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To know more give a
missed call on 8655097225
● World Health Day is celebrated on 7th April each year by the World Health Organisation to draw attention to critical health issues. The slogan for World Health Day is “Health For All.”
● The theme of World Health Day 2019: Universal health coverage, everyone, everywhere.
As we pledge to improve our physical health this World Health Day, let’s take the opportunity to introspect upon our financial health too.
TRIVIA
STAGE 2: BETWEEN 30-50 (Married with kids)
● Asyoumoveintoyour30’s,yourealisethe importance of a balanced diet and make a conscious attempt to eat healthily.
● Yourrelationshipstatusislikelytohavechanged to married with kids in this phase.
● Youhaveincreasedcashflows,and yourfinancialaspirationsinclude the future of your spouse and children.
● Justlikeyouwouldbecarefulwithyourphysical health, it is time to pay attention toyourfinancialhealthbytakingthefollowing steps:
►Ensurethatyourinsurancecoverageis adequate to protect your family from facingfinancialwoesinyourabsence.
►BeefupyourEmergencyFund. ►YoucanconsideraSIPtop-upfacility
that increases your investment by aminimumof10%annually.
►Startsavingfortheeducationof children as early as you can.
STAGE 3: 50 AND BEYOND (Moving towards retirement)● Youarecarefulabout
your diet and are probably cutting out carbs and controlling fat.
● Similarly,inyourfinancialdiet,it’stimetore-assessyour investments.
● ConsiderbalancedEquityto Debt ratio as you move closer to your goals.
● Atthisstage,youcanconsider a Systematic WithdrawalPlan(SWP)from your existing investments.
● AnSWPisineffectoppositeofaSIPthatallows you to withdraw a stipulated amount each month. It ensures aregularcashflowin your retired years.
STAGE 1: IN YOUR 20’S (Single and independent)
● Whenyouarefitandyoung, we tend to neglect our diet and the need for regular exercise.
● Youcanbuildrobustfinancialhealthbyinculcatinggoodfinancialhabits early.
● Youmustseparateneedsfrom wants, setting financialgoalsandinstilfinancialdisciplinefirst.
● Asimplewaytodosois by investing in Mutual Fundstomeetfinancialgoals through the Systematic Investment Plan(SIP)route.
● Amust-doatthisstageis the creation of an EmergencyFundthatcansufficefor6-12monthsusing Liquid Funds.
YOUR PERFECT FINANCIAL DIET PLAN
Insurance that provides financial protection and liquid savings that can come
to your aid in times of a financial emergency
are equivalents of carbohydrates in
your financial diet.
Financial equivalents
of proteins are asset
classes such as Equity and Debt.
Financial equivalent of right fat consumption is maintaining the
right balance between Equity and Debt
according to your
risk appetite, time horizon
and goals.
In this fast-paced age, you know the importance of being physically fit. However, have you given your financial health as much thought?
Consumption of fat helps
your body store energy and aids
development.
CARBOH
YDR
ATES
F
ATS
PROTEINS
Asoundfinancialplancanbeablueprintora“dietplan”forinvestmentsatvariouslifestages.Whileeveryindividualhasdifferentfinancialgoalsandthusmusthaveauniquecustomisedplan
for investments. Here are some broad guidelines you can follow at various life stages:
Areyouconfusedaboutyourfinancialdiet?Readonfortheperfectsolution.Asweallknow,therearethreeprimaryfoodgroups-Carbohydrates,ProteinsandFats.
Nowlet’slookattheirfinancialequivalents.
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Carbohydrates are the most important part of your meal as
they are the main source
of energy.Proteins are an
essential part of your diet as they
promote growth.
SIP YOUR WAY TO ROBUST FINANCIAL HEALTH!
Good financial habits equal good
financial health; start today!
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SIP AND SWP: AID FOR
A PERFECT FINANCIAL DIETJust like good food habits, good money habits from the start can ensure that you effectively meet your
financial goals. Let's talk about two good financial habits that you can inculcate with Mutual Funds.
SIP SWPWhat is it - Systematic
Investment Plan What is it - Systematic
Withdrawal Plan Whatdoesitdo-Allows you to invest in a Mutual Fund scheme of your choice periodically in small amounts?
Whatdoesitdo-Allowsyoutowithdrawafixedamount from your existing investment by selling some units?Ineffect, it's an opposite ofaSIP.
Advantages - Cost averaging and compounding. ● Costaveragingmeans,
you buy more units when markets are low and lesser units when markets are high. That averages your purchase cost and also protects against volatility.
● Compoundingmeans,the returns from your investment arere-investedin the principal amount of investment. Thus the longer you remain investedinaSIP,the more you stand to gain.
Advantages - Cost averaging and Tax benefits. ● Cost averaging: The
same principle of cost averaging is applicable in theSWPcontextaswell.
● Tax efficiency: Any gain on the sale of MF units attracts Short Term CapitalGainsTax(STCG)of15%.However,thesaleofSWPareinsmallerunits from the principal amount and thus does not attract STCG.
How to use a SIP YoucantieeachSIPyouinvestinaseparatefinancialgoal.Youcanbeginwithaninvestment of as low as ` 500andusethetop-upfacilityofSIPstoincreaseyourinvestments as your salary orcashflow increases.
How to use an SWP AnSWPisaneffectivewayofearningafixedincome at regular intervals from your existing investments in Mutual Funds.
Investing in MFs through the SIPfacilityisakintomakinganEMIpaymentbuttowardsthe goal of wealth creation. BylinkingeachSIPtoaseparatefinancialgoal, you can ensure that you can meet all yourfinancial goals promptly.
AnSWPisespecially helpful for a retiree looking to supplement pension income.
WHAT NEXT?
Learn how you can useSIPandSWP
facility to meet your financialgoalsefficiently
● Nomatterhowlessyoursalaryisatthebeginningofyourcareer, youcaninculcategoodfinancialhabitsrightatthestart.
● Chalkingoutafinancialplanbeforeyoubegintakingsmallstepstowardseachfinancialgoalcanhelpyoumeetallofthesegoals effectively.
● YoucanstartaSIPtowardsafinancialgoalwithaslessas` 500permonthandincreaseitwitheveryriseinsalary.
● However,SIPswillworkifyouremaininvestedforthelongterm.Patienceisthekey,asSIPsprovidethebenefitofcompounding.
● Thelongeryoustayinvested,themoreyoustandtogain.
SWATANTRA KUMAR EXPLAINS - THE RICH CAN BE FINANCIALLY HEALTHY
For more details, follow us on Twitter @utimutualfund;Emailqueriesorsuggestions:[email protected] Pleasemention‘Swatantra in The Hindu’ in subject line. Formoresuchfinancialadvice,headtoourwebsite:http://www.utiswatantra.com Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
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