Questions and Answers , Part 6

POSTED BY manish ON December 3, 2009 COMMENTS (74)

I am putting some questions answered by me to users on “Ask a Question” form . I am putting 3 questions and there answersΒ  . If you have any comments or better suggestions please feel free to add as comment . You can see other questions and answers done in the past Here .

You can also ask your questions from other experts on recently started Jagoinvestor Forum

ask a question

Question 1#

I’d like to invest Rs 5,000 – 7,000 a month through SIP to build a corpus for my child’s education in 20 yrs from now. I think I will need around 20 lakh (which will be around 60 lakh when we count the inflation). I’d like around 80% to go in equities for 1st 15 years and then switch to a more risk averse equation. Which funds do you suggest? Child will be born in Apr 10, can I start rightnow?

I’ve a term plan for 70-80 lakhs. So, ULIP would not be appropriate for this goal, right?

Answer 1 :

Excellent , congrats on planning this .

>>> 7000*(1.01)*(1.01**240 – 1)/.01
6994035.4332886515

Understand the Formula here

7000 per month can make around 70 lacs assuming 20 yrs and 12% yearly (1%) return . This is as per your requirement , which looks achievable easily , considering you review your investments every year and maintain your asset allocation .. .

You can put some amount (20-30%) in PPF (child name or yours) .. and then rest divided in some 2-3 good funds through SIP .. this should do the job .

you can choose any good fund listed on the article some days back .. You can also look for Balanced funds if you dont want to take too much risk ..

Question 2#

I am planning to invest my money in some CHIT fund scheme where in on an average you get more interest than in SB/Fixed deposits. What is your view on it and can we really trust these chit fund companies.
Following are links of couple of chitfund companies:

AnswerΒ  2:

I havent looked at what they have to offer , but without seeing that I am telling you dont invest in these .. Have you every heard these names from more than 3-4 people , Might be they have made some money out of this , but is that under law and are there contracts which are legally binded .

There are cases of frauds in these kind of chit funds . I found some complaints against these chit funds on net .. please go through them .. they might be offering higher returns but always remember that anyting above 8% is with risk πŸ™‚ otherwise everyone will go with them only .. Don’t get into this unless you are ready to loose all your money someday ..

https://www.consumercomplaints.in/complaints/shriram-chit-funds-c41300.html
https://www.consumercomplaints.in/complaints/margadarsi-chits-karnataka-pvt-ltd-c217337.html

I feel even options trading is safer than these .. because you only loose because of yourself there , not someone else .

Question 3#

I would like to invest Rs.7000/ month by auto SIP ( for 2to 4 Years. My risk profile is moderate and my preference is to invest in Balanced Fund, Debt Fund & Diversified fund. My age is 45 years. Please recommend some of the good fund and amount to be invested per month.

Answer 3:

2-4 yrs is a modetate time frame .. You should go for Equity funds or Balanced funds only if you can take some risk on your investments , Risk does not mean negative return , it means below normal returns also ..

If you are ok to invest 7k per month , then even if you invest in something which gives 10% , you can generate aroundΒ  4.14 Lacs . If you take risk and target equtiy funds , you can get 15% returns also , which will make 10 Lacs ..

Incase your Goal after 4 yrs can be met by 4 lacs , then i would recommened 10% route which will involve mostly debt funds or Balanced funds .. or Debt funds + Equity funds (30-40%) ..

You have to ask your self if you want your goal to be met or Generate higher returns with RISK πŸ™‚

The best thing I think would be

  • 3k in Debt fund or FD
  • 1k,1k in 2 Balanced Fund
  • 1k,1k in 2 ELSS funds (equity , tax saving also)

Have a look at

Best of Luck , Dont hesitate to ask any other question and reply back if there is any doubt yet

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74 replies on this article “Questions and Answers , Part 6”

  1. Kishalay says:

    Hi Manish,
    I have invested my money in the below listed funds for last 3 years…
    1. ICICI prulife — lifetime super ( 18000 pa)
    2. ICICI prulife — lifetime gold return gurantee fund (50000 pa)
    3. LIC Jeevan Anand — (7332 pa )

    I invested my money into these plans without knowing much as I was very new in this field. I have a plan to take a policy for my retirement… Please suggest me how to go ahead and which are the good ways to build my wealth ..

    Recently I have done Jeevan Tarang from LIC … I think I have done a mistake, Now please suggest me how to achieve my goals ..

    Thanks,
    Kishalay

    1. Kishalay

      You should mainly use Mutual funds (equity oriented) to achieve your goals . Stop your ULIPs and take the money after 5 yrs if you cant handle ULIP’s .

      For LIC products , you will have to take painful steps of surrendering it if you are in the start of the tenure .

      Manish

  2. Prashanth G says:

    Hi Manish,
    Thank you very much for all your informative blogs.

    Can you let me know how can I find out the existing cost of completing courses like MBBS (in India) and MBA/MS in top universities (US/UK)? I’m finding it difficult to get this information. Any pointers would help (for financial planning for my kid’s education).

    Thanks,
    Prashanth

    1. Prashanth

      hmm.. thats a tricky one πŸ™‚ . For MBBS its tough to arrive at one figure as it differ a lot from one college to other , but better take the max figure .

      Manish

      1. Prashanth G says:

        Hi Manish,

        Amazing to see your quick response! Thanks!

        I’m actually looking for top rated colleges. Looks like I’ll have to consult a financial planner who I believe will have this kind of information. Also, can you recommend a good financial planner in Bangalore? I’m ready to pay whatever fee they specify.

        Thanks,
        Prashanth

  3. S Singh says:

    I still don’t understand why people get so excited about chit fund, I have read numerous cases of fraud, may be these people never read newspapers.

    1. S Singh

      Yes, most of the times people are attracted to those high returns . Some of the chit funds are ok i would say .

      Manish

  4. purna says:

    Hi,

    I have small doubt in my mind thought of clearing with you. If CAGR of 12% appreciation is expected over next 20 year or so, what will be the sensex levels or nifty levels and how about indian GDP over next 20 years from today, Do you think all these are practical returns over long term. I believe stock markets/global economies are more or less become trading platforms, though we could see 100% or 200% returns from time to time over next 5-10 years, i some how suspect this returns are really sustainable in long run,because of the hidden reasons which we are not aware today?,

    Am i sounding too pessimist, but the reasons are,

    1. Last 10 years were I.T industry created lot fo employment directly and indirectly, which indians never seen before in decades such as 40K,50K, hence inflation shooted at sky rocket levels.

    Now, where are we finding the right opportunities for our unemployed youth in order to convert them to users.

    Indians are traditionally conservative, so indian consumption story some how i doubt to appreciate at the rate of 12% CAGR.

    Last, yes there are some companies which might outperform, but we will only come to know, when it is done.

    Please share your views.

    1. Purna

      CAGR of 12% from equity does not mean that index levels also rise to that level . one can achieve 12% using diversification , rebalancing techniques . If market moves up and down and come back to same level . its 0% increase , but if you use SIP techniques , with same situation the returns are positive (non-zero) .

      Manish

      1. Nilesh says:

        Specific to your statement “If market moves up and down and come back to same level . its 0% increase ”

        If this is the case, then don’t you think that a average customer required to put lot of attention to portfolio(specific to equity) and NOT just after 1 year or even 6 months. In that case it doesn’t prove the modern phenomenon that promotes a traditional user to invest into stock market/MF as it is needs high intelligence to be in good profit.

        Your views please

        1. Nilesh

          May be you didnt see the whole comment , Definately direct investing is tough , however if a common investor does follow rebalacing technique for long term , he can acheive good returns because of ups and downs in the market . Not sure which point confused you , can you ask again with specific points .

          Manish

  5. vivek says:

    thanx for the links
    but can u please tell what should one look for while buying the shares.

    1. manish says:

      Vivek

      If it was so easy to answer “What should one look at while buying the shares” ,then everyone would be a good investor . there are lot of things one has to look while buying the share . There can be a seperate post on that which I am not a expert.

      Long term investment is something you learn from practice and lot of hardwork . I Would suggest your read Rohit Chauhan and Tip guy blog . They are good ones to learn stuff on value investing .

      Manish

      1. vivek says:

        hi manish
        i recently went through ur article on akruti city crash. wat i got is u hv mentioned a link to nseindia.com to knw the history of any stock, my question is , is it right to take the stocks which is having more delivery then trading, i mean is it one way of picking the stocks. u got me, nah……..

        1. Vivek

          In a sense yes , you can do that . Share trading heavely and not being kept by people .

          Manish

  6. vivek says:

    HI MANISH
    CAN YOU PLEASE EXPLAIN WHAT IS PE RATIO, EPS,FACE VALUE OF A SHARE.
    WHAT ARE THE THINGS ONE SHOULD LOOK WHILE INVESTING IN STOCKS .

  7. Purna says:

    Hi Manish

    I have taken ULIP policy on June 2009 for next 20 years. My premium is 48000 per year but they are charging 440 rupees per month. 5280 rupees per annum, but as per new IRDA policies, how much they need to charge me? and also I contacted them about new IRDA policies and they said the new rules for only policies which are sold after Jan 1st 2010, for the old policies they continue to charge as per the previous charges only. is this true? if this is non compliant as per New IRDA policies, who and how do we complain about my insurarer,
    Appreciate your inputs if any in this regard,
    Thanks in advance.
    Purna.

    1. manish says:

      Nope, as per IRDA rules , all the new policies has to comply with IRDA rules . Ask them for detailed explaination on this . Go to their compaint section.

  8. Srikanth says:

    As many others mentioned this blog is very informative for one’s financial planning. Ok here here goes mine and I don’t think I am in the correct peg (realized after going through these blogs)….kudos to you…..

    I am now investing in LIC (jeeva shree – ~25000/- p.a, money plus (ULIP) – 10000/- p.a, jeevan tarang – ~27000/- p.a.) and in 20000/- p.a. in ULIP of a private bank. So investing close to ~80K in just insurance and ULIP. I am now planning not to invest in ULIP once they complete the lock-in period. I did realize that the SIP would be primary option (then EPF) for me to go with to get the best return over a long period of time (25-30yrs). Apart from these I normally invest in delivery trading (NOT marginal trading) but that is just a hobby.

    Am I going wrong with my assumptions?Please throw some insight, also I would like to know how the returns would be calculated sort of any math expression.

    -Srikanth

    1. manish says:

      Srikanth

      You shoudl take a term insurance asap and then invest your rest of the money for each goal systematically . Also your hobby is very expensive one πŸ™‚

      Dont use the word “investing” with Delivery trading . Its just tradng and very risky . Are you making much money from trading , if yes ,then continue .

      For understanding the formulas , you can look at the video i created for basic formula see Archives πŸ™‚

      Manish
      Manish

      1. Srikanth says:

        Thanks for your dynamic response. Can you brief on “You shoudl take a term insurance asap”?? I am in an impression that Jeevan Shree I am going with is already a life insurance policy, isn’t the case? Or you meant in addition to this I should take one more?

        May I know if you were me how would you invest? (assuming the goal is just getting the best realistic returns in log term).

        I started to trade just to experiment my understanding of certain market segments in real time, though the earnings are not discouraging, I don’t want to invest big chunk of my savings in trading.

        Thanks in advance, I would certainly go through your video.

        -Srikanth

        1. manish says:

          Jeevan Shree is a Insurance policy , agreed . But how does that solve the problem.

          The issue here is that you might not be covered adequately and with proper cost . I am sure that the cost you are paying for your current policy is extremelly high and you are obscenely undercovered . Let me know how much is your cover as % of your annual salary . I feel its less than 300% .

          Trying out trading to understand thing is a impressive statement and it shows that you are keen to learn. But just make sure that the fees you pay is not too much to learn . Better mock trade a lot and then trade with real money .

          If I were you , I would first make sure what I want in my life , my financial goals of future . then i would first make sure that My family is adequately coverd . iWould take cheap term insurance and good health insurance . After my protection is complte , I would then go goal based investing in Equity for long term because I would understand that Equity gives superior returns over long term .

          Manish

  9. naresh says:

    thanx for that prompt reply,
    but can u tell me which one is the better amongst these 7 options to start with and when to switch over to other option, and please tell me about the better ULIPS.

    1. manish says:

      Naresh

      I would suggest you stay away from ULIPs , Its not suitable for you, which is fine πŸ˜‰
      better go with simple products like mutual funds , ETF etc … When to switch in a ULIP is a question which is very tough to answer and need great expertise πŸ™‚

      manish

  10. Vijay Kumar says:

    I am planning to start a investment club with a group of about 10 friends with small capital and later expand it to bigger investments. I want to invest in shares, real estate, start a business like hotel / hospital / school and others in the future. I would like to know the legal issues and procedures for starting it. Any advice and guidance will be highly appreciated.

    1. manish says:

      Vijay

      I am blank my self on the legal issues πŸ™‚ . better consult a lawyer πŸ˜‰ and let us know πŸ™‚

      Manish

  11. naresh says:

    what is icici life time gold plan can you give some detail about it.
    anyways, your blog is very informative. thanx

    1. manish says:

      Its a regular ULIP from ICICI . Here are the features .

      β€’ A regular premium Unit-linked endowment policy that offers potentially higher returns through the Multiplier Fund.
      β€’ Option to choose from 7 different investment funds.
      β€’ Systematic withdrawal of money from fourth year of Policy term.
      β€’ Higher of the fund value and sum assured payable as death benefits.
      β€’ Option to switch between funds up to 4 times a year, absolutely free.
      β€’ Available with optional Waiver of premium Rider.
      β€’ Tax benefits under Sections 80C, 80D and 10 (10D) of the Income Tax Act, 1961.

      So nothing differnet in this ULIP . If you want to buy ULIP only , there are better choices .

      Manish

  12. vivek chowdhry says:

    hi again
    but manish i m a doctor, i have seen the documents ,ofcourse it has some exclusion like all other mediclaim policies,but it covers the cost of hospitalisation,operations,accidental injuries,cost of doctors,drugs,nurses,investigations or tests. I, myself is a cardiac anaesthetist ,i see the critical care part also.but the thing i dont understand if operation, accidents and hospitalisation for more than 24 hours are not critical care then wat type of critical care the critical care rider includes.

    1. manish says:

      ok . Then you dont understand what is Critical illness insurance .. Under critical insurance there is list of illnesses they cover like Cancer etc .. and once your are diagonised for any thing , you will get the lumpsum amount .

      So if you have 5 lac of cover and you are diagonised for any illlness in the list , you will get 5 lac .

      Manish

  13. vivek chowdhry says:

    hi manish
    i m planning to take a term insurance.
    i have a mediclaim policy (family floater) frm star health with SI of 5 lakh.
    should i take the term policy with riders or plain term policy.can u please explain about these riders.

    1. manish says:

      Depends on wheather your your Health insurance is providing the things rider would provide .. Do they provide critical illness cover , i dont think so ?

      In that case you should buy riders πŸ™‚ which is not present in Health insurance , you will have to take the pain of digging your Document policy πŸ™‚

      Manish

  14. Purna says:

    I dont know manish, However i cannot save more than 20,000 rupees per month, after considering PPF and reserves for short term expenses i reserved myself to invest not more than 20,000 rupees because thats the amount which is surplus for me. Would you suggest, how much do i have to invest if i need make 1 cr in 10-15 years.

    1. manish says:

      Purna

      My aim here at jagoinvestor is to empower people to learn things, not just give them answers πŸ™‚ . So if you dont know the answer , find out !! . Try your best first that how to calculate this stuff .. so if you want to generate 1 crore in 20 yrs and you expect 12% yealy return , how much you need to invest per month . Find this out !! ..

      I will give you answer here , but at the end story does not end , untill you become self dependent in finding this out . you dont need to depend on me or this blog or anyother person to find it out πŸ™‚

      So for if you want to make 1 crore in 20 yrs , you need to invest 10k and for if you want it in 15 yrs , then you need to invest 20k per month .

      Also you can do another thing , invest 11,500 for 15 yrs and then let if grow for another 5 yrs , that way also you can make 1 crore in 20 yrs πŸ™‚ . I have explained all this in a video on this blog . find out and let me know when you are done .. I want to make sure you know how to calculate this .

      Manish

      1. Purna says:

        Thanks manish, I really like the idea of “Self dependent”. I appreciate you.

        1. manish says:

          Great !! .. So did you find that out ?

  15. Purna says:

    Manish,

    I am looking for your advise, i am 35 years old with spouse 2 kids, earning 2.4 lakhs per annum ( Surplus money after my expenses which i can invest for any long term 15-20 years, single income family my wife does not work).

    Objectives:
    1. to work not more than 15-20 years from now.
    2. aim to achive 1 cr by 2020. or early whenever my investments achive 1 cr.

    Would you be able to adivse whether investing in the above 2 funds, will achive my target by 2010? or you do you suggest any thing else in my investing profile?

    1. manish says:

      Yes you can invest in those funds .. however i would say use some debt also like 20% in PPF .

      Do you know how much contribution you should make per month to achieve the target ?

      Manish

  16. Purna says:

    Thanks Manish, I have been wandering to get answer for this, You have made it pretty clear.Thanks again. Hence Can i just invest in HDFC top 200 and DSP Black Rock 100, in these two funds in SIP manner for next 10-20 years.? Please advise.

    1. manish says:

      yes .. put money in both

      Manish

  17. manish says:

    Purna

    You have valid arguments and this is something one has to understand well to understand Equity .
    You have ask question like what is Equity and what is stock market , what do they signify ?

    Stock market are the barometer of economy its development . So all the economies which are already developed like US and Japan , will face the issues you pointed out . Japan has a different case . US markets are dragging to move up because of its bubble created all these decade and bad decisions.

    Other thing is when you invest in Equity , you dont just leave it and forget for long term , you have to atleast monitor it every year and take appropriate decision as and when situation changes .

    India , China and other asian countries are now entering a mode of “becoming developed countries” and hence for next 30-40 yrs we will see explosive growth in these economies which will result in making these economies ahead of US and UK by 2050 + . Thats the reason I dont see any other investment avenue better than Equities in India in coming decades .

    Manish

  18. Purna says:

    Hi Manish,

    I have the following questions, could you please comment.

    1.If EQUITIE’s are really good for long term capital appreciation, why Japan stock markets are not recovered since 1990.not even half of the 1990 heights.

    2.Why US markets are dragging at the same level of where they were at 10 years ago. ex. Dow was struggling at 10,000 since 10 years.

    3.Do you foresee any such kind of problems will/might happend to indian sensex in this decade? between 2010 till 2020.

    Could you please give me your analysis by comparing history of work equity markets as well. I am basically long term invester, however i can stay any long time such as 20-30 years. But I dont want to loose my money. Please let me know your reply.

  19. manish says:

    I need to find out more on this .. What are your goals .. Get income for your needs or for investing ?

    1. vijay says:

      Goal is to get monthly returns @10,000. Postoffice MIS gives 6,000 per month for 9 lakhs @ 8% pa + 5% as bonus at the end of the term ie 6 years. Is there any other instrument better than this as monthly payout which is safe,not related to equity which provides better returns on a monthly basis.

      1. manish says:

        Vijay

        There are no safe products which can give you more than MIS . there are products like MIP from MF , but then its risky .

        manish

  20. vijay says:

    Hi Manish,

    Need you analysis on Post Office MIS since I have been building up 2-3 lakh to scale up to 9 lakh (joint account) so that it should pay me a regular montly payout. Need you suggestion as to how to invest for montly returns if any. Thanks.

  21. Nipi says:

    Not sure if I was clear with the plan of the funds mentioned all are – Diversified and Growth Plans.

    Thanks
    Nitin

    1. manish says:

      Nipi

      I am not clear with what you want , can you please ask in detail .. tell me exactly what is the problem .

      Manish

      1. Nipi says:

        Sorry for the confusion created Manish,
        1) DSP BlackRock Equity Fund
        2) DSP BlackRock Tiger Fund
        3) Reliance Growth Fund
        All the above funds are Diversified and Growth fund Plans,

        Question was,
        If I should renew it or Should I switch or add any other funds ?
        I read your reply that all are good funds, so are you saying I can stay invested in this for another year ?

        Thanks
        Nitin

        1. Manish says:

          Depends on how you define “Good Funds” .. All of them are higher risk funds . Return wise they are good funds , but they are risky too .. So make sure you are ok with the downside potential also .

          If you are a risk taker then continue ..

          Manish

  22. Nipi says:

    Manish,

    Nice post and Nice analysis. I had a question, I am invested in below funds for 2 years and now 40% +
    1) DSP BlackRock Equity Fund
    2) DSP BlackRock Tiger Fund
    3) Reliance Growth Fund

    Are these good investment ? My renewable is due Jan 2010.
    Your reposnse would be appreciated.

    Thanks
    Nitin

    1. manish says:

      These are all good funds .. Make sure you are a risk taker ..

      Manish

  23. Niranjan says:

    Hi Manish
    Thanks a lot for your timely and perfect advice . I had invested 1,50000 in HDFC endowment plan for year 2007,08,and 09. When I asked agent whats is current NAV and fund value . I got unbelivable answer that the total amout I am owing is 1,55000 only after 3 years . What is your advice on this. shoud I exit from this policy ?

    1. manish says:

      Niranjan

      Whats so unbelivable in this .. Equity crashed heavily in 2008-09 and now your money is back on track . ULIP has risk always .. if you are socked it means you were not ready for this .. I think you should exit the policy and move to less riskier things like Index funds or balanced funds .

      manish

  24. manjeet says:

    Dear Manish,

    I read a few of your posts and each one of them were great in terms of the information they provided. It’s a good initiative taken by you to educate people about investments.
    I learned about things like term policy, SIP etc. but I’m still not confident enough to take a decision on my own.
    I need to invest for the purpose of tax-saving for this financial year. I need your suggestions on this. I still need to invest 60000 for my savings and another 50000 for my wife. My annual salary is 8lac and my wife’s is 3lac.
    I’ve invested in a ULIP for 24000. The premium is due in feb. I’ve paid 2 premiums for it. Should I continue with it. What else should I invest in.
    Please suggest all the possible options of investment as I only have 2 months to invest.

    1. manish says:

      Thanks , Nice to know you are learning

      So the other things in tax saving , you can try are

      – Make sure you are insured , take term Insurance
      – Plan your Long term goals and start investing in it through ELSS (tax saving MF) , so that anyways the lockin period does not hurt .
      – PPF is somthing you should invest at least some part (long term , lock in of 15 yrs)

      You also need to reevaluate your ULIP investment .. get more idea by reading more on this blog and comments , start a forum topic if you wish . Mainly concentrate on your tax saving , as you are in higher tax braket , your wife tax saving is also important , but still , she can manage πŸ™‚

      Manish

  25. vivek chowdhry says:

    thanx manish and guru for ur nice advice.

    1. manish says:

      any time πŸ˜‰

  26. vinay says:

    Hi Manish,

    your post is excellent. I have been following your post for a while, which gives me a very good idea about financial planning. I would like to invest some money, but currently I am out of India, I had a demat acct (which online acct got locked & I cant get it resolved because of change in address). I really do not know, how to invest in MFs & other schemes. Can you help that whether I can reach any agent or I can open some acct online?

    thanks, Vinay

    1. manish says:

      Thanks

      hmm.. why dont you invest in it through someone else who is in India , like your wife or someone .. You can try investing through fundsindia.com . try them . Why dont you start a discussion in forum and find this ?

      Manish

  27. vivek chowdhry says:

    hi manish
    i must tell you that this site is realy realy very informative and interesting too.
    i have opend it at 7 pm and now its 1.30 am and i m still into it.
    the site and information provided by you are realy addicting for a new invester like me.
    thanx for such nice artcles.
    i hv just (on nov 24 2009) invested in SBI life smart ULIP MONEY MARKET FUND with 50000/-
    i hv to pay an annual premium of 50000/-fo three years. at the time of investing i didnt ask much,thinking that a plan by SBI cant be bad. Can you tell me how is this product ,its advantages and disadvantages, wat should i do further, for how much time should i remain in this and evry thing regarding this. please do reply

    1. manish says:

      Thanks for your appreciation Vivek , I am glad to know that you are liking the blog so much .

      So you have invested in ULIP , It does not matter which ULIP because SBI is no different than others . I have already talked upon ulip in many article , please find articles on that and go through them . ULIPs are not the right prodoct for everyone and I suspect they are not right for you as well . Check what is the policy fund value at the moment , if you feel that its not for you than stop paying the premium , you should get your money at the end of 3 yrs of lock in period .

      Manish

    2. Guru says:

      Hi Vivek,
      You have help at hand in the form of a free-look period. This is a feature that has been mandated by the Insurance Regulatory and Development Authority (IRDA) and is available with policies across the board.
      The free-look provision to a policy means a customer has 15 days from the date of the policy’s receipt to revisit his purchase decision. This would essentially mean that the policyholder has the time to go through the policy fineprint, understand how the policy is going to work and convince himself that he needs such a policy before deciding to commit funds every year over the plan tenure. The objective: Make the process of buying insurance transparent, easy and fulfilling for the customer, rather than leaving him with the feeling that he has picked up what he would have otherwise not needed.
      If a customer does decide within the 15-day free-look period that the policy he purchased is not suited to his requirements, the policy can be returned to the company. However, the entire premium paid by him will not be refunded. Costs incurred by the insurance company in the form of stamp duty charges and the cost of a medical check-up, if any, will be deducted before the payout is made.

      There might also be a deduction of risk cover charges on a proportionate basis β€” that is, as the life of the policyholder has been covered till such time he decides to return the policy, risk cover charges for this period may also be applicable. However, the deduction under this head, if any, may be minuscule.

      So, go ahead & cancel your ULIP within the free-look period, if you feel that is unsuitable for you and have got Nirvana from Manish πŸ™‚
      I wish that your agent does not curse me for enlightening you about this πŸ˜‰

      1. manish says:

        Thanks for explaining the free look up period .. Nice

        Manish

  28. Anonymous says:

    I am using fundsindia for past 3 months, found them excellent service, Have SIP’s, one time investment with them .. Every Investment just went through perfectly
    Though for every new transcation (ie One time investment or registering SIP) they will send you courier, which you need to sign and sent it back (you just send them email, courier guy will come to your door).
    Now planning to redeem 1 investment, lets see how smooth it goes !! πŸ™‚

    1. Niranjan says:

      Hi
      I am also planning to invest in MF’s thru fundsindia . How safe it is . Provide some idea
      Thanks

    2. manish says:

      @Anonymous

      Nice to know that .. So we just register with them and then how do we make the payment ?

      Manish

      1. Anonymous says:

        @manish Online Banking/Internet Payment
        @niranjan what do you mean by safety ? It is just another investment, Portfolio is created on your/investor name, Mailing address, bank account detail is in your detail, Even if Fundsindia dies, your existing investment shall be Safe, Only Problem which I see is investment in Process (process take 1-2 days)… Any other concern ??

        1. manish says:

          Thanks for the reply πŸ™‚

          Manish

        2. Srikanth says:

          Hello Anon, Manish and others,

          This is Srikanth from FundsIndia – just jumping in quickly to clarify a couple of points.

          Thanks, Anon, for the kind words.

          The paper work is a one-time paperwork – once per all bulk-investments, and once per SIP setup (SIP setup requires ECS mandate form for the amount and date – processed by your bank, so wet signature is a must). As Anon points out, we fully facilitate any courier – both ways.

          The transaction processing time is industry standard – For investments, units are alloted at T+1 basis, and redemptions depend on whether it is equity fund, debt or liquid fund – again exactly in keeping with industry standards. FundsIndia does not add any overheads to the investment processing.

          Hope these clarify. Do email me if you have questions.

  29. Nitin says:

    Hi Manish,

    Thanks for providing so much valuable information!!!!

    Would like to aks one qeustion. As we aware that sebi has removed the entry load from buying mutual fund , but banks are charging the the transaction fees which is 15% or 30/- whicheve is lower 9In case of ICICI direct).

    Now i just visited the http://fundsindia.com/ (May be i am late in knowing about this fundsindia site)…:-)
    I found that they are offering No Entry load and No Transaction fee if we buy mutual fund through them …

    they are saying in FAQ that they do not charge any fee to thier client , they earn via “annual fund management ”
    as per them

    “In the case of mutual funds, our source of revenue would be the so-called ‘trail fees’. This is not something that we charge our investors explicitly. These are paid out of the annual fund management fees that every mutual fund already charges.”

    How much it is true… As we know that there is no free luch in the world…but seems they are offering… πŸ™‚ If it is true then we can save atleast 30 rupeee per SIP/Month…

    Do you info how much this is true and once should go with them ….

    Thanks!
    Nitin

    1. manish says:

      Nitin

      Yes , they are correct . They have a different revenue model . They will earn from the Mutual funds company and also from Ads posted on their website . So you can go through them , The only thing is they are new and not that well known for now . So its your choice that you want to go through them or other portals like ICICI . just make sure how easy or tough it is to manage your funds , sell them on time etc etc . mainly Customer service .

      Manish

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