.

WELCOME TO ALL FOR

INVESTOR AWARENESS
PROGRAM

BY:
PREETAM KUMAR
NJ INDIA INVEST PVT. LTD.
BRANCH MANAGER
RANCHI
POST RETIREMENT
PLANNING
 Agenda

Understanding
Concept Of Post Retirement
5 Investment Products For Retired
Features Of Those Investment Products
Which Is The Best Option For Retired
Why A Family Fails To Create Wealth
Success Mantra Of Today
 Concept of Post Retirement
Retirement is the point where a person stop
employment completely
A Shift from one activity to another activity
Unproductive-No more Income
.
365 days of Holiday
Too Much of Time
Health Issue
Retirement is the climax of life with Proper
Planning we can make it a happy ending else!!
.
 Investment Products for Retired

1.Senior Citizens Savings Scheme (SCSS)

2.Monthly Income Scheme (MIS)
3.Bank Fixed Deposit (FD)
4.Secondary Market Bond (SMB)
5.Mutual Funds (MF)
Liquid Fund
Monthly Income Plan With SWP
Balance or Balance Advantage Fund With SWP
But Before Investment

About Something !
 Investment Features
Safety

Return

Liquidity

Tax Benifit – Tax Free

Regular Income

Capital Apreciation
Investment Option No.1
 Senior Citizens Savings Scheme
What is SCSS?
SCSS is a scheme that is exclusively for Senior Citizens (aged
60 yrs or more)
SCSS Provides Regular Income on a Quarterly basis.
At the end of Term you will get your Deposit Amount Back

Term and Interest Rate

Maturity Period for this scheme is 5 Years
Current annual interest rate is 8.4%

Deposit Limits
Minimum is Rs.1,000/-
Maximum is Rs.15 lakh
 Senior Citizens Savings Scheme
Tax Benifits
In Section 80C (Up to Rs.1.5 Lakh)
TDS-Interest received more than Rs.10000 in year
Interest received is Taxable as per your Income Tax slab

Where do you open the account

Post Offices,Nationalised Banks or Private Banks

Extension Period and Premature Closure

After maturity the account can be extended for 3 years
After 1 year 1.5% and after 2 yrs 1% of deposit amount
 Senior Citizens Savings Scheme
Investment Features
Safety: Full
Liquidity: Money Gets Locked for 5 years
Return : 8.4%
Interest is Taxable as per slab (If slab is 10%)
After Tax Return: 7.56%
Inflation: 7%
Net Return after Tax and Inflation: 0.56%
Regular Income : Yes
Capital Appreciation : No
 Investment Option No.2

Monthly Income Scheme

(MIS)
 Monthly Income Scheme
What is MIS
MIS is a Scheme that Provides Regular Monthly Income
Every Month you will receive the Interest Till End of Tenure
At the End of Tenure you will get your Deposit Amount Back

Term and Interest Rate

Maturity Period is 5 years in This Scheme
The Interest Rate is 7.6% Per Annum

Deposit Limits
For a Single Account the Maximum is 4.5 Lakh
For a Joints Account the Maximum is 9 Lakh
 Monthly Income Scheme
Tax Benefits
In Section 80C (No Tax Benefits)
No TDS (Tax Deducted as Source) under this scheme
Interest is Taxable as per your Income Tax Slab

Where Can be open the Account

In Indian Post Office

Premature Closure
After 1 Year the account can be closed
Before 3 Years 2% of Deposit Amount
After 3 Years 1% of Deposit Amount
 Monthly Income Scheme (MIS)
Investment Features
Safety : Full
Liquidity : Money Gets Locked for 5 years
Return : 7.6%
Interest is Taxable as per slab(If slab is 10%)
After Tax Return : 6.83%
Inflation : 7%
Net Return after Tax and Inflation : -0.16%
Regular Income : Yes
Capital Appreciation : No
 Investment Option No. 3

Bank Fixed Deposit

 Bank FD (TDR-Interest Payout)
What is TDR ?
TDR is a type of Fixed Deposit where you can choose to
receive the interest either Monthly or Quarterly
At the end of tenure you will get your Deposit Amount Back

Term and Interest Rate

Minimum Term - 7 Days
Maximum Term – 10 Years
Interest Rate – Average 6.50% To 8.00 %

Maximum Limits
No Maximum Limits
 Bank FD (TDR-Interest Payout)
Tax Benefits
In Section 80C (up to Rs. 1.5 Lakh)
TDS (If the interest received is more than 10000)
Interest received is Taxable as per your IT slab

Extension Period
After Maturity it can be increased as per Term
But the interest may be changed

Premature Closure
Generally 1% of Deposit Amount
 Bank FD (TDR-Interest Payout)
Features
Safety: (Up to 1 Lakh)
Liquidity: Money Gets Locked for 5 years
Return : 7.0%
Interest is Taxable as per slab(If slab is 10%)
After Tax Return: 6.30%
Inflation: 7%
Net Return after Tax and Inflation: -0.70%
Regular Income: Yes
Capital Appreciation: No
 Investment Option No. 4

Secondary Market Bonds

 Secondary Market Bonds

What is Secondary Market Bonds

Secondary Market Bonds are Bonds issued by PSUs
Banks or Corporates to raise money for their business

These Bonds traded in Wholesale Debt Market

(WDM)and hence called Secondary Market Bonds

These Bonds are available at various yields

depending their tenure,credit rating etc

The Yields on these bonds keeping changing with

change in Bond Prices in WDM
 Secondary Market Bonds
Secondary Market Bonds on Sale at NJ
At NJ,We are selling SMB of Select PSU Banks

These Bonds which have been issued by the PSU Banks

due to requirement of capital as mandated by RBI

The coupon rate on these bonds are around 10%-11%,

while the current yield are 9%-10%

These Bonds are having a maturity of 5-10 Years

These Bonds pay interest Annually basis and the price

of 1 bond is 10 lacs
Secondary Market Bonds
 Secondary Market Bonds

Features
Easy To Invest
No TDS
No Requirement of Form 15G/15H
High Liquidity
Completely Paperless in Demat Format
Interest credited Directly to Client bank account
Strong PSU Brands with Zero defaults
Interest is Taxable as per slab
 Secondary Market Bonds

Investment Features
Safety: Full
Liquidity: Money Gets Locked for 5 or 10 Years
Return : 10.0%
Interest is Taxable as per slab(If slab is 10%)
After Tax Return: 9.0%
Inflation: 7%
Net Return after Tax and Inflation: 2.0%
Regular Income: Yes
Capital Appreciation: No
 Advantage & Disadvantage
Advantage
Safe Investment
Guaranteed Returns
Regular Income Monthly or Quarterly or Annualy
Peace of Mind During Retirement Life

Disadvantage
Interest Rate is not Attractive now
Interest is Taxable as per slab
TDS upon some product
Liquidity Problem
At the end of Term you will get your Deposit Amount Only
Investment Option No. 5
 History of Mutual Funds

The Mutual Fund industry in India started in 1963

with the formation of UTI, at the initiative of the
Government of India and Reserve Bank of India.

The History of Mutual Funds into four phases

First Phase:1964-1987(Only UTI)

Second Phase:1987-1993 (SBI,GIC,PNB etc.)

Third Phase:1993-2003 ( Reliance,Hdfc,Birla,ICICI)

Fourth Phase: Since February 2003

 Mutual Fund (MF) Concept
A common pool of money into which
investors place their contribution
This money is to be invested
according to the pre-stated objectives of the fund
Ownership of the fund is joint or mutual amongst all
investors - equivalent to the contribution made as a
proportion of the overall fund
Ownership through holding of units at NAV
 How Does Mutual Fund Work

AMC
Savings

Trust Investments
Units
Unit holders Returns

Regitrar

SEBI Trust

Custodian AMC
 Advantage of Mutual Fund

Portfolio Diversification
Professional Management
Reduction in Risk
Liquidity
Convenience and Flexibility
Regulated by SEBI
Attractive Return
No Entry Load,No TDS or No 15G/15H
Tax Free Return*
Access to Information
 Types of Mutual Fund
By Structure
Open Ended – Can be done Any time
Close Ended – Can be done NFO only

By Investment Objective
Equity Fund - Invest largely in Equity Shares
Debt Fund – Invest in Government or Corporte Debt
1. Liquid Fund
2. Debt Fund
Hybrid Fund – Invest in both Equity and Debt
1. Monthly Income Plan (MIP)
2. Balance or Balance Advantage Fund
.

LIQUID FUNDS
Money Market Mutual Fund

INTRODUCING
LIQUID FUNDS
 Liquid Funds
What is Liquid Funds:
Liquids Funds are mutual fund schemes,which invest
in very short term CP,CD or Treasury bill

Liquid Funds DO NOT invest in Equity Market

There are no Entry/ Exit charges

Minimum Investment period is 1 day

LIQUID FUND IS BETTER THAN

SAVINGS ACCOUNT INTEREST
 Features of Liquid Funds

Safety of Investment

Liquidity (Any Time Money)

Better Return Than Savings A/C Interest

No Charges For Investment

Easy To Invest

Easy To Withdrawal
 TAX BENIFITS IN LIQUID FUNDS

For Growth Option

Short Term TAX BENIFITS
Capital Gain TaxIN MIP
- As Per Slab
Before 3 Years
Long Term Capital Gain Tax – 20% With
Indexation After 3 Years

For Dividend

In Dividend option - DDT is 28%

It is advisable to invest in the Growth option
 Liquid Funds Vs Saving A/C

Features Savings Account Liquid Fund

Safety Full Full

Liquidity Always (Anytime) Always (Anytime)

Return 3 To 4% 7 To 8%
After Tax
Return(10%Slab) 2.7 To 3.6% 6.3 To 7.2%
 Returns of Some Liquid Fund
(25th Jan 17)

Scheme Name 1yr 2 yrs 3 yrs 5 yrs

BSL Savings Fund 9.58% 9.16% 9.31% 9.31%

SBI Savings Fund 8.48% 8.30% 8.52% 8.91%

HDFC CMF-TAP 8.930% 8.20% 8.28% 8.38%

Reliance Money
Manager Fund 8.23% 8.09% 8.29% 8.61%
 INTRODUCING

MONTHLY INCOME PLAN

 MONTHLY INCOME PLAN

HYBRID PRODUCTS THAT TAKE

EXPOSURE TO DEBT & EQUITY

MONTHLY INCOME PLAN AIMS TO STRIKE

BETWEEN STABILTY AND GROWTH
 WHY MONTHLY INCOME PLAN

Combination of Debt and Equity

Power of diversification
Focus on Capital Appreciation with
Very Low Volatility
Active Management of Portfolio
Tax Benefit after 3 Year with Indexation

IDEAL FOR INVESTORS WITH A

REQUIREMENT OF STABILITY (DEBT) AND
GROWTH (EQUITY) OVER THE LONG TERM
 TAX BENIFITS IN MIP

For Growth Option

STCGT - As Per Slab Before 3 Years
LTCGT – 20% With Indexation After 3 Years
For Dividend
In Dividend Option- DDT is 28%
It is Advisable to Invest in the Growth option

IDEAL FOR SEEKING TAX EFFICIENT

RETURN AND LONG TERM CAPITAL
APPRECIATION WITH LOW RISK
 SWP FROM MONTHLY INCOME PLAN

Systematic Withdrawal Plan (SWP) is a service offered

by Mutual Funds which provides investors with a
specific Amount of payout at a pre-determined time
intervals, like Monthly, Quarterly, or Annually
Reasons for SWP from Monthly Income Plan :
Ideal solution for uncertain investment horizon
Regular income
To meet living requirement after retirement
Tax Effective Return
Beat Inflation
Capital Appreciation
SWP FROM MONTHLY INCOME PLAN

SYSTEMATIC WITHDRAWAL
PLAN FOR 5 YEARS
FROM
MONTHLY INCOME PLAN

LET'S LOOK AT THE PERFORMANCE

OF SWP IN SOME MIP @ 8% ANNUAL
WITHDRAWALTHROUGH MONTHLY
ROUTE
 RETURN OF SOME MIP
(25th Jan 17)

Scheme Name 1yr 2 yrs 3 yrs 5 yrs

BSL MIP Plan II Wealth 25 19.33% 9.57% 15.92% 13.60%

SBI Monthly Income Plan 15.20% 10.21% 13.44% 11.57%

KOTAK MIP 17.44% 9.19% 13.24% 11.31%

HDFC MF MIP-LT 18.53% 8.19% 14.40% 11.61%

 Monthly Income Plan
Investment Features
Safety : Not Risky in Long Term
Liquidity: Always (Anytime)
Return : 10 – 12% (Expectation)
STCGT is as per Income Tax slab before 3 Years
LTCGT is 20% with Indexation after 3 Years
Inflation :7%
Net Return after Tax and Inflation : 2.5 – 4.0%
Regular Income : Yes
Capital Appreciation After Taking SWP of 8%
 INTRODUCING

BALANCED FUND
OR

BALANCED ADVANTAGE
FUND
 BALANCED FUND
HYBRID PRODUCTS THAT TAKE
EXPOSURE TO EQUITY & DEBT

BALANCED FUND AIMS TO STRIKE A

BALANCE BETWEEN GROWTH AND STABILTY
HOW DOES BALANCED FUND WORK
HOW DOES BALANCED ADV FUND WORK

Flexibility to move within the range of 30-80%

 WHY BALANCED FUND

Combination of Equity and Debt

Power of diversification
Focus on Capital Appreciation
Lower Volatility
Active Management of Portfolio
Tax Free Return after 1 Year

IDEAL FOR INVESTORS WITH A

REQUIREMENT OF GROWTH (EQUITY) &
STABILITY (DEBT) OVER THE LONG TERM
 TAX BENIFITS IN BALANCED FUND

For Growth Option

Short Term Capital Gain Tax - 15% Before 1 Year
Long Term Capital Gain Tax - Nil After 1 Year
For Dividend Option

In Dividend option- Dividend Distribution Tax is NIL

It is Advisable to Invest in the Both Growth or Div

IDEAL FOR SEEKING TAX EFFICIENT RETURN

AND LONG TERM CAPITAL APPRECIATION
WITH MODERATE RISK
 SWP FROM BALANCED FUND

Reasons for SWP from Balanced Fund :

Ideal solution for uncertain investment horizon

Regular income
To meet living requirement after retirement
Tax Effective Return
Beat Inflation
Capital Appreciation

BALANCE FUND WITH SWP IS ADVISABLE FOR

RETIRED PERSON WHO WANTS REGULAR
INCOME FOR LONG TERM
 SWP FROM BALANCED FUND

SYSTEMATIC WITHDRAWAL
PLAN FOR 10 YEARS
FROM
BALANCED FUNDS
LET'S LOOK AT THE PERFORMANCE
OF SWP IN SOME BALANCED FUNDS
@ 8% ANNUAL WITHDRAWAL
THROUGH MONTHLY ROUTE
 Returns Of Some Balance /Balance
Adv Fund As On 25th Jan 17
Scheme Name 1yr 3 yrs 5 yrs 7 yrs

BSL Balance Adv Fund 26.76% 16.97% 13.44% 10.29%

SBI Magnum Balance Fund 12.78% 18.56% 18.22% 12.02%

RRSF - Balance Option 13.21% 18.95% 16.42% 12.54%

HDFC Balance Fund 20.76% 21.37% 17.71% 16.50%

 SWP FROM BALANCED FUND

Investment Features
Safety : Not Risky in Long Term
Liquidity: Anytime
Return : 12 – 15% (Expectation)
STCGT is 15% before 1 Year
LTCGT is NIL after 1 Year
Inflation :7%
Net Return after Tax and Inflation : 5 – 8%
Regular Income : Yes
Capital Appreciation After Taking SWP of 8%
 BALANCED FUNDS
IS THE

TRUE WEALTH CREATING

INSTRUMENT
Which Is The Best Option for Retired
 Which Is The Best Option for Retired
OPTION RETURNS NET RETURN AFTER REGULAR
TAX AND INFLATION INCOME
SENIOR CITIZENS 8.5% 0.65% QUARTERLY
SAVINGS SCHEME Guaranteed
MONTHLY 7.7% - 0.07% MONTHLY
INCOME SCHEME Guaranteed
BANK FIXED 7.25% -0.72% MONTHLY OR
DEPOSIT Guaranteed QUARTERLY
IDBI SECONDARY 10% 2% ANNUALY
MARKET BONDS Guaranteed
MONTHLY 10-12% 2 TO 4% MONTHLY OR
INCOME PLAN Expected QUARTERLY
BALANCED FUND 12-15% 5 TO 8% MONTHLY OR
Expected QUARTERLY
 Which Is The Best Option for Retired

SENIOR CITIZEN SAVING SCHEME NO

POST OFFICE - MIS NO

BANK FIXED DEPOSIT NO

SECONDARY MARKET BONDS YES

MUTUAL FUND- MIP/BALANCE FUND YES

Why a Family Fails To Create Wealth ?

Not Proper Planning

Delay In Investment

Lack Of Financial Education

Choose The Wrong Type Of Product

Not Consult With Financial Advisor

Not Keep Patience

 Success Mantra Of Today

Always Consult With Financial Advisor

Don't Put All Your Eggs In One Basket

Choose The Right Asset Class

Don't Delay In Investment

Increase Your Knowledge Level

 Success Mantra Of Today

IF YOU HAVE
PATIENCE
AND
CONVICTION
NO BODY CAN STOP TO
MAKE YOUR MONEY
.

Wish You All For Happy Post Retirement

By: Arvind Kumar Dipak

.

By: PREETAM KR.