Dear friends,
I have been getting innumerable number of queries from young investors in the age group of 30-35 requesting an overall advice in financial planning. Most of them have an income level of 35000 to 40000 per month, some of them have even lesser income at 25000 per month.
There are many different financial planners who may advice on different issues but I have designed an overall plan meant for a typical young person in the young age of less than 35 with monthly income level of Rs.25000 to Rs.30000. Other persons may work out their strategy accordingly. In my assumption, the typical person is married with two kids.
1. Financial Security :
Assuming there is a mis-hap (God Forbid), your family should have at least Rs.30 Lakhs coverage/ compensation. For this purpose, I suggest the following :
a. Go for Term Assurance plan, eg. SBI LIFE Shied Policy wherein the premium covers only life risk and the premium amount is not repaid. At a young age with a longer term, the premium will work out to less than Rs.6000.00 per annum for a cover of Rs.10,00,000.00. There may be other such pure risk term assurances which you can enquire. The premium outgo works out to Rs.500.00 per month (but paid annually.)
b. The General Insurance companies offer one Janata Personal Accident Policy with coverage of Rs.1,00,000/- and the premium is Rs.264.00 or so and this one time lasts for 5 years.
c. The above General Insurance Companies also offer Personal Accident policies wherein a coverage of Rs.10 Lakhs may cost something less than 3000.00 per annum (please check exact amount). The coverage is only for accidental death. It can be safely assumed, with the medical advancement, death in young age is mostly due to accidents. The monthly outgo may be around 300.00 approx.
d. Go in for a ULIP (LIC Market plus, UTI Ulip, SBI Life Unit Plus/Horizon etc.) with a coverage of Rs.3,00,000.00. Try to get the best possible alternatives and go in for the Equity or Growth or Maximiser options. Different companies have different names.
e. Invest about Rs.5,000.00 per month in a well diversified equity fund under Systematic Investment Plan, Dividend Reinvestment option.
f. Purchase some shares which have a long life (multibaggers). There may be several of such stocks, but stocks with adequate and sustained cash flows like Noida Toll are the best.
g. If you are not covered under PF scheme, invest 10 percent of your monthly income in any mutual fund scheme – Tax Saving scheme in SIP.
h. If you are not covered by any medical benefits in your employment, take a Health Insurance (Mediclaim) from any of the Government Insurance Companies viz. General Insurance etc. with TPA (cashless claims)
If you follow the principles, your coverage is initially Rs.23 Lakhs as above and with the increasing savings over a period of time, your financial security will cross the targeted amount of Rs.30 Lakhs shortly.
Friends, your family is of utmost importance to you. ALWAYS INVEST FOR A LONG TERM.
KASHIWALA
I have been getting innumerable number of queries from young investors in the age group of 30-35 requesting an overall advice in financial planning. Most of them have an income level of 35000 to 40000 per month, some of them have even lesser income at 25000 per month.
There are many different financial planners who may advice on different issues but I have designed an overall plan meant for a typical young person in the young age of less than 35 with monthly income level of Rs.25000 to Rs.30000. Other persons may work out their strategy accordingly. In my assumption, the typical person is married with two kids.
1. Financial Security :
Assuming there is a mis-hap (God Forbid), your family should have at least Rs.30 Lakhs coverage/ compensation. For this purpose, I suggest the following :
a. Go for Term Assurance plan, eg. SBI LIFE Shied Policy wherein the premium covers only life risk and the premium amount is not repaid. At a young age with a longer term, the premium will work out to less than Rs.6000.00 per annum for a cover of Rs.10,00,000.00. There may be other such pure risk term assurances which you can enquire. The premium outgo works out to Rs.500.00 per month (but paid annually.)
b. The General Insurance companies offer one Janata Personal Accident Policy with coverage of Rs.1,00,000/- and the premium is Rs.264.00 or so and this one time lasts for 5 years.
c. The above General Insurance Companies also offer Personal Accident policies wherein a coverage of Rs.10 Lakhs may cost something less than 3000.00 per annum (please check exact amount). The coverage is only for accidental death. It can be safely assumed, with the medical advancement, death in young age is mostly due to accidents. The monthly outgo may be around 300.00 approx.
d. Go in for a ULIP (LIC Market plus, UTI Ulip, SBI Life Unit Plus/Horizon etc.) with a coverage of Rs.3,00,000.00. Try to get the best possible alternatives and go in for the Equity or Growth or Maximiser options. Different companies have different names.
e. Invest about Rs.5,000.00 per month in a well diversified equity fund under Systematic Investment Plan, Dividend Reinvestment option.
f. Purchase some shares which have a long life (multibaggers). There may be several of such stocks, but stocks with adequate and sustained cash flows like Noida Toll are the best.
g. If you are not covered under PF scheme, invest 10 percent of your monthly income in any mutual fund scheme – Tax Saving scheme in SIP.
h. If you are not covered by any medical benefits in your employment, take a Health Insurance (Mediclaim) from any of the Government Insurance Companies viz. General Insurance etc. with TPA (cashless claims)
If you follow the principles, your coverage is initially Rs.23 Lakhs as above and with the increasing savings over a period of time, your financial security will cross the targeted amount of Rs.30 Lakhs shortly.
Friends, your family is of utmost importance to you. ALWAYS INVEST FOR A LONG TERM.
KASHIWALA
3 comments:
Great planning.....
Hi
I bought Jagsonpal @ 31 rs. I've seen your fundamental analysis and all are in greate detail. Can you please my id mohit21_grover@yahoo.com in your mailing list and please let me know prospects of jagsonpal.... i am in deep losses at this point in this stock .
Hello Mr. Kashi,
What do you think is the future of Tata Teleservices, though the company had made some losses in past but its on the verge of coming back, also with Virgin backing it. I had got 100 @ 34 and now its trading @ 31. Would appreciate if you can give your views on the same. Also I have a Q, do high volume stokcs give less returns ? My id pillainitin79@yahoo.com can you please add it in your mailing list.
pls add me deekam21(at)hotmail(dot)com to your email list
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