jayantharde.com

While selecting an investment avenue, you have to match your own risk profile with the risks associated with the product before investing. In reality, risk and returns are inversely related, i.e., higher the returns, higher is the risk, and vice versa. *Most investors want to make investments in such a way that they get sky-high returns as fast as possible without the risk of losing the principal money they have invested.* This is the reason why many investors are always on the lookout for top investment plans where they can double their money in few months or years with little or no risk. However, it is a fact that investment products that give high returns with low risk do not exist. In reality, risk and returns are inversely related, i.e., higher the returns, higher is the risk, and vice versa. There are some investments that carry high risk but have the potential to generate high inflation- adjusted returns than other asset class in the long term while some investments com...

As suggested by its title, the article advocates that investors work backward. They should begin their plans upon entering the workforce, by specifying their desired income during retirement. Once that is known, and an asset allocation is specified, the required contribution rate can be calculated. This process is aspirational. That is, while Javier's model is fixed, providing investment returns, contribution amounts, and withdrawal rates with assurance, investors enjoy no such confidence. As young adults, they know neither what the financial markets will bring nor (yet) what income will meet their retirement needs. Their lives lie ahead of them. The point of the paper is to change the investor's mindset. Javier wishes to combat the standard practice of keeping one's head down, contributing to retirement accounts according to perceived ability, then looking up as retirement approaches and wondering what the accumulated assets will be able to afford. Better to know th...

Savings for retirement are important, but they are often ignored. There is plenty of time in it where some people ignore it by thought. At the same time, some people are satisfied that some of their salary goes to the Employees Provident Fund (EPF), but reliance on EPF contributions isn’t just right for retirement. There are three major columns of financial planning for retirement in any country. Here are these: First column: Public pension Second column: Professional retirement Third column: Private or personal allowance Those who are retirement funding need to understand these three. It should also know how this will affect their savings in retirement. First column – Public pension The first column meets the social insurance needs. It’s called a public pension, therefore. It’s used primarily to help the poor and the old. Such pension schemes are entirely run by the government. This is an example of the Old Age Pension Scheme for Indira Gandhi...