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7/27/2019 Best Ways to Invest 1 Lakh
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16 The Economic Times Wealth, October 29-November 4, 2012
BESTWAYS TOINVEST`1 LAKHIf you have come across a windfall and want to invest
the lump sum, here is a road map to help you decide the
avenue that suits you best according to your timehorizon, risk appetite and tax bracket.
Yourinvestmentdecisionshouldalsotakeinto
accountyouroverallassetallocation.Ifyouareinvestingforthelongterm,goforequityonlyifyourallocationallowsyouto takethatkindof
exposuretothevolatileassetclass.
Anyinvestmentinstocksandequitymutualfunds
shouldnotbe donethroughalumpsum.Instead,putthemoneyinashort-termdebtfundandstartasystematictransferplantoshiftsmallamounts
(`5,000-6,000)toanequityfundeverymonth.
Iftheinterestincomeona bankfixeddeposit
exceeds`10,000ayear,thebankwilldeduct10.3%asTDS.However,if youhavenotmentionedyourPAN,theTDSwillbe 20.6%.
AnincorrectPANwillalsoinviteapenalty.
Ifyourincomedoesnotexceedthebasic
taxexemption,youcangetbacktheTDSbyfilingyourtaxreturn.ToavoidTDS,submitadeclarationunderForm15G.Senior
citizensshould submitForm 15H.
Long-te
aretax-eligiblefofunitsi
holdingp
YES
NO
Yes
3-9
MONTHS
AFTER
1 YEAR
NIL NIL: LOSS
IS NOT
ACCEPTABLE
MODERATE:
5-10% DROP IN
VALUE IS OKAY
VERY HIGH
RETURNS
HIGH RETURNS
EVEN IF RISK IS
HIGH
RETURNSSHOULD BEAT
INFLATION
SAFETY OF
CAPITAL
10%OVER
20%
3-5
YEARS
AFTER
5 YEARS
Use the money to:
* Settle credit card bills.
* Pay off personal loan.
* Prepay home loan.
Invest in
Fixed deposits, liquid
or short-term debtfunds.
Invest in
Bank deposits.
Invest inMIPs or
balancedfunds.
Invest in
Mid-cap and multi-capfunds, direct equity.
Invest in
MIPs or debt-orientedbalanced funds.
Invest in
Bank depos-its or FMPs.
Invest in
Debt funds.
No
WHAT IS
YOUR TAX
BRACKET?
,
`1 LAKHTO
INVEST
DO
YOU HAVE
A HIGH-
INTEREST
LOAN?
Invest in
FMPs or debtfunds.
Invest in
PPF, tax-saving
bank deposits.
HOW SOON
DO YOU NEED
THE MONEY?
WHAT IS
YOUR TAX
BRACKET?
WHAT IS
YOUR RISK
APPETITE?
WHAT IS
MOST
IMPORTANT
TO YOU?
WHAT I
YOUR TA
BRACKE
HAVE YO
EXHAUST
YOUR SE
80C LIMI
POINTS TO REMEMBER
1 2 3 4 5
Text:BABARZAIDI
Graphics:CHANDER