financial awarness

2. Investor
Awareness
Program

3. Role of Financial Planner
 77% Indians don't save for retirement,
most depend on children for support
 Only 3 people out of 100 have a life
insurance policy in India
 Nearly 30% of Indian population don't
have any health insurance
Source: NITI Ayog, National Sample Survey, India's official socio-economic survey

4. 80 0
20
20
40 40
60
60
• Play & fool
around
• First Job
• Get Married
• Buy 1st Home
• Buy 1st Car
• Kids
• Get Married
• change Job
• Buy 2nd
Home
• Buy 2nd Car
• Retirement
Biggest Fear
• What if I cant work ?
•What if I pass away ?
•How much is enough to
retire?
•How do I ensure my
children's get right foundation
?
No Income
We only have 14000 days to achieve our goals
Why Financial Planning
The 28000 days

5. Financial Pyramid
Insurance ( Life, Health,
Disability)
Emergency & debt planning
Wealth creation

6. Safety &
Security
Tax
Efficient
Regular
Income
Easy
Liquidity
What do we expect from Investment ?

7. How we do Investment
Is it safe?
Rs. 100 note Kept in locker is safe, but
value of the same Rs. 100/- will be
very less after 10 Years

8. Who is eating your money ?

9. Inflation is real monster
Never forget two rules:
10 Year CPI Inflation - 6.25% to 6.5%
Present FD rate - Approx. 5%Real rate of
Return : -1.25% to -1.5%
Real lifestyle inflation is more than CPI

10. Rs. 466.10
Rs. 265.33
FD assumed returns =5 %
Life style inflation= 8%
Inflation is real monster……cont

11. Interest rates in traditional schemes
Note: Rates as of Dec 2021
Note: Rates as of Dec

12. Returns vs asset class

13. Inflation adjusted returns

14. Portfolio Rebalancing

15. Note: Rebalancing does not mean you are buying at lowest level and
selling at highest level
Portfolio Rebalancing Returns

16. Why Insurance

17. Risk Vs Return on Assets Allocation

18. Inflation
Inflation= Is general rise in price of goods and services in the economy over time. i.e. Purching power of money gets
declined over period of time due to inflation
Real Value of Money = Nominal Value - Inflation

19. Real Return

20. Returns of Different Asset Class
CAGR of Underlying Asset Class

21. Time Value of Money:Cost of Delay
0
0.5
1
1.5
2
2.5
3
Double the time Double the investment Double the return
Cost of Delay
5 years
10% pa,
Rs 1000
a
month
10
years
10% pa,
Rs 1000
a
month
10 years
10%
pa, Rs
1000 a
month
10
years
10% Rs
2000 a
month
10 years
6 % pa
Rs 1000
a
month
10 years
12% pa
Rs 1000
a
month

22. Sample Asset Allocation for Moderate Risk Profile
Disclaimer: The model portfolio is for representative purpose and needs
to be rebalanced on annual basis with respect to market dynamics
Model portfolio for 25 year old person with moderate risk profile with investment
horizon of 10 years
Equity large Cap
40%
Equity mid cap
20%
Equity small cap
10%
Global equity
5%
Debt
short
term
15%
Debt gilt
5%
Gold fund
5%

25. Goal Based Financial Planning
Goal Based FinanciaGGGl Planning
Goal Based Financial Planning

26. Sample Financial Plan

27. Real Estate
Real Estate Markets
returns from 2012 till date
CAGR ranges from 0- 2%

28. •Value of Property = Rs 75 Lacs (1500 sq ft @ Rs 5000/sq ft)
•Required Initial Down Payment (@20% of Property value) = Rs
15 Lacs
•Loan Availed (for remaining 80%) = Rs 60 Lacs
•Loan Tenure = 20 Years
•Loan Interest Rate = 10.15%
•Few more administrative costs are as follows:
•Loan Processing Charges & Other Expenses (@2% of Property) =
Rs 1.5 Lacs
•Registration Fees & stamp duty (@10%) = Rs 7.5 Lacs
Real Estate VS Mutual Fund

29. Real Estate VS Mutual Fund….cont
Loan
Tenure
Loan
Amount
@ 10.5%
Total Interest
Paid
Total Tax
claimed
Total Rental
Income@ 5%
increase
every year
Post Tax Rental
Income
Maintenance
cost
Taxes
Paid Insurance
Rental
income
Post
expenses
20 years60 Lakhs 80.30 lakhs 1953621 4897393 3917914 650000 200000 600000 2467914
This means, that effectively the property costs about Rs 1.39 Cr as depicted in
table below
Property Appreciation
Scenario 1,
12%
Scenario 1,
10%
Scenario 3,
9%
5,17,8,2582 3,42,69,782 2,75,31,782

30. Real Estate VS Mutual Fund….cont
Initial lump sum investment in MF schemes of Rs 24 Lacs. This amount is equal to the
sum of Initial Property Down Payment (Rs 15 Lacs), Registration Charges (Rs 7.5 Lacs)
and Loan Processing fees (Rs 1.5 Lacs).
Now the EMI amount in earlier case was Rs 58,459. This amount in this case can be
used as monthly SIP. But we also need to consider the tax benefit of Rs 1 Lac availed
on house loan investment – which is to be equated monthly. That amounts to Rs 8333
and resultant amount available for monthly SIP is Rs 50,126.
Mutual Fund Returns of ELSS Funds
12% CAGR for 1st
12 Years
10% CAGR for
next 6 years
7 % CAGR for next
3 years
Total Maturity Amount after 20 years 7,06,02,200
Maturity Amount post capita gain Tax @10% 6,49,85004
Difference Amount @ property appreciation at 9% 3,74,53,222

31. Fixed Deposit vs. Debt Fund

32. Life Insurance Returns
IRR( internal rate of
return) of any
insurance cash value
policies for term of 20
year is in between
5 to 6%
Average rate of
inflation for last 20
years is 7.5%
Source : IRDA

33. ULIP Vs Mutual Fund

34. ELSS VS PPF Returns

35. ELSS VS PPF Returns..cont

36. Equity is Risky
1984
Indira
Gandhi
Assassination
1988
Bofors Crises
1990
Forex Crisis
1991
RaJiv Gandhi
Assassination
1992
Harshad
Mehta Scam
1995
IPO Mania
crashes
1999
Kargil War
2000
Dot
com
Burst
2008
Sub-Prime
Crisis
2010
Euro Zone
Crisis
2011
US Rating
Downgrade
2016
Demo
2017
GST
2018
Trump
Trade
War
Sensex Value at 1984 was 245
Sensex Value at 2018 is 35547

37. DON’T MISS THIS INVESTMENT OPPORTUNITY IT’S TIME TO ADD MORE IN
DOWNTIMES
Equity is Risky…cont

38. Asset Allocation & Rebalancing

39. FD Investor
Ostrich
Both of them feel that they are safe
When Ostrich is afraid, it will burry its head in the ground, assuming that
because it cannot see, it can not be seen
Ostrich Mentality

40. Fund Managers Investment

41. Thank You
Zenith Financial Services
67 B, Vivekananda Nagar, Behind Sai
Mandir , Wardha Road, Nagpur : 440015
www.zenithfinancialservices.net.in

42. Appendix

43. A vehicle for investing in portfolio of stocks and bonds
How Mutual Fund Works?

44. Types of Mutual Fund Schemes
•Equity Schemes
•Debt Schemes
•Hybrid Schemes
•Solution Oriented Schemes
•Other Schemes

45. Investment Avenues in Mutual Fund
Lump sum :
• A lump sum amount is defined as single complete
sum of money.
SIP:
• Systematic Investment Plan

46. Systematic Investment Planning (SIP)
 Systematic Investment Plan is an effective way to do financial planning that
allows you to invest a fixed amount regularly at a specified frequency say, weekly,
monthly or quarterly according to the investors’ convenience.
 Systematic Investment Plans work best for investors who are seeking for long
term goals, such as children higher education or for their retirement plans.
 It is a safest mode of investing in equity market as your investments are spread
equally over a period of time rather than following the high and lows of the market.

47. • With SIP, your investment works hard and you benefit
from what is known as rupee-cost-averaging (i.e. your
average cost of buying comes down over time).
SIP can tackle Market
Fluctuations:
• Takes out the risk of market timing.
• Adds the benefit of the power of compounding and
rupee cost averaging.
SIP can deliver the
Power of
Compounding:
• With SIP, to iterate, there is no need to time the market-
and in effect you emerge a net winner out of market
fluctuations.
SIP makes the
Discipline of investing
possible:
• You can choose from a wide array of schemes.
• You can decided to keep invested amount in an earlier
schemes & invest future SIP installments into a new
scheme.
Start small. Built a
large corpus over time:
Benefits of SIP

48. Rupee Cost Averaging

49. Rupee Cost Averaging …cont.

50.  For someone who wishes to build up capital over the longer term and is not familiar with
equity markets, investing regularly through a SIP in a mutual fund is one strategy that can
ensure success to a large extent.
 What it really means is that you invest a fixed sum from your savings every month, instead
of making a heavy one-time investment. Over the years, an SIP can add up to give really
substantial returns.
 For example, a monthly SIP of Rs 1000 at the rate of 9 % would grow to Rs 6.69 lacks in 10
years, Rs. 17.83 lacks in 30 years and Rs. 44.20 lacks in 40 years. The true benefit of SIP is
reaped by investing at lower levels.
 A systematic investment plan (SIP) is an effective means to beat market volatility and
benefit from the enormous power of compounding over time.
 A SIP allows you to invest in any mutual fund by making smaller periodic investments
instead of a lump sum one-time investment. Since this is small money flowing out at
regular intervals , it doesn't affect your other financial commitments significantly.
Compounding with SIP

51. Thank You