MyWay Wealth Weekly Update (Issue #19): The worry in debt markets and your portfolio!

In recent times, debt funds have proved that they are not without risk. This entire slew of events began right after the IL&FS fiasco was brought to light.

Key events included:

  • On January 22, CRISIL has downgraded its rating on the non-convertible debentures (NCDs) of Jharkhand Road Projects or JRPICL to ‘CRISIL D’ from ‘CRISIL BB(SO)/Watch Negative’.
  • Essel Group founder Subhash Chandra gave a scare to markets after he came out with a letter post the 26% crash in Zee Entertainment shares, apologising to bankers, NBFCs and mutual funds for not “living up to expectations”.
  • The sharp fall in shares of some Zee companies added to the debt funds’ woes as they were the backing of securities in which many debt funds had invested in.
  • Care ratings have downgraded over Rs. 1 lakh crore worth of debt issued by the country’s third largest housing finance firm DHFL.

The biggest investors under pressure were mutual funds.

Are mutual funds in any position to mitigate such risk? (more…)

MyWay Wealth, your One Stop Destination for Mutual funds

Many people these days want to put their money to work through investments. But most of the time, people hesitate or withdraw from investments because they consider it has a hassle, be it in terms of the paperwork involved and which investment option to choose. Some technically savvy people would want to invest through online investment platforms i.e. through websites or mobile apps but are confused to choose the best platform.
This article helps you solve all these confusions. Yes, MyWay Wealth is India’s most trusted platform for Direct Plans Mutual Funds. It is your one-stop destination for all Mutual Funds because they don’t just provide access to a wide range of funds but also provide funds that suit your investment needs. MyWay helps you choose the right investment option that is based on your financial goal and risk appetite.

Let’s look at more features of MyWay Wealth and what it has in store for you:

 

Get tailor-made funds

With MyWay Wealth’s Direct Plans, you receive fund recommendations only after you have keyed in the amount you can contribute every month, the time period of your investment and other such information that suit your financial goals and needs.

MyWay
Equity, Debt, Hybrid Discover a wide range of fundsInvest in various categories of funds which have consistently outperformed the market. MyWay Wealth’s Smart Recommendation Engine is built on top of scientific financial models and years of historical market data.

Explore Top rated Mutual Fund across different categories

                 Keep track of your funds

MyWay Wealth has “advanced research reports” and “portfolio alerts” that help you remain in touch with your portfolio and make wise decisions.

Invest
Term Insurance Save for a specific purpose

With MyWay Wealth, you can park money for a period between 1- 3 years or you can also save money for a specific goal such as retirement fund, child’s education or wedding, vacation or any such goal.

Save specifically for your retirement

With MyWay Wealth, you can invest in the National Pension System (NPS) and save for retirement and earn more returns than that of PPF.

Read More on NPS: Why is NPS better than PPF?

NPS page
term insurance Secure your family

By investing the same amount as your monthly Netflix subscription, you can get a life cover of 50 lakhs to 2Cr, to support your family in the event of your death..

Read More on Term Insurance: Secure your family with Term Insurance.

Save Tax

With MyWay you can invest specifically in tax saving ELSS Mutual Funds and get a larger share of returns from your investments.

Explore: best tax saving funds with high returns

ELSS
SIP  

  Maintain a disciplined savings habit

With Systematic Investment Plans (SIPs) you can invest small amounts in regular installments and make your savings work better. If you prefer to invest in lump-sum then you can always choose One-time investments.

All this for No Fees and No Commission!. Choose MyWay Wealth app and it would be your one-stop destination to dive into various mutual funds schemes that suit your investment horizon and risk appetite.
Invest now

Think Investment, Think MyWay Wealth!

Child's Education Goal - Dipika Jaikishan

How to invest towards Children’s Education Goals?

This video helps you to plan your child’s education successfully and tells you the need to invest right now for your child’s future.

Here is a quick overview of this video:

  1. What is a child’s education plan?
  2. What your basic motivation should be while investing in this plan?
  3. Where can you invest in your child’s future?

Investment fads come and go, but choices remain the same.

Investment fads

The age-old fundamentals taught to us at schools never change, right? A Gurukula has now become a Convent, or a blackboard could have changed to a smart-board but the values imbibed in us remain the same.

Same works for Investment Choices.

The performance of the Indian Economy can be determined with the help of the GDP (Gross Domestic Product). GDP in simple words is the market value of all the final goods and services produced in a period of time. India’s GDP growth rate was 8.3 percent in the year 2003, raised to 10.4 percent in 2010 but fell to 3.2 percent in the year 2013 and again saw a rise in the year 2017 with 6.7 percent as the growth rate.

So an Economy depends on various economic factors and numbers do fluctuate, so it’s quite natural for other indicators like Inflation, Interest Rates, Corporate Profits, Currency Strength and also Stock Market to go through a roller coaster ride. The Indian Economy is facing a shock wave and we definitely foresee a doubtful future with the three C’s of Confusion, Consternation, and Concern.

The Stock Market is known for its volatility in stock prices. But trying to track the Stock Market on a daily basis to gauge the performance of your long term equity funds, is like trying to find a needle in a haystack. Yet, there are people who do this as a job, they are called Traders or Speculators and it is their role to inspect the market minute to minute. 

But we are investors. Most of us are salaried people and do afford to set aside savings every month. But the normal mistake seen in investors is that we get into a “herd mentality”. We buy more when the market goes up and sell when the markets go down. It’s likely we follow the herd and do what other investors do. But in reality, the ones who make money are the ones who stay invested.

So rather than getting baffled by the volatility of the markets, what we can do is invest a small chunk of our savings every month in equity through a well-structured plan called SIPs (Systematic Investment Plan). If you invest with the objective is to make high returns from your valuable investments, then the best way is to stay put for a long time. By doing so, you will not only earn index-beating returns but also meet the rising prices in the economy. So all you need is the fourth C: Consistency.

illustration

Behavioural Finance plays a key role in understanding the investment activities of people. Another aspect where the “herd mentality” can be seen again is with Gold and Real Estate. 8 out of 10 people in a family gathering or a common forum will brag about their success stories of earning high returns by investing in real estate or gold. But what they don’t include is the making charges that go into Gold returns and transaction costs, taxes, cost of maintenance, registration or stamp duty, when it comes to Real Estate. And not to forget about the hassle involved in finding or selling property in India, including the cost of fixing the house for the tenants. Also, we don’t keep a close watch on the property prices or gold prices as much as we look at the day-to-day variations in the stock market. If we did, we would realize that Gold and Real Estate also go through volatility. When it comes to risk, Real Estate does go through price, liquidity and legal risk and Gold is equally risky as it is not a source of regular income. But thanks to the stock market, although it is risky, at the same time it is also transparent, helping us to track them and also help in creating and generating wealth/income.  

If you’re a person who reads and consumes a lot of knowledge on Mutual Funds, you would have noticed that a number of books, magazines or articles still follow“Logical Investment Techniques”. Where investors like you and me gasp at day-to-day conditions in the stock market and ponder on our decisions regarding  funds, famous authors like Monika Halan (Editor, MintMoney and author of “Let’s Talk Money”) and Dhirendra Kumar (Founder and Chief Executive, Value Research and author of “Best Investments”), believe that equity fights inflation, provided you stick to the knit.

To get access to top recommended Equity Mutual Funds, MyWay Wealth is a one-stop destination. From Equity to mid-cap funds, tax saving to advanced investing, you can find them all on MyWay. And for investors who feel Gold is a good investment option, you still invest in them through Gold funds with MyWay rather than physical Gold. All you need is a few minutes to complete your KYC process and input your monthly contribution.

MyWay Wealth

As stated before, numbers in an Economy aren’t stable always, volatility in the market shall prevail, but what remains unchanged is that fact that your investment decision will rely on your risk appetite and your financial needs. This will not alter even if you would choose a bank for an investment or an app for the same. For example: If Equity funds through Systematic Investments Plans (SIPs), was your choice to meet your short term goals 5 years back, then, you can still choose the same investment for your present goals. All that would change is the amount you would deposit through SIPs (it’s wise to increment the amount you contribute to SIPs as and when you’re earning potential increases) which will be according to your present goals, needs, and profile.

Remember not to get disenchanted with the daily fads of the Stock Market.

Child education

Secure your Child’s Education

Most of you would have heard these words of wisdom from Nelson Mandela:

Education is the most powerful weapon which you can use to change the world.

— Nelson Mandela

But the rising costs of education (at all levels from elementary school to college higher education) have made it harder to get a quality education for our kid(s). Quoting Arne Duncan (who was Secretary of Education for the USA):

State governments generate less revenue in a recession. As state leaders struggle to make up for lost revenue, legislatures tend to cut funding for higher education. Colleges, in turn, answer these funding cuts with tuition hikes.

— Arne Duncan

Arne is talking about the state of education in the USA, this isn’t any less true here in India. 10-15 years ago, fees for a good school was about Rs. 10000-12000. The same quality of education in the same school for standard 12 is now about Rs. 2 Lakhs per year. That’s a hike of over 10x in 15 years. For the uninformed, most expert financial advisors say that while purchasing power parity increases by 6-8% every year, education inflation is always in 2-digit numbers.

Think of the times when we reminisce about missing the good old days from when we were younger, studying in schools and colleges (at a fraction of cost that we pay today for the same quality of education).

Forecast of Education Costs for next 10 years

Based on ‘Q3 2017 Salary Budget Planning Report’ (by Willis Towers Watson), Salaries in India are projected to rise at 10% in 2018 (the same as an actual increase in 2017). But education costs are stated to increase by 12% on an average across different grades.

To give you an idea about the hike in education costs in a 5-years spread timeline (assuming that costs continue to rise at 12% every year), here is a simple illustration:

 2013201820232028
Under-graduate₹ 1,41,857₹ 2,50,000₹ 4,40,585₹ 7,76,462
Post-Graduate₹ 11,34,854₹ 20,00,000₹ 35,24,683₹ 62,11,696
Higher Education A-tier (abroad)₹ 28,37,134₹ 50,00,000₹ 88,11,708₹ 155,29,241
Ivy League Higher Education ₹ 45,39,415₹ 80,00,000₹ 140,98,733₹ 248,46,786

At the risk of sounding redundant, it’s worth reminding that your salary would not increase at the same pace.

Miscellaneous education costs

Also, the above forecast doesn’t even consider ‘miscellaneous costs’ that piggyback on the top of regular education expenses (such as gadgets and other extra-curricular costs). We had been focusing on tuition expenses for our quantitative analysis above, but let’s not forget the additional financial burden of a standard of living that one has to maintain at schools (think gadgets, books, social activities for the child, etc.) Moreover, children, these days take extra classes (such as summer camps, extracurricular activities such as art or sports coaching, etc.) none of which come cheap.

Costs for college education

Well, while school education costs could be met by saving small amounts, the cost of higher education in college might easily take up 40% of your monthly salary.

In case you didn’t notice, this comparison only states the obvious: That as years pass, the costs of school and higher education would only go up.

What can you do to be financially prepared for your child’s education?

First things first: How much do we need to save? Based on calculations in the table above, parents have to eventually save Rs 65L for their child’s higher education.

Well, here is what we recommend to our investors on MyWay Wealth app:

SIP + Term Insurance = a good education plan.

1. Invest in Mutual Funds

Our MyWay Wealth app helps you to build a mutual fund portfolio to save for education.

Once you input your risk appetite while analyzing the past returns (1Y/3Y/5Y/10Y/15Y/20Y), our Smart Recommendation Engine (built on top of scientific financial models and years of historical market data) recommends a portfolio of mutual funds that will help you build the corpus for your child’s education costs.

2. Get term insurance which provides a cover of Rs. 65Lakhs.

This simply means that Rs 65L should be covered by a term plan. In case of your absence (such as accidental death), the education goal will not be compromised. This policy for a healthy adult of the age of say 32 would come at a premium of ~Rs 5000 annually. Let us not look at immediate gains causing ourselves long term pains and buy a term cover to secure education of kids even when we are not there for them.

Is it safe to invest in Mutual Funds?

Safe to invest

I am always amazed at how ants work as a team. Ants always carry huge objects together making it possible for them to achieve their goals and reduces the burden of a single ant.

Mutual Funds use the same ideology of ants. The pool in funds from multiple investors and use this money to purchase various securities in the market such as stock, bonds, etc.

If this was so simple, then why do people fear to invest in Mutual funds and resort to traditional instruments such as Fixed Deposits, Recurring Deposit or leave money idle in Savings Account?

The answer is, Safety!

Let me answer the most common question in the mind of investors:

Is it safe to invest in Mutual Funds?

Investments in Mutual funds are highly safe due to the following reasons:

  1. Diversification

Remember the old saying “Don’t put all your eggs in the same basket”, Mutual funds have definitely capitalized on this quote. Mutual funds wisely invest your funds in various instruments such as stocks, bonds, and other commodities. Thus diversifying the risk that could arise from investing in a single stock.

Read More: Top Rated Mutual Funds Categories

  1.  Reduces Risk

“Mutual fund investments are subject to market risks. Please read the scheme information and other related documents before investing. “ How can it reduce risk?

But imagine if you have to go to the stock market and buy and sell stocks yourself and track companies. Are you free from risks? No, because we are investors not traders. With Mutual funds, your funds are managed by Professional Fund Managers who are expert in financial markets. They make sure your investments are put into well-performing assets and closely choose schemes that suit your investment and risk horizon. They perform regular rebalancing of your portfolio and structure your investment allocation to take complete advantage of market conditions. This also means that in contrast to Fixed Deposits, your potential to earn more returns is higher.

Read More: What is Portfolio Rebalancing?

  1.  Inflation-beating returns.

This is one more reason why I say investing in mutual funds are safe. When you invest your money in Fixed Deposits, your money is locked for a fixed period of time and for a predetermined interest rate. What if during this period the inflation rate is more than the return rates provided by Fixed Deposits? How will you face the rising prices? Mutual funds have a solution for this. The average inflation rate in India is 4% and if you take the past 10 years returns of Mutual funds it ranges between 12% – 16% which easily beats inflation. Thanks to the dynamic stock market.

Read More: Mutual Funds that have provided returns > 15%

  1.      Flexibility

Emergencies such as accidents or health issues are uninvited guests in anyone’s life. One way to face them is to be able to access your money easily. With Mutual Funds, you can sell your funds in a short period by investing in Short Duration Funds. Also, mutual funds allow you to invest and park your money aside for a shorter duration between 1-3 years. This helps you to save money for a goal.

Read More: Short Duration Funds

  1.     A fund for every investor.

Every person is unique, so are your goals and needs. With mutual funds, every investor has a scheme that is drafted specially for him/her. If you are a conservative user then Mutual funds allow you to invest primarily in bonds (Government securities – risk-free) with little exposure to stock (Equities). Say if you are a customer who wants moderate returns and are willing to face more risk, then with mutual funds you can invest 60% in Debt and 40% in Equity. These percentages can vary as per your wish.

Another benefit with mutual funds is that the minimum investment amount is as small as Rs. 500 /-.

Read More: Goal Based Investing

  1.     Tax Benefits

Mutual Funds have a number of tax benefits such as:

  • Schemes such as ELSS (Equity Linked Savings Scheme) provide tax exemptions up to 1.5 lakhs under Section 80(C).
  • National Pension Scheme is a plan that helps investors to save for retirement. With NPS save tax up to 1.5 lakhs every year under Section 80(CCD) and save additionally Rs. 50,000 p.a. under Section 80CCD(1B).
  • Term Insurance, a plan that lets you cover your family in the event of your untimely death and helps you save tax up to Rs. 46,800.
  1.      Safety

Another famous instrument for investing in Gold, Silver or Platinum. But with buying these commodities also comes the fear of losing it to theft or damage of purity. In the case of gold, there is an extra worry about making and wastage charges. But with Mutual funds, you can invest in Gold Funds. These are virtual funds wherein the investor can gain appreciation in Gold value without the hassle of owning physical Gold. Read More: Top Rated Gold Funds

“Everything you want is on the other side of fear”

–Jack Canfield

Stop fearing risk, rather remember to stay invested for a long term and leverage the benefits of Mutual Funds. Begin your investments today with “MyWay Wealth” app.

Think Wise, Think MyWay

Equities! A Smart Way to Invest

EquityPeople normally don’t find it safe to invest in Equity. They consider it a gamble. Why? Because your shares are traded in the stock market which is subjected to market fluctuations. Then why does Monika Halan, consulting Editor for Mint, state “I Love equity funds”  in her book “Let’s Talk Money”.

Let’s look at this picture:

Think smart

Surprising! The most trusted instruments such as Fixed Deposit multiplies wealth only by 20 times whereas investments in Equity multiplies it by 260 times.

Equities are stocks, meaning shares of a company. When you invest in equities it means you own the shares of a company and are partial owners of the company

Here are some benefits of investing in equities:

  • Higher gains: As mentioned before investments in equities are subjected to market conditions, so one has more potential to earn higher gains when the market price of a share rises.
  • Dividend: If the company you invest in performs extremely well then, as equity shareholders of the company you are entitled to earn dividends.
  • Authority: Once you invest in shares of the company you get voting rights in the company, meaning you can exercise control.
  • Easy transfer: The shares are listed in the stock market and hence if you want to sell your shares, you can do so easily, thereby increasing liquidity.
  • Bonus shares: At times, a company can issue additional shares instead of dividends to existing shareholders.
  • Higher Claim: Since you are the owner of shares in the company, it also means you get to enjoy a share of the incomes of the company.
  • Right shares: There are chances that you receive “Right Shares” when the company goes in for further expansion of capital. Owning these shares, you get higher preference than the general investors.

 

All these benefits make you feel so important and prioritized. But the hitch is how do you know which company’s stock performs well? How are your shares trending in the market? When to sell or buy?

This arises the need to understand the difference between investors and traders. The work of a trader is to track the market minute to minute and closely monitor the fluctuations in the stock. But as an investor, you must ascertain your investment horizon and financial need, invest in Equities and to stay invested until investment purpose is achieved. Remember, “time in the market” is important not timing the market.

The best option to invest in Equities is through Mutual Funds. Even Monika Halan says that she doesn’t buy shares directly but rather invests in Equity through Mutual Funds. Because when you do so, the decision of picking the right stock is vested with Professional Fund Managers who track the movement of shares closely and rebalance the investment portfolio regularly. They have a tab on the performance of companies, markets, political events, interest rates, and past data that help them to forecast the future of a stock. With Mutual Funds, there is a scheme for every person depending on your risk and investment goal. Say if you are a conservative investor but are willing to take a little bit of risk then, with Mutual funds you can always have your investments primarily in Bonds (Debt) with a little exposure to Stock (Equity).

Read More: Goal-Based Investing

As an investor one should remember that Equity Investing is no gamble. In a growing economy like India, good investments should outperform in the long run, irrespective of the macroeconomic factors. The Table below will give a clear idea:

 

Time Period 1 year 3 years 5 years
Amount Invested (INR) 12000 36000 60000
L&T India Value Fund Direct Plan Growth Option 10,948.02 37,485.68 76,658.66
ICICI Prudential Bluechip Fund Direct Plan Growth 11,596.35 40,193.66 75,470.58
SBI Bluechip Fund Direct Growth 11,322.36 37,843.27 72,645.74

These are the Top 3 Rated Funds on MyWay Wealth. The Table clearly shows that when Rs 1000 a month invested through SIP in these funds, say L&T India Value Fund Direct Plan Growth Option for a period of 1 year gives a fund value of Rs. 10,948 which is lesser than the invested amount of Rs. 12000. But when the same process is carried out for a process of 5 years, the fund value is Rs. 76,658.66, which is 27% more than the invested amount Rs. 60000. The same pattern is seen in the other two funds as well.

To sum it up, Equities may be volatile in the short run, but over the longer period, volatility will decrease and the returns will increase, thus reducing the risk.

So, Remember!

The thumb rule in Equity is to stay patient and remain invested for a long period to reap its benefits.

MyWay Wealth, a bouquet of Mutual Funds?

bouquet of Mutual Funds

Digital Platforms are gaining rapid pace amongst people today. It’s because of the wide range of benefits one gets while investing in Mutual funds online. These platforms are:

  • User-friendly,
  • Completely paperless,
  • Give precise information,
  • Highlight recommendations,
  • Provide alerts and
  • Have a variety of options with just a few clicks.

“MyWay Wealth” is one such platform. With MyWay Wealth app you get access to a variety of funds that are tailor-made and customized for your needs, making it the one-stop destination for investments in Mutual Funds. Also, MyWay Wealth app is India’s trusted app for Direct Mutual Funds which is best known for its commission-free and paperless process, and it lets you discover, invest and track your investments with the right actions to your portfolio.

Let me walk you through the various options in “MyWay Wealth”, that helps you select the right Mutual Fund according to your investment horizon, risk appetite and financial necessities.

The first thing you need to do is to install the “MyWay Wealth” app from your app store or play store, on your smartphone.  

Once you open the app, it would ask you to enter your phone number. You need to enter the OTP you receive and then you arrive on the landing page of the app.  

screenshots_MyWay

The app immediately gives you an option to switch from Regular Plans to Direct Plans. Direct Plans are commission free, whereas in Regular Plans a Mutual Fund house pays commission to the broker from your investment. It’s wise to invest in plans that are more profitable and beneficial.

Read More: Why Direct Plans are better than Regular Plans?

The first and foremost step you need to complete on “MyWay Wealth” is to register yourself by completing the KYC( Know Your Customer) process which takes less than 5 minutes. To complete this process you would require:

  • PAN card
  • Address Proof
  • Bank details

Having completed this step you are ready to make your investments on MyWay Wealth.

MyWay Wealth provides a wide range of options to invest in, namely:

  • Build Wealth:

MyWay Wealth provides the opportunity to create wealth by letting you invest through Systematic Investment Plans or through One-Time investments, whichever suits your financial goal. The app is well structured to provide you a clear picture regarding the returns one would receive for the amount invested, in a specific period and the choice of percentage between Stocks and Bonds (risk and return aspects).

Read More: SIPs are the best option for investments.

  • Invest in Top Mutual Funds:

MyWay Wealth lets you invest in Equities, Debt Funds, and Hybrid funds. In Equities, it provides a variety of categories such as tax planning, Small/ Mid/ Multi/ Large-cap funds, Sectoral and International funds. In Debt funds, it offers investments in Liquid, Gilt(medium and long), Short and ultra short term funds and credit opportunities. Options in Hybrid funds include Balanced, Arbitrage, and Conservative funds.

Read More: Top Mutual Funds Categories

  • ELSS Mutual Funds:

MyWay Wealth provides for all your needs, that even includes tax saving. ELSS (Equity Linked Saving Schemes). It provides the highest return, at the same time is the only pure equity investment instrument to provide deduction benefits under Section 80(C), saving tax up to 1.5 lakh. Also, ELSS has the shortest lock-in period of 3 years.

Read More: ELSS vs PPF, Choose the best tax saving plan  

  • National Pension Scheme

MyWay Wealth is the first and only online app to provide the benefit of National Pension Scheme for its investors. The National Pension System is a Government initiative, with an intention to provide pension opportunity to every Indian and to inculcate the habit of saving especially for retirement. With NPS you can earn returns between 9-14% which is way more than other pension schemes such as Public Provident Fund or Senior Citizen Savings Scheme.

Read More: Additional 50,000 tax deduction with NPS, truly a gift for my retirement.

  • Term Insurance  

In term insurance, you would pay a set amount as premium on agreed intervals, that forms the sum assured. In the event of your untimely death during the term of the insurance, then your beneficiaries would receive the sum assured. With this option, you can provide a cover of 1 Crore to your family with the same amount you set aside for your monthly TV subscription and also save tax up to INR 46,800.

Read More: Term Insurance, the right choice to protect my family.

  • New Fund Offer (NFO)

NFO is the first time subscription when a new scheme is launched by an Asset Management Company. It has newer opportunities,  unique features, and low NAV. You can be a part of the fund’s growth journey through NFO by investing either in Growth or Dividend scheme.

Read More: What is an NFO?

  • Save for a goal

You are unique, so are your investment goals. With this option, MyWay Wealth app helps you to save for a specific purpose such as Retirement Fund, Child’s Education, Child’s Wedding, Vacation or any such goal. This helps an investor to get into a habit of making a goal based investing.

Read More: Setting goals, the first step to investing.

  • Park Money

This option in MyWay Wealth allows you to keep money aside for a short duration ranging between 1-3 years. Thereby giving the opportunity to retrieve your parked money at the right time and avoiding the temptation of unnecessary expenditure or idling money.

Read More: Put your idle money to work.

  • Gold Funds

We all love to own Gold. For some, Gold a fashion status, for some it’s a good investment option and for some, it’s both. MyWay Wealth allows its investment in Gold Funds, wherein an investor can gain from appreciation in gold value without the hassle of owning physical gold. Unlike physical Gold, Gold Funds has no making charges, no purity issues and no worries about theft thereby ensuring more gold for your money.

Read More: Top Rated Gold Funds

Every Investor has a need, every need leads to a goal and we at MyWay have an investment for all your goals.

Don’t Delay, Just Think Investments

Think MyWay Wealth

Term Insurance for Women

Term Insurance

“Someone is sitting in the shade today because someone planted a tree a long time ago.”

–Warren Buffett

 

This phrase is so true when we speak about our Mothers. Mothers play such a significant role in our lives. The lessons they teach structure our lives beautifully. A woman has so many responsibilities to fulfill at various stages of her life, be it the role of a daughter, a sister, a wife, a mother and if you’re a working woman, then you’re even the bread earner of the family. As women, we know every nook and corner of our house and understand the needs of every family member; their favorite food, their outing spot, the gadgets they like and even their financial needs. We always want to protect our families from every trouble.

But what if we are not around them? What happens when we cannot cater to their needs? What if we face an untimely death? Still, as mothers, we want our families to have a peaceful life after we have left them. For this, we need to prepare our families both mentally and financially. This arises the need for Women especially to have

“Term Insurance”

Term Insurance is the purest form of Life insurance, wherein you need to pay a fixed amount as a premium to a certain amount known as Sum Assured. And in case of your unfortunate death during the policy term, your family receives the amount.

Why should a working woman opt for Term Insurance?

  • The conventional thought is, Men are the bread earners of the family, even though women work. Let’s imagine your income stops for a while. Can anything substitute that income? No, right? So a women’s salary is also a major source of income for the family. Also, Term insurance is provided based on the total income of the family. Hence your salary matters.
  • Since you’re a working woman you would help your partner in taking care of the expenses of your family. A term cover is essential because, in the absence of your income, it would help your partner to handle the expenses all by himself. Let’s say, for example, School fees of the children, EMI, loan, rent etc.

Read More on: Worried about your Job? Mutual Funds can help!

 

What is the use of a term plan for a homemaker?

  • Even if you don’t make monetary contributions to your family, your absence would still leave a huge void in your family.
  • Your partner or your siblings would have to carry forward your responsibilities.
  • With the help of term insurance, your partner or siblings can cut down on their work hours or part-time jobs and dedicate their time in fulfilling your responsibilities. (Planning of your child’s marriage /education or taking care of your parent’s medical needs). They would receive a fixed amount of income, that would cater to their financial necessities and goals.

Read More on: Invest in Term Insurance to Save for your Child’s Education

Women receive certain special benefits with term insurance such as:

  • Special premium rates especially for women.
  • If you don’t smoke, then you receive attractive premium rate benefits.
  • Comprehensive protection with the option to choose Critical illnesses rider and other added riders as well with your term plan

How do I get Term Insurance done?

Working women normally have a busy schedule, an easier way to handle finances would be to use digital platforms. MyWay Wealth – India’s most trusted app for Direct Mutual Funds, is one such digital platform that offers Term Insurance.

The app has a user-friendly interface, completely paperless process and charges no fees or commission. All you need is a few minutes on your smartphone and you will be able to provide a cover of 1 crore to your family, with the same amount with which you get a Netflix monthly subscription.

Term Insurance cover

You may delay but life will not, and lost time is never found again.

Hence plan your Term Insurance on MyWay Wealth app today and be rest assured regarding your families well-being. You have worked hard all your life, now make it work for you. “Let your presence be felt always”.

Direct vs Regular

Earn 1.5% more returns with Direct Plans, find out how!

Usually, when we place orders online, we come across two products, those that don’t charge for delivery and the other that charge for the same. We usually opt or like the ones that provide “Free Delivery.” Right? The simple reason being we do not incur additional charges for our purchase, and that reduces the burden of our expenses.
Even Direct Plans and Regular Plans of Mutual Funds work on a similar concept.

Regular Plans are mutual funds that you buy through an intermediary such as an advisor, distributor, agent, or broker. These agents charge commission, trail, or distribution fee for the service they provide, thus increasing the expenditure for your investment. And not always do brokers or intermediaries intent to sell plans that suit your financial needs, their primary objective would be to push the scheme and earn their share of profit.

Now let’s look at funds that are like the delivery of free online products.
SEBI made new regulations with regards to Mutual Funds, which was made effective on January 1, 2013, i.e. Introduction of Direct Plans. Direct Plans are those mutual funds in which investors can directly invest with Asset Management Companies (AMC) who do not involve intermediaries and do not charge any agent or broker fees.

The advantage of Direct Plans:

  • Direct Plans do not involve intermediaries, and hence, Fund Managers can generate better returns by reducing their expense ratio.
  • The Net Asset Value (NAV – per share market value of a fund) is more when compared to Regular Plans implying that the returns that you can make are higher by approximately 0.5% for equity funds and 0.2% for debt funds.
  • Investors can earn 1-1.5% more returns with Direct Plans. Additionally, a difference of 1% can be a huge gap with the compounding effect in the long-term.

Let’s look at a simple example:
An investment of 2 lakhs in each Direct, as well as Regular plans for 20 years, yield different returns.

 

Direct Vs Regular

Direct Plans offer 42.2 lakhs, which are 16.5% returns, whereas Regular plans help you earn 32.7 lakhs, which are approximately 15% returns. It is a clear example that the Direct Plan is more beneficial and hassle-free than Regular Plans.

Which one is better?
It’s simple!

 Direct Plans = Higher Returns

However, each investor’s risk appetite is different, and so is their knowledge or expertise about Mutual Funds. So if you are a newbie to investing and have no prior knowledge of mutual funds, then initially you can opt for Regular Plans. However, once you have gathered enough experience and expertise, it’s highly recommended that you quickly switch to Direct Plans.

Think Smart! Think Investments!

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