Droplet Wealth

My Partner called me and told me that we are no different from laymen who know that Short term Interest rates are going to fall. We both know the same and hence we are the same. Yes I would say but only for the sake of that knowledge.                            The 1 Year FD in SBI in 2012 would have fetched a interest of 9.25% per annum but today it fetches only 6.25% and this is of course a grave matter for Fixed deposit holders. Because if they had known the interest rate would fall, they would have bought 10 Year FDs which would have paid the same 9.25 % today instead of ending up getting a measly 6.25 % today. So simple.  Now it is expected that Interest rates can fall further - what do we do? Buy 10 Year FDs and lock the "assumed" higher interest today or Wait for the Interest rates to go up?   Speculate. Speculate. Speculate.  This is where a good financial planner...

A lot of us might be thinking about making part payments against our home loans. We suggest you look at the below table of savings before you take any such decisions -  For those not adept with numbers/tables, lets us clarify in simple sentences.  1. If we prepay 1 lac of our home loan at the beginning of each year for 5 years. Our Total "Interest Savings" come to about INR 5 lacs for a period of 15 years. 2. If instead of prepaying the home loan, we choose to invest the same in an equity mutual fund, then a fund returning 12.5% per annum, would help us create a corpus of 20 lacs. 3. If instead of prepaying the home loan, we choose to invest the same in an equity mutual fund, then a fund returning 10% per annum, would help us create a corpus of 15 lacs. Before we complete - here are the few reasons why r ecommend delaying the Pre-Payment of the home loan - 1. The Prepayment can be used to create your retirement corpus. 2. Locking up your savings...

C lick here to read in Tamil We know so many people that have a home loan. How much ever they try to, they still pay a minimum of 40% to 90% of principal as Interest to the lender. We delved about this and wanted to give our readers a plan that helps them reclaim the interest portion.  We have normally noticed that most of the home bought are about 40 lacs. WIth 20% down payment, the loan amount comes to 32 lacs. On a loan taken for 15 years at 8.6%, the EMI works out to be INR 31,700. If the loan is duly completed in 15 years, the total interest paid is 25 lacs. Now we have to do plan to get this 25 lacs back.   But the plan is good only if there is no extra payout that the borrower has to make. So we suggest that you extend the loan tenure to 20 years. This will save you 3,700 per month in EMI. Next, Invest the EMI savings in a good equity fund for 20 years. Let's see what happens now.  As one can see by simply managing one's investme...