Investment

Question 1

Funds Selections - Short Term

Answer 1

1-3 years (Debt Funds, Hybrid)
setting budget,
building an emergency fund,
buying a car
planning an  vacation

Question 2

Funds Selections - Long Term

Answer 2

10-15 years (Equity,Large Cap)
retirement
buying a home
Kid education

Question 3

Timespan
Corpus
Target for V/M

Answer 3

20 years - 2040
2 +2
Invest 20k monthly each monthly in equity large cap funds - 12% expected

Question 4

LIC Returns

Answer 4

Vish - 2038 -Estimated - 62L

Motu - 2038 - Estimated -25L

Question 5

PPF

Answer 5

Motu - Estimated - 1 Cr

Question 6

EPF

Answer 6

20k per month @8.65% for the next 20 years
Vish- 2040 - Estimated - 1.5 Cr
Motu - 2040 - Estimated - 64L

Question 7

Gold ETFs

Wealth Tax

Answer 7

Gold ETF has emerged as a better medium of investing. It is an open-ended mutual fund whose units represent physical gold that is 99.5% pure, with each unit representing 1 gram of gold.
Besides, unlike physical gold, investors don’t have to pay wealth tax, securities transaction tax on gold ETFs.

Question 8

When to stop SIP

Answer 8

Poor performance of a scheme compare to its peers and benchmark for last 6-8 quarters is a fairly long time to decide to stop SIP and switch to new scheme in same category. However, there is a probability the fund has a specific strategy which is not performing in a particular kind of market.”
One must identify what’s going wrong with the scheme by talking to fund managers and mutual fund experts.

Question 9

Whats Aggressive Hybrid Fund

Answer 9

Aggressive Hybrid Funds are balanced funds invest primarily in stocks with some allocation to FD-like instruments. Spreading out of investments means these funds are less risky than pure equity funds with almost similar returns in the long run
HDFC Hybrid Equity Fund

Question 10

Income from House Property

Answer 10

The property has to be completed within three years from the end of the financial year in which the loan is taken. The interest paid during the construction phase keeps accumulating. It can be used to claim deduction for five years after possession. For example, if the total interest paid during the construction period is Rs 5 lakh, one can claim Rs 1 lakh deduction every year for the next five years.

In case of a property which is not self-occupied, the total amount paid as interest can be claimed as deduction. However, you have to show the rent earned as income from house property in the tax return. To arrive at income from house property, deduct municipal taxes (water, sewerage tax, etc) from the rental income. Then, deduct 30% (repair and maintenance charges) from this value to arrive at the taxable amount. For instance, if income from the property is Rs 1,80,000, and assuming a total of Rs 36,000 can be deducted for municipal taxes and 30% as repair and maintenance charges, the taxable component comes to Rs 1,00,800.

Another lesser-known fact is that if you sell the house within five years of taking possession, the deductions claimed on principal payments are reversed. The amount deducted in previous years is considered as income in the year of sale and taxed accordingly.

Question 11

Investment Risk Decision

Answer 11

Aggressive hybrid fund category is suitable for first-time investors or very conservative investors.
Conservative investors can choose large cap mutual funds.
Multi cap mutual funds are suitable for moderate investors.
Mid and small cap schemes are recommended only to investors with very large risk appetite and ability withstand extreme volatility.