FindUrSpace Investment and Insurance Advisory
Our team of experts guide you and run you through the advantages and disadvantages of each type of investment, be it a Fixed Deposit, Mutual Fund or Unit Linked Insurance Plan (ULIP) and recommend the best fit plan based on your future needs and goals. Be it your future pension plan, retirement goals or your child future education plan, we have a best fit plan for you. The Fixed Deposits in NBFC clients offer you a better than normal banking FD rate of interest while providing you with the investment safety details.
There are two primary ways of investing in a mutual fund — lump sum and SIP. A lump sum investment is a one-time investment while a SIP (systematic investment plan) is a recurring investment.
A lump sum investment is generally considered when the investor has a big corpus to invest. This could be money received after retirement or from the sale of a house or from an inheritance or it might just be the case that you have accumulated money in your bank account and wish to invest it now. There can be many reasons to consider a lump sum investment, but a SIP is generally recommended. This is more so in the case of investments in an equity mutual fund.
Benefits of SIP over Lumpsum Investments
A SIP has the following benefits over a lump sum investment:
- No worry of timing the market – The markets have always been volatile. Investors often face confusion regarding the best time to enter the market. If you invest a big amount in a market high and the markets crash after you have invested, you will lose out on a major portion of your investment. With a SIP, your money is spread over time and only some parts of your entire investment will be at a peak, which will allow you not only limit losses but also invest at a low with the next SIP instalments.
- Rupee cost averaging – A SIP allows you to invest at different levels of the market. When the market is low, the fund manager will be able to buy more units as compared to when the market is at its peak. It will help to reduce the per-unit cost of buying the units. This phenomenon is known as rupee cost averaging. Ultimately, you will end up with higher gains.
- Build the habit of investing – When you initiate a SIP, a fixed sum is transferred from your bank account to the mutual fund scheme. It is a disciplined way of investing and inculcates the habit of saving. The earlier you start, the larger the corpus that you may accumulate.
- Ideal for budding investors – If you are someone who has just started a career, then SIP is your thing. You can begin investing and get exposure to equities even with a nominal amount. As your income increases in future, you may step-up your investments. SIP investments can also earn higher long-term returns as compared to lump sum investments. You can still invest a lump sum amount in a debt fund, but SIPs are the way to go when it comes to investing in equity funds.
How should you invest in mutual funds if you have a big corpus in hand?
Let’s suppose you have ₹10 lakh in your bank account that you wish to invest in mutual funds for the long-term. You should surely not put the entire amount in equity funds in one go.
There are two approaches that you can take to invest this amount:
- Start a monthly SIP of an amount that you are comfortable with. This could be ₹10,000, ₹20,000 or ₹50,000. Let the money stay in your bank account till all of it gets invested systematically in the equity mutual funds you have chosen
- Invest the lump sum in a liquid fund. Then start a Systematic Transfer Plan (STP) from the debt fund to an equity fund. Your corpus will not only earn higher returns than a savings bank account but also allow for systematic investment
If you want to go for an STP, then be aware of the tax implications.
What are the rules of taxation on the gains made from such investments?
Gains made from debt fund are subject to capital gains tax. Short-term gains are added to your taxable income while long-term gains are taxed at 20% after indexation. Every STP installment will be considered as a redemption from the debt fund and taxed accordingly. But despite the tax, the debt fund investments will generate higher returns than a bank account, especially if the STP to an equity fund runs for a long period of time. Investors who don’t want to complicate things can opt for the first option. But either way, a lump sum in an equity fund should be avoided.
Insurance in its basic form is defined as “A contract between two parties whereby one party called insurer undertakes in exchange for a fixed sum called premiums, to pay the other party called insured a fixed amount of money on the happening of a certain event”. In simple terms it is a contract between the person who buys Insurance and an Insurance company who sold the Policy.
By entering into contract the Insurance company agrees to pay the Policy holder or his family members a predetermined sum of money in case of any unfortunate event for a predetermined fixed sum payable which is in normal term called Insurance Premiums. Insurance is basically a protection against a financial loss which can arise on the happening of an unexpected event.
Why do we need Insurance ?
What will happen to my family if god forbidden something happens to me ? If this question bothers you, then Life Insurance is the answer. An Insurance company collects a small percentage from you and in return promises to pay your family a predetermined sum in case of an unfortunate event.
The Basic Logic of Insurance is to :
- Provide Financial Security to your family.
- Protect your Assets such as Car, Equipments, House etc from Accidents or natural disasters.
- As a means of Investments / Savings & Tax Planning.
We deal with Corporate, Individual and commercial insurance products
- Home Insurance – Fire and other exposures for Building & Contents, Burglary incl. contents, Electronics & Mobile phone
- Motor Insurance – Private & Commercial vehicle, Roadside assistance, Comprehensive & Third party, Coverage of lapsed policies
- Life Insurance – Self & couple plans, Term, ULIPs, Endowment, Money back, Whole life, Child & Retirement plans, Insurance & investment needs
- Health Insurance – Individual, Family & Corporate plans, Coverage of OPD expenses, Cashless hospitalisation
- Travel Insurance – Flight cancellation & delay, Pre-existing diseases, Baggage & Passport loss, Personal Accident & Personal Liability covered
Why do you really need an insurance and why is it good to go with FUS?
- Provide Financial Security to your family
- Protect your Assets such as Car, Equipment’s, House etc from Accidents or natural disasters.
- Free comparative analysis – price & features across leading insurance companies
- Advice on add on features, claim settlement ratios & cashless claim benefits
- Discounts for long term policies
- Personalised attention
- Turnaround time
- As a means of Investments / Savings & Tax Planning
- Many other specific tailor-made insurance facilities offered