All of us need money for our future requirements; some people also call it financial goals. The main question that lies in our mind is that “How much shall I invest”?
I have tried to simplify the whole investment procedure for you so you can do it on your own
Three steps to investing –
1. Why do you want to invest? (Goal – Child Education, Buying car etc, Time – when)
2. What is your risk appetite? (How much risk you can take)
3. Enter your data in below excel template and get the amount that you should be investing on monthly/ Yearly basis
Download the template from below link
https://drive.google.com/file/d/0B6PCLqvOx_9JZWc3MF9NRWFIanc/edit?usp=sharing
https://drive.google.com/file/d/0B6PCLqvOx_9JZWc3MF9NRWFIanc/edit?usp=sharing
Note – Please enter inputs in highlighted fields, Result will come in GREEN color cells
Definitions - of terms used in Excel template
Goal It is the present value of the cause you investing for. If you are investing for say a hatchback car, then the goal may be 5,00,000
Time How much time you have to invest by when you want to realize your goal
Assumed inflation Rate
I have used 7% as inflation rate; you can change the number if required. However 7% is reasonable assumption used across in financial industry
ROR (Rate of Return)
It will depend on the investment you are making.
· FI – for FD or any other fixed income you can directly enter the rate of return
· EQ – depending upon the mutual funds you have chose, you can enter the ROR number. You can look at funds past performance to decide how much return you should be expecting
