and reward will come to an average value and you’ll get your target return
Please do your research well before investing to anything or rather you can research and find a good knowledgeable investing adviser and consult with them before investing..
Bhai FDs also come with 1 lac insurance coverage. You said the right thing. 🙂 Edit: with equity you went totally wrong bro. There is nothing more rewarding than equity investment. With long term goals such as investing in mutual funds, where a pro fund manager does everything for you, risks become very less as those funds follow or track some benchmark index. In 2008 some navs got halved. In 2000 crisis same thing happened. They rose again and beat the fd, gold, PPF by multifold margin. When you are young, go for equity. It ll build wealth for yaa. In old age, things become different.
friends is it gud to book fd with idfc for 2lkh for 2 yrs im planning same … any opinion regarding this will be highly appreciated… worried about bank is idfc gud??
Avoid it
I was going to open fd with future enterprise but when I came to know Not 1 Rs is insured
I abandoned it
Safest and highest returns, go to Hyderabad and buy some lands on the east or the west.
prices?[saying loosely however dont have so much ]
and where near the airport?
DCB Bank FD -8% Interest rate – 36 months tenure
https://www.dcbbank.com/cms/showpage/page/zippi...