The Complete Guide To Financial Planning

Financial Planning
The Complete Guide to
Financial Planning
Version: November 2011 / India
www.bajajcapital.com
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Financial Planning
Index Content Page No 6 7 8 8 8 9 9 9 10 11 11 12 13 14 15 16 17 20 21 22 23 24 25 26 28 29 30 32
Financial Planning Introduction 360o Financial Planning What is 360 Financial Planning? Why do you need Bajaj Capital's 360 Financial Planning? How will 360 Financial Planning help you? Who needs 360 Financial Planning? How do I get my personalised 360 Financial Plan created? Comprehensive 360 Financial Planning Sample Financial Plan Personal Financial Plan Portfolio Projection Cash-flow Projection Asset Allocation Current Situation Financial Plan Goals Financial Frequently Asked Questions (FAQ) 360o Plan 1. Investment Planning Importance of Investment Planning Evaluating options Investment Strategies Risk Vs Returns Investment Planning Steps Investment Planning Tips Inflation Devil The Power of Compounding Risk Thermometer
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Financial Planning
Content 2. Insurance Planning (Life Insurance) Retirement Planning Insurance Planning Saving Planning Health Insurance / Planning Tax Planning Education Planning You (General Insurance For Individual) Health Insurance Motor Insurance Home Insurance Travel Insurance Personal Accident (General Insurance For Corporates) Group Mediclaim Group Personal Accident Office Property & Asset Insurance Liability Insurance Directors' And Officers' Liability Insurance Marine Insurance Professional Indemnity See Also 3. Retirement Planning Retire And Prosper Retirement Planning Tips Why Plan For Retirement 4. Tax Planning Tax Planning Tips Tax Saving Schemes Tax Free Income 5. Children's Future Planning 6. Cash Flow Planning Personal Budget Cash Flow Planning Basics
Page No 35 37 38 40 42 44 45 46 47 48 49 50 51 52 53 54 55 56 57 62 64 66 68 69 70 71 72 73 74 75 77 79 81 82 83 84
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Financial Planning
Content About Investments I. Mutual Funds (Mf) What Are Mutual Funds? Why Choose Mutual Funds? Types of Mutual Funds Snapshot of Mutual Fund Schemes How to Calculate the Growth of Your Mutual Fund Investments? Points To Remember Mutual Fund Acronym Income Tax Pan Number Requirement For Mf Investments Gold Mutual Funds See Also II. Bonds Types Of Bonds See Also III. Pension Schemes About NPS IV. Real Estate Our Services Buying Real Estate Our Presence V. Company Fixed Deposits Fixed Deposits Glossary Frequently Asked Questions (FAQ) See Also VI. Post Office Schemes (POS) Post Office Monthly Income Scheme (MIS) Post Office Time Deposit Scheme (TD) Post Office Savings Account National Savings Certificate (NSC) Kisan Vikas Patra (KVP) Public Provident Fund (PPF) Senior Citizen's Savings Scheme VII. Initial Public Offering (IPO) Frequently Asked Questions (FAQ) (IPO / FPO)
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Financial Planning
Content VIII. Portfolio Management Service (PMS) Wealth Management Why La Premier Our Philosophy Our Products Suit Our Exclusive Services Our Advisory Process Our Institutional Advisory Services Our Team NRI Services List of NRI Services NRI Help Center Research & Publication Financial Tools Knowledge Cafe How To Achieve Lifetime of Investment Success Investment Mantras For The Uninitiated Systematic Approach To Investments: S.T.P or S.I.P Get Yourself a Financial Planer - Even If It Requires You To Pay Fees Make Your Portfolio Uncertainty Proof Choosing Financial Advisor About Bajaj Capital Ltd Chairman Message Milestone Our Mission, Aim and Objectives Our Vision Our Networks Who's Who at Bajaj Capital The Significance of Our Logo
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Financial Planning
Financial Planning
The only thing permanent in life is change. Times change; People change; so does life. You expect life to be much better tomorrow than it is today. Tomorrow, you hope to fulfill all your dreams and aspirations. But what happens if things take an untoward turn? What if life doesnt happen the way you planned it for? At Bajaj Capital we understand this. We know that an unexpected change in your financial situation can be incredibly stressful. Hence we help you plan your financial life. We make sure that whatever is the situation; financially your life never goes unrestrained. So we bring for you the most preferred solution: Financial Planning!
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Financial Planning
Introduction
Lets Simplify! Financial Planning Theres just no way around it: absolutely everyone needs financial advice. Should you invest with risk? Go into more debt? Live more frugally (carefully)? Give to charity? Retire early with enough assets? These are some questions that we all seek answers to. For many, following a financial plan sounds like a chore (task). It creates images of tedious expense tracking, cutting out on all the fun things in your life, and being forced to count every penny. Fortunately, that doesn't have to be the case. Financial planning is a process of: Setting objectives, Assessing Assets and Resources, Estimating future financial needs, and Making plans to achieve monetary goals.
Financial Planning can be as simple or complex as you make it, but no matter how you create your plan if you follow it, you'll be on your way to Financial Independence.
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Financial Planning
360o Financial Planning

Financial Planning is becoming increasingly popular in developed countries all over the world. Now, with a little help from Bajaj Capital, you too can give yourself the 360 Financial Planning edge!
What is 360 Financial Planning? 360 Financial Planning is a unique software-based simulation that takes a holistic view of your lifelong financial needs and charts a personalized investment strategy to help you meet them. Broadly, it involves: Identifying your current financial status Listing and prioritizing your goals Creating a sound investment plan to achieve them Monitoring the plan to facilitate swift (speedy) corrective action 360 Financial Planning is based on the premise that every individual has certain basic financial needs that are expressed at various stages of life (getting married, buying assets like homes, vehicles, or providing for your child's education and wedding and retiring finally ). With the help of 360 Financial Planning, you can prepare yourself well in time for all these goals. Why do you need Bajaj Capital's 360 Financial Planning? You may have many dreams, needs and desires. For example, you could be dreaming of: Owning a new car Buying a dream house Providing your children with the best education Planning a grand wedding for your children Having a great time after your retirement
But in today's world of skyrocketing costs and increasing inflation, how many of these dreams can you hope to turn into reality? By planning well, you can utilize your limited resources to the fullest. 360 Financial Planning helps you see the big picture and invest for specific long-term and short-term goals well in time.
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Financial Planning
360o Financial Planning How will 360 Financial Planning help you? Instead of investing in an ad-hoc manner, 360 Financial Planning helps you take a holistic, all-round view. Briefly, 360 Financial Planning comprises: Investment Planning Cash Flow Planning Tax Planning Insurance Planning Children's Future Planning Retirement Planning To make your wealth grow To provide for assets and meet the periodic cash requirements To save on taxes and increase your income To protect yourself, your family and your assets To give your children a financially secure future Because retirement is a time to relax, not to get worried
Who needs 360 Financial Planning? Everyone does, because everyone has a right to dream. And realising dreams is easier when you work to a plan that's: Reliable Realistic Proven Bajaj Capital's 360 Financial Planning Programme could make a difference to all those who wish to lead a worry-free, financially secure life. How do I get my personalised 360 Financial Plan created? Here is how Financial Plans are prepared: The process begins with identifying your needs with the help of the Need Analysis Form Our Financial Planners then use the especially-created 360 Financial Planning software to generate a personalized Snapshot. The Snapshot gives you a graphic account of all your financial requirements, at every stage of your future life. Based on the Snapshot, our experts work out an investment strategy. Once implemented, our experts keep regular track of your investments A Financial Planning session takes just 15 minutes but gives you benefits of a lifetime.
Identifying your needs and setting your goals. Creating a 360 degree Financial Snapshot based on your goals. Deriving upon an investment strategy based on it. Keeping a regular track of your investments Review and re-plan your investments from time to time. -9-
Financial Planning
Comprehensive 360 Financial Planning

Total happiness in one's life comes from four quadrants: 1. 2. 3. 4. Spiritual, Mental, Physical and Financial well-being.
All the four quadrants are interdependent and can't provide complete peace of mind in isolation. Financial Independence completes your wellness wheel with mind, body and sprit and leads you towards total happiness so that you can enjoy every moment in your lifespan. Also the "buy today, pay tomorrow" habit of today's generation makes the need of Personal Financial-Planning more pertinent (relevant). If you don't plan your future finances in advance, tomorrow it will be too late for you to meet your old age needs of regular income and medical care. Increasing life expectancy and no social security provision in India add to the fact and make an urgent call for Financial Planning for every human being. Comprehensive 360 Financial Planning is like making your own financial horoscope. A roadmap to enable you to make all the provisions for your financial needs and responsibilities in life; you can plan ahead for the following through comprehensive financial planning. Dream House Education of Children Child's Wedding Wealth Creation Retired Life Risk Management Plan your finances well to turn your dream house into a reality. The pride and a sense of security in owning a house is tremendous. Every parent dreams of giving the best education to their children. With proper Financial Planning now you can plan ahead for their education. The wedding of our children always hold a very important place of our life. So make it a gala (festival) affair with financial planning Lots and lots of money- that's what anybody dreams and wants to have. Plan it and create wealth to have a secure future. After working hard in life anybody would love to spend later years of life comfortably. So plan it now with prudent financial planning. Protect your movable and immovable assets through insurance. It's a part of financial planning.
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Financial Planning
Sample Financial Plan

Don't just dream... Plan! Financial Planning is becoming increasingly popular in developed countries all over the world. Now, with a little help from Bajaj Capital, you too can give yourself the 360 Financial Planning edge! Get your Financial Plan prepared now. To help you understand better here is a sample snapshot. Your Financial Plan would look like this (Following are view of sample snapshot):
PERSONAL FINANCIAL PLAN
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Financial Planning
PORTFOLIO PROJECTION
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Financial Planning
CASHFLOW PROJECTION
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Financial Planning
ASSET ALLOCATION
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Financial Planning
CURRENT SITUATION
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Financial Planning
FINANCIAL PLAN GOALS
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Financial Planning
Financial Frequently Asked Questions (FAQ)

What is Financial Planning? Financial planning is the process of meeting your life goals through the proper management of your finances. Financial planning helps you make advance provision for financial needs that will arise in the future. The objective of financial planning is to ensure that the right amount of money is available in the right hands at the right point in the future to achieve an individual's life goals. Why should I make a Financial Plan? Financial planning provides direction and meaning to your financial decisions. It allows you to understand how each financial decision you make affects other areas of your finances. For example, buying a particular investment product might help you save adequately to finance your child's higher education or it may provide enough for a comfortable retirement. You can also adapt more easily to life changes and feel more secure that your goals are on track. Who is a Financial Planner? A financial planner is someone who uses the financial planning process to help you determine how to meet your life goals. The key function of a financial planner is to help people identify their financial planning needs, their present priorities and the products that are most suitable to meet their needs. He or she normally possesses detailed knowledge of a wide range of financial planning tools and products, but his major role is to help clients choose the best products for each need. The planner can take a 'big picture' view of your financial situation and make financial planning recommendations that are right for you. Can I do my own Financial Planning? Some personal finance software packages, magazines or self-help books can help you do your own financial planning. However, you may decide to seek help from a professional financial planner if: You need expertise you don't possess in certain areas. For example, a planner can help you evaluate the level of risk in your investment portfolio and revise your asset allocation You don't have the time to spare to do your own financial planning; You know that you need to improve your current financial situation but don't know where to start; You feel that a professional advisor could help you improve on how you are currently managing your finances; You have an immediate need or unexpected life event such as an inheritance or major illness; You want to get a professional opinion about the financial plan you developed for yourself. What should I look for in a Financial Planner? A financial planner works for you. His or her loyalty should be to the client, not the product (s)he is trying to sell. The financial planner should be in a position to provide you with unbiased advice and recommend products that match your needs and are the best performing ones available. Look for any affiliations of the financial planner to any product manufacturer. Until unless the financial planner is truly independent, (s)he will not be able to give you objective advice.
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Financial Planning
F.A.Q How can I plan for tomorrow when I can hardly pay for today? Have a budget. Determine what you actually spend each month. There are fixed expenses like rent, loan repayments, etc. every month about which we can do little. The variable items such as food, clothing and entertainment are often what get away from us. Use your discretion to contain these variable expenses to start saving. How much should I be saving? It is hard to apply a rule of thumb toward savings, because it varies with age and income level. Ten percent is a good start. If you find that is too high for you, don't let that deter you. You can start by putting a little aside each month and then slowly increasing it. What if I don't achieve my goals? Financial planning is a common sense approach to managing your finances to reach your life goals. It cannot change your situation overnight; it is a lifelong process. Remember that events beyond your control such as inflation or changes in the stock market or interest rates will affect your financial planning results. Why do I have to provide so much personal information? Consider a visit to your doctor. Without complete and fully accurate details, your doctor cannot prescribe the best course of action. The same applies to financial planning. In order to obtain the best service for your 'financial health' all details and specifics must be disclosed. What type of information do I have to provide? Typically, information regarding investments held, number of dependants, income and expenditure details, and savings and financial planning needs, etc. The more accurate information you give, the better the quality of advice given. What should a Financial Plan include? A financial plan should include a review of your net worth, goals and objectives, investment portfolio, cash flow, investments, retirement planning, tax planning and insurance needs, as well as a plan for implementing your goals. Why is there an evaluation of my insurance needs? Evaluating your insurance needs is part of personal financial planning. Insurance takes care of your unpredictable needs and as these needs can arise at anytime, insurance is extremely important. Investments take care of your predictable needs and ideally should follow after your unpredictable needs are first addressed. The insurance industry has changed a great deal over the past few years and there is a whole array of new products from LIC as well as private insurance companies. What about taxes? It is important that financial plans are tax efficient. The financial plan should help you in minimizing your tax liability and also maximizing your after-tax returns from your investments. Some financial planners help their clients in preparing and filing their tax returns.
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Financial Planning
F.A.Q After a plan is developed, what next? The best plan is useless unless it is put into action. Your financial planner will assist you completely in implementing the plan, if and when, desired by you. How often should I update the plan? It is good to review the plan when there is a lifestyle change such as marriage, birth, death or divorce. Any change in financial position should be evaluated as well. Most people have an annual update that reviews how the plan is being implemented. The review also considers changing goals and circumstances.
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Financial Planning
360o Plan
1. Investment Planning 2. Insurance Planning 3. Retirement Planning. 4. Tax Planning 5. Children's Future Planning 6. Cash Flow Planning
Investments Planning
Insurance Planning
Retirement Planning
Tax Planning
Children's Future Planning
Cash Flow Planning
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Financial Planning
1. Investment Planning
Everyone needs to save for a rainy day. Once you have saved enough to take care of emergencies, you should start thinking about investing and to make your money grow. We can help you plan your investments so that you can reap adequate benefits and achieve your financial goals. Bajaj Capital's Investment Planning Service includes: Risk Profiling Asset Allocation and Portfolio Construction Creation and Accumulation of Wealth through Systematic Investment Plans (SIP) Regular review of progress and Portfolio Rebalancing
Essentially, Investment Planning involves identifying your financial goals throughout your life, and prioritising them. Investment Planning is important because it helps you to drive the maximum benefit from your investments. Your success as an investor depends upon your ability to choose the right investment options. This, in turn, depends on your requirements, needs and goals. For most investors, however, the three prime criteria of evaluating any investment option are liquidity, safety and return. Investment Planning also helps you to decide upon the right investment strategy. Besides your individual requirement, your investment strategy would also depend upon your age, personal circumstances and your risk appetite. These aspects are typically taken care of during investment planning. Investment Planning also helps you to strike a balance between risk and returns. By prudent planning, it is possible to arrive at an optimal mix of risk and returns that suits your particular needs and requirements.
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Financial Planning
360o Plan > Investment Planning IMPORTANCE OF INVESTMENT PLANNING Essentially, Investment Planning involves identifying your financial goals throughout your life, and prioritizing them. For example, if you want to invest for funding your vacation next year, don't choose an investment vehicle that has a three-year lock-in. Similarly, if you want to invest for your daughter's marriage after 10 years, don't invest in 1yr bonds for the next 10 years. Instead, choose an option that matches your investment horizon. Investment Planning is important because it helps you to derive the maximum benefit from your investments. Your success as an investor depends upon your ability to choose the right investment options. This, in turn, depends on your requirements, needs and goals. The choice of the best investment options for you will depend on your personal circumstances as well as general market conditions. For example, a good investment for a long-term retirement plan may not be a good investment for higher education expenses. In most cases, the right investment is a balance of three things: Liquidity, Safety and Return. Investment Planning also helps you to decide upon the right investment strategy. Besides your individual requirement, your investment strategy would also depend upon your age, personal circumstances and your risk appetite. These aspects are typically taken care of during investment planning. Investment Planning further helps you to strike a balance between risk and returns. By prudent planning, it is possible to arrive at an optimal mix of risk and returns, which suits your particular needs and requirements.
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Financial Planning
360o Plan > Investment Planning EVALUATING OPTIONS (Best Investment Planning) Choosing the Right Investment Options The choice of the best investment options for you will depend on your personal circumstances as well as general market conditions. For example, a good investment for a long-term retirement plan may not be a good investment for higher education expenses. In most cases, the right investment is a balance of three things: Liquidity, Safety and Return.
Choosing the Right Investment Option
LIQUIDITY How easily an investment can be converted to cash, since part of your invested money must be available to cover financial emergencies.
SAFETY The biggest risk is the risk of losing the money you have invested. Another equally important risk is that your investments will not grow and you'll not earn enough from it to offset the impact of inflation. There are additional risks like decline in economic growth. But the biggest risk of all is not investing at all.
RETURN Investments are made for the purpose of generating returns. Safe investments often promise a specific, though limited return. Those that involve more risk offer the opportunity to make - or lose - a lot of money.
To a large extent, the choice of the right investment option will also depend upon your financial goals. For example, if you want to invest for funding your vacation next year, don't choose an investment vehicle that has a three-year lock-in. Similarly, if you want to invest for your daughter's marriage after 10 years, don't invest in 1yr bonds for the next 10 years. Instead, choose an option that matches your investment horizon.
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Financial Planning
360o Plan > Investment Planning INVESTMENT STRATEGIES You can make your own investment picking approach or adopt one after consulting financial experts or investment advisors. Whatever method you use, keep in mind the importance of diversification, or variety in your investment portfolio and the need for a strategy, or a plan, to guide your choices. Investment Approaches The options you choose to put your money in; reflect the investment strategy you are using - whether you realize it or not. Most people adopt the following approaches:Conservative These investors take only limited risk by concentrating on secure, fixed-income investments etc. Moderate Such Investors take moderate risk by investing in mutual funds, bonds, select blue-chip equity shares, etc. Aggressive These are investors who take major risk on investments in order to have high (above-average) returns like speculative or unpredictable equity shares, etc. As a matter of fact, the investment approach of an investor is directly linked to his or her ability to shoulder risk. The ability to take risks depends largely on personal circumstances and factors like age, past experiences with investing, level of responsibility, etc. Try our Risk Thermometer find out your risk-taking ability http://www.bajajcapital.com/financial-planning/investment-planning/risk_thermometer.php An investor's money never goes to sleep. It earns him interest every hour of the day and all 365 days of the year.
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Financial Planning
360o Plan > Investment Planning RISK VS RETURNS Risk and returns go hand in hand. Higher the risk, higher is the possibility of earning a good return. Thus, it follows that all types of investment have some form of risk attached to it. Theoretically, even 'safe' investments (such as bank deposits) are not without some element of risk. Broadly, here are the various types of risks that you might have to face as an investor. Credit Risk The risk is that the issuer of the security will default, or not repay the principal amount. This is valid for corporate bonds etc. Liquidity Risk If you invest in securities, stocks, bonds, you are risking their sell-ability. In other words, your money gets stuck unnecessarily, creating an asset-liability mismatch. Market Risk Financial markets are volatile in nature. Volatility means sudden swings in value from high to low, or the reverse. The more volatile an investment is the more profit or loss you can make. Since there can be a big spread between what you pay and what you sell it for. But you also have to be prepared for the price to drop by the same amount. Those who invest in stocks and mutual funds typically run this risk. Interest Rate Risk Depending on the interest rate movement in the economy, the rates of interest investment instruments may go up or come down, resulting in a subsequent reverse movement of their prices. Such a scenario of economic instability might affect mutual funds etc. The whole idea behind investment planning is to evaluate the risk associated with various type of investments and take steps so as to balance it with the desired return.
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Financial Planning
360o Plan > Investment Planning INVESTMENT PLANNING STEPS Investment Planning is the key to successful investing. It is a scientific process, which, if done in the right sprit, can help you achieve your financial goals. Here are the basic steps of Investment Planning. Step 1: Identify your financial needs and goals The starting point of a sound investment plan is to begin with a clear understanding of you financial needs and goals. Typically, any financial need or goal would translate into determining the tenure of your investment (investment horizon). All investment needs and goals can therefore be translated into: Short-term (less than 1 year), Medium-term (more than 1 year), and Long-term (more than 5 years). Here is an example of the financial goal of a typical household (a couple with two children). Financial Goals Expected Cost (at todays prices in Rs) Anils computer 0.5 Lakhs Sunitas school admission 0.35 Lakhs Vacation 0.5 Lakhs Buying a second car 5 Lakhs Anils education 2 Lakhs Sunitas education 2 Lakhs Retirement 20 Lakhs Step 2: Understanding investment choices There are three basic investment categories: Equity, Debt, and Cash. Any investment can be classified into one of these three categories, or asset classes. The key to investment success lies in understanding how each asset class performs over the various investment horizons, the choices within each category and the risks involved in making investment decisions in each of these choices. Equity or Stocks: are ownership shares investors buy in a corporation. When you make equity investments, you become part-owner (to the extent of your shareholding) of the company you have invested in. However, there is no particular rate of return indicated while investing. The current value of your holding is reflected in the price at which the stock/share is traded in the stock markets. Hence, these constitute a relatively riskier form of investment. Time Frame Investment Horizon Next month 6 months 1-2 years 2-3 years 10-12 years 12-15 years 20-25 years Short-term Short-term Medium-term Medium-term Long-term Long-term Long-term
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Financial Planning
360o Plan > Investment Planning Debt Instruments or Bonds: are loans investors make to corporations or the government. They promise a fixed return at the time of making the investment. Also the promise of getting the money back is dependent on who is making the promise. In case of the Government, the promise will certainly get fulfilled, but if the issuer of debt is a company or an institution, the quality of the issuer needs to be adjudged, to ascertain its ability to keep the promise. Debt investments, therefore, provide you with the promise that your principal will be returned along with the interest payable thereon. Cash: includes money in bank savings accounts and other liquid investment options. Asset Classes Cash Debt Equity Instruments Savings deposits in a bank, Liquid Mutual funds GOI Relief Bonds, Public Provident Fund, National Savings Certificate, Company Fixed Deposits, Debtbased Mutual funds ,Debentures/Bonds Equity-based Mutual Funds Stocks/shares issued by various companies Risk Low Low to Medium, depending on the type of issuer. In case the issuer is Govt, the risk of default is negligible High
Step 3: Decide an appropriate mix of various investment choices (Asset Allocation Plan) Making an asset allocation plan is about determining the proportion of investments in each of the three basic asset classes. Essentially this depends upon your profile as an investor. Whatever stage of life you are at, you would need to invest part of your money for security and liquidity. A part of your investments should generate regular income and part of it should contribute to growth and capital appreciation. The proportion however, will vary based on individual goals, time horizons available to meet those goals and one's risk profile (the tolerance reaction to any down turn in the stock/debt markets). The key to investment success lies in determining the appropriate mix of the above mentioned categories and not just the individual investments that are done within each category.
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Financial Planning
360o Plan > Investment Planning INVESTMENT PLANNING TIPS Set a Goal What you want to achieve and when-deciding this is important. So set financial goals to bring purpose and clarity to the investment process. Research Regularly Next step is to know what kind of investments will help you achieve the goal. You can do it yourself or take the help of a professional investment advisor. Invest Early Once you know where to invest; do it as soon as possible. The earlier you begin, the more you benefit from the power of compounding. Budget Planning A must for all prudent investors; Budget Make you live within your means and give a clear picture of your finances. Avoid Debts Avoid unnecessary borrowings. Treat extra expenses as a loan that you must repay yourself. Make saving a habit. Small changes in your lifestyle can result in major changes in your saving corpus. Review and Reinvest Be alert and open to changes. Markets change, your needs change, investment instruments change. Be aware and make it a point to review your investments from time to time to create maximum wealth for yourself.
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Financial Planning
360o Plan > Investment Planning INFLATION DEVIL Inflation, the rate at which the general level of prices for goods and services rises, can steadily erode the purchasing power of your income. That is why you should invest a portion of your savings at a rate higher than the inflation rate to recover the loss of purchasing power. This means that over time a rupee will be able to buy a lesser amount of goods and services. If the inflation rate is 5%, then Rs. 100 worth of goods will cost Rs. 105 after a year. The following table indicates how the value of Rs 1 Lac will change over time at different levels of inflation. Inflation % P.A 2% 3% 4% 4.5% 5% 6% 90,573 86,261 82,193 80,245 78,353 74,726 82,035 74,409 67,556 64,393 61,391 55,839 74,301 64,186 55,526 51,672 48,102 41,727 67,297 55,368 45,639 41,464 37,689 31,180 60,953 47,761 37,512 33,273 29,530 23,300 55,207 41,199 30,832 26,700 23,138 17,411 Table indicating the value of Rs 1 Lac at different levels of inflation over time.
Years 5 10 15 20 25 30
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Financial Planning
360o Plan > Investment Planning THE POWER OF COMPOUNDING Regardless of where you choose to put your money - cash, stocks, bonds, or a combination of these - the key to saving for the future is to make your money work for you. This is done through the power of compounding. Compounding investment earnings is what can make even small investments become larger, given enough time. You are probably already familiar with the principle of compounding. The money you put into a bank account earns an interest. Then, you earn interest on the money you originally put in, plus on the interest you have accumulated. As the size of your account grows, you earn interest on a bigger and bigger pool of money.
Years 5 10 15 20 25 30
The following table shows how much your money would grow when you invest a fixed amount per month over a period of 10, 15, 20, 25, and 30 years, assuming an interest rate of 10% p.a. Amount (Rs) 1000 2000 3000 4000 5000 78,082 156,165 234,247 312,330 390,412 206,552 413,104 619,656 826,208 1,032,760 417,924 835,849 1,253,773 1,671,697 2,089,621 765,697 1,531,394 2,297,091 3,062,788 3,828,485 1,337,890 2,675,781 4,013,671 5,351,561 6,689,452 2,279,325 4,558,651 6,837,976 9,117,301 11,396,627
Years 5 10 15 20 25 30
Here's how much your money would grow if you make a lump sum (one-time) investment and leave it untouched. The interest rate has been assumed to be 10%. Amount (Rs) 100000 200000 300000 400000 500000 161,051 322,102 483,153 644,204 805,255 259,374 518,748 778,123 1,037,497 1,296,871 417,725 835,450 1,253,174 1,670,899 2,088,624 672,750 1,345,500 2,018,250 2,691,000 3,363,750 1,083,471 2,166,941 3,250,412 4,333,882 5,417,353 1,744,940 3,489,880 5,234,821 6,979,761 8,724,701
The real power of compounding comes with time. The earlier you start saving, the more your money can work for you. To attain certain amount of corpus within a set period of time, a pro-active investment style is preferable. Thus, no matter how young you are, the sooner you begin saving for the future, the better it is.
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Financial Planning
360o Plan > Investment Planning The Magic of Compounding: Long time ago there was a King in India who loved to play games. He soon grew bored of all the games played at that time and wanted a new game that was challenging. He commissioned a poor mathematician who lived in his kingdom to come up with a new game. The mathematician invented the game of chess. When he showed it to the king, the ruler was so pleased that he gave the inventor the right to name his prize for the invention. The man, who was very wise, asked the king: "Your highness, if you place just one grain of rice on the first square of this chess board, and double it for every square, I will consider myself well rewarded." "Are you sure?" asked the king, greatly surprised. "Just grains of rice, not gold?" "Yes, your highness" affirmed the humble man. "So it shall be" ordered the king, and his courtiers started placing the grain on the chess board. One grain on the first square, 2 on the second, 4 on the third, 8 on the fourth and so on. By the time they came to the 10th square they had to place 512 grains of rice. The number swelled to 5, 24,288 grains on the 20th square. When they came to the half way mark, the 32nd square, the grain count was 214, 74, and 83,648- that is over 214 crores! Soon the count increased to lakhs of crores and eventually the hapless king had to hand over his entire kingdom to the clever mathematician. And it all began with just one grain of rice! Moral of the story: Never underestimate the power of compounding. It is rightly called as the 8th wonder of the world. Small amount of money invested every month from the beginning of your work-life can lead to millions at the time of your retirement.
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Financial Planning
360o Plan > Investment Planning RISK THERMOMETER The age group I belong to is: 21 - 30 Years 31 - 35 Years 35 - 45 Years 45 - 55 Years Above 55 Years I have: More Then 3 dependents 1-3 dependents No dependents Which statement best describes your approach as an investor? I am very cautious about taking risks, and I want to avoid losses. I am somewhat cautious about taking risks, and I can handle relatively small losses. I can take some risks that are generally associated with greater account growth potential but I wish to minimize short-term losses in my account. I am open to taking risks for growth potential. I am less concerned about short-term (less than one year) losses or gains; I am more interested in long-term growth. I am risk taker and want to maximize the growth of my account over the next decade or longer. I am not concerned about short-term losses. When is your next big spending due or expected? Less than 1 year Between 1 year 3 years Between 3 years 5 years More than 5 years Do you have an emergency fund set aside to meet any unexpected requirement? No, I do not have any money for emergencies. I have enough to meet one month's expenses. I have enough to meet two to three months' expenses. I have enough to meet four to six months' expenses. I have more than six month's worth. You receive an unexpected bonus equivalent to three months' salary, Will you? Put it in a bank deposit at 5% guaranteed return? Invest it in an instrument which gives a return in the range of 4-7%. Invest it in an instrument that gives a return of around 15% p.a.with a downside 3 risk of 10%.
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Financial Planning
360o Plan > Investment Planning How often do you monitor your investments? Daily or Weekly Monthly Occasionally When you make an investment decision, you Decide on gut feel. Seek advice from friends and well-wishers. Rely on your investment advisor. Analyze all options thoroughly. Investments with higher short-term volatility are more likely to have a greater chance of meeting longterm goals. Conversely, investments likely to provide stable returns and minimum short-term losses are less likely to meet long-term investment goals. With this in mind, which of the following is most consistent with your investment attitude? Avoiding short-term losses is more important to me than meeting long-term goals. I am equally concerned about avoiding short-term losses as well as meeting long-term goals. I am willing to bear short-term fluctuations to maximize the chance of meeting my long-term goals. The chart below shows possible growth of Rs. 100 over a five-year period for a series of different investment strategies. Which of the five scenarios are you most comfortable with as an investor? 130 to 160 110 to 176 90 to 200 77 to 250 59 to 280 What percentage (%) of your portfolio is allocated to Equity currently? No investment in Equity Upto 10% Between 10% to 30% Between 30% to 60% More than 60%
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Financial Planning
360o Plan > Investment Planning
Risk Thermometer Result
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Financial Planning
2. Insurance Planning
Security is something we all look for: Security of our Future, Security of Finances, and Security of our Loved Ones. This makes Insurance Planning important Goes a popular saying that explains the importance of Insurance Planning: It is extremely important that every person, especially the breadwinner, covers the risks to his life, so that his family's quality of life does not undergo any drastic change in case of an unfortunate eventuality. So what are the risks that we run? To name a few: Risk on our lives Risks of medical contingencies Risks to assets The worries of replacement of the incomes that we contribute to the running of the household Since they have the capability of depleting our wealth considerably As the replacement of these can have tremendous financial implications
If we can imagine a situation where our goals are disturbed by acts beyond our control, we realize the relevance of insurance in our lives. Insurance, simply put, is the cover for all the risks that we run into during our lives. Insurance enables us to live our lives to the fullest, without worrying about the financial impact of events that could hamper it. In other words, insurance protects us from the contingencies that could affect us.
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Financial Planning
360o Plan > Insurance Planning Why Insurance Planning? (For different stages of life) Insurance Planning is concerned with ensuring adequate coverage against insurable risks. Calculating the right level of risk cover is a specialized activity, requiring considerable expertise. Proper Insurance Planning can help you look at the possibility of getting a wider coverage for the same amount of premium or the same level of coverage for the same amount of premium or the same level of coverage for a reduced premium. Hence, the need for proper insurance planning Insurance Planning takes into account the risks that surround you and then provides an adequate coverage against those risks. There is no risk not worth insuring yourself against. Be it life or non-life. And insurance should first and foremost be looked as a measure to guard against all risks. Now depending upon person to person Insurance needs differ too. It depends on your age, profile, requirements, level of risks, your income etc. So insurance planning takes into account all the factors before chalking out a plan customized for you and gives you the most suitable option.
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Financial Planning
360o Plan > Insurance Planning LIFE INSURANCE Life Insurance for Retirement Why & How to Plan Life Insurance Life Insurance for Savings Life Insurance for Health Life Insurance for Tax Savings Life Insurance for Children Education / Future
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Financial Planning
360o Plan > Insurance Planning RETIREMENT PLANNING (Life Insurance) Retirement planning is the important task of deciding how one will live once he/she retires. Retirement planning involves the consideration of a number of factors, including at what age you hope to retire, how much money you will need to cover the living expenses coupled with the things you plan to do once you've retired, and where your money will come from. In short, retirement planning is planning your finances for the period of life after you stop working. Why Retirement Planning is necessary? Longer retirement years: Average life spans are increasing in India and hence, the retirement years are likely to be longer. With the rise in inflation you will need more money to live in comfort. Financial independence post retirement: Earlier, people could depend on their children to take care of them post retirement. However, as a modern individual, would you not like to maintain your financial independence post retirement also? Inflation: Inflation is an important factor. Post retirement, you need a regular income to ensure that your expenses can be met. How to plan for retirement? Here is a small way to do your Retirement Planning: 1. First of all see what is your current household expenditure are. 2. Inflation is one important factor that needs to be taken into account, so grow your current household expenditure at an assumed rate of inflation for the years remaining for retirement. 3. You will get the required inflation adjusted post retirement income. 4. Then you will have to calculate the monthly investment required to meet the desired retirement income required. When to start for Retirement Planning? "You are never too young to start for retirement planning" as the famous saying goes. So plan for your retirement as early as possible so that you can create a good amount of corpus for yourself at the time you retire. There are various factors that need to be taken into account to do retirement planning for oneself like cost, inflation, market volatility etc as these factors eat up the money saved by you.
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Financial Planning
360o Plan > Insurance Planning Let us see an example here: Mr. Mohan started investing Rs 4000 per month at the age of 30 and his friend Mr. Sohan started slightly late at the age of 40. He invested Rs 6000 per month, when both of them retired at the age 60. Mr. Mohan 30 years 4000 14,40,000 91,17,301 Mr. Sohan 40 years 6000 14,40,000 45,94,181
Age at which began investing (yrs) Monthly investment amount (Rs) Total Amount invested (Rs) Corpus at age 60 (Rs)
Mr. Mohan is a rich man by almost Rs 45,00,000. This is the power to start investing early as it makes an exponential difference.
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Financial Planning
360o Plan > Insurance Planning INSURANCE PLANNING (Life Insurance) Insurance Planning is one of the most important pillars of Financial Planning. This is because Life Insurance is the only tool which can fulfill financial commitments in case of untimely death of the bread earner of the family. Thus having an appropriate life cover is important. Why Insurance Planning is required? Increasing liabilities: People today prefer to take loans to fulfill their needs, instead of waiting to save for the future. Hence, in your absence, your family needs to take care of this loan Nuclear family structure: Earlier, people could depend on their extended joint family system to take care of their near and dear ones in case of their absence. However, the share of families with more than 5 members has come down from 64% in 1990 to 56% in 2005 and is expected to decrease further. Increasing lifestyle diseases: People these days are prone to many diseases as a result of which the longevity of life is also reduced. Thus it gets important to take an appropriate risk cover and give your family a financially secure future. Loans & Liabilities: Insurance policy also helps to cover up one's loans and liabilities. The house one buys for our shelter, we would never want to let it go. Thus an insurance policy can help one to cover the loan liabilities. How much Life Cover should one take? This is determined by the concept of Human Life Value (HLV). HLV is the monetary value of all the yet-to-be fulfilled needs of the dependents plus all the outstanding liabilities. Human life value, commonly known as HLV, is an easy to use numeric way of arriving at an answer to the question above. An individual's HLV is typically expressed in terms of multiple of his or her annual income. 1. Some people think that they are adequately insured but in reality this is not the case. 2. As a thumb rule, 100 times of the monthly household expenditure should be an ideal risk cover for an individual. 3. 80-90% of the risk is covered through 100 times of the monthly household expenditure. 4. The objective of this is that people think that they are adequately insured but in reality they are not able to manage their household expenditure for even 2 years also.
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Financial Planning
360o Plan > Insurance Planning When to start for your Insurance Planning? Look at the table below: It shows the premium amounts that an individual at different ages would pay for a risk cover of Rs.1 Crore for 20 years. Age Premium 30 years 34653 35 years 46070 40 years 65973 45 years 98504 There is a difference in the premium amount if you take insurance at later ages. This is because the probability of diseases is larger at high ages and mortality is high.
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Financial Planning
360o Plan > Insurance Planning SAVING PLANNING (Life Insurance) Savings and investments go hand in hand. In fact small amount of money saved magically compounds into a good lumpsum amount in future which can be utilised to fulfill one's financial goals and thus results in wealth creation for future. The earlier one starts to plan for wealth creation, the earlier and conveniently the goals of life can be met. Case-I Case-II Case-III Target Amount (Rs.) 3200000 3200000 3200000 Tenure (years) 20 15 10 Returns (%) 10 10 10 Annual Investment (Rs.) 55870 100716 200785 Monthly Investment (Rs.) 4656 8393 16732 Why are Savings / Investments required? 1. Asset purchase needs are fulfilled: Savings and investments result in wealth creation for an individual. He can use his savings or the lumpsum amount that he has created for purchasing any asset he wants and can fulfill his cherished dream. 2. Disciplined savings to curb wasteful expenditures: Insurance inculcates the habit of regular and disciplined savings, which is the key to successful long term financial planning. Pay your premiums regularly and enjoy the uninterrupted benefits of wealth insurance. 3. Tax benefits : Apart from protection and savings, wealth insurance plans also offer tax benefits as per prevailing tax laws.
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Financial Planning
360o Plan > Insurance Planning When to start doing savings for yourself? It is never too early to plan for oneself. Rather planning done on time helps save and create a handsome corpus after a few years. Look at the table below: It shows the amount of money that an individual would need to save per month in order to have a corpus of Rs.32 Lacs after 20, 15 and 10 years, assuming growth rate of 10%.
Case-I Case-II Case-III Target Amount (Rs.) 3200000 3200000 3200000 Tenure (years) 20 15 10 Returns (%) 10 10 10 Annual Investment (Rs.) 55870 100716 200785 Monthly Investment (Rs.) 4656 8393 16732
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Financial Planning
360o Plan > Insurance Planning HEALTH INSURANCE / PLANNING (Life Insurance) Health is wealth as the common saying goes. Health is the most important thing for any individual and therefore planning well for it becomes important. Why is Health Insurance necessary? 1. Medical emergencies can strike anytime to anyone unexpectedly, so to handle these unforeseen contingencies health planning becomes necessary. 2. Due to heavy cost involved in good medical care, one's savings get exhausted in heavy medical expenses and with rising cost it can get worse. 3. Also due to changing lifestyles of people due to long working hours, lack of exercise, stress levels, bad eating habits etc, the immunity system gets weakened and thus the chances of illness gets increased. How to take Health Insurance? Generally, there are no savings available under health plans. Thus planning for one's health can be done through Unit Linked Health Plans (ULHP). Unit Linked Health Plans are the plans wherein the individual can also create a fund for himself, as being a unit linked plan his investments are also made in the market. These plans would help create a corpus and thus cover up health emergencies. Thus sound health cover planning ensures you have access to sufficient funds to meet direct medical expenses of the treatment, indirect expenses at the time of treatment and loss of income, if any, due to the illness.
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Financial Planning
360o Plan > Insurance Planning TAX PLANNING (Life Insurance) Tax Planning is a very important part of an individual's financial planning. Nobody wants to give their hard earned money as taxes. Therefore planning for taxes is important so that one can get maximum advantage of all the provisions available under the Income Tax Act 1961. Insurance policies enjoy tax benefits under section 80C and section 10(10D), subject to conditions. But tax savings should not be the sole reason to buy an insurance policy. An individual should focus on his goal planning as well and then buy the life insurance plan. Tax saving is incidental in nature. Therefore one should look at his needs and objectives also while buying insurance.
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Financial Planning
360o Plan > Insurance Planning EDUCATION PLANNING (Life Insurance) Planning for their children and giving them the best of everything is every parent's dream. Child's education and marriage requires a lot of systematic planning. These are generally goal based planning and thus some amount of money needs to be allocated every month. However planning for the child's future through Unit Linked Plans is an ideal solution as it gives the family an ideal solution as it gives the benefit of both family protection and high returns. Why Child Insurance is required? 1. Increasing cost of education, because of which one needs to star saving early. 2. For the overall development of child and to make him an all rounder in all the fields, child planning becomes necessary as it increases the overall cost of education. 3. Child Insurance plans has the benefit of Waiver of Premium, which says that if something happens to the parent, all the future premiums are waived off and are paid by the insurance company and thus the goal for which child planning was done does not get defeated. 4. Also it inculcates tax savings under the prevailing income tax laws. Parameters to be taken into consideration while doing Child Planning 1. Start as early as possible: 2. Generally the tenure for planning for your child is 12-15 years. Thus one should start planning early so that you are able to create some amount of corpus at the time your child requires. Also the compounding effect reduces if you start late. Thus planning for your child on time is important. 3. Equity based investments to get good returns: 4. You can invest your money in a unit linked child plan wherein your money can be invested in equity based fund as well, so that you are able to enjoy the market uptrend and thus create wealth for yourself. 5. Waiver of Premium concept : The benefit of waiver of premium is very important in context of child plans. This says that in case anything happens to the father of the child, the insurance company will waive off all the future unpaid premiums and will pay them on behalf of the parent. On the other hand, all the future benefits would remain intact. Thus the purpose for which the child plan was taken doesn't get defeated. 6. Make your current investment by taking into account your child's future goals
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Financial Planning
360o Plan > Insurance Planning YOU (Life Insurance) Every individual has certain dreams and goals in his life. He also wants to aspire for his objectives. Therefore 'You' forms an important aspect of the Rishtey Concept. An individual can fulfill all his dreams and goals and even realise his cherished dreams through prudent financial planning. Thus making a right choice and investing in a right insurance plan is necessary.
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Financial Planning
360o Plan > Insurance Planning GENERAL INSURANCE General Insurance for Health (Mediclaim) General Insurance for Motor General Insurance for Home General Insurance for Travel General Insurance for Personal Accident General Insurance for Corporate - Group Mediclaim Policy - Group Personal Accident - Office Property & Asset Insurance - Liability Insurance - Directors' and Officers' Liability Insurance - Marine Insurance - Professional Indemnity
Silent Features: General Insurance comprises of insurance of property against fire, burglary etc, personal insurance such as Accident and Health Insurance, and liability insurance which covers legal liabilities. There are also other covers such as Errors and Omissions insurance for professionals, credit insurance etc. Non-life insurance companies have products that cover property against Fire and allied perils, flood storm and inundation, earthquake and so on. There are products that cover property against burglary, theft etc. The non-life companies also offer policies covering machinery against breakdown, there are policies that cover the hull of ships and so on. A Marine Cargo policy covers goods in transit including by sea, air and road. Further, insurance of motor vehicles against damages and theft forms a major chunk of non-life insurance business. Personal insurance covers include policies for Accident, Health etc. Products offering Personal Accident cover are benefit policies. Health insurance covers offered by non-life insurers are mainly hospitalization covers either on reimbursement or cashless basis. Liability insurance covers such as Motor Third Party Liability Insurance, Workmens Compensation Policy etc offer cover against legal liabilities that may arise under the respective statutes Motor Vehicles Act. There are general insurance products that are in the nature of package policies offering a combination of the covers mentioned above. For instance, there are package policies available for householders, shop keepers and also for professionals such as doctors, chartered accountants etc. Apart from offering standard covers, insurers also offer customized or tailor-made ones.
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Financial Planning
360o Plan > Insurance Planning HEALTH INSURANCE (General Insurance) Health is wealth and a Mediclaim Policy is the best way to insure it. Mediclaim is the best solution that you can use to cover up all medical expenses. These policies cover the insured person for in-patient hospitalization provide extensive coverage including room charges, boarding expenses, nursing expenses, operation theater charges, ICU charges, surgeon fees, specialist fees, medical practitioner, consultant fees, cost of medicines and drugs, blood, oxygen, diagnostic test, cost of pacemaker, artificial limbs, etc. Pre and post hospitalization, pre-existing diseases, day care treatment, domiciliary hospitalization, cost of health check-up, ambulance charges, etc. are also covered. Also the premium paid is eligible for tax benefit under section 80D of the Income Tax Act, 1961. You can avail the benefit of discount in premium for every claim free year of the policy. Some of policies also offer cashless hospitalization service at all network hospitals. Today, there are several insurance companies offering wider health coverage at affordable premium rates. We bring to you different products available to suit your best requirements. Health Insurance (popularly known as Medi-claim Policy) offers protection from unexpected medical emergencies, providing a financial support. Health insurance therefore, can be a source of support as it takes care of the financial burden your family may have to go through. It will help you tackle such situations with ease by providing you with timely and adequate medical care. This policy covers individual & ones family from medical expenses during 1. Sudden illness, 2. Surgeries (acquired in respect of any disease, which has arisen during the policy period.) 3. Accidents including room charges, doctor's fees, medicines, tests etc that may arise in future. Options available: 1. 2. 3. 4. 5. 6. 7. 8. Family Floater Individual Health Insurance Individual Health Insurance + Critical Care Critical Care Personal Accident Top Up Policy Health Policy Including OPD Coverage Family Floater Including Parents or in-laws
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Financial Planning
360o Plan > Insurance Planning MOTOR INSURANCE (General Insurance) Motor Insurance is a wide comprehensive cover designed to provide protection to you & your car. Protection from loss of car or damage to the car giving a secured driving It covers: 1. Own damage 2. Legal liability of insured towards third party personal injury and property damage arising out of an accident involving the insured vehicle 3. Passengers 4. Hired driver 5. Depreciation Reimbursement 6. Loss of Personal Belongings 7. Daily Allowance 8. No Claim Bonus Protection 9. Repair of Glass, Fibre, Plastic and Rubber Parts 10. Key Replacement 11. Emergency Transport and Hotel Expenses 12. Return to Invoice Options available 1. 2. 3. 4. 5. 6. Car Insurance Two wheeler Commercial vehicles Passenger Carrying Vehicle 3 wheeler Tractors etc.
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Financial Planning
360o Plan > Insurance Planning HOME INSURANCE (General Insurance) Home Insurance policy provides a cover to the structure and contents of your home from all unforeseen natural & man-made catastrophes. It provides protection for property and interests of the insured and his family members. It is imperative that you secure your home which gives one peace of mind protecting the most valued possession. Coverages are: 1. 2. 3. 4. 5. 6. 7. Fire & Allied Perils Burglary & Theft Electrical & Mechanical breakdown (Domestic, Audio & Audio-visual appliances) Public Liability (Third Party Liability) Covers Accidental breakage Coverage to building & contents Personal Accident to self & family
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Financial Planning
360o Plan > Insurance Planning TRAVEL INSURANCE (General Insurance) Travel Insurance / Overseas Medi-claim policy is a basic requirement when one travels abroad, either its for business, sight-seeing, shopping or pleasure. This policy covers you for any kind of hospitalization which is very expensively priced overseas. Also covers for: 1. 2. 3. 4. 5. 6. 7. Baggage loss, Passport loss, Personal accident, Trip cancellation Home Insurance when you are traveling Dental Expenses Maternity expenses in life saving scenario etc.
It is a single policy which covers all unforeseen risks medical & non-medical when one is in a strange place. Options available: 1. 2. 3. 4. 5. Single Trip Multi Trip Student Medical Senior Citizen Pay per day basis
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Financial Planning
360o Plan > Insurance Planning PERSONAL ACCIDENT (General Insurance) Accidents do not happen when you are driving a car, or away on a vacation. It may happen anytime & anywhere. Considering that modern day life is so dangerous, a personal accident policy is a solution to such vagaries of life. Its a Benefit Policy. Coverages are: 1. 2. 3. 4. 5. Accidental Death Benefit Accidental Permanent Total / Partial Disability Benefit Accidental Partial / Temporary Disability Benefit Broken Bones Burns
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Financial Planning
GENERAL INSURANCE FOR CORPORATE Group Mediclaim Policy Group Personal Accident Office Property & Asset Insurance Liability Insurance Directors' and Officers' Liability Insurance Marine Insurance Professional Indemnity
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate GROUP MEDICLAIM (For Corporates) Group Mediclaim Policy Rising costs of Healthcare have made it necessary for every employer to cover their employees and their families from financial instability that may arise in case of a hospitalization. Group Health Insurance also called as Group Mediclaim in India is primarily cashless hospitalization coverage for your employees and their families. It covers the following: Hospitalization costs - if the hospitalization is for more than 24 hours. Pre and Post Hospitalization Costs. Ancillary Costs like Ambulance [specifically mentioned in the policy]. Cashless Coverage for Self+Spouse+2 Kids+ 2 Parents Pre-Existing illness Coverage from Day 1 Maternity Coverage from Day 1 Day 1 Baby Coverage Waiver of 30 Days waiting Period Waiver of 1 and 2 year Exclusions on various illnesses Waiver of any sub-limits in the policy Full Coverage for parents without Medical Tests
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate GROUP PERSONAL ACCIDENT (For Corporates) Considering the lifestyle today; every employee in your organization is exposed to various risks of accidental death and disability, specifically at work and while traveling to and fro the work place. In case of any such event actually happening, the Employer has a moral duty to provide compensation, hence in our opinion; this cover becomes one of the most critical covers for employees. A Group Personal Accident Policy provides worldwide comprehensive lump sum coverage to your staff from risks of accidental death and disability. It covers the following: Accidental Death Accidental Permanent Total Disability Accidental Permanent Partial Disability Accidental Temporary Total Disability Periodic Addition/Deletion is possible. Groups as small as 3 members can be covered
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate OFFICE PROPERTY & ASSET INSURANCE (For Corporates) Property Insurance 1. Fire Insurance: Your office/plant is your showcase to the world. You manage and maintain your office/plant with lot of detail, passion and money. A major fire can result in a disaster for a business to the extent that many companies never recover. The importance of having a fire insurance policy cannot be over emphasized. Fire Insurance covers your office's structure and contents not only against the risk of fire but also other perils like lightning, flood, storm, earthquake, riots, terrorism etc. 2. Burglary Insurance This policy covers property contained in business premises, stocks owned or held in trust against the risk of burglary. It also covers cash, valuables, securities kept in a locked safe or cash box in locked steel cupboard on specific request. 3. Machinery Breakdown (MBD) Insurance The unexpected occurrences of Machinery Breakdown can damage machinery and cause expensive production delays or interrupt cash flow. This policy covers the breakdown of machinery due to various perils. This policy is indispensable for businesses that operate using a large number of machines. The breakdown of a single machine may bring the operations of the factory to a standstill. This policy covers monetary costs involved in restoration or replacement of machines. \ 4. Money Insurance Businesses handle cash, and bankers' drafts, making this form of insurance essential. 5. The Insurance Covers: Covers money while in transit in the personal custody of the insured or his employee. Covers money in premises during business hours, Covers money in a safe or strong room outside business hours. 6. All Risks Insurance This policy covers valuables like Jewellery, ornaments, paintings, work of art, and similar artifacts of sentimental values. The policy provides cover on a wide basis and covers loss or damage due to fire, riot & strike, burglary, house breaking, theft and accidental loss or damage. Cover is not freely granted on account of its vulnerability to losses and moral hazard.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Office Property & Asset Insurance 7. Contractor's All Risk (CAR) Insurance: Construction being a risk prone industry, accidents, including personal injuries and property damage are very frequent, and these accidents may bust your plans, schedules and costs. A CAR policy covers the physical damage to materials to be used for the project - whether in transit, in storage or forming part of the contract works. There is also an ancillary cover up to moderate limits for third party liabilities. It is a main feature of the CAR policy to cover those who have an immediate material interest in the project. That includes the owner, the contractor and usually all sub contractors.
Equipment Insurance Businesses today depend on computers, laptops and other electronic devices for their day-to-day operations. The Electronic Equipments Insurance policy protects your equipment like computers, communication systems and other electronic equipment from any risk while such equipment is at work, at rest or during maintenance operations. The policy can also cover the additional expenditure that you will have to incur by way of hiring substitute systems. 1. Scope of Cover: Cover operates when the insured property is at work or at rest or being dismantled for the purpose of cleaning/overhauling or during subsequent re-erection. 2. The Policy broadly covers: Material damage to electronic equipment (which can include systems software) due to sudden and unforeseen events, under Section I Cost of external data media, including cost of reconstruction of data under Section II, as also increased cost of working under Section III. While Section I is compulsory, Section II and Section III are optional. 3. Sum Insured Section I: New Replacement cost of the insured property including Freight, Erection cost, Customs Duty, if any. Section II: Cost of restoring the external data media by replacing lost or damaged data media by new material and lost information. Section III: Sum Insured should represent the hiring charges per hour for substitute equipment for ensuring continued data processing for the period of indemnity specified, including personnel and transportation charges.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Office Property & Asset Insurance Fire Insurance For most of the businesses, a Fire/Property Insurance policy is more like a routine electricity/water bill. The Insurance Company sends the renewal notice, you negotiate on premium and premium is paid off. The policy is then forgotten till the renewal comes up. With terrorism and other risks growing, your business needs to be insulated and protected from any such financial catastrophe. Fire, Riots, Terrorism, Explosion, etc. can cause severe damage to the survival and continuity of any business. At the same time, you need to have the correct idea of what the policy covers and what are the extensions you can go for. Question: What does Fire & Special Perils Insurance Cover? Fire and Special Perils Insurance, one of the oldest forms of Insurance covers these risks, covers a majority of risks on property, making it one of the most crucial and basic covers any business needs to take. It covers the following perils: 1. Fire 2. Lightning 3. Explosion/Implosion 4. Aircraft Damage 5. Riot, Strike, Malicious and Terrorism Damage 6. Atmospheric Perils: Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and Inundation. 7. Loss or visible physical damage to property due to impact of any Road/Rail Vehicle or animal in direct contact not belonging to the owner/employees 8. Subsidence and Land Slide including Rock Slide. 9. Bursting/Overflowing of Water Tanks, Apparatus and Pipe 10. Missile Testing Operations 11. Bush Fire [Excluding Forest Fire] 12. Important Add-On
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Office Property & Asset Insurance The following are some important Add-On/Riders which could be added as per your requirement to the policy: 1. Earthquake: Earthquake is an Exclusion in the Standard Fire Policy, this needs to be taken as an add on cover with payment of additional premium. 2. Incremental Cost of Alternate Accommodation This provides for additional expenses incurred in for the alternate accommodation. For e.g. you pay a lease of Rs. 2 Lakhs for your current property per month, and due to fire and alternate accommodation for your staff, you are forced to lease a property of Rs. 5 Lakhs, then you can insure your additional cost of Rs. 3 Lakhs. In case you own the property, you can insure the additional cost for Rs. 5 Lakhs. 3. Omission to Insure Additions and Alterations If you have regular purchase of equipment, machinery, valuable parts - you can take a blanket cover of say 10% of the total value of equipment, to avoid the danger of omission to add/alter. 4. Start Up Expenses If after reinstatement of the property, there would be additional costs to start the smooth functioning of your business/production, you can take a cover against these expenses too. 5. Spoilage Material Damage If your production plant runs continuously, then there is a risk of sudden stoppage, due to which there could be damage to the machinery as well as spoilage of material in the machinery. This damage can be covered as an ADD ON. To conclude, Fire & Allied Insurance is a very vast and flexible Insurance Coverage, covering various man and god made calamities, extremely essential as a part of your Risk Management System. It could be the most comprehensive coverage for you, at the same time, if you don't invest time or professionals- it could actually be another electric bill, with no return.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Office Property & Asset Insurance Office Package Policy Office Insurance Package is a comprehensive package of different insurance policies that provide flexibility and cover for various contingencies. A package policy like this avoids you arranging different policies for fire, burglary, machinery breakdown etc. It provides you complete control of managing all your risks in office under one policy. Over and above this, an Office Insurance being a package plan also helps you get good discounts. 1. Fire (Building and Contents) Covers losses caused by fire, lightening, riot, strike, storm, cyclone, flood and terrorism. 2. Burglary Protects contents of your shop against any loss or damage caused by burglary or attempted burglary 3. Burglary of cash in safe Provides for losses resulting from the burglary of cash kept in safe 4. Cash in transit Covers losses because of burglary of cash while it is being carried from the bank/ATM to your shop 5. Glass breakage Covers loss or damage to any fixed plain glass caused by any accident, external and visible means. 6. Damage to neon sign Covers neon or glow signs displayed at your shop premises against damage caused by fire, accident, riot, and flood. 7. Cheque forgery Covers loss caused by forgery or material alteration of cheques, drafts or any other negotiable instruments issued by you or in your favour. 8. Fidelity: Covers direct financial losses sustained due to fraud or any dishonest act by your salaried employees. 9. Tenant's legal liability: This cover provides for legal liability imposed on you by the property owner on account of damage to property by fire, earthquake, flood and riots. 10. Employer's liability: It provides for legal liability to your employees.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate LIABILITY INSURANCE (For Corporates) In the increasingly litigious world that we are in Irrespective of the size of business, it is critical to consider liability insurance. It is prudent to cover your business against all kinds of liabilities - public liability (third party injury or property damage) from industrial and non-industrial operations, product liability, professional indemnity, D&O liability and E&O liability. Bonsai Insurance offers a wide array of liability products to suit your business needs. The following are some of the products: 1. Product Liability 2. Public Liability Act Only 3. Workmen's' Compensation Policy 4. Public Liability Insurance (Industrial Risks) Policy 5. Public Liability Insurance (Non-Industrial Risks) Policy 6. Product Liability Insurance Introduction Safety and reliability of products are an important concern to consumers, sellers & manufacturers. Faulty products can be hazardous for the consumers' health & property. The manufacturer/ seller of faulty could be held liable for such damages, exposing themselves to financial losses. Product liability insurance protects the companies exposed to above risk by financially assisting policyholders in such situations. This Policy broadly covers: 1. Legal liability of the Insured towards damages to the third party arising due to faulty products manufactured / sold by the insured, liability with respect to: Accidental death Bodily injury or disease Loss or damage to property Legal costs and expenses incurred with the prior consent of the Insurer and within the limit of indemnity. 2. Depending on exposure (end users, sales territories, nature of products & turnover), the proposer has to fix two limits of indemnity under the policy: Any One Accident (AOA) Any One Year (AOY) AOA and AOY can be in ratio of 1:1, 1:2, and 1:3 and maximum can be 1:4. It is not permissible to issue the policy with unlimited liability. 3. Public Liability - Industrial & Non Risks
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Liability Insurance 4. Legal liability of the Insured towards damages to third party with respect to: Accidental death Bodily injury or disease Loss or damage to property Legal costs and expenses incurred with the prior consent of the Insurer and within the limit of indemnity 5. Public Liability - Act Only This Policy broadly covers the Owner's statutory liability on the no-fault principle for the following conditions resulting from an accident while handling any hazardous substances: Death of or injury to any person Damage to property
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate DIRECTORS' AND OFFICERS' LIABILITY INSURANCE (For Corporates) The Directors' and Officers' Liability Insurance [D&O] policy has been designed specifically to meet any financial liabilities imposed upon the Directors' or Officers' in their personal capacity for any wrongful act, knowingly or unknowingly in their respective capacity under Common Law, Corporate Law and Security Law causing financial loss to the other stakeholders of the company. In a recent spate of litigation, a number of adverse court verdicts regarding the liability of directors and officers of companies to various stakeholders like Employees, Creditors, and Shareholders were passed where the directors and officers were held personally liable for payment of compensation to the third party. This policy is necessary for directors and officers of every company if they wish to avoid potential litigation owing to: 1. Failure of supervision. 2. Inaccuracy in statements of financial accounts. 3. Lack of judgment and good faith. 4. Mismanagement of funds. 5. Misstatements in prospectuses. 6. Allotment of shares. 7. Unauthorized loans or investments. 8. Failure to obtain competitive bids. 9. Imprudent expansion resulting in a loss. 10. Using inside information. 11. Unwarranted dividend payment, salaries or compensation. 12. Misleading statements filed with the stock exchange. 13. Misrepresentation in acquisition agreement for the purchase of another company. 14. Wrongful dismissal of an employee. 15. Risks Covered This policy covers all claims made in event of: 1. Mergers, takeovers and divestment. 2. Liquidation. 3. Changes in control of shareholding. 4. Share issues. 5. Shareholder claims. 6. Misdeeds of co-directors. 7. Trustee accountability and responsibility. 8. Customs and excise allegations. 9. Administrative liabilities. 10. Termination of employment. 11. Disposal of old firm/ entry of new owners. 12. Miscellaneous litigation. 13. Compensation Offered
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Directors' & Officers' Liability Insurance The extent of indemnity being severely restricted by the Companies' Act will reimburse the extent of legal costs expended only if the Director/ Officer successfully defend the act taken against him. Also, coverage is available on a 'claims made' basis and applies only to claims made against the Board of Directors during the policy period, irrespective of when the wrongful act occurred. The Cover Applies To: 1. Liabilities arising from any claim made against Directors and/ or Officers of the company by reason of any wrongful act in their respective capacity. 2. Liabilities against the company where it is required to indemnify the Directors/ Officers pursuant to common, or 3. Statutory law provisions or Memorandum and Articles of Association. 4. The company and its subsidiaries that are under the common control of the Directors / Officers. Exclusions: 1. The policy will not pay for the losses arising from any claim. 2. Prior and pending litigation and claims submitted under previous policies. 3. Bodily injury, sickness, disease, emotional distress, death, damage or destruction of tangible property including loss. 4. Insured v/s Insured. Viz. Directors suing each other. 5. Illegal personal profit and remuneration. 6. Deliberate, dishonest or fraudulent acts. 7. Pollution and/ or contamination. 8. Insider trading. In the increasingly litigious corporate world, directors and officers are getting more and more exposed to variety of legal liability. There are lots of limitations, to the extent of which a Director or an officer can always be vigilant and take right decisions. The major constraints come from market risks, political risks or financial risks. The D&O helps the Directors and the Company to transfer such financial risks and legal liabilities to professional fund managers.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate MARINE INSURANCE (For Corporates) A contract of marine insurance is an agreement whereby the insurer covers against losses incidental to marine adventure. There is a marine adventure when any insurable property is exposed to maritime perils i.e. perils consequent to navigation of the sea. The term 'perils of the sea' refers only to accidents or causalities of the sea, and does not include the ordinary action of the winds and waves. Besides, maritime perils include, fire, war perils, pirates, seizures and jettison, etc. There are Four Types of Marine Insurance: 1. Hull Insurance Covers the insurance of the vessel and its equipment i.e. furniture and fittings, machinery, tools, fuel, etc; it is effected generally by the owner of the ship. 2. Cargo Insurance Includes the cargo or goods contained in the ship and the personal belongings of the crew and passengers 3. Freight Insurance Provides protection against the loss of freight; in many cases, the owner of goods is bound to pay freight, under the terms of the contract, only when the goods are safely delivered at the port of destination. If the ship is lost on the way or the cargo is damaged or stolen, the shipping company loses the freight. Freight insurance is taken to guard against such risk. 4. Liability Insurance It is one in which the insurer undertakes to indemnify against the loss which the insured may suffer on account of liability to a third party caused by collision of the ship and other similar hazards. In a contract of marine insurance, the insured must have insurable interest in the subject matter insured at the time of the loss. Insurable interest is not required to be present at the time of taking the policy. Under marine insurance, the following persons are deemed to have insurable interest: The owner of the ship has an insurable interest in the ship. The owner of the cargo has insurable interest in the cargo. A creditor who has advanced money on the security of the ship or cargo has insurable interest to the extent of his loan. The master and crew of the ship have insurable interest in respect of their wages. If the subject matter of insurance is mortgaged, the mortgagor has insurable interest in the full value thereof, and the mortgagee has insurable interest in respect of any sum due to him. A trustee holding any property in trust has insurable interest in such property. In case of advance freight the person advancing the freight has an insurable interest in so far as such freight is repayable in case of loss. The insured has an insurable interest in the charges of any insurance policy which he may take.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate > Marine Insurance Types of Marine Insurance Policies: 1. Voyage Policy It is a policy in which the subject matter is insured for a particular voyage irrespective of the time involved in it. In this case the risk attaches only when the ship starts on the voyage. Time Policy It is a policy in which the subject matter is insured for a definite period of time. The ship may pursue any course it likes; the policy would cover all the risks from perils of the sea for the stated period of time. A time policy cannot be for a period exceeding one year, but it may contain a 'continuation clause'. The 'continuation clause' means that if the voyage is not completed within the specified period, the risk shall be covered until the voyage is completed, or till the arrival of the ship at the port of call. 2. Mixed Policy It is a combination of voyage and time policies and covers the risk during particular voyage for a specified period of time. 3. Valued Policy It is a policy in which the value of the subject matter insured is agreed upon between the insurer and the insured and it is specified in the policy itself. 4. Open or Un-valued Policy It is the policy in which the value of the subject matter insured is not specified. Subject to the limit of the sum assured, it leaves the value of the loss to be subsequently ascertained. 5. Floating or Declaration Policy It is a policy which only mentions the amount for which the insurance is taken out and leaves the name of the ship(s) and other particulars to be defined by subsequent declarations. Such policies are very useful to merchants who regularly dispatch goods through ships.
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Financial Planning
360o Plan > Insurance Planning General Insurance for Corporate PROFESSIONAL INDEMNITY (For Corporates) Professionals are employed with complete trust and faith by clients. Unfortunately, human error cannot be eliminated and hence they are exposed to the risk of claims from clients who have suffered loss due to neglect, error or omission. The Professional Indemnity Policy is meant for professionals to cover liability falling on them as a result of errors and omissions committed by them whilst rendering professional service. This policy is meant for following professionals: 1. Doctors and medical practitioners, which covers registered medical practitioners like physicians, surgeons, cardiologists, pathologists etc 2. Medical establishments, which covers legal liability falling on the medical establishment such as hospitals and nursing homes, as a result of error or omission committed by any named professional or qualified assistants engaged by the medical establishment. 3. Engineers, architects and interior decorators. 4. Lawyers, advocates, solicitors and counsels. 5. Chartered accountants, financial accountants, management consultants. Highlights: 1. This policy is meant for professionals to cover liability falling on them as a result of errors and omissions committed by them whilst rendering professional service. 2. The policy offers a benefit of Retroactive period on continuous renewal of policy whereby claims reported in subsequent renewal but pertaining to earlier period after first inception of the policy, also become payable. 3. Group policies can also be issued covering members of one profession. Group discount in premium is available depending upon the number of members covered. Scope: The policy covers all sums which the insured professional becomes legally liable to pay as damages to third party in respect of any error and/or omission on his/her part committed whilst rendering professional service. Legal cost and expenses incurred in defense of the case, with the prior consent of the insurance company, are also payable, subject to the overall limit of indemnity selected. Only civil liability claims are covered. Any liability arising out of any criminal act or act committed in violation of any law or ordinance is not covered.
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Financial Planning
360o Plan > Insurance Planning SEE ALSO Products http://www.bajajcapital.com/insurance/gen_insurance_product.php?id=4 Forms & Brochures http://www.bajajcapital.com/insurance/general_insurance/download.php?id=4 General Insurance Products http://www.bajajcapital.com/insurance/gen_insurance_product.php?id=4 Request Premium Quote http://www.bajajcapital.com/insurance/general_insurance/request-quote-premium.php?id=4 Health Insurance http://www.bajajcapital.com/insurance/general_insurance/general_insurance.php?id=4 Insurance Policy Reminder http://www.bajajcapital.com/insurance/general_insurance/PolicyReminder.php?id=4
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Financial Planning
3. Retirement Planning
Some like it. Some don't. But retirement is a reality for every working person. Most young people today think of retirement as a distant reality. However, it is important to plan for your life post-retirement if you wish to retain your financial independence and maintain a comfortable standard of living even when you are no longer earning. In simple words you need retirement planning. This is extremely important, because, unlike developed nations, India does not have a social security net. Also the fact that though longevity has increased, the number of working years haven't, makes retirement planning empirical. Our Retirement Planning Services: Computing that amount that would be required post-retirement. This is done after taking inflation and time value of money into account. Building your Retirement Corpus using Systematic Investment Plans (SIPs) and other long-term growth orient products. Ensuring adequate post-retirement income through safe investments. REMEMBER: The asset allocation and selection of investment vehicles keep changing as your risk-bearing capacity diminishes. Retirement should be the best period of your life, when you can literally sit back and relax or enjoy your life by reaping benefits of what you earn in so many years of hard work. But it is easier said than done. To achieve a hassle-free retired life, you need to make prudent investment decisions during your working life, thus putting your hard-earned money to work for you in future.
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Financial Planning
360o Plan > Retirement Planning RETIRE AND PROSPER In simple words, retirement planning means making sure you will have enough money to live on after retiring from work. Retirement should be the best period of your life, when you can literally sit back and relax or enjoy your life by reaping benefits of what you earn in so many years of hard work. But it is easier said than done. To achieve a hassle-free retired life, you need to make prudent investment decisions during your working life, thus putting your hard-earned money to work for you in future. Why is it important? India, unlike other countries, does not have state-sponsored social security for the retired people. And after several decades when pensions provided many people with a large chunk of money they needed to live comfortably after they retired, things are changing. While you may be entitled to a pension or income during retirement, in the new economic era, you are increasingly likely to be responsible for providing for your own needs. Although the compulsory savings in provident fund through both employee and employer contributions should offer some cushion, it may not be enough to support you throughout your retirement. That is why retirement planning is extremely important for every one. There are many reasons for the working individuals to secure their future emergence of nuclear families and its attendant insecurity, increasing uncertainties in personal and professional life, the growing trends of seeking early retirement and rising health risks are among few important risks. Besides falling interest rates and the sustained increase in the cost of living make it a compelling case for individuals to plan their finances to fund their retired life Planning for retirement is as important as planning your career and marriage. Life takes its own course and from the poorest to the wealthiest, no one gets spared. "Everyone grows older". We get older every day, without realising. However, we assume that old age is never going to touch us. The future depends to a great extent on the choices you make today. Right decisions with the help of proper planning, taken at the right time will assure smile and success at the time of retirement.
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Financial Planning
360o Plan > Retirement Planning RETIREMENT PLANNING TIPS People have different plans for retired life. For example you may think of retirement as a time to relax, to laze around, to spend more time with family, travel or write a masterpiece. Attaining financial independence after retirement will not be just a dream if the following steps are followed with steady discipline, perseverance and if smart investment strategies. Start saving early: Nobody takes retirement seriously. But the fact is that even a small sum of money saved regularly and invested regularly makes a big amount which will come in very handy after retirement. One should not believe that after retirement, one can place all savings into income generating investment and spend rest of life in happiness. If you don't plan early, you could end up eroding your principal savings in order to supplement your monthly income. Retirement should be your top priority: Retirement should be kept as a top priority because if one does not keep it at the top one might end up depending on one's children, which probably no one would relish. Create a Retirement Plan: Develop a plan for saving based on your requirements at the time of retirement. The goals you keep for saving depend on your lifestyle but you will need at least about 66% of your pre-retirement income to maintain your standard of living when you stop working. Understand your Pension Plan: If your employer offers pension plan, understand carefully your benefit level, financial stability of plan and the vesting period. Use retirement plans even if you already have enough money. With retirement plans your money grows in a tax efficient manner and compounding interest over time makes it one of the best investment options. Balance your risk tolerance and your investment strategy: Evaluate your risk profile and then balance your investment strategy to invest in various avenues to get the most out of your retirement money keeping your risk profile unhampered. Diversify your investments & allocate your assets carefully: Depending on your work profile divide your savings into equity, bonds, Mutual Funds, and other investment avenues. Don't invest too heavily in one sector or one company, since the risk associated with putting all your eggs in one basket is indeed very high. Save and Invest Regularly: Saving and investing regularly makes a big difference at the time of retirement. Investing at regular intervals builds your retirement fund over time and helps you to minimize risk and gives a tension free retirement-a time to pursue your hobbies, fulfill your dreams and passions.
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Financial Planning
360o Plan > Retirement Planning WHY PLAN FOR RETIREMENT If you are in young, retirement may be the last thing on your mind. But if you think you have a long way to go for to plan for retirement, think again. It is never too early to prepare for retirement, especially if you want to maintain the same standard of living that you would have got accustomed to by then. Let us take a hypothetical example. Let's assume that you are a 35 year old, earning Rs.3 lakh per annum. Your salary grows at 5% per annum and you plan to retire after 25 years. Under these circumstances, assuming your post-retirement requirement would be 60% of your last annual income (Rs.10 lakh approx), you would need about Rs.6 lakh per annum after retirement. To achieve this, you need a retirement corpus of Rs.75 lakh assuming you earn a return of 5% per annum over a period of 20 years. To meet this goal, you would have to invest more than Rs.9,000 per month at 7% per annum for the next 25 years. Inflation and tax implications have not been considered for simplicity.
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Financial Planning
4. Tax Planning
Proper tax planning is a basic duty of every person which should be carried out religiously. Basically, there are three steps in tax planning exercise. They are as follows: 1. Calculate your taxable income under all heads i.e. Income from Salary, House Property, Business & Profession, Capital Gains and Income from other Sources. 2. Calculate tax payable on gross taxable income for whole financial year (i.e. from 1st April to 31st March) using a simple tax rate table, given on next page. 3. After you have calculated the amount of your tax liability. You have two options to choose from: A) Pay your taxes B) Minimize the amount of tax you pay with prudent tax planning. Most people rightly choose Option 'B'. Here you have to compare the advantages of several tax saving scheme and depending upon your age, social liabilities, tax slabs and personal preferences, decide upon a right mix of investments, which shall reduce your tax liability to zero or the minimum possible. Every citizen has a fundamental right to avail all the tax incentives provided by the Government. Therefore, through prudent tax planning not only income-tax liability is reduced but also a better future is ensured due to compulsory savings in highly safe Government schemes. We sincerely advise all our readers and clients to plan their investments in such a way, that the post-tax yield is the highest possible keeping in view the basic parameters of safety and liquidity
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Financial Planning
360o Plan > Tax Planning TAX PLANNING TIPS First, let's start by assessing your income tax liability. Once you have identified your tax liability, you can then create the right plan. Please note that this applies only to salaried individuals. Following rates are applicable for computing tax liability for the current Financial Year i.e. April 1, 2009 to March 31, 2010 (Assessment year 2010-2011). Our endeavour is to present the complex provisions of the Income Tax Act in a simplified manner, which could be understood by a common investor as well as by a layman. For other Resident Male Individuals below 65 years of age and HUFs
Net Income Range Up to Rs. 1,60,000 Rs. 1,60,001 to Rs. 3,00,000 Rs 3,00,001 to Rs 5,00,000 Above Rs. 5,00,000 Income Tax Nil 10% of income above Rs. 1,60,000 Rs. 14,000 + 20% of the income above Rs. 3,00,000 Rs. 54,000 + 30% of income above Rs. 5,00,000 Plus Education Cess Nil 3% of income tax 3% of income tax 3% of income tax
For Resident Women below 65 years of age

Net Income Range Up to Rs. 1,90,000 Rs. 1,90,001 to Rs. 3,00,000 Rs 3,00,001 to Rs 5,00,000 Above Rs. 5,00,000 Income Tax Nil 10% of the income above Rs. 1,90,000 Rs. 11,000 + 20% of the income above Rs. 3,00,000 Rs. 51,000 + 30% of the income above Rs. 5,00,000 Plus Education Cess Nil 3% of income tax 3% of income tax 3% of income tax
For Resident Senior Citizens (who are 65 years or more at any time during the Financial Year 2007-08)
Net Income Range Income Tax Plus Education Cess Up to Rs. 2,40,000 Nil Nil Rs. 2,40,001 to Rs. 3,00,000 10% of the income above Rs. 2,40,000 3% of income tax Rs 3,00,001 to Rs 5,00,000 Rs. 6000 + 20% of the income above Rs. 3,00,000 3% of income tax Above Rs. 5,00,000 Rs. 46000 + 30% of the income above Rs. 5,00,000 3% of income tax The rules for "Senior Citizen" are the same as for 'Men' as well as 'Women'. Any person who turns 65 on any day prior to or on March 31, 2009 will be treated as a Senior Citizen.
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Financial Planning
360o Plan > Tax Planning Tax Liability FY 2009-10 AY 2010-11
Filing of Income Tax Return 1. Filing of income tax return is compulsory for all individuals whose gross annual income exceeds the maximum amount which is not chargeable to income tax i.e. Rs. 190000 for Resident Women, Rs. 2,40,000 for Senior Citizens and Rs. 1,60,000 for other individuals and HUFs. 2. The last date of filing income tax return is July 31, in case of individuals who are not covered in point 3 below. 3. If the income includes business or professional income requiring tax audit (turnover Rs. 40 lakhs), the last date for filing the return is September 30. 4. The penalty for non-filing of income tax return is Rs. 5000 (after assessment year).
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Financial Planning
360o Plan > Tax Planning TAX SAVING SCHEMES After assessing your tax liability, the next step is tax planning. It involves selecting the right tax saving instruments and making investments accordingly. Deductions from Taxable Income: Deduction under section u/s 80C This new section has been introduced from the Financial Year 2005-06. Under this section, a deduction of up to Rs. 100000 is allowed from Taxable Income in respect of investments made in some specified schemes. Specified Investment Schemes u/s 80C and u/s 80CCC (1) 1. 2. 3. 4. 5. 6. 7. 8. Life Insurance Premiums Contributions to Employees Provident Fund/GPF Public Provident Fund (maximum Rs 70,000 in a year) NSC (National Savings Certificates) Unit Linked Insurance Plan (ULIP) Repayment of Housing Loan (Principal) Equity Linked Savings Scheme (ELSS) of Mutual Funds Tuition Fees including admission fees or college fees paid for full-time education of any two children of the assessee (Any development fees or donation or payment of a similar nature shall not be eligible for deduction). 9. Infrastructure Bonds issued by Institutions/ Banks such as IDBI, ICICI, REC, PFC etc. 10. Interest accrued in respect of NSC VIII issue. 11. Pension scheme of LIC of India or any other insurance company. 12. Fixed Deposit with Banks having a lock-in period of 5 Years Notes: There are no sectoral caps (except in PPF) on investment in the new section and the assessee is free to invest Rs. 100000 in any one or more of the specified instruments. Amount invested in these instruments would be allowed as deduction irrespective of the fact whether (or not) such investment is made out of income chargeable to tax. Section 80C deduction is allowed irrespective of the assessees income level. Even persons with taxable income above Rs. 1000000 can avail the benefit of section 80C. Some of the popular pension plans are Jeevan Suraksha by LIC, Life Time Pension By ICICI Prudential Life Insurance, Aviva Life - Pension Plus by Aviva Life Insurance, Max-Easy Life policy by Max New York Life, Nirvana Plus by Tata AIG Life Insurance etc. Please note that because the deduction is allowed from taxable income, the exact savings in tax will depend upon the tax slab of the individual. Thus, a person in the 30% tax slab can save income tax up to Rs. 30,900 (or Rs. 33,990 if annual income exceeds Rs. 10,00,000) by investing Rs. 1,00,000 in the specified schemes u/s 80C. - 77 www.bajajcapital.com
Financial Planning
360o Plan > Tax Planning Deduction under section 80D Under this section, deduction of up to Rs 40000 can be claimed in respect of premium paid by cheque towards health insurance policy of various General Insurance companies like Royal Sundaram Health Shield Gold, Reliance Healthwise etc. Such premium can be paid towards health insurance of spouse, dependent parents as well as dependent children as per following table:
On whose life health Insurance Policy is taken Individual taxpayer, his/her spouse and dependent children Rs. 15,000 5,000 20,000 Additional Deduction for parents of the Individual whether dependent or not Rs. 15,000 5,000 20,000 Total
General Deduction Additional Deduction if one of the insured is Senior Citizen Total
30,000 10,000 40,000
Accordingly a person who is falls/in the 30% tax bracket can save income tax up to Rs 4,635 (or Rs. 5099 if the annual income exceeds Rs 10,00,000) by paying Rs 15,000 as premium for "Mediclaim" policy in a year. Deduction under section 24(b) Under this section, interest on borrowed capital for the purpose of house purchase or construction is deductible from taxable income up to Rs. 150000 with some conditions to be fulfilled.
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Financial Planning
360o Plan > Tax Planning TAX FREE INCOME The following incomes are completely exempted from income tax without any upper limit. 1. 2. 3. 4. Interest on PPF/GPF/EPF. Interest on GOI tax free bonds. Dividends on Shares and on Mutual Funds. Any capital receipt from life insurance policies i.e., sums received either on death of the insured or on maturity of life insurance plans. However, in case of life insurance policies issued after March 31, 2004, exemption on maturity payment u/s 10(10D) is available only if the premium paid in any year does not exceed 20% of the sum assured. 5. Interest on savings bank account in a post office. 6. Long term capital gain on sale of shares and equity mutual funds if the security transaction tax is paid/imposed on such transactions. Dividend Income Dividend income from companies /equity-oriented Mutual Funds is completely exempt in the hands of investors. Dividend is also tax-free in the hands of investors in case of debt-oriented Mutual Fund schemes. Gift Tax: Gift tax was abolished with effect from October 1, 1998. The gifts are no longer taxable in the hands of donor or donee. However, with effect from September 1, 2004, any gift received by an individual or HUF will be included in taxable income, provided the amount of gift exceeds Rs 50,000. However, gifts received from any of the following will continue to remain tax free: 1. Spouse 2. Brother or sister 3. Brother or sister of the spouse 4. Brother or sister of either of the parents of the individual 5. Any lineal ascendant or descendant of the individual 6. Any lineal ascendant or descendant of the spouse of the individual 7. Spouse of the person referred to in (2) or (6) 8. Also, gifts received on the occasion of marriage or under a will by way of inheritance are also tax free Banking Cash Transaction Tax was abolished with effect from March 31,2009
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Financial Planning
360o Plan > Tax Planning Computation of Gross Taxable Income As per Income Tax, Income of a Person is computed under the following 5 Heads: 1. 2. 3. 4. 5. Income from Salaries Income from House Properties Profit & Gains of Business & Profession Capital Gains Income from Other Sources
Now we will discuss in detail about the taxability of these sources of income. 1. Salary or Pension Income Salaried employees are issued a certificate of tax deducted at source from salary income by their employers in Form No. 16. It also gives the Net Taxable Salary figure. 2. Income from House Property If the property is self occupied then the Income from House Property is treated as NIL. If any loan is taken for the purchase of the property then the amount paid towards interest upto a maximum of Rs.150000/- is deducted from taxable income. In case property is given on rent, then we have to find out the a. Annual Rental Income b. From this deduct Property Tax paid if any c. From balance amount deduct 30% towards repairs & maintenance d. From the residual figure deduct the amount of interest paid on loan taken for the purchase of the property. e. The resultant figure is the Income from House Property. 3. Profit from Business / Profession Income as arrived on the basis of Profit & Loss A/c 4. Income from Interest Interest Income from the following sources is also required to be included in the Gross Following are the taxable Income from interest: 1. 2. 3. 4. 5. 6. Interest on company deposits. Interest on debentures/bonds. Interest on savings bank account/ fixed deposits with banks. Interest on post office savings schemes like MIS, NSC, KVP etc. Interest on private loans given to relatives, friends or any other entity. .Interest on government securities.
Note: Deduction u/s 80 L has been omitted now and accordingly, interest income from the above sources is fully taxable now.
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Financial Planning
5. Children's Future Planning
Like every parent, you too must be overjoyed to watch your child grow. All parents want to give the best possible upbringing to their children. This includes good education and security, in case of any eventuality. Soon, your little bundle of joy will grow up, and it will be time to provide for his or her higher education and wedding. The purpose of Children's Future Planning is to create a corpus for foreseeable expenditures such as those on higher education and wedding, and to provide for an adequate security cover during their growing years. Children's Future Planning acquires added importance because children's education and wedding are high priority life goals: which can neither be postponed nor can there be a compromise on the amount. Good education has always been the passport to a secure future. Today, career opportunities have grown manifold, and there are many professional courses that your child can aspire for. However, costs of higher education have also increased exponentially. Like most parents, you might be saving regularly to ensure a safe tomorrow for your child. However, savings alone is no longer enough. For ensuring adequate funding of your child's education, you as a parent need to do two things: Invest appropriate amount systematically and at regular intervals Provide for a financial security blanket to cover any eventuality It is never too early to start saving and investing for your child's future, especially in today's context. For example, the cost of a professional degree today is approximately Rs 2.5 lakhs. If your child is one-yearold today, after 17 years when he/she goes to college, you may require a sum of Rs 6.3 lakhs, assuming an annual rate of inflation of 6%. There are many products which your Financial Planner can use to achieve the above objectives. For example, he could suggest a Children's Future Plan offered by any good insurance company, to build a corpus for your child's higher education, and provide for a security cover in the event of the parent's unfortunate demise. Children's plans are also available under unit-linked option. Being unit-linked, they offer access to investments in all kinds of asset classes - equity, debt and cash.
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Financial Planning
6. Cash Flow Planning
What Is Cash Flow Planning? In simple terms, cash flow refers to the inflow and outflow of money. It is a record of your income and expenses. Though this sound simple, very few people actually take the time out to find out what comes in and what goes out of their hands each month Cash flow planning refers to the process of identifying the major expenditures in future (both short-term and long-term) and making planned investments so that the required amount is accumulated within the required time frame. Cash flow planning is the first thing that should be done prior to starting an investment exercise, because only then will you be in a position to know how your finances look like, and what is it that you can invest without causing a strain on yourself. It will also enable you to understand if a particular investment matches with your flow requirement. So does it involve looking at future cash flows only? Not really. You should always do a cash flow for yourself as on date, and you will realize that you could have a potential savings amount within each month of your working life. This is the amount that you should look at saving for meeting your financial goals. The best way of doing this is to have a personal budget. Why is Cash Flow planning important? Cash flow plans are commonly used by business houses. Without a viable cash flow plan, a company could easily spend more than its revenue, putting it in peril. Unfortunately, most of us do not realise that a cash flow plan is as important for people like us as well. The principles that apply to corporate finance and to our personal lives are largely the same. There has never been a bigger need than today for families and individuals to work out cash flow plans. Without proper cash flow planning one could easily get caught in the debt trap. Of course, it goes without saying that creating a plan is not enough. One also needs to implement the plan, besides bringing about a change in the spending habits. Cash flow plan brings you face-to-face with what you should ideally be saving, and investing in a systematic and regular manner, and what would it mean to you to withdraw from your portfolio after a couple of years. It brings down in numbers what your financial future has in store for you, and gives a crystal clear view (as much as is possible with inflation and the interest rate scenario).
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Financial Planning
360o Plan > Cash Flow Planning PERSONAL BUDGET How to make a Personal Budget? The first thing you will need to do is to collect all your bills, receipts and other documents which will help you monitor your spending for the month. A good idea is to jot down all your expenses in a notebook. Include both fixed and variable expenses in your list. Fixed expenses: These are those that stay the same every month (at least for a relatively long period). These are expenses that have been committed for a long term. For example, rent, school fees of your children, wages paid out to domestic helps, etc are all fixed expenses. Variable expenses, These are those expenses that change from month to month. Expenses on food, clothing, electricity and phone bills, entertainment, etc. could be clubbed under this head. You have a relatively higher control over some of these. Steps to Creating an Effective Personal Budget Make a list of all of your monthly income: If you have received an annual bonus, divide this number by 12. Do the same to all other lump sum incomes of an annual nature. It is important to list all sources. Next, make a list of all your monthly expenses: If an expense occurs less frequently, convert it to the monthly format. Be sure to include all expenses as housing, food, transportation, utilities, entertainment, etc. It is wise to track your spending for a full month during this stage. Now you can see for yourself if your income covers all of your current expenses. If the answer is no, then you need to cut down on your expenses. Depending on the amount of the shortfall, you may choose to reduce some of your variable expense (such as spending money on movies or junk food!) or increase your earnings. For example, you could take up a part-time job after your regular work hours, or give tuitions. If your income is in excess of your expenses, consider investing the difference instead of spending it. If you have just started the budgeting exercise, it may be difficult to keep all records. Do not worry; just keeping tracking of as many expenses as you can. The more accurate and complete this exercise is the easier and more effective will your cash flow planning be.
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Financial Planning
360o Plan > Cash Flow Planning CASH FLOW PLANNING BASICS The idea behind cash flow planning is to match expenses on life goals with the available income. Cash flow planning begins with identifying the sources and the amount of income and expenditure. 'Income' includes maturities of investments, income from other sources, dividends, etc. 'Expenses' include loan repayments, and all other outflows etc. The next crucial step is to list out the life goals and assigning a time frame for achieving them. For example, your list could look like this: Going abroad on a vacation next year Buying a car in 2 years Buying your child a computer next year The next step is to prioritise these goals. As you will notice, some of these goals (like buying your child a computer, which is important for his or her education; or a wedding in the family) are high priority, while others (such as going abroad on a vacation) could be assigned a relatively lower priority. High priority goals are those where you do not have the liberty of compromising either on the time frame or on the amount. Low priority goals, on the other hand, can be tweaked around a bit. Finally, take care to ensure that you have a contingency fund to tackle an emergency. Ideally, the size of your contingency fund should be two-three times your monthly expenditure, if you are a working person. If you are a retired person, the amount should be three to five times. Thereafter, your financial planner can help you work out the right investment strategy by using the principles of Investment Planning. Essentially, this involves calculating the amount of investment required to realise the goal, taking inflation into account.
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Financial Planning
About Investments
Everyone needs to save for a rainy day. Once you have saved enough to take care of emergencies, you should start thinking about investing and to make your money grow. We can help you plan your investments so that you can reap adequate benefits and achieve your financial goals. Investment Instruments I. II. III. IV. V. VI. VII. VIII. Mutual Funds Bonds Pension Schemes Real Estate Company Fixed Deposits Post office Schemes Initial Public Offering (IPO) Portfolio Management Service (PMS)
I. Mutual Funds
II. Bonds
III. Pension Schemes
IV. Real Estate
V. Company Fixed Deposits
VI. Post office Schemes
VII. Initial Public Offering (IPO)
VIII. Portfolio Management Service (PMS)
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Financial Planning
About Investments
I. Mutual Funds
Mutual Funds are among the hottest favorites with all types of investors. Mutual funds ranks among one of the preferred ways of creating wealth over the long term. In fact, mutual funds represent the hands-off approach to entering the equity market. There are a wide variety of mutual funds that are viable investment avenues to meet a wide variety of financial goals. This section explains the various aspects of Mutual Funds. WHAT ARE MUTUAL FUNDS? A Mutual Fund is a trust that pools together the savings of a number of investors who share a common financial goal. The fund manager invests this pool of money in securities, ranging from shares and debentures to money market instruments or in a mixture of equity and debt, depending upon the objectives of the scheme.
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Financial Planning
About Investments > Mutual Funds WHY CHOOSE MUTUAL FUNDS? Investing in Mutual Funds offers several benefits: Professional Expertise Fund managers are professionals who track the market on an on-going basis. With their mix of professional qualification and market knowledge, they are better placed than the average investor to understand the markets Diversification Since a Mutual Fund scheme invests in number of stocks and/or debentures, the associated risks are greatly reduced. Relatively Less Expensive When compared to direct investments in the capital market, Mutual Funds cost less. This is due to savings in brokerage costs, demat costs, depository costs etc. Liquidity Investments in Mutual Funds are completely liquid and can be redeemed at their Net Assets Value-related price on any working day. Transparency You will always have access to up-to-date information on the value of your investment in addition to the complete portfolio of investments, the proportion allocated to different assets and the fund manager's investment strategy. Flexibility Through features such as Systematic Investment Plans, Systematic Withdrawal Plans and Dividend Investment Plans, you can systematically invest or withdraw funds according to your needs and convenience. SEBI Regulated Market All Mutual Funds are registered with SEBI and function within the provisions and regulations that protect the interests of investors. AMFI is the supervisory body of the Mutual Funds industry.
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Financial Planning
About Investments > Mutual Funds TYPES OF MUTUAL FUNDS Diversified Equity A mutual fund scheme that achieves the benefits of diversification by investing in the stocks of companies across a large number of sectors and as a result, it minimizes the risk of exposure to a single company or sector. Sectoral Equity A mutual fund scheme which focuses on investments in the equity of companies across a limited number of sectors, usually one to three. Index Funds These funds invest in the stocks of companies, which comprise major indices such as the BSE Sensex or the S&P CNX Nifty in the same weightage as the respective indice. Equity Linked Tax Saving Schemes (ELSS) Mutual Fund schemes investing predominantly in equity, and offering tax deduction to investors under section 80C of the Income Tax Act. Currently rebate u/s 80C can be availed up to a maximum investment of Rs 100000. A lock-in of 3 years is mandatory. Monthly Income Plan Scheme A mutual fund scheme which aims at providing regular income (not necessarily monthly, don't get misled by the name) to the unit holder, usually by way of dividend, with investments predominantly in debt securities (upto 95%) of corporate and the government, to ensure regularity of returns, and having a smaller component of equity investments (5% to 15%)to ensure higher return. Income schemes Debt oriented schemes investing in fixed income securities such as bonds, corporate debentures, Government securities and money market instruments. Floating-Rate Debt Fund A fund comprising of bonds for which the interest rate is adjusted periodically according to a predetermined formula, usually linked to an index. Gilt Funds These funds invest exclusively in government securities. Balanced Funds The aim of balanced funds is to provide both growth and regular income as such schemes invest both in equities and fixed income securities in the proportion indicated in their offer documents. They generally invest 40-60% in equity and debt instruments. Fund of Funds A Fund of Funds (FoF) is a mutual fund scheme that invests in other mutual fund schemes. Just as fund invests in stocks or bonds on your behalf, a FoF invests in other mutual fund schemes.
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Financial Planning
About Investments > Mutual Funds SNAPSHOT OF MUTUAL FUND SCHEMES

MUTUAL FUND TYPE Money Market OBJECTIVE Liquidity + Moderate Income + Reservation of Capital Liquidity + Moderate Income RISK Negligible INVESTMENT PORTFOLIO Treasury Bills, Certificate of Deposits, Commercial Papers, Call Money WHO SHOULD INVEST Those who park their funds in current accounts or short-term bank deposits Those with surplus short-term funds INVESTMENT HORIZON 2 days - 3 weeks
Short-term Funds (Floating short-term) Bond Funds (Floating Long-term) Gilt Funds
Little Interest Rate
Regular Income
Credit Risk & Interest Rate Risk Interest Rate Risk High Risk
Security & Income
Call Money, Commercial Papers, Treasury Bills, Certificates of Deposit (CD), Short-term Government securities. Predominantly Debentures, Government securities, Corporate Bonds Government securities
3 weeks 3 months
Salaried & conservative investors Salaried & conservative investors Aggressive investors with long term out look. Aggressive investors.
More than 9 - 12 months
12 months & more 3 years plus
Equity Funds
Long-term Capital Appreciation
Stocks
Index Funds
To generate returns that are commensurate with returns of respective indices
NAV varies with index performance
Portfolio indices like BSE, NIFTY etc
3 years
Note: Mutual fund investments are subject to market risks. Please read all scheme related documents carefully before investing.
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Financial Planning
About Investments > Mutual Funds HOW TO CALCULATE THE GROWTH OF YOUR MUTUAL FUND INVESTMENTS? Let's assume that Mr. Gupta has purchased Mutual Fund units worth Rs. 10,000 at an NAV of Rs. 10 per unit on February 1. The Entry Load on the Mutual Fund was 2%. On September 15, he sold all the units at an NAV of Rs 20. The exit load was 0.5%. His growth/ returns is calculated as under: 1. Calculation of Applicable NAV and No. of units purchased: a. Amount of Investment = Rs. 10,000 b. Market NAV = Rs. 10 c. Entry Load = 2% = Rs. 0.20 d. Applicable NAV (Purchase Price) = (b) + (c) = Rs. 10.20 e. Actual Units Purchased = (a) / (d) = 980.392 units 2. Calculation of NAV at the time of Sale a. NAV at the time of Sale = Rs 20 b. Exit Load = 0.5% or Rs.0.10 c. Applicable NAV = (a) (b) = Rs. 19.90 3. Returns/Growth on Mutual Funds a. Applicable NAV at the time of Redemption = Rs. 19.90 b. Applicable NAV at the time of Purchase = Rs. 10.20 c. Growth/ Returns on Investment = {(a) (b)/(b) * 100} = 95.30%
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Financial Planning
About Investments > Mutual Funds POINTS TO REMEMBER Do not speculate Always evaluate risk-taking capacity. Do not chase returns Because what goes up must come down Do not put all eggs in one basket Diversification reduces the risk. Do not stop working on Mutual Funds Continuous evaluation of funds is a must. Do not time the market Every time is good for investments. Mutual Funds are subject to market risks and there is no assurance that the fund objective will be achieved. NAVs fluctuate depending on forces affecting the Capital market. Past performance may or may not be sustained in the future.
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Financial Planning
About Investments > Mutual Funds MUTUAL FUND ACRONYM Assets Management Company (AMC) A highly regulated organization that pools money from many people into portfolio structured to achieve certain objectives. Typically an AMC manages several fundsopen ended/ close ended across several categories- growth, income, balanced. Balanced Fund A hybrid portfolio of stocks and bonds Close Ended Fund They neither issue nor redeem fresh units to investors. Some closed ended funds can be bought or sold over the stock exchange if the fund is listed. Else investor has to wait till redemption date to exit. Most listed close ended funds trade at discount to the NAV. Open Ended Fund A diversified and professionally managed scheme, it issues fresh units to incoming investors at NAV plus any applicable sales charge, and it redeems shares at NAV from sellers, less any redemption fees. Entry/ Exit Load A charge paid when an investor buys/sells a fund. There could be a load at the time of entry or exit, but rarely at both times. Expense Ratio The annual expenses of the funds, including the management fee, administrative cost, divided by the fund under management. Growth/Equity Fund A fund holding stocks with good or improving profit prospects. The primary emphasis is on appreciation. Liquidity Investment can be bought or sold. A person should be able to buy or sell a liquid asset quickly with virtually no adverse price impact. Net Assets Value (NAV) NAV is a price or value of one unit of a fund. It is calculated by summing the current market values of all securities held by the fund, adding the cash and any accrued income, then subtracting liabilities and dividing the result by the number of units outstanding. Interest Rate Risk The risk borne by fixed-interest securities, and by borrowers with floating rate loans, when interest rates fluctuate, i.e. when interest rates rise, the market value of fixed-interest securities declines and vice versa.
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Financial Planning
About Investments > Mutual Funds Credit Risk Credit risk involves the loss arising due to a customers or counterpartys inability or unwillingness to meet commitments in relation to lending, trading, hedging, settlement and other financial transactions. Capital Market Risk It is the risk arising due to changes in the Stock Market conditions. New Fund Offer (NFO) NFO is a security offering in which investors may purchase units of a closed-end mutual fund. A new fund offer occurs when a mutual fund is launched, allowing the firm to raise capital for purchasing securities. A new fund offer is similar to an Initial Public Offering (IPO). Both represent attempts to raise capital to further operations. New fund offers are often accompanied by aggressive marketing campaigns, created to entice investors to purchase units in the fund. However, unlike an initial public offering (IPO), the price paid for shares or units is often close to a fair value. This is because the net asset value of the mutual fund typically prevails. Because the future is less certain for companies engaging in an IPO, investors have a better chance to purchase undervalued shares.
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Financial Planning
About Investments > Mutual Funds INCOME TAX PAN NUMBER REQUIREMENT FOR MF INVESTMENTS Whom does it apply to? PAN number is required from all investors including NRI, PIO and Guardians in case of minors. POA and Lien holders need not submit the documents To which transactions it is applicable? All fresh purchases, additional purchases, SIPs registered with effect from 02/07/2007. Which transactions are not covered? Redemptions, Switches, STP, Dividend Payouts, Dividend Reinvestments and SIPs registered prior to 02/07/2007. Which are the documents to be submitted for applications greater than and equal to Rs.50000? PAN copy duly attested, or If PAN is not available, Form 60 with proof of address along with copy of Form 49A (application for PAN) duly acknowledged. Which are the documents to be submitted for applications less than Rs.50000? PAN copy duly attested, or Copy of Form 49A (application for PAN) duly acknowledged Who should certify the PAN? Self certification and Attestation by Bank Manager/ Notary (clearly mentioning their name and designation, affixing their respective seal/ stamp and sign in original), or Distributor (thru whom the investment is mobilized, affixing the ARN code stamp, clearly mentioning the name of the person attesting the document and signing in original), or AMC/ Registrar (clearly affixing the AMC/ Registrar stamp and sign in original of the employee clearly mentioning his/ her name and/ or employee ID no) Can we accept an application, if 1st unit-holder has a PAN and joint holders do not have a PAN, and have not even applied for the same? No, we can't accept that application because as per the new guideline of SEBI, every holder has to submit his/her PAN card while investing irrespective of any amount. For example, Mr. A and Mr. B have applied jointly for investment in one of the mutual fund schemes. In that case, both of them are required to have their PAN card or PAN card acknowledgement as a proof that they have applied for the same. What if, a client is investing in MF for quite sometime now, since PAN card has been made compulsory now, Will it affect already invested money? PAN Card has been made mandatory for all fresh mutual fund transactions irrespective of any amount w.e.f. July 02, 2007. However, redemptions or switches can be made without PAN card copy or other documents i.e. Form 49A. Payouts/ Dividend reinvestments and SIPs registered before July 02, 2007 will be processed without a PAN.
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Financial Planning
About Investments > Mutual Funds
What will be the treatment for mutual funds investment documents after Dec 31, 2007? All those investors who have applied for their PAN card and submitted the PAN acknowledgement as a proof that they have applied for PAN card, must submit duly attested photocopy of their original PAN card on or before Dec 31, 2007. From Jan 01, 2008 , submitting a copy of the evidence of having applied for PAN/ Form 60/Form 61 will not be valid and it will be mandatory for all the investors to provide a certified copy of the PAN card for all kind of fresh transactions. Does the investor have to give copy of PAN along with every fresh investment? Yes. The investor has to give a copy of PAN with every fresh transaction. In case of single applicant with nominee, whether PAN number is required for the nominee? No. PAN card of nominee is not required. Is PAN required for fresh investments even through SIPs? Yes. A PAN card is required for every fresh purchase of SIP (at the time of first transaction only)
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Financial Planning
About Investments > Mutual Funds GOLD MUTUAL FUNDS What is a Gold Fund? The Mutual Fund scheme investing into Gold with very many benefits like: Purity: Good control on quality of gold. Safe Custody: No locker charges, No Risk of theft. SIP Facility: Availability in smaller denomination. Easy Liquidity Cost Effective: No Wealth Tax. No Demat requirement. Why gold as an asset? Positive Return in last decade Gold as an investment asset has given positive returns for each year during the last decade outpacing most of asset classes. Gold has provided compounded annual return in excess of 16% cent and it has appreciated by 422% in absolute terms during the decade. India is the world's largest gold consumer Indian consumers regard gold jewellery as an investment and are well aware of gold's benefits as a store of value. Gold is also recognized as a form of money in India, a tradable liquid asset. Demand versus Supply With increase in demand and relatively limited supply, the value of gold is expected to appreciate. Instability in currency market The recent instability in the currency market is also a factor for gold's bull run
Mutual Funds: Gold A foundation asset class for wealth creation From being an alternative investment option, gold has gained the status of must have in any portfolio Gold is seen as a symbol of security and a sign of prosperity. It is one of the foundation assets for Indian households and a means to accumulate wealth from a long term perspective. Gold investment has been in the culture of Indian tradition and has been on rise amongst the modern investors as well due to the financial uncertainty and inflationary pressures.
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Financial Planning
About Investments > Mutual Funds Investment Case for Gold an asset class apart The yellow metal continues to breach its high (YOY) since 2001 till date.
Past Performance may or may not be sustained in future. The above table and graph gives an illustration of the performance of Gold on the basis of historical data, if invested directly. The same should not be construed as an indication, promise, guarantee or a forecast of any returns. The details may not necessarily provide a basis for comparison with any other investment avenues. Readers are advised to seek independent professional advice and arrive at an informed investment decision before making any investments. Source: Bloomberg, Gold (USD/Oz) The graph above shows the open, close high and low for a ten year period. The figure in the graph indicates the high level of gold prices for each year. The gold prices have risen for 10 consecutive years driven by recovery in key sectors of demand and continued global economic uncertainty. Moreover there is a mismatch in demand and supply of gold with the declining trend of official sector sales. In fact for the first time over two decades, the official sector is set to record net inflows in 2010.(Source: World Gold Council) The performance of gold has not only been strong, but its volatility also remained low, providing a foundation for a well diversified portfolio. Asset allocation with gold aims to provide an opportunity to enhance and stabilize returns over a period Gold as asset over centuries has maintained its value against inflation and considered a hedge against inflation.
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Financial Planning
About Investments > Mutual Funds SEE ALSO NFO http://www.bajajcapital.com/investments/mutual-funds/NFOs.php?id=3 Fund Manager http://www.bajajcapital.com/investments/mutual-funds/fund%20manager.php?id=3 Fund Barometer http://www.bajajcapital.com/investments/mutual-funds/fund_pages/Fund-Barometer.xls FAQ http://www.bajajcapital.com/investments/mutual-funds/faqs.php?id=3 PAN Requirements http://www.bajajcapital.com/investments/mutual-funds/pan.php?id=3 Dividends Declared http://www.bajajcapital.com/investments/mutual-funds/mf_historical_divident.php?id=3 News http://www.bajajcapital.com/investments/mutual-funds/mf_news.php?id=3 Top-Funds http://www.bajajcapital.com/investments/mutual-funds/mf_top_funds.php?id=3 Latest NAV http://www.bajajcapital.com/investments/mutual-funds/mf_latest_nav.php?id=3 Historical NAV http://www.bajajcapital.com/investments/mutual-funds/mf_historical_nav.php?id=3 NAV Graph http://www.bajajcapital.com/investments/mutual-funds/mf_nav_graph.php?id=3 Compare Funds http://www.bajajcapital.com/investments/mutual-funds/mf_compare_funds.php?id=3 Dividend Declared http://www.bajajcapital.com/investments/mutual-funds/mf_historical_divident.php?id=3 Gold Funds http://www.bajajcapital.com/investments/mutual-funds/funds.php?id=3
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Financial Planning
II. Bonds
Bond refers to a security issued by a company, financial institution or government which offers regular or fixed payment of interest in return for borrowed money for a certain period of time. By purchasing a bond, an investor loans money for a fixed period of time at a predetermined interest rate. While the interest is paid to the bond holder at regular intervals, the principal amount is repaid at a later date, known as the maturity date. While both bonds and stocks are securities, the principle difference between the two is that bond holders are lenders, while stockholders are the owners of the organization. Another difference is that bonds usually have a defined term, or maturity, after which the bond is redeemed, whereas stocks may be outstanding indefinitely. An exception is a consol bond, which is perpetuity (i.e., bond with no maturity). Thus a bond is like a loan: the issuer is the borrower (debtor), the holder is the lender (creditor), and the coupon is the interest. Bonds provide the borrower with external funds to finance long-term investments, or, in the case of government bonds, to finance current expenditure. Certificates of Deposit (CD) or commercial paper are considered to be money market instruments and not bonds. Bonds must be repaid at fixed intervals over a period of time. TYPES OF BONDS 1. Tax Free Bonds, 6.5% Tax free bonds have been withdrawn from the market. This will not effect the investments already made. 2. Taxable Bonds See Next Page
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Financial Planning
About Investments > Bonds 2. Taxable Bonds Salient Features: 1. Eligibility for Investment The Bonds may be held by I. an individual, not being a Non-Resident Indian (NRI) a. in his or her individual capacity, or b. in an individual capacity on joint basis, or c. in an individual capacity on anyone or survivor basis, or d. on behalf of a minor as father/mother/legal guardian II. Hindu Undivided Family. III. As below: a. 'Charitable Institution' to mean a Company registered under Section 25 of the Indian Companies Act 1956 or, b. An institution which has obtained a Certificate of Registration as a charitable institution in accordance with a law in force; or c. Any institution which has obtained a certificate from Income Tax Authority for the purpose of Section 80G of the Income Tax Act, 1961. IV. "University" means a university established or incorporated by a Central, State or Provincial Act, and includes an institution declared under section 3 of the University Grants Commission Act, 1956 (3 of 1956), to be a university for the purposes of that Act. 2. Limit of Investment There is no maximum limit for investment in the Bonds. 3. Tax Treatment I. Income-Tax Interest on the Bonds will be taxable under the Income-Tax Act, 1961 as applicable according to the relevant tax status of the bond holder. II. Wealth Tax The Bonds will be exempt from Wealth-tax under the Wealth- Tax Act, 1957. 4. Issue Price I. The Bonds will be issued at par i.e. at Rs.100.00 percent. II. The Bonds will be issued for a minimum amount of Rs. 1000/- (face value) and in multiples thereof. Accordingly, the issue price will be Rs.1000/- for every Rs.1000/(Nominal). 5. Subscription Subscription to the Bonds will be in the form of Cash/Drafts/Cheques. Cheques or drafts should be drawn in favour of the Receiving Office, specified in paragraph 10 below and payable at the place where the applications are tendered.
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Financial Planning
About Investments > Bonds 6. Date of Issue I. The Bonds will be issued with effect from 21st April 2003. II. The date of issue of the Bonds in the form of Bond Ledger Account will be the date of receipt of subscription in cash or the date of realisation of draft/cheque. 7. Form I. The Bonds will be issued and held at the credit of the holder in an account called Bond Ledger Account (BLA). II. New Bond Ledger series with the prefix (TB) are to be opened. All investment in 8% Savings (Taxable) Bonds by an existing BLA holder will be viewed as a new investment under a new BLA. III. The Bonds in the form of Bond Ledger Account will be issued by and held with designated branches of the agency banks and SHCIL as authorised by Reserve Bank of India in terms of paragraph 10 below. IV. The Certificate of Holding in respect of Bond Ledger Account will be issued in Form TBX or Form TBY as applicable for non-cumulative and cumulative investments respectively. V. The Certificate of Holding in respect of cash applications may be issued on the same day as per the extant instructions. 8. Applications I. Applications for the Bonds may be made in Form A (Annex 2) or in any other form as near as thereto stating clearly the amount and the full name and address of the applicant. II. Applications should be accompanied by the necessary payment in the form of cash/drafts/cheques as indicated in paragraph 6 above. III. Applicants who have obtained exemption from tax under the relevant provisions of the Income Tax Act, 1961, shall make a declaration to that effect in the application (in Form 'A') and submit a true copy of the certificate obtained from Income-Tax Authorities. 9. Receiving Offices Applications for the Bonds in the form of Bond Ledger Account will be received at: a. Authorised Branches of State Bank of India, Associate Banks, Nationalised Banks, four private sector banks and SHCIL as specified in the Annex 3. b. Any other bank or branches of the banks and SHCIL as may be specified by the Reserve Bank of India in this regard from time to time. 10. Nomination A sole holder or a sole surviving holder of a Bond, being an individual, may nominate in form B (Annex 4) or as near thereto as may be, one or more persons who shall be entitled to the Bond and the payment thereon in the event of his/her death. 11. Transferability The Bond in the form of Bond Ledger Account shall not be transferable.
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Financial Planning
About Investments > Bonds 12. Interest I. The bond will be issued in cumulative and non-cumulative form, at the option of the investor. II. The Bond will bear interest at the rate of 8% per annum. Interest on non-cumulative bonds will be payable at half-yearly intervals from the date of issue in terms of paragraph 7 above. Interest on cumulative bonds will be compounded with half-yearly rests and will be payable on maturity along with the principal. In the latter case, the maturity value of the Bonds shall be Rs.1601/- (being principal and interest) for every Rs.1000/-(Nominal). Interest to the holders opting for non-cumulative Bonds will be paid from date of issue in terms of paragraph 7 above upto 31st July/31st January, as the case may be and thereafter at half-yearly for period ending 31st July/31st January on 1st August and 1st February. Interest on Bond in the form of "Bond Ledger Account" will be paid, by cheque/warrant or through ECS by credit to bank account of the holder as per the option exercised by the investor/holder. 13. Advances/Traceability against Bonds The Bonds shall not be tradable in the secondary market and shall not be eligible as collateral for loans from banks, financial Institutions and Non Banking Financial Companies, (NBFC) etc. 14. Repayment The Bonds shall be repayable on the expiry of 6 (Six) years from the date of issue. No interest would accrue after the maturity of the Bond. Bonds Instruments Infrastructure Bonds Government of India (GOI) Bonds Capital Gain Bonds Non Convertible Debentures (NCD) Bonds Easy Gold Scheme Bonds
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Financial Planning
About Investments > Bonds SEE ALSO Infrastructure Bonds Introduction http://www.bajajcapital.com/investments/bonds/infrabond_intro.php?id=3 FAQ http://www.bajajcapital.com/investments/bonds/infra_faq.php?id=3 Product List http://www.bajajcapital.com/investments/bonds/infrastructure_bonds.php?id=3 Government of India (GOI) Bonds http://www.bajajcapital.com/investments/bonds/goi_bonds.php?id=3 Capital Gain Bonds http://www.bajajcapital.com/investments/bonds/capitalgain_bonds.php?id=3 Non Convertible Debentures (NCD) Bonds http://www.bajajcapital.com/investments/bonds/download_ncd_bonds.php?id=3 Easy Gold Scheme Bonds http://www.bajajcapital.com/investments/bonds/download_gold_bonds.php?id=3
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Financial Planning
III. Pension Schemes
Bajaj Capital as Point of Presence (POP) Bajaj Capital as a POP for the New Pension Scheme shall be the first point of interaction between the voluntary subscriber and the NPS architecture. All functions related to registration of subscribers, undertaking the Know Your Client (KYC) verification, receiving contributions & instructions from subscribers and transmission of the same to designated NPS intermediaries shall be performed by us. Bajaj Capital, as of now is rendering services through 25 of its selected centres spread across India that will be acting as Point of Presence - Service Providers (POP-SPs). All services as subscriber registration, change of details, receiving contributions, grievance handling, etc will be performed by the POP-SP. We have our expertise in offering products & services as: Financial Planning & Investment Advisory DP Services Financial Products as Mutual Funds, IPO, Life & Non Life Risk Cover Plans, Company FD, Post Office Schemes, Real Estate, Structured Products, Art and other such specialized plans. Portfolio Construction Plan & Portfolio Reviews In house publications for promoting financial literacy amongst our investors Certified Financial Planners to integrate your finances with your life goals Pan Services, etc. NPS stands as a very important addition to suite of products & services being offered by Bajaj Capital. NPS is a pension scheme introduced by Government of India.
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Financial Planning
About Investments > Pension Schemes ABOUT NPS What is NPS? It is a pension scheme introduced by Government of India where, you can regularly invest in this scheme and get a part in lump-sum at your retirement and it gives fixed monthly income for the lifetime. Common man's gateway to getting pension benefits post retirement. How does it work? The NPS is based on a unique individual Permanent Retirement Account Number (PRAN) created for individual subscribers. The PRAN Number will remain the same for your lifetime irrespective of where you operate your NPS A/c from across the nation. This system will initially be based on two types of sub accounts created for individual investors: a. Tier 1: non withdraw able & tax deferred pension account (for all individuals) and b. Tier 2: with draw able savings account with no tax advantages (for all individuals subject to minimum deposits per year in Tier-1 A/c). In this system, A member will have complete control on how his / her contributions / savings are being managed by selecting a professional Pension Fund Manager (PFM) from a pool of PFM's. A subscriber shall periodically contribute savings into his/her Permanent Retirement Account (PRA) while he/she is working and - Use the accumulations at retirement to procure a pension for the rest of his/her life. What are the exclusive NPS Benefits? Cost effective mode of planning for one's retirement, the cost structure is far more efficient when compared with charges levied by mutual funds or other investment options. Investment in NPS is highly safe and it contains very less amount of risk these schemes were launched in May-2009 and have yielded about 12% annualized return. New Pension Scheme provides high returns compare to other relative investment options. It provides tax benefits under section 80C of income tax. Government provided pension plan directly regulated by PFRDA - Safety wise Great End to End Retirement Planning Tool as it will offer investment benefit during the work life and annuity benefit post retirement Option to seamlessly switch across savings b/w investment schemes Portable Plan Nationwide access to NPS over a period of time A Must in every individual's portfolio
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Financial Planning
About Investments > Pension Schemes Investment Options in NPS 1. NPS offers two approaches for investment a. Active Choice The subscriber will have the option to select how his / her proceeds will be invested across the 3 asset classes with a cap on equity at 50%. b. Auto Choice If the subscriber is unwilling to express choice, the proceeds will be invested in a pre determined asset allocation depending on age band that the subscriber is in. 2. Investor can decide on proportion of investment to be made across different Debt, Equity & Government Securities. The maximum exposure that can be taken in equity is up to 50%. The investment classes are as given below: a. G-Class Investment would be in Government securities like GOI bonds and State Govt. bonds b. C-Class Investment would be in fixed income securities other than Government Securities c. E -Class Investment would primarily in Equity market instruments. It would invest in Index funds that replicate the portfolio of either BSE Sensitive index or NSE Nifty 50 index.
Withdrawal Facility If the vesting age is less than 60 years, then 20% of the amount accumulated can be withdrawn and the balance 80% will have to be used to purchase annuity. If the vesting age is 60 years or more but less than 70 years, then 60% of the amount can be withdrawn either as lump sum or in a phased manner between age 60 & 70. Balance 40% will have to be used to purchase annuity. In case of death due to any cause, the nominee will have the option to withdraw the proceeds in lump sum.
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About Investments > Pension Schemes Do I have a choice to select my Fund Manager for investing my proceeds? You can select from the following seven pension fund managers for managing your proceeds: 1. 2. 3. 4. 5. 6. 7. SBI Pension Funds Pvt. Ltd UTI Retirement Solutions Ltd LIC Pension Fund Ltd IDFC Pension Fund Management Co Ltd Kotak Mahindra Pension Fund Ltd Reliance Capital Pension Fund Ltd ICICI Prudential Pension Funds Management Company Ltd.
Contributions Tier I: Minimum number of contributions: 4 Minimum contribution: Rs.6000 in a year Minimum contribution: Rs.500 per contribution Tier II: Minimum contribution of Rs.1000 at the time of account opening Minimum balance of Rs.2000 at the end of a financial year Charge Structure: New Account Opening Charges (Both Tier I & Tier II): Rs.40 Subsequent Contribution / Modification: Rs.20 Documents Required Two copies of identity proof Two copies of address proof Signature / Thumb impression (Male: Left, Female: Right) Date of Birth Proof Self Declaration that he / she is not a pre existing member of NPS Colored Passport size photograph
For Tier II Account, along with above documents, bank details & cancelled cheque is mandatory. NRI should have account with bank based in India to open account under NPS. After the account is opened, the Central Record Keeping Agency (CRA) shall mail a welcome kit containing subscriber's Permanent Retirement Account Number (PRAN) card and the complete information provided by the subscriber in the Subscriber Registration Form.
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Financial Planning
IV. Real Estate
In today's competitive world the Indian Real Estate sector offers you choices galore. In such a scenario you need a reliable partner who will give you the right advice and hold your hand to help you make the right choice. Intelli Realty from the house of Bajaj Capital is the right partner for you. It is the singlewindow to all your Real Estate needs providing you with cutting-edge insights into India's diverse and challenging Real Estate markets and offering you a complete range of services related to purchase/sale/leasing of residential and commercial property. Intelli Realty enables you to identify opportunities and risks first-hand. Backed by Bajaj Capital, India's leading Investment Advisory and Financial Planning company, Intelli Realty brings accurate and timely Real Estate market intelligence to help you make smart business decisions. We regularly update our clients with research reports carefully prepared and constantly updated by a team of highly qualified research professionals. A team of Real Estate Managers who continuously keep abreast of the everchanging consumer needs. In addition, we leverage our industry relationships and bring for our clients; from across India, the right property that matches their needs and maximizes their returns. Our work is not based on guess or assumption, "RESEARCH", is the only way we follow to accomplish our client's requirement of real estate. We are supported by our property experts and extensive property and client database, which enable our professionals to access regional property opportunities and to pursue client interest in a cost-effective manner. Spread across six cities in India (Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Kolkata) Intelli Realty provides investors with comprehensive range of services including research, consultancy, transactions and property management. Our experience of more than 6 years gained by working with the most active Developers, Corporates and Individuals make us the unchallenged market leaders in realestate advisory services. Our clients include individual investors, renowned HNI's Institutions, NRI, etc; they demonstrate the quality we deliver to them.
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Financial Planning
About Investments > Real Estate OUR SERVICES Intelli Realty TM SERVICES Property Services Sale/purchase of residential property Sale/purchase of commercial property Residential and Commercial leasing Housing loans (tie-up with leading banks) Areas of Operation We are primarily active in Delhi & NCR. However, we also undertake projects in various Indian cities on a case-to-case basis. Home Loan As we are the complete solution in all aspects of Real Estate, Home Loan facility is one of them. We are the channel partner of some reputed Bank and we facilitate in getting Home Loan as well. There are different types of Home Loans available in market to meet your needs, some of them are as follows: Home Purchase Home Improvement Home Construction Home Extension Home Conversion Land Purchase
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Financial Planning
About Investments > Real Estate BUYING REAL ESTATE The real estate sector is one of the fastest growing sectors in India and is poised to grow manifold with the thrust on infrastructure expansion. Highways, airports, SEZs, townships, commercial properties etc. are coming up all over the country, representing a great wealth creation opportunity for investors. According to Merill Lynch (world's leading financial management and advisory company), the Indian realty sector will grow from $12 billion in 2005 to $ 90 billion by 2015. Knight Frank, the real estate consultancy group, has predicted a 20% growth rate, year on year for the organized sector in India. This year, the Government of India has added fresh impetus to real estate sector by allowing 100% FDI. This relaxation of FDI ceiling rate has opened the doors for the international real estate developers to come to India. Real Estate as an investment According to the Financial Planning approach pioneered by Bajaj Capital, real estate is an important asset class. Investing in a carefully selected mix of asset classes is the ideal way to achieve long term investment success. The real estate sector in India has always been viewed as an unorganized sector but the past few years have seen a shift in the key that drives the growth. Returns from real estate investment in India have been higher than in other Asian countries. Real estate is an important resource that assists wealth creation. The real estate scenario in India has undergone a paradigm shift to include sectors like entertainment, hospitality, retail etc. along with the residential and office spaces. The Government of India's decision to allow 100% FDI in real estate construction has been another favorable step. Investment in real estate has begun to look competitive and is turning out to be a good investment option as compared to other investment options like equity. It attracts investors by giving a possibility of stable and predictable income yields, moderate capital appreciation and tax structuring benefits. Overall, real estate is expected to offer good investment alternatives to stocks and bonds in the coming years. OUR PRESENCE We are having all India network and having 146 Branches, In Real Estate business we are currently functioning in Delhi and NCR and about to launch these services in all around country, which is including but not limited to Chennai, Kolkatta, Mumbai, Bangalore, Hyderabad, Pune, Jaipur, Ludhiana, Chandigarh, Lucknow, Cochin, Ahmadabad, Dehradun, Coimbatore, Baroda......
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Financial Planning
V. Company Fixed Deposits
Introducing to Company Fixed Deposits Fixed Deposits in companies that earn a fixed rate of return over a period of time are called Company Fixed Deposits. Financial institutions and Non-Banking Finance Companies (NBFCs) also accept such deposits. Deposits thus mobilised are governed by the Companies Act under Section 58A. These deposits are unsecured, i.e., if the company defaults, the investor cannot sell the documents to recover his capital, thus making them a risky investment option. Benefits of investing in Company Fixed Deposits High interest. Short-term deposits. Lock-in period is only 6 months. No Income Tax is deducted at source if the interest income is up to Rs 5,000 in one financial year Investment can be spread in more than one company, so that interest from one company does not exceed Rs. 5,000 Like most investment option, Company Fixed Deposits are a mixed bag. Company FDs can be an interesting investment option if you know how to select the right FD, and how to avoid the no-so-good ones. Here are some of the points that investors should keep in mind. Spread your Risk The deposits should be spread over a large number of companies engaged in different industries. This way, you'll be able to diversify your risk among various industries/companies. Try not to put more than 10% of your total investments in one particular company. Choose the Right Period of Deposit Ideally, the investment should be for 1 to 3 years depending upon the rate of interest. Periodic Review The performance of the companies should be reviewed at maturity. This will help you decide whether to renew or reshuffle the deposit. It is also wise to keep a track of these companies by checking their share prices, annual reports and other details reported in newspapers.
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Financial Planning
About Investments > Company Fixed Deposits FIXED DEPOSITS GLOSSARY

Annual Yield Is the effective annual rate of return taking into account the effect of compounding interest, its utility lies in its ability to standardize varying interest-rate arrangements into an annualized percentage number for comparison The ability of a fixed deposit in India to generate interest, which is then reinvested in order to generate further earnings, is known as compound interest. Fixed Deposits in India are deposits for a fixed or specified period chosen by the depositor and are repayable on expiry of that period. Such deposits generally carry comparatively higher rate of interest depending on the time span. The original amount plus the compound interest thereon, stated as of a specific future date. A Fixed Deposit account that is owned together (jointly) by two or more people. The depositors can decide whether transactions require the signatures of all parties or whether one party can take actions on his/her own. KYC norms were introduced by the RBI to ensure customer identification and help control financial frauds, identify money laundering & suspicious activities. To comply with this requirement, NBFCs require the following documents for new depositors photos, PAN card copy, identification proof and address proof. The date on which the principal amount of any debt instrument becomes due and is repaid to the investor and interest payments stop. Companies ask their FD Holders to make nominations which mean that they should nominate persons to whom the the Fixed Deposit Amount should go in the event of their death. Nomination can be made in Fixed Deposit Application form itself or on a separate form indicating the name and address of the nominee. Non-Resident Fixed Deposits are those, which are maintained by Indian nationals and Persons of Indian origin resident abroad, foreign nationals and foreign companies in India. Few Companies accept ordinary non-resident Fixed Deposits in the names of private individuals provided initial deposits for investing in the Fixed Deposits are done through NRO Account. NRO stands for Non-Resident Ordinary account. It refers to the savings or Fixed Deposit account of a Non-resident Indian in a bank in India. This is a Rupee account. Interest earned in this account is taxable. The account can be jointly held with a resident Indian. The principal and interest in this account are nonrepatriable The original amount invested is called the principal amount. As per the tax rules, any person/institution making payments on Salaries, Rent, Interest, Commission etc. required deducting tax before making payments. This deduction is called Tax Deducted at Source (TDS). In the case of banks, TDS is deducted only if the interest earned (both paid and accrued) is more than Rs. 5000 in a single branch. The bank also has to file the appropriate form (Form 16A) annually showing the various details of the deductions made and Deposit of Tax thereon. This form is needed file filing the annual tax return for the individual.
Compound Interest
Fixed Deposit Account
Future Value
Joint Account
Know Your Customer (KYC)
Maturity Date
Nomination
Non-Resident Fixed Deposits
NRO
Principal Tax Deducted at Source(TDS)
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Financial Planning
About Investments > Company Fixed Deposits FREQUENTLY ASKED QUESTIONS (FAQ) What is Company Fixed Deposit? Company Fixed Deposit is the deposit placed by investors with companies for a fixed term carrying a prescribed rate of interest. Why is interest from Company Fixed Deposit higher than Banks? Company Fixed Deposits have always offered interest which is 2-3% higher than Bank Deposit rate, because they have to pay higher interest to banks for borrowing money. How is interest payments made? Interest is paid on monthly/quarterly/half yearly/yearly basis or on maturity, and is sent either through cheque or through Electronic Clearing System basis. When is TDS deducted on the interest from Company Fixed Deposits? TDS is deducted if the interest on fixed deposit exceeds Rs.5000/- in a financial year. Is there any scope of appreciation of principal? No, at the end of deposit period, the principal is returned to the deposit holder. How to choose a good company deposit scheme? Ignore the unrated Company Deposit Schemes. Ignore deposit schemes of little known manufacturing companies. For NBFCs, RBI has made it mandatory to have an 'A' rating to be eligible to accept public deposits. One should go further and look at only AA or AAA schemes. Within a given rating grade, choose the company with a better reputation. Once you decide on a company, choose the schemes that have given a better return. Unless you need income regularly, you should prefer cumulative schemes to regular income options since the interest earned automatically gets reinvested at the same coupon rate, resulting in better yields. It also gives you a lump-sum amount at one go. It is better to make shorter deposit of around 1 year to 3 years. This way, you can not only keep a watch on the company's rating and servicing, but also have your money back in case of an emergency. Check on the servicing standards of the company. You should not invest in companies that care little about investor services, like promptly sending interest warrants or the principal cheque. Involve your Financial Planner / Investment Advisor for advice in all your transactions. Do not bypass and invest directly. Check whether the company accepts outstation cheques and makes payment through at par cheques, especially if you do not live in the same city where the company is situated. Which companies can accept deposits? Companies registered under the Companies Act 1956, such as: Manufacturing Companies. Non-Banking Finance Companies. Housing Finance Companies. Financial Institutions. Government Companies.
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Financial Planning
About Investments > Company Fixed Deposits Upto what limits can a company accept deposit? A Non-Banking Non-Finance Company (Manufacturing Company) can accept deposits subject to following limits. Upto 10% of the aggregate of paid-up share capital and free reserves if the deposits are from shareholders or guaranteed by the directors. Otherwise upto 25% of the aggregate of paid-up share capital and free reserves. A Non-Banking Finance Company can accept deposits upto following limits: - An Equipment Leasing Company can accept four times of its net owned fund. - A Loan or Investment Company can accept deposit upto one and half time of its net owned funds. What is the period of the deposit? Company Fixed Deposits can be accepted by a Manufacturing Company having duration from 6 months to 3 years. Non-Banking Finance Companies can accept deposit from 1 year to 5 years period. A Housing Finance Company can accept deposit from 1 year to 7 years. Companies where you should not invest? Companies that offer interest higher than 15%. Companies that are not paying regular dividends to the shareholders. Companies whose Balance Sheet shows losses. Companies that are below investment grade (A) or less rating. There is an old saying "Don't Put All Your Eggs in One Basket ". Company Deposits should be spread over a large number of companies. This will help you to diversify your risk among various companies/industries. Never put more than 10% of your total investible funds in one company.
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Financial Planning
About Investments > Company Fixed Deposits SEE ALSO Product List http://www.bajajcapital.com/investments/fixed-deposits/govt-companies.php?id=3 Categories of Investors http://www.bajajcapital.com/investments/fixed-deposits/investor-categories.html?id=3 Compare Products http://www.bajajcapital.com/investments/fixed-deposits/comparefd.php?id=3 Maturity Amount Calculator http://www.bajajcapital.com/investments/fixed-deposits/fdcalc.php?id=3 Maturity Yield Calculator http://www.bajajcapital.com/investments/fixed-deposits/maturity_yield_calc.php?id=3 FD Research Report http://www.bajajcapital.com/investments/fixed-deposits/fd_research.php?id=3
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Financial Planning
VI. Post office Schemes
Post Office Monthly Income Scheme These schemes are offered by the Government of India. Safe, secure and risk-free investment options. No Tax Deduction at Source (TDS). Nomination facility is available. Nomination can be changed at any time These instruments are transferable to any part of India. Attractive rates of interest. Post Office Schemes Post Office Monthly Income Scheme (MIS) Post Office Time Deposit Scheme (TD) Post Office Savings Account National Savings Certificate (NSC) Kisan Vikas Patra (KVP) Govt schemes offered through Post Offices and Nationalised Banks: Public Provident Fund (PPF) Senior Citizen's Savings Scheme
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About Investments > Post office Schemes POST OFFICE MONTHLY INCOME SCHEME (MIS) Salient Features Interest rate of 8% per annum payable monthly. 5% bonus also payable on maturity period is 6 years. Minimum investment amount is Rs.1500/- or in multiple thereof. Maximum amount is Rs. 4.50 lakhs in a single account and Rs.9 lakhs in a joint account. Premature encashment facility after one year. No TDS. Account can be opened by an individual, two/three adults jointly, and a minor through a guardian. A minor having attained 10 years of age can open an account in his/her own name directly. Non-Resident Indian / HUF cannot open an Account. Minors have a separate limit of investment of Rs. 3 lakhs and the same is not clubbed with the limit of guardian. A separate account is opened for each deposit. Any number of accounts can be opened subject to the maximum prescribed limit. Facility of automatic credit of monthly interest to saving account if accounts are at the same post office. Facility of premature closure of account after 1 year to 3 years @ 2.00% discount. Deduction of 1% if account is closed prematurely at any time after three years. Facility of reinvestment on maturity of an account. Interest not withdrawn does not carry any interest Maturity proceeds not drawn are eligible to earn savings account interest rate for a maximum period of two years. Account is transferable to any Post Office in India, free of cost. Nomination facility is available. Rebate under section 80C is not admissible. Most suitable scheme for senior citizens and for those who need regular monthly income. Deposits are exempt from Wealth Tax.
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Financial Planning
About Investments > Post office Schemes POST OFFICE TIME DEPOSIT SCHEME (TD) Salient Features Interest payable annually but calculated quarterly at following rates: Period Rate of Interest 1 Year 6.25% 2 Years 6.50% 3 Years 7.25% 4 Years 7.50% Minimum amount of deposit is Rs.200/-. No maximum limit. Account can be closed after 6 months but before one year without any interest. Facility of redeposit on maturity of an account. No interest is payable on un-drawn interest amount. Account can be opened by an individual, two adults jointly and minor through guardian. A Minor who has attained the age of 10 years can open the account in his/her own name to be operated directly. Non Resident Indian / HUF can not open the account. Any number of accounts can be opened. Two, three and five years accounts can be closed after one year at a discounted rate of interest. Deposits not drawn on maturity are eligible to saving account interest rate for a maximum period of two years. Account can be pledged as security against a loan to banks/ Government institutions. Accounts are transferable from one Post office to any Post office in India. Rebate under section 80-C is not admissible. Interest income is taxable. Deposits are exempt from wealth tax. No TDS. Nomination facility available.
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Financial Planning
About Investments > Post office Schemes POST OFFICE SAVINGS ACCOUNT Salient Features Minimum amount Rs 20/- in case of non-cheque account, Rs.500/- in case of cheque account. Minimum balance of Rs.500/- is to be maintained for a cheque account. Account is opened with cash only. Maximum balance permissible is Rs. 100000/- in a single account and 200000/- in a Joint account. Two/Three adults, individuals, minor through guardian can open an account. A minor having attained 10 years of age can also open an account directly. One individual account and one joint account can only be opened at a Post Office.
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Financial Planning
About Investments > Post office Schemes NATIONAL SAVINGS CERTIFICATE (NSC) 6 Years National Savings Certificate 8th Issue. Salient Features Rs. 1000/- grows to Rs. 1601/- in six years. Minimum investment Rs. 500/Maximum no limit. Certificates can be pledged as security against a loan to banks/ financial Institutions. A Tax saving investment under Sec 80C Individual or minor can apply Rate of interest 8% compounded half yearly Two adults, individuals, and minor through guardian can purchase. Companies, Trusts, Societies or any other Institutions are not eligible to purchase. Non-resident Indian/HUF cannot purchase. No premature encashment. Annual interest earned is deemed to be reinvested and qualifies for tax rebate for the first 5 years under section 80C of the Income Tax Act. Maturity proceeds not drawn are eligible to Post Office Savings Account interest for a maximum period of two years. Facility of reinvestment on maturity. Facility of encashment of certificates through banks. Certificates are encashable at any Post Office in India before maturity by way of transfer to desired Post Office. Certificates are transferable to any Post office in India. Certificates are transferable from one person to another person before maturity. Duplicate certificate can be issued for in case the original one gets lost, stolen, destroyed, mutilated or defaced certificate. Nomination facility is available. Facility of purchase/payment to the holder of Power of Attorney. Tax Saving instrument - Rebate admissible under section 80 C of the Income Tax Act. Deposits are exempt from Wealth Tax.
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About Investments > Post office Schemes KISAN VIKAS PATRA (KVP) Salient Features Money doubles in 8 years and 7 months. Facility for premature encashment. No maximum limit on investment. No TDS. Rate of interest 8% compounded annually. Two adults, individuals and minor through guardian can purchase. Companies, Trusts, Societies or other Institutions are not eligible to purchase. Non-Resident Indian/HUF are not eligible to purchase. Maturity proceeds not drawn are eligible for Post Office Savings account interest for a maximum period of two years. Facility of reinvestment on maturity. KVP can be pledged as security against a loan to Banks/Government Institutions. KVP are encashable at any Post Office before maturity by way of transfer to desired Post office. KVP are transferable to any Post Office in India. KVP are transferable from one person to another person before maturity. Duplicate can be issued for lost, stolen, destroyed, mutilated and defaced patras Nomination facility is available. Facility of purchase/payment of Kisan Vikas Patras to the holder of Power of Attorney. Rebate under section 80C is not admissible. Deposits are exempt from Wealth Tax.
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About Investments > Post office Schemes PUBLIC PROVIDENT FUND (PPF) Salient Features The rate of interest is 8% compounded annually. The minimum deposit is 500/- per annum The maximum is Rs. 70000/- per annum Interest is totally tax free. Tax saving instrument under section 80C. Loan facility available from third year. The Public Provident Fund Scheme is a statutory scheme of the Central Government of India. The Scheme is for 15 years. One deposit with a minimum amount of Rs.500/- is mandatory in each financial year. The deposit can be in lumpsum or in convenient installments, not more than 12 installments in a year or two installments in a month, subject to total deposit of Rs.70000. It is not necessary to make a deposit in every month of the year. The amount of deposit can be varied to suit the convenience of the account holders. The account in which deposits are not made for any reason is treated as discontinued, account and such an account cannot be closed before maturity. The discontinued account can be activated by payment of the minimum deposit of Rs.500/- with default fee of Rs.50/- for each defaulted year. The account can be opened by an individual or a minor through the guardian. Joint account is not permissible. Those who are contributing to GPF Fund or EDF account can also open a PPF account. A Power of Attorney holder can neither open nor operate a PPF account. The grand father/mother cannot open a PPF on behalf of his/her minor grand son/daughter. The deposits shall be in multiples of Rs.5/- subject to minimum of Rs.500/-. The deposit in a minor account is clubbed with the deposit of the account of the guardian for the limit of Rs.70000. No age is prescribed for opening a PPF account. Interest is not contractual but the rate is notified by the Ministry of Finance, Government of India, at the end of each year. The facility of first withdrawal in the 7th year of the account subject, to a limit of 50% of the amount at credit preceding three year balance. Thereafter one withdrawal in every year is permissible. Premature closure of a PPF Account is not permissible except in case of death. Nominee/legal heir of PPF Account holder on death of the account holder cannot continue the account. The account has to be closed in such case. The account holder has an option to extend the PPF account for any period in a block of 5 years at each time. The account holder can retain the account after maturity for any period without making any further deposits. The balance in the account will continue to earn interest at normal rate as admissible till the account is closed.
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Financial Planning
About Investments > Post office Schemes One withdrawal in each financial year is also admissible in such account. A PPF account can be opened either in a Post Office or in a Nationalised Banks. The Account is transferable from one Post Office to another and from Post Office to Bank or from a Bank to a Post office. Account is transferable from one Bank to another bank as well as within the bank to any branch. Deposits in PPF qualify for rebate under section 80C of Income Tax Act. The interest on deposits is totally tax free. Deposits are exempt from wealth tax. The balance amount in the PPF account is not subject to attachment under any order or decree of court in respect of any debt or liability. Nomination facility is available. The Best option for long term investment.
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About Investments > Post office Schemes SENIOR CITIZEN'S SAVINGS SCHEME Salient Features 9% interest per annum payable quarterly. Minimum Deposit: Rs 1000 and multiples thereof. Maximum Limit: 15 Lakhs. The scheme is for 5 years and can be extended for a further period of 3 years. Premature closure facility is available after 1 year with nominal penalty. Risk free investment. Individual aged of 60 years and above can invest. Retiring employees aged 55 years and above can invest under scheme. A tax saving instrument Joint account can be opened with spouse. Best Return Very Safe investment - A central government scheme
Objective of the Scheme We are all well aware that interest rate on Small Saving Scheme has been reduced to 5% in the last four years. The decline in interest rate was initiated from January 2000. The interest rate on December 31, 1999 in Monthly Income Scheme was 13% which came down to 8% with effect form March 31, 2003. The decrease in the interest rate had a negative impact on the lives of Senior Citizens. The dwindling interest income was cause of concern and hardship for them .Interest income is a lifetime benefit for the senior citizens. The Budget for 2004-2005 had two beneficial aspects, as far as small Saving Schemes are concerned. The first one is that rates of interest on small savings have been kept stable with no change in rate of interest in any Post Office scheme. The second benefit came with the introduction of Senior Citizen Saving Scheme-2004 offering a higher rate of interest as compare to any other small savings scheme. The scheme has come into operation from August 2, 2004. The main objective of the scheme is to provide relief to the senior citizens and to check the further decline in their interest income.
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Financial Planning
VII. Initial Public Offering (IPO)
Introduction IPO (Initial Public Issues) of good and growing companies keep on coming in the market. History shows investors who bought equity shares of reputed companies during their initial public issues have now become rich and prosperous
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About Investments > Initial Public Offering FREQUENTLY ASKED QUESTIONS (FAQ) (IPO / FPO) What is an IPO? An IPO is defined as an exercise when an unlisted company makes either a fresh issue of securities or an offer for sale of its existing securities or both for the first time to the public. From an investor point of view, IPO gives a chance to buy shares of a company, directly from the company at the price of their choice (In book build IPO's). Many a times there is a big difference between the price at which companies decides for its shares and the price on which investor are willing to buy share and that gives a good listing gain for shares allocated to the investor in IPO. What is Follow on Public Offering (FPO)? Follow on Public Offering (FPO) is public issue of shares for already listed company, coming up in market with further equity dilution / stake sale. What is primary & secondary market? Primary market is the market where shares are offered to investors by the issuer company to raise their capital. Secondary market is the market where stocks are traded after they are initially offered to the investor in primary market (IPO's etc.) and get listed to stock exchange/s. What are Book-built & Fixed-Priced issues? In case of book building issue, shares are offered in a price band and the demand of the share at a particular price can be known everyday during the issue period. Unlike the book-building route, the price is known in advance to investors in case of offer of shares through normal public issue (Fixed priced issues).
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About Investments > Initial Public Offering How can one apply for an IPO? Physical Application: An investor needs to first obtain an IPO application form through a share broker, an investment consultant or from the collecting banks. The investors are required to fill up the form and remit the amount after calculating the number of shares applied for in the bank, which has been designated as a collecting centre for the particular IPO. Apply online: To apply in IPO's online an investor has to have a Demat account which provides this facility. There is almost no paperwork involves in applying IPO's online. ASBA Process: Applications Supported by Blocked Amount (ASBA) Process, is the alternative payment method (optional) for IPO application where the IPO bidding amount remains in investors account, but blocked by the bank until allotment is done. The purpose of adding this new payment option is to reduce the turn around time for IPO Stock listing and to make the refund process faster. It's available exclusively for retail individual investors through participatory banks (SCSB). What is the floor price in case of book building? Floor price is the minimum price (Lower Tag of price-band) at which bids can be made in book built issue. How is the Retail Investor defined as? Retail individual investor refers to an investor who applies or bids for securities of or for a value of not more than Rs.100000. An individual investor above Rs. 100000 investments comes under HNI / NII quota (Lesser reserved). Can one change/revise his/her bid? Yes, the investor can change or revise the quantity or price in the bid using the form for changing/revising the bid that is available along with the application form. However, the entire process of changing of revising the bids shall be completed within the date of closure of the issue. What proof can a bidder request from a trading member for entering bids? A bidder can request for a transaction registration slip as proof of his/her having entered the bid. Whenever a bid is entered by trading members into the system, a unique transaction registration slip is automatically generated. Transaction registration slip gives details regarding number of shares bid for, price, the client name among other details.
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About Investments > Initial Public Offering What is a Red Herring Prospectus (RHP)? 'RHP' is a prospectus which does not have details of either price or number of shares being offered or the amount of issue. This means that in case the price is not disclosed, the number of shares and the upper and lower price bands are disclosed. On the other hand, an issuer can state the issue size and the number of shares are determined later. In the case of book-built issues, it is a process of price discovery and the price cannot be determined until the bidding process is completed. On completion of the bidding process, the details of the final price are included in the offer document. The offer document filed thereafter with ROC is called a prospectus. What are Risk Factors? Here, the issuer's management gives its view on the Internal and external risks faced by the company. Here, the company also makes a note on the forward-looking statements. This information is disclosed in the initial pages of the document and it is also clearly disclosed in the prospectus. It is generally advised that the investors should go through all the risk factors of the company before making an investment decision. How much tax one has to pay on returns (capital gains) for a particular IPO? If an investor sells IPO allocated shares with in 12 month of IPO Allotment, he comes under short-term capital gains and all such gains are taxed.
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VIII. Portfolio Management Service (PMS)
Fore More Details Visit http://www.bajajcapital.com/contactus.php
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WEALTH MANAGEMENT
At, Bajaj Capital, our interactions with hundreds of High Networth Individuals, Corporates, institutions and family-owned businesses have helped us to understand their special needs and requirements. La Premier adheres to stringent quality standards and professional ethics. At the same time, we ensure that our services are packaged and delivered with a personal touch. Why La premier Our Philosophy Our Products Suit Our Exclusive Services Our Advisory Process Our Institutional Advisory Services Our Team
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Wealth Management WHY LA PREMIER At, Bajaj Capital, our interactions with hundreds of High Networth Individuals, Corporates, institutions and family-owned businesses have helped us to understand their special needs and requirements. From these experiences, about a decade ago, was born La Premier. It is a specialised group comprising handpicked professionals who provide an exclusive and world-class service to a select group of very special clients- both individual and institutional. Our specialised services are based on the well established principles of Comprehensive Financial Planning, backed by in-depth research and supported by hi-tech systems. La Premier adheres to stringent quality standards and professional ethics. At the same time, we ensure that our services are packaged and delivered with a personal touch. Bajaj Capital was one of the first companies in the organized sector to offer investment advisory and Wealth Management services along with a wide spectrum of financial products and services, all under one roof. Over the past 45 years, we have won the trust of over eight lacs individual investor clients, including hundreds of High Networth the Individuals, Non-Resident Indians and members of businessowning families. In fact, we are honored to be the 'personal financial advisors' to several families that have been investing through us for three generations. The trust and goodwill of our investors are our greatest assets, motivating and inspiring us to excel and achieve the greatest heights of professionalism and service.
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Wealth Management OUR PHILOSOPHY Your wealth can grow more wealth. Provided enough time and effort is put in to study markets, weigh the various investment options and take complex decisions. But for extremely busy people like you, time is a luxury. That's why; you need the services of specialised wealth managers like La Premier. At La Premier, the single, most important objective is to offer Independent Wealth Management solutions by helping you to accumulate, preserve, and enhance your wealth. Our endeavour is to preserve your capital first. Only then do we make recommendations to enhance your wealth, focusing upon areas requiring attention on a priority basis. Disciplined Long-term Investment Approach: We believe that 'time' and not 'timing' is what matters, when it comes to investments. Diversification of Holdings: It is essential to create a well-diversified portfolio with representation of all asset classes, so that no single asset class is allocated undue weightage.
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Wealth Management OUR PRODUCTS SUIT Comprehensive Wealth Management Products: A wide range of products covering major asset classes like: Equity Debt
Equity Mutual Fund Stock Trading PMS Private Equity Funds
Fixed Income Funds Structured Products Fixed Maturity Plans Primary Bonds Secondary Bonds RBI Bonds
Insurance Life Insurance General Insurance Re-Insurance Gold Gold ETF Gold Funds Real Estate Intelli Realty - Property Services Division of Bajaj Capital Group. Art BCAH (Bajaj Capital Art House) - Offers you exclusive advisory services for investing in art. Just Trade Comprehensive Financial Planning An Online Platform for Investing in Equities, Mutual Funds and IPO's Comprehensive Financial Planning Your La Premier Wealth Manager will help you plan your finances, based on your needs, goals and risk appetite. From retirement planning and property purchase to financing your children's education, your wealth manager will put your plans in place. You will have the opportunity to review the progress of your Investment portfolio at least twice a year to ensure your finances are kept upto- date.
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Wealth Management OUR EXCLUSIVE SERVICES Special clients have special needs. To cater to the elite segment of High Networth Clients, La Premier offers an exclusive range of value added services. These include: Independent, Unbiased advice through a dedicated Wealth Manager. Market information sharing through quality in-house research reports, made available at regular intervals. Periodic portfolio review and construction of a balanced portfolio comprising of all asset classes. Regular update on portfolio valuation. Pro-active advice on market events and triggers. Asset Allocation Immediate alerts on new products offerings. Need-based interactions with Fund Managers and other financial experts like Tax Experts, Estate Planners, etc. Regular events like seminars, conferences and talks by fund managers/ Industry market experts. NRI Services, visit following link http://www.bajajcapital.com/nri/index.html
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Wealth Management OUR ADVISORY PROCESS Investment consultancy is a complex business, requiring an intimate understanding of several financial parameters and human factors, including the client's requirements and the market subtleties. Being a process-driven organization, we have perfected a four-step advisory procedure, which includes:
Need Analysis Our experts analyze and assess your investment objectives and your comfort level with various asset classes, such as Equity, Debt, Realty, etc. Asset Allocation We determine an optimal mix of asset classes to meet your financial goals. Portfolio Construction Based on the asset mix, we build a customized, diversified portfolio of insurance and investment products. Ongoing Review Once implemented, we monitor your portfolio regularly. This allows our advisors to recommend adjustments if required, and these are executed once we receive your go-ahead.
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Wealth Management OUR INSTITUTIONAL ADVISORY SERVICES The institutional Advisory Group provides personalized, professional money management services to organizations nationwide. It is a strategic service arm that caters to major corporations, government entities, unions and nonprofit organizations. We have presence in all the metros in the country with an annual mobilization of over Rs.2000 crores. We enjoy the patronage of over 1,000 quality relationships with an AUM (Asset-Under-Management) of 2,500 crores. Dedicated wealth manager will carefully assess the organization's objectives and will help in developing investment policies appropriate to the goals and risk profile of each portfolio. It will include identification of a customized solution that best matches the objectives and risk constraints involved. It will be our continuous endeavor to monitor your portfolio and provide you with regular reports and market updates. Our uniqueness is extending services under single window concept among the following areas: Investment Advisory and Treasury Management Corporate Insurance and Risk Management Advisory Resource Mobilization through Equity/Debt Placement Project Finance Financial Planning Services Provident Fund Investments
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Wealth Management OUR TEAM Specialists at your service In an organization like ours, having the right person at the right place is critical to delivering services that match international standards. Over the years, we have developed a strong team of professionals who are experts in specialised fields of finance. These professionals give La Premier its cutting edge. Our team comprises Certified Financial Planners, Chartered Accountants, Company Secretaries, Legal Experts, MBAs and Economists. In addition, we also have a full-fledged in-house research unit Bajaj Capital Centre for Investment Research, which keeps a minute-by-minute track of market developments. All these professionals work in tandem with just one goal in mind: your satisfaction.
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NRI SERVICES
Source: http://www.bajajcapital.com/nri/index.html Originally established in 1964, we are an experienced leader in the advisory business. Our objective is to provide value added services to help you succeed. Indias largest Open architecture , Independent, Unbiased & Financial Advisory House First Corporate Distributor of Financial Products Nationwide Distribution Network 3 major corporate entities: - Bajaj Capital Ltd. SEBI approved Merchant Bankers and leading investment advisors and Financial Planners - Bajaj Capital Insurance Broking Ltd. IRDA regulated Insurance brokers - Bajaj Capital Investor Services Ltd. NSE members for stock broking
We at Bajaj Capital NRI Services significantly reduces the time, cost, complexity, and risk typically associated with investing in a global platform, thus radically reducing or eliminating barriers to developing a successful investment service. With Bajaj, youll immediately recognize several key advantages: The design, delivery and execution of meaningful research and individual need based portfolio strategies A proactive service desk with significant execution experience in back office operations for smooth transaction processing The ability to support every client, regardless of volume, with a dedicated and qualified team that consistently monitors their portfolio account Above all, Bajaj Capital follows superior customer service philosophy: Our customer service approach allows us to make clients our top priority. With each clients individual goals in mind, we continually seek opportunities, provide strategy, assess risk, and guard against execution anomalies that help us provide the best of class services. As a committed and innovative company, we always research new services and methodologies in order to enhance our service platform.
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NRI Services There are over 750 different mutual funds in India today and about 35 different companies that run these funds. So, how will you choose which fund to invest in? Many investors look at past performance and assume that the fund will continue to return the same in the future. This is not always true and can often be wrong Therefore, we at Bajaj Capital NRI Services are a specialized group of certified and experienced professionals, who offer the most appropriate advice on the product and your investment needs Our specialized services are based on the well-established principles of comprehensive financial planning, backed by our strong in-house research enabling us to offer customized services to NRI investors. Four-step Advisory Process: Need Analysis We analyze & assess your investment objectives including your comfort level with various asset classes and to fulfill a short-term or a long-term goal Asset Allocation We determine an optimal mix of asset classes to meet your financial goals. Portfolio Construction Based on that asset mix, we build a customized, diversified portfolio of various investment products. Ongoing Review We monitor your portfolios performance, making adjustments as necessary, while communicating with you regularly.
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NRI Services LIST OF NRI SERVICES Source: http://www.bajajcapital.com/nri/services/nri_services.php NRI Taxation NRI Taxation Double Taxation Avoidance Agreements (DTAA) Capital Assets and Capital Gains TDS (Tax Deducted at Source) for NRIs Special Provisions Applicable to Non-residents Property Taxation/ Investment Guidelines and Norms Purchase and Sale of Residential / Commercial Property Tax Exemption for NRIs/ Overseas Indians TAX Issues faced by NRIs
NRI Banking NRI Banking NRI Bank Accounts Non-Resident (External) Account - NRE Account Non-Resident Ordinary Rupee (NRO) Account Foreign Currency (Non-Resident Indians) FCNR (B) Account
NRI Remittance & Repatriation NRI Remittance & Repatriation Remittance NRI Repatriation Repatriation Procedures for NRIs/ Indian Overseas Repatriation Rules for NRIs/ Indians Oversea Repatriation of Income / Earnings (FAQ)
PAN Card Assistance PAN Card Assistance The necessity for a PAN Card to NRIs Applying for a PAN Documents to be submitted as Proof of Identity and Address PAN Charges PIO Card Scheme
NRI Laws in India FEMA Rules & Policies FEMA: Foreign Exchange Management Act, India
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NRI Services Hospitality Services The non-resident Indians either on a visit or planning a permanent return are left groping for information. Fortunately, we provide an assortment of services which caters to the specific requests of NRIs before, during and after their visit to India. As soon as you arrive in India, we can provide you with car rental services, airport transfers, hotel accommodation, sightseeing trips, online booking of air and train tickets, and pre-paid telecom services even before you land. The needs could also vary from payment of bills in your absence, to arrange family occasions and gettogethers, or to get the best possible medical treatment for self or a relative in India We at Bajaj Capital NRI Services offer customized solutions to meet your needs. So, if you have a specific requirement, do contact us. Hospitality Services: Travel Assistance Personalized Services in India Send Gifts to India Family Assistance
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NRI Services NRI HELP CENTER While NRIs serve their term abroad, several personal matters are to be sorted out such as filing of tax returns, collecting and depositing rent on property and payment of insurance premium etc. Similarly, overseas Indians returning home are better equipped to handle re-location blues with the deft handling of major worries on a well-appointed accommodation, a reputed school, availing a car loan, opening a bank account, and making investments NRI property buyers are relying heavily on online services at a small fee, as against depending on their friends and relatives to maintain their properties. Apart from assisting NRIs in selecting, purchasing and leasing property, personalized services for NRIs are extending to security services to keep a watch on their assets in their absence. Furthermore, NRIs who are entangled in litigation in India, we offer Legal solutions and off-court mediation services by legal experts to overseas Indians who are unable to attend to these issues personally. The gamut of our services for NRIs is infinite, and ever growing to meet individual requirements. We at Bajaj Capital NRI Services offer customized solutions to meet your needs. So, if you have a specific requirement, do contact us at following address: Registered and Corporate Office Bajaj Capital Ltd NRI Services Bajaj House, 97, Nehru Place New Delhi - 110019 Ph: +91-11 - 41693000, 66161111, 66272300-15 extension: 670 Mobile: +919999796543 Email: nri@bajajcapital.com Website: http://www.bajajcapital.com/nri/contactus.php
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RESEARCH & PUBLICATION

Research Real Economic Stock Ideas Weekly Equity Updates Morning Call BCCIR Select Fund Fund Hulchul Stock Trading Ideas NFO Analysis ULIP Multi-meter Fund Barometer Derivative Strategies IPO Analysis Publication Investors India Money Multiplying News Quick Insurer Tax Planning Guide
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FINANCIAL TOOLS
Calculator How to become a Crorepati easily See how your money grows Get desired amount for your Child's Education Get desired amount for your Child's Marriage Get desired amount of pension after Retirement Human Life Value Calculator Future Value Calculator Employee Provident Fund Calculator Gratuity Calculator
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KNOWLEDGE CAFE
Investment means putting your money to work to earn more money! And it always helps if you have some knowledge in this matter. So we bring for you this Knowledge Cafe. A space that will share with you information on investments, give you tips to invest better, tell you secrets of becoming a good investor, update you on the latest market trends- all this so that you are an informed investor. If investment done wisely, it can help you meet your financial goals like buying a new house, paying for a college education, enjoying a comfortable retirement or whatever is important to you. The articles posted here will help you grasp the basics of investing wisely. Investment Tips for Beginners Articles
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Knowledge Cafe > Investment Tips for Beginners HOW TO ACHIEVE LIFETIME OF INVESTMENT SUCCESS Follow Bajaj Capital's time tested Investment Philosophy: Do not invest directly in the stock market. Take the Mutual Funds route. Safety of principal should be of prime importance. We believe in a controlled (risk) approach to investments. Do not let inflation eat up your money in a savings bank account. Go for superior and stable returns. Have a look at your financial objectives. Your investments should depend upon them. Take the long-term approach to equity investments. Diversify your investments. Do not put all your eggs in one basket. Keep a reasonable amount of liquid cash to meet your emergency needs. Take a balanced approach to investing. Avoid risky investments as well as an overly cautious approach to Investing. Monitor your investments once a month and take corrective action, if required, immediately. Do not try to time the entry and exit of your investments. Every time is a good time to invest if you have a long- term outlook and keep investing regularly. Put no more than 10% of your total investments in one company.
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Knowledge Cafe > Investment Tips for Beginners INVESTMENT MANTRAS FOR THE UNINITIATED Planned investments are the way to go, if you wish to become a successful investor. All of us are not born with a silver spoon in our mouth. But each one of us wish to strike gold and has a desire to be rich. There is a constant urge in us to make our money grow at a pace that not only provides for our financial goals but also helps us to improve our standard of living from good to better. This makes it really essential for all of us to plan the allocation of our available financial resources in such a way that we can generate the maximum possible return. The term 'allocation of resources' means putting your money in the various asset classes such as debt, equity and cash. However, this cannot be done by following an ad-hoc approach to investments. One is required to plan investments in a systematic manner so that he gets maximum returns with minimum risk. Also, the allocation should be regularly reviewed at periodic intervals. For this, one can either plan investments oneself, or refer to an expert (a Financial Planner) who not only helps you invest appropriately but also monitors the performance of your portfolio so that you do not miss on the best opportunities available in terms of investing and also do not take undue risk on your portfolio. A financial planner will give meaning to your investments by linking the same to your financial goals. This way one would know where one is going and it will become easier to chart out an appropriate path way towards the relevant destination point. An investment decision is a trade off between the risk & return. However, the investment avenue will definitely depend upon certain factors. Some of the questions you need to answer are: What is your age? How many dependents do you have? What are your financial goals? How much money would you need to fund each goal? What is the time horizon of your goals? How much are you concerned about liquidity? What is your risk profile? All these questions will help your advisors to chalk out a plan which can match the suitable products with your goals.
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Knowledge Cafe > Investment Tips for Beginners Your need could be: Investment Planning Tax Planning Children's Future Planning Cash flow Planning Insurance Planning Retirement Planning Cash-flow Planning: It takes care of the timing of cash inflows and outflows. It basically helps in analysing the income and expenses and intends to maintain a regular flow of income in the family. It is a holistic approach to meet the life goals. Insurance Planning It is not the person who passes away but for those who survive. It takes care of the financial loss which may arise on the happening or non happening of an event. Insurance Planning relates to two fields of insurance Life Insurance: It takes care of the financial needs of the dependants of the deceased bread earner of the family. General Insurance: It takes care of the risk of financing of property. Retirement Planning It takes care of the cash-flows during retirement when the person is not working. Usually people are not concerned about retirement at an early age. But planning for retirement at an early stage is necessary in order to maintain the same standard of living. Investment Planning: It takes care of investment decisions i.e. to say this decision relates to appropriateness of an investment, inflation factor, etc. Tax Planning: It implies arrangement of the person's financial affairs in such a way that it reduces the tax liability. Children's Future Planning: It takes care of regular expenses on your child's education and higher education. It also helps you to make arrangements for your children marriage.
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Knowledge Cafe > Articles SYSTEMATIC APPROACH TO INVESTMENTS: S.T.P OR S.I.P Are you saving something from your regular income? If you are saving, is it getting added to your investment corpus? If you are creating a corpus, are you getting above inflation return on it? Systematic approach towards investments is the best way to save, accumulate and create wealth for your future. Two such strategies are Systematic Investment Plan (SIP) and Systematic Transfer Plan (STP). In SIP, a fixed amount is invested in a particular scheme at periodic intervals. SIP is a very good strategy for salaried people, or those who receive a periodic inflow of cash. Advantages of SIP: Saving and wealth accumulation Inculcates disciplined habit of investing Entry at various market levels (averages out the possible risk associated with the equity market) Hassle-free mechanism (one-time arrangement instructions are given at the time of initial transaction) Power of Compounding Investments synchronised with your cash inflows/salary If you have a lumpsum amount, but do not want to expose the entire amount to equity at one go, you can make an arrangement where some amount gets transferred to an equity scheme from a debt scheme periodically. This system is known as Systematic Transfer Plan.
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Knowledge Cafe > Articles GET YOURSELF A FINANCIAL PLANER - EVEN IF IT REQUIRES YOU TO PAY FEES My husband and I are looking for a financial planner in the Boston, MA-Portland, ME area. We live and work in Boston right now. He is an internal medicine resident and I am a holistic health professional. He will finish residency in June of '09 and at that point, we plan to move home to Maine and buy our first home. While we both have student loan debt (consolidated at a low rate), we have also been setting money aside so that we can hopefully come up with a 20% down-payment. We are good savers, but have been very timid about investments. We are looking to find a certified financial advisor who: can help us reach our short-term goals (move, house purchase, pay of student loan debt); help us set up a solid system for when our income increases significantly; Wont charge us crazy amounts of money. I am hoping to establish a long-term relationship with this financial advisor. Do you use a financial planner? If so, would you recommend using a fee-only professional ($150$200/hour seems like A LOT of money to me...) or would you recommend a commission-based professional? And lastly, can someone recommend a CFP in the northeast? Thanks for your suggestions!
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Knowledge Cafe > Articles MAKE YOUR PORTFOLIO UNCERTAINTY PROOF The Wild Card Continued economic growth could lead to a spike in interest rates, crushing bonds. How to Seize Control Keep risk in perspective: Even if we do see a calamitous rise in interest rates, the magnitude of losses for bond and bond-fund investors would very likely be much less than stock investors have faced during large equity-market sell-offs. This article discusses how to keep worries about rising rates in perspective, and it links to a Fidelity study chronicling how bonds have performed during sustained periods of rising rates. Avoid long-term bonds: If you're looking at returns during the past decade, long-term bonds, especially Treasuries, look like a slam-dunk missed investment. (The long-term bond fund category has gained about 8% on average during the past decade, versus 6% for intermediate-term bond funds.) If the economy continues to sputter along in fits and starts, long-term bonds could continue to prosper. But the volatility in long-term bonds has also been nearly twice as high as has been the case for intermediate-term bonds. For that reason, I think it makes sense to downplay long-term bonds if the goal of your fixed-income portfolio is income and capital preservation. Esteemed investors such as Jack Bogle and Bill Bernstein are on the same page. Stress-test your bond portfolio: Even if you don't own long-term bonds, it's still a good idea to investigate just how sensitive your portfolio would be to an increase in interest rates. This article outlines a concrete way to simulate how much your portfolio could lose if interest rates bumped up by 1 or 2 percentage points.
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Knowledge Cafe > Articles CHOOSING FINANCIAL ADVISOR While choosing an advisor, consider the following factors: Your Advisor Must Be an Organisation: Your advisor needs to outlive the life of your investments. This is possible only if your advisor is a company or institution rather than an individual advisor. Also a company has better resources, research expertise, standardized processes and qualified staff to render quality advice and services. It is much safer to deal with a company that has a reputation for honesty, integrity, transparency and ethical dealings than with an individual. Your Advisor Must Be Experienced & Reputed: Find out the background and certifications of the firm you want to appoint as your investment advisor. The more the experience of your advisor, the better it is. Find out about the advisor's clientele. This will give you a better idea of what to expect as a client and learning about their security guarantees will give you confidence that you're making the right choice. Must Have an All-India Presence: In today's dynamic world, you never know which place or city you might be located at, in the future; an advisor with a national footprint will ensure that you do not miss his advice and service, irrespective of your location. Know The Products and Services: Decide what you need. Then choose investment advisory firm that caters to your needs and matches your expectations. Know the breadth and depth of the investment firm's products, the financial services it offers and the planning process it involves to make your wealth grow. Must Have A Research Department: This ensures that you get quality advice on time and are update about the market trends and changes so that accordingly you can review your portfolio. Must Have An Online Investment Platform: Tech savvy investors will find this attribute very attractive as they will be able to keep track of and manage their investments at the click of a mouse from the comfort of their office or home, at any point of time. Remember: It Is The Quality Of Investment Advice That Determines Whether You Earn In Lakhs Or Crores.
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About Bajaj Capital Ltd

Welcome to India's leading Financial Planning and Investment Advisory Company. Where dreams inspire us to excel, they ignite hope and kindle in us the passion to stretch our limits. At Bajaj Capital we believe that nothing can or should stop us from dreaming. And financial constraints should be the last thing to stop anyone from realizing them. For over four decades now, Bajaj Capital has been helping people to realize their aspirations by making their wealth grow, and planning their financial lives. Bajaj Capital offers advice on Investments, Insurance, Tax Saving, Retirement Planning, Future Planning for Children and more. As India's largest distributors of financial products, Bajaj Capital brings for you a wide range of investment options - the entire gamut of financial instruments and investment products of almost all major public and private companies and the Government. sector. These services and products are delivered through Bajaj Capital's network of over 200 branches located all over the country. The company is a SEBI-approved Category I Merchant Banker catering to Individual Investors, Corporates, HNI and NRI clients. The commitment of the company to create wealth for its clients with independent, need-based and research based advice has been recognized by 8, 00,000 individual investors and over 3000 institutional clients. In a world full of 'ready-to-give-free-of-cost-advice' people it is necessary that you choose the one that works in your interest. You need help from a professional investment advisor, who sees investments from your perspective. That's what we do. We Create Wealth: 45 years of experience as Investment Advisors and Financial Planners We give you impartial, research-based and need-based advice We offer a wide range of financial products and services Personalized wealth management advice: We offer investment guidance and portfolio planning. Prompt, courteous service, 24 x 7 online accessibility- www.bajajcapital.com Countrywide network of over 200 branches Strong team of qualified and experienced professionals including CAs, MBAs, MBEs, CFPs, CSs, Insurance Experts, Legal Experts and others SEBI-Approved Category I Merchant Bankers Group Co BCIBL is an IRDA-licensed Direct Insurance Broker
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About Bajaj Capital Ltd Chairman Message Dear Visitor, Welcome to the cyber home of Bajaj Capital. Here, you can learn how to turn your dreams into reality by investing wisely. For well over four decades now, we at Bajaj Capital have been helping millions of investors reach their financial goals, and live fuller, richer and more satisfying lives. Over these years, the Bajaj Capital family has seen tremendous growth. Now, with our online venture, we are all set to make our presence felt even beyond the geographical boundaries. We remain committed to offer the best of our services, skills and expertise to all our valued investor clients and visitors. Seen from this perspective, our online venture is yet another effort at reaching out to you. I hope that you will find this website useful. I welcome your suggestions to improve this site, and make it more useful to investors. K.K. Bajaj Chairman, Bajaj Capital Ltd. Bajaj Capital is among the pioneers of the investment advisory and financial planning industry in India. For over four decades, the Company has been serving Indian investors, and giving shape to the vision of its founder - chairman, Mr. K.K. Bajaj.
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About Bajaj Capital Ltd Milestone Bajaj Capital has contributed to the growth of the Indian Capital Market at every step. In 1965, we were the first to innovate the Companies Fixed Deposit. Today, we are playing an active role in the growth of the Indian Mutual Fund industry. We are also working closely with private insurance companies to deepen India's insurance market. Here is a glimpse of our journey through the years. 1964 Bajaj Capital sets up its first Investment Centre in New Delhi to guide individual investors on where, when and how to invest. India's first Mutual Fund, Unit Trust of India (UTI) is incorporated in the same year. 1965 Bajaj Capital is incorporated as a Company. In the same year, the company introduces an innovative financial instrument the Company Fixed Deposit. EIL Ltd. (Oberoi Hotels, then known as Associated Hotels of India Ltd.) becomes the first company to raise resources through Company Fixed Deposits. 1966 Bajaj Capital expands its product range to include all UTI schemes and Government saving schemes in addition to Company Fixed Deposits. 1969 Bajaj Capital manages its first Equity issue (through an associate company) of Grauer & Wells India Ltd.; right from drafting the prospectus to marketing the issue. 1975 Bajaj Capital starts offering 'need-based' investment advice to investors, which would later be known as 'Financial Planning' in the investment world. 1981 SAIL becomes the first government company to accept deposits, followed by IOC, BHEL, BPCL, HPCL and others; thus opening the floodgates for growth of retail investment market in India. Bajaj Capital plays an active role in all the schemes as 'Principal Brokers' 1986 Public Sector Undertakings (PSUs) begin making public issues of bonds MTNL, NHPC, IRFC offer a series of Bond Issues. Bajaj Capital is among the top ranks of resource mobilisers. 1987 SBI leads the launch of Public Sector Mutual Funds in India. Bajaj Capital plays a significant role in fund mobilisation for all these players. 1991 SBI issues India Development Bonds for NRIs. Bajaj Capital becomes the top mobiliser with collections of over US $20 million. 1993 The first private sector Mutual Fund Kothari Pioneer is launched, followed by Birla and Alliance in the following years. Bajaj Capital plays an active role and is ranked among the top mobilisers for all these schemes. 1995 IDBI and ICICI begin issuing their series of Bonds for retail investors. Bajaj Capital is the comanager in all these offerings and consistently ranks among the top five mobilisers on an allIndia basis. 1997 Private sector players lead the revival of Mutual Funds in India through Open-ended Debt schemes. Bajaj Capital consolidates its position as India's largest retail distributor of Mutual Funds. 1999 Bajaj Capital begins marketing Life and General Insurance products of LIC and GIC (through associate firms) in anticipation of opening up of the Insurance Sector. Bajaj Capital achieves the milestone of becoming the top 'Pension Scheme' seller in India and launches marketing of GIC's Health Insurance schemes.
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About Bajaj Capital Ltd 2000 Bajaj Capital implements its vision of being a 'One-stop Financial Supermarket.' The Company offers all kinds of financial products, including the entire range of investment and insurance products through its Investment Centres. Bajaj Capital offers 'full-service merchant banking' including structuring, management and marketing of Capital issues. Bajaj Capital reinvents 'Financial Planning' in its international sense and upgrades its entire team of Investment Experts into Financial Planners. 2002 The company focuses on creating investor awareness for Financial Planning and need-based investing. To achieve this goal, the company introduced the International College of Financial Planning. The graduates of this institute become Certified Financial Planners (CFPs), a coveted professional qualification. 2004 Bajaj Capital obtains the All India Insurance Broking License. Simultaneously, a series of wealth creation seminars are launched all over the country, making Bajaj Capital a household name. 2005 Bajaj Capital launches 360 Financial Planning, a software-based Programme aimed at encouraging scientific and holistic investing. 2007 Bajaj Capital launches Stock Broking and Depository (Demat) Services. 2008 Bajaj Capital launches Just Trade, an online Platform for investing in Equities, Mutual Funds, IPO's
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About Bajaj Capital Ltd Our Mission, Aim and Objectives Mission Statement Bajaj Capital aims to be the most useful, reliable and efficient provider of Financial Services. It is our continuous endeavour to be a trustworthy advisor to our clients, helping them achieve their financial goals. Our Aims To serve our clients with utmost dedication and integrity so that we exceed their expectations and build enduring relationships. To offer unparalleled quality of service through complete knowledge of products, constant innovation in services and use of the latest technology. To always give honest and unbiased financial advice and earn our clients everlasting trust. To serve the community by educating individuals on the merits of Financial Planning and in turn help shape a financially strong society. To create value for all stake holders by ensuring profitable growth. To build an amicable (friendly) environment that accords respect to every individual and permits their personal growth. To utilize the power of teamwork to function as a family and build a seamless organization
Our Vision To be the most preferred financial planning and investment advisory company in India by providing consumers with informed choices of lasting value, create wealth for them to make their tomorrow better than today. Our Networks Visit following link for more details: http://www.bajajcapital.com/aboutus/network.php?id=1
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Financial Planning
About Bajaj Capital Ltd Who's Who at Bajaj Capital

A visionary par excellence, a pioneer and a leader, Mr. K.K. Bajaj has been instrumental in shaping Bajaj Capital's emergence as one of India's largest Investment Advisory companies. He is a highly respected figure in the field of institutional and personal finance and Company FDs. His emphasis on honesty, ethics and values are the guiding principles of the organisation. Mr. K.K. Bajaj Chairman Mr. Bajaj is also a prolific writer and has written over 200 articles on diverse issues such as Personal Finance, Economic Affairs, and Health. Mr. Rajiv Deep Bajaj is the Vice Chairman & Managing Director of Bajaj Capital Ltd. He is also the Founding Chairman of Financial Planning Standards Board, India and has been one of the key people involved in bringing the globally recognized Certified Financial Planner TM professional designation to India. Mr. Bajaj has over 20 years of strategic management experience in the fields of Investment Banking, Investment Advisory, Insurance Brokerage and Financial Planning. He had spent his initial years in setting up of the investment banking business for Bajaj Capital. He also played an important role in expanding the distribution reach of Bajaj Capital from 20 offices in 1990 to around 200 now. In the last few years, Mr. Bajaj has spent a lot of time in upgrading the operating system and processes of the company. Under his leadership, the company has won various category awards and recognition nationally like Great Places to Work (2008 and 2009) and 'Best Financial Advisor Retail' Award for 2009 by CNBC TV18. Mr. Bajaj has done his MBA (International Wealth Management) from University of Geneva, Switzerland and an Executive MBA (International Wealth Management) from Carnegie Mellon University, Pittsburgh, USA. He holds an 'International Certificate for Financial Advisors' from the Chartered Insurance Institute (CII), London, UK. He is also amongst the first batch of 25 Certified Financial Planner (CFPTM) designation holders in India. Mr. Bajaj is a member of CII Mutual Fund Committee, Entrepreneurs' Organization (Delhi Chapter) and a Council Member of European Business Group. An active speaker and writer on Investment Strategy and Financial Planning in leading print and electronic media, Mr. Bajaj is extremely passionate about spreading financial literacy among the masses. His interests include Golf, Yoga, fitness training and Meditation.
Mr.Rajiv Deep Bajaj Vice Chairman & Managing Director
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Financial Planning
About Bajaj Capital Ltd

Mr. Sanjiv Bajaj is the Managing Director of Bajaj Capital Ltd. In his role, he is involved in planning and implementing of several important future projects of the company. He has been instrumental in conceptualizing and implementing a highly successful distribution model for Life and General Insurance, through what are known as 'Insurance Planning Centres'. Under the able guidance of Mr. Sanjiv Bajaj, Bajaj Capital Insurance Broking has emerged as one of India's leading Insurance Broking Houses within a short span since its inception in January 2004. He also has a keen interest in the Information Technology area and heads the function for the company. Mr. Sanjiv Bajaj Managing Director Mr. Sanjiv Bajaj started his career in 1995, when he worked on various projects which included developing Alternate channels of distribution like Associate Model, etc. From here, he moved on to Investment Advisory services, which included understanding the client's needs and offering them solutions to meet their requirements by using various financial planning tools. Apart from being a Post Graduate in Business Management, Mr. Sanjiv Bajaj also holds an International Certificate for Financial Advisor's from the Chartered Insurance Institute (CII), London, and is a certified Financial Planner from Financial Planning Standards Board India (FPSB). Mr. Bajaj is an active speaker on Financial Planning, Investments, Insurance Planning and careers in the financial services industry
Mr. Anil Chopra is the Chief Executive Officer & Director of Bajaj Capital Limited. He joined the Company in 1984. Mr. Chopra has been instrumental in expanding the branch network of Bajaj Capital Ltd. all over India. A Chartered Accountant and a Certified Financial Planner, Mr. Chopra is credited with introducing international accounting and HR practices in the organisation. His most valuable contribution, however, has been in building up a financially literate society and making Bajaj Capital a strong retail brand. He is considered an authority, and is widely sought after by the media for quotes on key developments in the industry. Mr. Anil Chopra Group CEO & Director
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Financial Planning
About Bajaj Capital Ltd The Significance of Our Logo
Our logo depicts Lord Ganesha who is the source of all our values and ethics in business. The large ears of Lord Ganesha remind us to hear more. We listen carefully to our clients to understand their needs. The weight of the trunk on the mouth symbolizes silence. We work silently, without blowing our own trumpet. The long trunk symbolizes continuous exploration. We explore all avenues to provide the best investment opportunities for our clients. The heavy posture of Ganesha symbolizes stability. We help our clients to attain financial stability through wise investments. Lord Ganesha is known as the remover of obstacles and bestower of prosperity. We emulate His example and try our best to help our clients attain prosperity by proper financial planning. Our logo has a yellow background. Yellow is the colour of gold, which symbolizes wealth. According to Vedic lore, it is also the colour associated with Brihaspati, the guru and counselor of the Gods. We offer our clients sage counsel to make their wealth grow. The letters are in red. Red is the colour rajas symbolizing power and incessant activity. It symbolizes our aggressive quest for your well-being and happiness. The white streak represents the trunk of Lord Ganesha. White is the colour of satva guna, and implies our selfless commitment to your life-long happiness.
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The Complete Guide To Financial Planning

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Financial Planning

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Index Content Page No 6 7 8 8 8 9 9 9 10 11 11 12 13 14 15 16 17 20 21 22 23 24 25 26 28 29 30 32

360o Financial Planning

Comprehensive 360 Financial Planning

Sample Financial Plan

PERSONAL FINANCIAL PLAN

Sample Financial Plan

Sample Financial Plan

Sample Financial Plan

Sample Financial Plan

Sample Financial Plan

FINANCIAL PLAN GOALS

Financial Frequently Asked Questions (FAQ)

Children's Future Planning

Cash Flow Planning

Choosing the Right Investment Option

360o Plan > Investment Planning

Risk Thermometer Result

For Resident Women below 65 years of age

360o Plan > Tax Planning Tax Liability FY 2009-10 AY 2010-11

30,000 10,000 40,000

5. Children's Future Planning

6. Cash Flow Planning

III. Pension Schemes

IV. Real Estate

V. Company Fixed Deposits

VI. Post office Schemes

VII. Initial Public Offering (IPO)

VIII. Portfolio Management Service (PMS)

About Investments > Mutual Funds SNAPSHOT OF MUTUAL FUND SCHEMES

Little Interest Rate

Security & Income

More than 9 - 12 months

12 months & more 3 years plus

Long-term Capital Appreciation

To generate returns that are commensurate with returns of respective indices

NAV varies with index performance

Portfolio indices like BSE, NIFTY etc

About Investments > Mutual Funds

III. Pension Schemes

IV. Real Estate

V. Company Fixed Deposits

About Investments > Company Fixed Deposits FIXED DEPOSITS GLOSSARY

Fixed Deposit Account

Know Your Customer (KYC)

Non-Resident Fixed Deposits

Principal Tax Deducted at Source(TDS)

VI. Post office Schemes

VII. Initial Public Offering (IPO)

VIII. Portfolio Management Service (PMS)

Fore More Details Visit http://www.bajajcapital.com/contactus.php

Equity Mutual Fund Stock Trading PMS Private Equity Funds

RESEARCH & PUBLICATION

About Bajaj Capital Ltd

About Bajaj Capital Ltd Who's Who at Bajaj Capital

Mr.Rajiv Deep Bajaj Vice Chairman & Managing Director

About Bajaj Capital Ltd

About Bajaj Capital Ltd The Significance of Our Logo

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