1

I. Plan for your future

2

Believe it or not ……… After 20 years

Your today’s monthly grocery bill of Rs 35,000 will become…..

An IIM degree for your child which costs Rs. 10 lakhs today will cost……

Rs. 92,800/-

Rs. 26.5 lakhs

Assuming inflation @ 5% p.a

Your dream home which costs Rs 50 lakhs today will be more dearer to you

Rs. 1.33 Crores

After 20 years…. “Once upon a time”

3

92,865

72,762

57,011

44,67035,000

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

100000

Today 5 10 15 20

37,689

48,102

61,391

78,353

100,000

-

20,000

40,000

60,000

80,000

100,000

120,000

Today 5 10 15 20

Prepare yourself to spend more on your favorite items in future…

Because somebody is continuously eroding the value your money, without

letting you know

Worth of Rs. 100,000 after 20 years

Amount required to maintain the same lifestyle as today

after 20 years

“Worthy today” becomes “Worthless tomorrow”“Affordable today” is “Unaffordable tomorrow”

Life will never be the same again…

Assuming inflation @ 5% p.a

4

Therefore you need to save for….

Capital Assets- House, Car

Medical emergency

Child’s education / Marriage

Other family obligations

Post Retirement expenses- To maintain at least present standard of living

Every individual has one or more of the above goals

5

Time and Tide waits for none…. Everybody has limited time to Save

Time to SaveEarnings

Consumption

Savings

Education Earning YearsAge- 22 yrs Age- 60 yrs

22 yrs22 yrs 38 yrs38 yrs 10- 20 yrs10- 20 yrsPost Retirement Years

6

Have you planned for your future

7

Some people work for money

While Some make money work for them!!!

Which category would you prefer

8

Writing on the wall… “Disciplined Approach” can lead to Wealth Creation !!!

Retiring Rich is simpler than you think !!

Start Early1

Invest Regularly

2

Don’t time the Market

3

Identify the best Asset Class

4

Let time be on your side5

9

Rule is “Early to bed, Early to rise makes a person Healthy, Wealthy & Wise”

YouAge : 25 yearsStart: TodayInvest : 5 yearsAmount : Rs 5000 p.a.

Your FriendAge : 25 yearsStart : at age 40Invest : 20 yearsAmount : Rs 5,000 p.a.

Note- Returns are assumed to be 10% p.a.

0.05 0.341.75

4.53

0.050.88

11.76

3.15

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

25 30 40 50 60

Age (in years)

Val

ue o

f Inv

estm

ent

(Rs.

Lak

h)

You start investing Your Friend starts investing

You stop investing

So why are your investments an exception to this rule

10

Because Time is ticking & every second counts.. Delays affect Wealth Creation….

It Always Pays To Start Early & Save For Your Retirement

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

25 30 35 40 45 50

If you start investing when you are (years)

(Rs.

Lak

hs)

Investment Gains from Investment

Rs. 1000 invested p.m. @ 10% p.a. till the age of 60 yrs

2.14.27.7

13.4

22.8

38.3

Just 5 years of delay reduces the wealth by

half!!!

11

Invest Regularly – Let the 8th Wonder work in your favor

70 lakhs

15%

23 lakhs

8 lakhs

5% 10%Rs.1000 invested every month for 30 years

Even small amounts invested regularly can grow substantially

“Compound Interest is the Most Powerful force in the Universe” …Albert Einstein

12

And please don’t predict the “Unforeseen”

Source: ICRA MFIE

“Time in the market” is more important that “Timing the market”…

“Predicting the market a folly”

Investing in the BSE Sensex – 26 years

Hope that you get it

right more

often than not!

19.11%

Fixed investment atlowest sensex value

every year – Best day to buy

17.19%

Fixed investment on 1st day of every month

17.13%

Fixed investment athighest sensex value

every year – Worst day to buy

13

Identify the best asset class

Source : CLSA

19.0

7.1

8.5

4.0

8.0

0.0 5.0 10.0 15.0 20.0

Equity

Gold

Bank FD's

Inflation

G-Sec

1980

- 200

7

%

CAGR

19.0%

8.0%

4.0%

8.5%

7.1%

Equities have outperformed all other asset classes in the long run – Globally as well as in India

14

Equities: Not risky in Long Term

As the time horizon increases, the probability of loosing money decreases

36 64

19 81

13 88

14 86

5 95

- 100

- 10 20 30 40 50 60 70 80 90 100

1

3

5

7

10

15

Inve

stm

ent H

oriz

on (Y

ears

)

Probability of Loss Probability of Profit

Invest for Long term…. Let Time be on your side

Source : BSE Sensex

15

Is India an attractive destination?

Fundamentals still in place

By 2032, India will be world’s third largest economy, next only to the U.S. and China

Large pool of English speaking skilled labor available leading to MNCs setting facilities, generating employment

Significant rise in the income levels continuing India on the consumption led growth trajectory

India remains attractive to Foreign Investors as indicated by strong FII flows

Inflow of Domestic savings to further drive the markets as equities continue to enjoy tax benefits

Indian corporates increasingly target world market – exploiting low cost base

Largest section of population in the age bracket of 20 – 60 yrs , which is the largest consumer group

Structural shifts in the population pattern will lead to India’s growth inline with global trends

Source : Brics Report