Jagoinvestor
May 18, 2009
Video post on Basic Formula in Personal Finance
This is a Video post by me , where I have tried to teach some basic formula’s for starters who should know important calculations using which they can calculate important stuff like Maturity value of Investment when they make SIP payments , or one time payments .
I am getting some questions like “I want to invest 2k per month for 10 yrs in mutual funds , Can i generate 20 lacs” type of questions . Seems like many readers do not know how to apply and use simple formula’s to calculate these stuff when they calculate how to generate wealth for long term . Often you might have felt that you have to depend on others for calculations , because you don’t know it themselves .
I have made a video myself where I explain 3 important formula’s which everybody should know .
1. Compound Interest
2. Annuity
3. CAGR
Lot of you might have learned this school , but many have forgotten it . So in this video post I have explained it with examples . I hope that it will help beginners or new readers . I am also giving a Calculator below the video where you can do your own calculations , If it gives any error , please go to the link I provide and calculate it there . I will also put presentation here , so that people who have very low bandwidth can view the presentation at least.
Presentation
Important Calculations In Personal Finance
View more presentations from manish.pucsd.
Embedded Calculator (click here if this gives some error)
Thank you very much for this starter kit, Manish.
I am just getting started with reading about SIPs and Mutual Funds and its very comforting to see content that helps in the Indian context.
Glad to know that Rohit ..
Hi,
Manish, as i understood by reading most of the comments above that Komal Jeevan and other policies are neither giving good investment nor good risk cover and has to be stopped. Also Surredering them give a big loss and paid up can be a good option.
Can you please suggest what is the process of Paid up a policy, do we need to inform the LIC for this or just stop paying the premium and it goes to Paid-Up automatically?
Waiting for your answer thanks?
Pavneet
Yes, if you stop paying premiums, it automatically becomes paid up , but its better if you can send them a mail on this anyways !
Old article. Yet must read for everyone to understand the basic formula of personal finance. Manish Rockzzz 🙂
Thanks Chetan !
Dear Manish,
It is really nice to read your blog, which has so much of information. I am 33 year old just started working out of country after working 9 years in India. I have two kids Daughter/Son- 9/5 yrs. After reading your blog i realized that i made many wrong mistakes in taking many LIC policies. I will really appreciate if you can give me some inputs/suggestion on below
-Monthly Income : 200,000
-Monthly House Exp : 38,000 (Including house rent as I am staying in Bangalore)
-Home Loan : 800,000 (Closing in July 2013)
-Car Loan : 350,000 (Closing in March 2013)
LIC Policies
– Money Back – 10500 Yearly Premium ( Taken in 2004)
– Komal Jeevn – 7000 yearly Premium ( Taken in 2006 for Daughter)
– Jeven Saral – 49000 Yearly Premium (Taken in 2008)
– Komal Jeevan – 41148 Yearly Premium( Taken in 2012 for Daughter)
– Komal Jeevan – 38570 Yearly Premium ( Taken in 2012 for Son)
I am planning to work for another 5 years outside country and would like to come back and settled. I need some fixed income from my saving but looking at this I don’t think so I may be.
I think first you need to stop putting your money in these policies. They are not helping you in insurance as well as investments .
Thank you for advise. Any suggestion on, better SIP to divert this investment.
I would say pick few funds like DSPBR top 100 , HDFC Prudence !
Hi Manish,
Really nice blog, very informative. I have taken a LIC jeevan saral (premium of 60000 per annum for 25 years) the agent told me that they invest in debt market and gave me a figure with a 10% returns, when i paid my premium this year(2nd year) I was told by some LIC official that the returns would be much lesser than what was told to me earlier. Can u share your view on this particular policy Jeevan Saral , should i continue it?
Hoping for a informative reply as always
Regards Saurabh.
Saurabh
All LIC policies mostly give returns on the range of 4-6% .. Just dont continue it if you want 10%+ return !
Dear manish. What is your opinion on LIC policies? Are these good or bad?
Only you can decide that .Here are some of the points
1. They provide below inflation returns
2. They are not liquid at all, you loose a big sum if you want money back in initial years
3. They are Safe though !
NOw you can decide if it fits your requirements or not – http://jagoinvestor.dev.diginnovators.site/2011/08/lic-policies.html
I would also like you to enlighten all of us about MMFs. I have read somewhere they are very good for short term investors but didn’t find any similar article on your blog.
What is that ?
Hi Manish,
I don’t have enough words to say thanks to you for this wonderful eye opener initiative. I already have started investing in ppf and begin long term planning.
I have worked for 2 years after completing my engineering from 2008-2010. Then opted for 2 years full time MBA and now started working again. I am also planning to avail your services in the near future but since i am just a beginner and my salary is also not that much good so I am planning to delay it till next 1 year. By that time, PPF and FDs are good instruments.
Keep up the good work. God Bless you. Thanks
Good to hear that 🙂 , Keep reading !
Hi, Manish
This blog is very informative. Thanks for all your work. At present i joined sbi and covered under new pension scheme. It is a market related scheme and no gaurantee on return and moreover the maturity amt is also taxable. What if the amt invested in the market does’nt gives expected returns compare to fixed deposits which gives on an average 8- 10%. Nps should be optional and govt cannot compel us to join such a scheme. It is our money and our right where to invest and where not. If Govt is not giving gaurantee of minimum return, then govt has no right to rub the shcheme on us. Can we go to court?
its like thats the term and condition of working in PSU , take it or leave it .
Hi Manish
I’m really impressed how you elaborate such things simple things so nicely.
A good and must read for people new to investments.
Please continue posting such useful information in clear and succinct way.
regards
shashank
Thanks Shashank !
Dear sanjay
I am confused now a days please help me. i m working with a bank as scale I & getting 27000/m (under old pension scheme). Now i have selected in another bank as Scale-ii 32000/m (new pension scheme). for long term benefit (approx 30 yr) weather i should continue or join new job? i am not much aware about new pension scheme. please reply soon.
Naveen
I am sure that the pension account would be transferrable ., right ?
Manish
Hey Manish,
Thanks. Very informative and kind of a refresher for me. Been out of finance for some time and this sort of helped…
Please keep up the good work…
Best Regards, Prajacta
Prajacta
Good to know that you are getting in touch with finance once again , but this one is personal finance 🙂
This one is great article. Almost all of us learn these formulas in Colleges and then forget it. Thanks for puting it here. Its helping me plan my investments clearly.
Great job Manish.
Regards
Shobha
Shobha
Thanks 🙂 . Keep watching and spreading the message
awesome
Thanks for liking it .. what else can be improved in this ? I know its more better quality , but I am human and I am learning
Manish
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