The Most Authentic Guide on Personal Finance and Investments

Massive changes in Mutual Fund Schemes post categorization and rationalization.
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Best investment that will give maximum returns!

Amit is not feeling well for the past couple of days. He goes to a doctor and asks him ‘What are the best medicines?’. The doctor prescribes him a couple of tablets. Amit takes these medicines. But he dies.


Because while Amit may have taken the "best" medicines, they were not the "right" ones for the disease that he was suffering from.

Fortunately the above incident is not true. The Amits of the world will tell their symptoms to the doctor and let the doctor advice the "right" medicine.

Unfortunately, when it comes to financial advice, these very Amits ask ‘What’s the best investment?’. They pick up tips in local trains, at the parties, in the gym or even from their paanwala. They read a few magazines, watch a couple of programmes and think they have learnt enough.

They implement such advice without considering whether it suits their financial profile or not. The result is financial death. Then they go about blaming the advisors, the regulators, the FIIs and everything under the sun.

The investment universe is a huge one. There are a number of investment opportunities with many options and sub-options. Each of these has a specific 'risk' element, a specific 'time' element, a specific 'return' element and a specific 'liquidity' element. Therefore, each investment is best suited to a specific need.

Amit’s investment need is different from the Aruns and the Arunas, the Vijays and the Vijayas, the Deepaks and the Deepikas. Therefore, if investment A is good for Arun or Deepika, it may not necessarily be good for Amit too.

In fact, Amit’s own needs will change with times and age. Equity may suit him better when he is 30; a mix of debt & equity may be a better option when he turns 45; and debt may be more palatable when he is 60.

Therefore, before Amit decides to invest, he must prepare a detailed financial plan. The plan is a broad road-map of where he stands and where he wants to go. This will then decide what are the best possible routes. In other words, he has to assess what he owns, owes and earns and what are his financial objectives. This will then decide what investment options are most suited to enable him to achieve his financial goals.

Moreover, it is going to be long financial journey spread over maybe 30 to 40 years. And during this period Amit will experience a lot of changes – in his personal life, in his professional life, in the economic scenario around him. Therefore, the financial plan should be updated and streamlined from time to time to take care of the new conditions.

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Ignorance is like a SIGNED BLANK CHEQUE... anyone can MISUSE it.

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