myths personal finance

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Personal Financial Engineering

A presentation to the Officers and Staff of INS Agrani


Finerva• Our Mission

– Dedicated to educate and support individuals in achieving financial freedom

• Our Values– Committed to build long term trust with our clients and

providing sustained thrust to their wealth creation

• Our Background– Over ten years in training and practicing financial planning– Wide experience in different industry sectors


A Need Analysis

•Preferred investment modes Insurance – EndowmentPost Office DepositsProvident fund

•Pension Planning: Only a few (7/19)•Children’s Plans: From PF & Deposits (9/19)•Risk Rating :Medium – 8, Low & No Risk – 11•Loans : Low (5/19) Highest- 4,60,000. Lowest 6,000•Average Age :33.6 years•Average Years to Retirement: 6.8 years•Average savings per year :Rs35,000/-•Salary is the only source of income Most cases


Kya aap bhi ye sochte hain? ki

Safest option in life is to get a secure job and stay there alwaysOnly doctors make a lot of moneySale! Sale! I buy always when there is a saleI will never understand how investing worksThey have a big house, they must be rich…There is not enough money for everyone to be richPeople who make mistakes are stupidFixed deposits are safer than stocksI will never be rich…Investing in stocks is gambling. Only crooks become crorepathis


The way forward…

• Achieve Financial FreedomFinancial Freedom is the state of your

personal life in which irrespective of whether you are working or not, you and your family is stable financially.


Myths in Financial Management

• Any investment with an element • of risk is bad– Factors to be considered while investing • Returns• Liquidity• Safety • Taxation

– Stock market returns over a period of time


RETURNS FROM VARIOUS ASSET CLASS

0

2

4

6

8

10

12

14

16

18

EQUITY DEBT GOLD


Sensex Returns since 1979

WORST RETURN

BEST RETURN

1 YEARHOLDIN

GPERIOD WORST

RETURN

BEST RETURN

5 YEARHOLDIN

G PERIOD

10 YEARHOLDIN

G PERIOD

BEST RETURN

WORST RETURN

+90% +44%

+32%

-26% -1%

+12%


Myth Number TWO

• I will get pension when I retire.

• I don’t need retirement planning.

– Expenses at the time of retirement

– Skill set for retirement


Myth number THREE

• Insurance is very costly.

– Term Plans are not

– Ensure your dreams for loved ones become reality


Inflation means Rs 10,000 would be…

25937

67275

174494

0

20000

40000

60000

80000

100000

120000

140000

160000

180000

10 20 30

10%

8%

6%


Myth Number FOUR

• Gold jewels are an investment

– Cost of procurement, cost of disposal

– Growth in value only covers inflation


Myth Number FIVE

• My house and vehicles are my assets

– Cash flow diagram & explanation

– How they can be assets


Cash flow diagram


Myth Number SIX

• To become a crorepathi is difficult

– Possible with small amounts invested regularly

also, if you start early.

– Returns chart & savings amount


Myth Number SEVEN

• Salary has to be my main source of

• income.

– Types of People – 4

– Be an Investor / Businessman– Leverage OPM, OPT

– Leverage Technology


Four Types of People

Employed


Kaun banega Crorepati ???


Aap Bhi ban sakthe hain

And Finerva is always here to help you…

myths personal finance

Economy & Finance