investment without goal is just like planning a journey without destination .We
always have a plan for all the small or big important activities and events in
our life. Even in our day to day life we are knowingly or unknowingly
systematically engaged in planning and acting according to plan.
morning buying a milk according to the number of people and their intake of
milk, cooking food according to appetite of the family and if some guest are
coming then taking the estimate and ordering or cooking food for them and the
precision of that planning is so well that nobody will be starving. So we all plan
for all micro, small and big events in our life, similarly we should ask our self
few important questions while investing.
Is it a right amount of investment?
investing according to my plan or need?
Am I saving enough according to my need?
investing in a right fund according to my need?
questions have only one solution that is Goal Based Investing.Let us understand
the crux of Goal Based investing while correlating and identifying the
solutions for following question.
What is a
Goal of your investment?
Amount of Savings required for your goal?
addressed/ covered all your risk before saving?
What is the
probability of your investments helping you achieving your goal?
Goal Based Investing is based on the solutions of all above questions and
addressing and identifying the solutions of these questions create the path of
prudent investments. The real gist of prudent investments is investing
according to your specific goal and monitoring the progress of your goal. To
achieve your long term financial goal it is extremely important to Set A Goal,
Invest For A Goal And Monitor a Progress of your Goal.
Goal based Investing works for you?
have to identify our specific goal for which you want to start investing and
the time frame available to reach that goal. Once you identify the goal and its
time, you have to identify the current amount required for your goal and add
the inflation in current amount according to the number of years remaining for
that goal to identify the future cost or the amount to achieve.
calculating the future cost of your goal ,decide on the asset allocation
according to your risk profile and calculate the exact amount of Monthly
investment/ SIP or Lumpsum Investments or the combination of lumpsum and
Monthly/ SIP investments you are planning to invest for your goal.
helps you to plan your Child`s Educations in 4 simple steps.
1. Let`s Give it a Name - Rahul`s Education.
What would Education course cost today -
Step3. How many years will your little one be ready
to secure admission in this course? - 10 Years.
Step 4. Click
backend does the calculation and Rahul Graduation planning would look like.
Graduation - 2030
amount - 11.82 ( 6 lacs in year 2030 will be 11.82 with 7 % inflation).
depending on your risk appetite and asset allocation in accordance to time
available for achieving the goal the amount of Monthly investments or Lumpsum
investments can be calculated.
a balance approach of investment in fund allocation considering the available
time of investment which is 10 years and the returns assumption of 13 % per
monthly investment amount required (SIP)
to achieve the goal would be around Rs. 5000 or the lumpsum amount
required to achieve the goal would be around 3.5 lacs.
individual have different goals according to their needs. The goals are like
Retirement , Kids Education , Marriage,
Start Up Buying
New Car Vacation
Fund Help you to plan for your Goal?
Graduation goal is long term goal which has to be achieved in
10 years with balanced risk approach then the allocation can be done in
combination of Large Cap , Mid Cap and Multi Cap funds. If there is any short term
goal like buying a car in next 2 years then the asset allocation can be done in
combination of short term debt fund and arbitrage fund for better tax efficiency on
investments ( Arbitrage fund with 2 year investment will attract only 10% Capital
Tax gains compared to short term debt fund which will be taxed for short term
capital gains at applicable tax slab as per the income tax )