i am happy the writer has given the clear and genuine advice from bottom of his heart, we need such guidance for the younger generation who are taking too much of risk for the hard earned money,the job marketof today is not permanent like before,with everyday story of hearing hire and fire,the money we get today has to be preserved with zero risk,this advice suits best specially to salary earning people.
while businessmen can divide their risk.salary people shud never invest in risky ventures .
my message is : stock market will be grown after october to bullish trend so i am not belive in fixed deposit more risk more return! sensex will be 15000 in next buul run after crossing level of 11500. ok wait & watch sir!
It is important that a investor diversifies the portfolio among Equity linked saving schemes, FDs , EPF, PF etc. Even if there is a fluctuation in one scheme , a balanced portofolio will ensure a steady return.
A very good article. But the investment decisions should be based on the Govenment policies and economic growth of the country. It should be analysed from net return (post tax) and not gross return angle. Today, there is no tax-free fixed deposit except investment in PPF (to some extent) which is having extremely long lock in period. Whereas returns from equity and mutual funds, dividend as well as capital gain are tax free (except a nominal 10% short term capital gain tax). Even 'long term' period has been reduced to one year. On the other hand interest on FD is taxed at a normal rate irrespective of the period of FD. Therefore, even 8% interest on FD will reduce the net return to 5.56% & 6.37% for 30% & 20% tax slabs respectively. This rate of net return hardly covers the 'doctored' inflation rate announced by the Government. On the other hand, with the annual GDP growth of over 8% and industrial production rate of over 10%, return from equity is likely to give a net return of over 10%. Any slow down in the economic growth will effect equally to FD & equity as far as net return to the investment is concerned.
yeah. agree w u fully. v souldn\'t put all our eggs in 1 basket. devide ur income into 3. 1st for daily expences n enjoyment.2nd for investment, 3rd for fixed deposit for rainy days! F R
I too agree partialy that one should not keep all his money in to share market. He has to keep some portion in Fixed Instruments for liquidity purpose. It should not be for good return. 1998 FD rate was 8 to 11% but not now. If you take today's FD interest along with cost of inflation, it won't give you better return. Of course, lot of senior citizen suffers because of this. In my opinion Share market with SIP or SWP would be the better option for investor.
Forget those days of 11 and 12 % interest on fixed instruments. It will be a few years before we see a 7 or 8% Yes the money is relatively safe in fixed income even if it gives a tiny 4 to 5% and if there is another stock market crash because of the world political uncertainty , the tiny percentage would seem like a monster reward.And your capital is risk free.
It has always been said that money management is equally important as earning. Still, many of us are unable to take the right decision. As far as investment is concerned, I feel that secure investments should be ensured on priority and later on one can think of investing in shares.
