Queries
then I would suggest not to take
such a drastic decision. If it is based
on an event-driven market risk,
then do not book profits. Timing the
market is not recommended, rather
time in the market and align your
investments to your goals to bring
discipline and focus.
Dilshad Billimoria, CFP,
Dilzer Consultants
George Anil
Could you recommend the
best ELSS fund to invest in
to save on taxes this year?
Equity-linked savings scheme (ELSS)
is transparent, tax efficient and
well-regulated and has a three-year
lock-in period. Despite market risks,
it can still deliver double-digit return
in a period of three or four years.
You need to check consistency in
performance. All mutual funds have
tax plans and I would rate schemes
from Axis, IDFC and Reliance
AMCs as better performers.
AK Narayan, Founder,
A.K. Narayan Associates
Paul
What is a defined pension
benefit plan?
In defined pension benefit plans,
the employer invests a part of
your compensation as a benefit for
your retirement. It is more like an
assured retirement benefit. When an
employer invests in an EPF account
for you, a part of it (8.33 per cent)
goes to EPS, which is a pension
scheme. You can access it when you
turn 58 or after you complete 10
years of service. NPS, on the other
hand, is a defined contribution plan.
Here, you have to take investment
decisions on your own whereas
in the defined benefit plans, the
employer takes the calls based on
guidelines set by the government.
Shweta Jain, CFP
Lalit Ramteke
I am planning to invest
`5,000 per month for my
16
rajesh shetty, Thane
I sold an Indian equity
share after one year
of purchase from my
Indian demat account.
Do I need to pay any tax
under LTCG if securities
transaction tax (STT) is
deducted while remitting
the money to me by the
securities firm?
chosen to save money for your
child’s education. It is all the more
appreciable as you have chosen to
invest via mutual fund schemes to
create a corpus.
You can look at two different
schemes of `2,500 each using SIP
route. The time frame of 13 years is
long enough to create a good corpus.
I would recommend you invest in a
balanced fund and a large-cap fund.
Example given below is hypothetical
and rate of return assumed is at 12
per cent per annum.
Amount per month= `5,000
Period = 13 years
Amount invested = `7.80 lakh
Likely corpus = `18.72 lakh
The corpus is likely to grow close
to 2.40 times.
AK Narayan, Founder,
A. K. Narayan Associates
Rajpal Singh, Perth, Australia
Long term capital gains
arising on sale of shares are
exempted under section
10(38) of the Income Tax
Act. The only point to
remember is that the shares
should be sold through
stock exchanges and that
the shares are held at least
for a period of 12 months.
STT is paid through the
broker while selling the
shares. Hence, there is no
capital gains tax payable
for long term gains.
AK Narayan, Founder,
A. K. Narayan Associates
three-year-old daughter’s
higher education. I have
calculated the cost of
education 13 years from now,
with 10 per cent inflation.
Should this amount be
invested in one single mutual
fund or multiple funds?
It is commendable that you have
Outlook Money February 2018 www.outlookmoney.com
Please offer advice on
mutual fund portfolio to
create wealth in the next
10-20 years. I can invest one
lakh per year, which can be in
the form of SIP. I don’t need
this money for immediate
use. Which funds should I
invest in to achieve my goal?
I am 37-years-old and new to
investments.
Financial goal should be set in terms
of amount to be accumulated in
a time-bound manner in order to
measure the progress time to time.
With your long-term investment
horizon, you can consider investing
in ICICI Prudential Focused
Bluechip Equity Fund, Aditya Birla
Sun Life Pure Value Fund and SBI
Magnum Multicap Fund. You can
invest `3,000 per month in each of
these schemes through SIP route.
Pankaj Mathpal, Managing Director,
Optima Money Managers
George Cheruvathoor, Chennai
Recommend a mutual fund
scheme where I can invest
`8,000 per month through