Actually I am not 100% clear on what you want to say , but regarding the liquidating your money from equity , even that has to be done in SWP way , not waiting till end date , that unlucky thing can definately happen

but just a cynical thought…. due to the fact that now India have trillion Rupee MF industry … but at the end of the day this money goes into Equity market – secondary market (where someone loss is someones gain and viceversa)… please note i m only talking about PURE EQUITY MF…..
so defintely where is the assurity, even if somebody hv moderate risk appetite, i would comletely give.. same RISK rating as that of stocks market for Equity MF…(there are very few MF who hv outperformed Index in past yrs)…

for people with age 25-35…its always advisable (from financial experts) to invest till 70-80% in equity to get advantage of compounding. who can assure u that…one may not face same kind of “Unlucky” situation during redemption…..

possibly this looks bit skeptical.. but with due respect to Fund mangers of AMC’s, averaging of investment due to SIP, power of compouding….etc …I would still prefer equity investment not more than 40-50% in my portfolio.
… Amit

If you had invested in 2002 , you must be sitting on a huge returns like 40-50% CAGR return , would you complain that time that the returns from mutual funds are 12-15% and not 40% CAGR ? In the same way its all about timing , the last 5 yrs returns are very rare occcasiions .. It does not happen generally , we are all unlucky , nothing else ..

Wait for few more years and overall you will see better returns . What you are facing are obvious risks of equity investing .

I agree with your calculationa and analysis of of an insurance plan and the advantages of term life insurance. I also agree with your outlook of PPF scheme. What is fail is to understand is the advantages of mutual funds or SIP. Having invested in mutual funds for a period of 5 years, i have burnt my finger and lost 25% of the principal amount that I invested. Mutual funds always have market risk and returns are not guranteed. Is there any mutual fund which can write on paper with guaranteed returns of 12% per annum(cumulative) and protect our principal from any losses. The so called returns of these funds are based on historic assessment and doesn’t guarantee our future returns. The relaince of of the funds choice for long term also has to be thought of as any single fund does not perform consistently for a longer period. If we want to diversify our risk and choice multiple funds then the returns are impacts(probably 8%). Do we have a better choice where returns are assured (12%)

You first calculate your returns from this policy using IRR – http://www.jagoinvestor.com/2011/02/calculate-insurance-policies-returns-video.html

Manish

I planned to invest in Kotak Money Back Plan as a Monthly Premium 1.8k for 20 Years. They have assured minimum maturity amount is around 6 lakhs apart from they offer Medical Surgery Claim upto 1.5 lakhs/year and 60,000k on 5th, 10th an 15th year. Shall i opt this plan or anyother better plan avail in market.

Pls suggest to help me to get rid of this confusion?

If you want to invest money only from invstments point of view , then please never go for traditional plans . Go for MF

Manish