Mutual Fund SIP Vs Post Office / Bank RD :
Which One is Best?
Can We Make Use of RD
Investments for SIP To Get The Best Out of it??? Find out...
By Mr. B. Padmanaban, CFPCM
Certified Financial Planner
We always compare SIP(systematic
investment plan) versus RD (recurring deposit)
because both are systematic investment plan.
SIP is variable and RD is
fixed. Our investors have the experience of RD for so many decades.
Normally RD is used for
yearly commitments like school fees, insurance premium, vacation so on and so
forth.
This particular money
still goes to RD because it is difficult to take a call on one year SIP
investments so we lost the opportunity.
Some of us take that
money in a liquid fund SIP, which is better than RD.
I found some interesting
strategy, and it will work all the time.
Instead of taking money from RD every
year, if we advise our client to postpone for one year which means next year
they have to manage with their existing funds.
 |
| Mr. B. Padmanaban, CFPCM Chennai |
Instead of 2nd year, 3rd
year onward we can give the money to client needs. There
are advantages by doing this in mutual funds. There is no exit load
because the money is going to withdraw the first 12 installments and no capital
gain as well. By doing this year on year client can generate very well return
out of it.
I have considered IDFC
Premier Equity which is one of the consistent fund, and it works for other
funds as well especially mid cap oriented funds. The data point I have taken is
real and I have started the SIP where the market is all time high in Jan 2008
and continued till today.
I have taken Rs. 2,000
SIP per month in case of 10% RD (Maximum I can assume), it would be Rs. 25,131
only.
Whereas, I allowed the
investor to take Rs. 27,000, from 25, 37, 49 month onward. This 27,000 comes to
25.39% return against 10% in RD!
After 7 years of
withdrawal, the value still remain Rs. 1,34,265.
For more details..
Fortune Planners Investment Services (P) Ltd.
Old no 5, New No 9, Kuppusamy Street,
G1, Lotus Apartments,
T. Nagar,
Old no 5, New No 9, Kuppusamy Street,
G1, Lotus Apartments,
T. Nagar,
No comments:
Post a Comment