Wealth Creation Toool

Mehul Bheda Certified Financial Planner (M) 9819592326

SYSTEMATIC INVESTMENT PLAN


The investments we make areultimately for some objectives such as to buy a house, Our Own Retirement Planning ,children’s education, marriage, and many Other Short Term as well as Long term Goal.


..and many of them require a huge one-time investment. As it would usually not be possible raise such large amounts at short notice, we need to build the corpus over a longer period of time, through small but regular investments.”


This is what SIP is all about. Small investments, over a period of time, result in large wealth and help fulfill our dreams & aspirations.


What is SIP Systematic Investment Plan?

“A SIP (Systematic Investment Plan) is smart

financial planning tool that could help you create wealth by investing small sums of money regularly, over a period of time.”


• How does it work?

A SIP is a flexible and easy investment plan. Your money is auto-debited from your bank account and invested into a specific mutual fund scheme. You are allocated certain number of units based on the ongoing market rate (called NAV or net asset value) for the day.

Every time you invest money, additional units of the scheme are purchased at the market rate and added to your account. Hence, units are bought at different rates and investors benefit from Rupee-Cost Averaging and the Power of Compounding.


• Affordable

• Convenience

• Allows Rupee cost averaging

• Capitalize Power of compounding

• Builds Savings Habit

• Prevent Sentiment driven Investment

What are the benefits of SIP?


#1 : Power OF Compounding

Albert Einstein once said, "Compound interest is the eighth wonder of the world. He who understands it, earns it... he who doesn't... pays it."

The rule for compounding is simple - the sooner you start investing, the more time your money has to grow.



Rs. 10000 invested every month @15% through SIP

4,51,155 8,85,745

27,52,170

66,85,067

1,49,72,395

0

2000000

4000000

6000000

8000000

10000000

12000000

14000000

16000000

Tenure Value

3 Year 5 Year 10 Year 20 Year15 Year


# 2 : Rupee Cost Averaging

Date NAV (Rs.) Units Amount (Rs.)

02-Mar-14 190.47 5.25 1000

13-Apr-14 233.32 4.29 1000

11-May-14 252.5 3.96 1000

10-Jun-14 339.27 2.95 1000

10-Jul-14 307.21 3.26 1000

10-Aug-14 343.02 2.92 1000

10-Sep-14 375.56 2.66 1000

12-Oct-14 392.46 2.55 1000

10-Nov-14 392.76 2.55 1000

10-Dec-14 416.48 2.4 1000

11-Jan-14 439.79 2.27 1000

10-Feb-14 412.21 2.43 1000

Total 4095.04 37.47 12000

Say you have opted for MF Systematic Investment Plan,

Investing Rs. 1000 every month from March 2007 to Feb 2010 in a diversified equity fund. Now check the average purchase cost per unit of your investments. It would be lower than the average NAV of your investment over 12 months.



A Monthly SIP Of Rs 10,000/-Started in Jan 1995

is Worth Rs 5.32 Crore Today

(Against Investment Of Rs 24,30,000/-)Annulised Return of 23.13%

(value as on 28th Feb 2015)

DID You Know?


DID You Know?DID You Know?

A Lumpsum Investment Of Rs 5,00,000/-

Invested Oct 1995

is Worth Rs 4.18 Crore Today

Annulised Return of 25.49%(value as on 2tth March 2015)


Cost of Delay

Today’s Age 25 Years

Current Cost ` 10,00,000/-

Cost When you turn 45 ` 46,60,957

You Start Investing Year Left to

Goal

Money to Invest Every

Month

Today , When You are 25 Years Old 20 5,067

When Your are 27 Years Old 18 6,549



When You are 33 Years Old 12 15,128

When You are 35 Years Old 10 20,805

inflation assumed at 8%, Expected Average Return =12%the above illustration is for illustration purpose only

So what’s your KEY to success?

Its not the timing but time in the market which matters

Start Early

Invest Regularly

Invest Long term


Point To Remember• You Can Start SIP With Minimum Amt Of Rs 500/1000

• You Can Start Investing through SIP Either In Liquid Fund, Debt Fund , Gold Fund, Balance Fund

, Tax Saving Scheme (ELSS) or Equity Fund.

• You Can Discontinue Your SIP anytime With Prior Notice of minimum 30 Days.

• Once Tenure OF SIP is Over You Can Continue Your SIP through Renewal of Sip or You can Stay

invested with accumulated investment for long Term

• Kindly Consult Your Financial Advisor for Taxation OF Debt Fund & Equity Fund

• Units allotted each month under ELSS Scheme are Locked in For 3 Years. ( For Getting Benefit U/s

80-C)

• You Can Invest More ( Additional Investment) through Additional one time Lump sum Investment

under your Existing SIP account , if You have surplus Fund. Or You Find Opportunity

• You Can Increase/Decrease Your SIP Amount Any time You Wish to..



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