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An IFA should other than looking at Asset Allocation of his/her client, he should concentrate on Business as usual. Both ULIP as reavatar of long term wealth creation with lower charges than Traditional endowment plans, distributor agent should choose lowest charge and decent yielding ULIP say about 25% of Investors wealth. MF both Equity and Debt are life changing investment class hence should constitute balance 75% of the kitty. The plan should be backed up by adequate amount of pure risk TERM PLAN
Recent changes in tax laws was overdue.. it was a matter of time otherwise it was again misused by the industry .be it dividend stripping or dividend payouts.. However average investors will not be impacted much as post tax return possibility is still high...
The introduction of LTCGT/STD @ 10% on equity Mutual fund in this Budget is a positive step by the Govt, it will curb the achurning of portfolios for narrow gain/narrow interest unless its genuinely required. This will help their fund grow undisturbed for a longer period. Also now the selection of asset class will be based on the actual requirements and goals of investors than merely for tax benefits.
MF becoming less competitive - If we consider post inflation return of other options then MFs will be winner. Another good thing that mis selling of dividend payout option certainly decrease. ULIP - In case of senior citizens cost of providing cover will matter a lot. If we consider that, then post DDT & LTCG returns from MF are far more attractive.
The interest is TAXABLE for PMs Vaya Vandana Scheme through LIC for Sr.Citizens investment up to Rs.15 lakhs which guarantees 8% return and not tax free as stated by Mr.Prabin Agarwala of Siliguri. WF may kindly clarify the correct position.
Absolutely not when it comes to returns. Next 10 years FD , Postal schemes, Vay Vandana yojana interest rates expected to remain lower. Inflation will gather momentum. ULIP mandate is balanced fund, lower risk. It will be big mistake to compare these, rather even PPF returns though tax free with Equity products which has bigger product basket to choose from, diversity to spread risk and equity returns will surpass any other financial instruments, investments including real estate. Besides Equity has highest and quickest liquidity. Long term holding and returns will make investor forget the pinch of LTCG or even STCG tax. Look at it as SR by an individual similar to CSR, Corporate Social Responsibility. FD, PPF, Postal schemes or even ULIP will not be apple to apple comparison with Equity, may it be mutual funds or stocks. Please do not haste for wrong decision.
I Dontt think ULIP is alternative to MF equity.