• Double Returns Rule
    Know when your investments will double up
  • Equity Investment Rule
    Calculate the percentage of your Equity investments
  • Rule of Saving

    Find out how much you need to save
  • Debt Investment Rule
    Calculate the percentage of your Debt investments

Rule

The percentage of your portfolio invested
in fixed income instruments/debt mutual
fund should equal your age.

Why it works?

  • This rule of thumb helps investors keep
    in mind that their portfolios need to
    change as per their age
  • This helps them in becoming more
    focused on avoiding risk in their
    investing than aiming for higher returns
  • As you grow you have less time to
    recover from market falls than some
    one younger

Grain of salt

As you enter retirement, taking all your
money equity mutual funds could slow the
growth of your portfolio too much,
preventing you from keeping pace with
inflation and possibly depleting your
retirement savings.

What’s your age?

(Don’t worry, we won’t let anybody else know)

0
21
100

% of your investment plan

should consist of fixed income instruments/debt mutual fund

Did you know rate of returns on different investment option?
PPF - 8.7% (Current Rate, Source: RBI)
Saving Account - 4% (Current Rate, Source: RBI)
Fixed Deposit- 8.5% (Current Rate, Source: SBI)
Equity Mutual Funds : S&P BSE Sensex has grown at a CAGR of 17.88% p.a over the last 10 years. Data is as on 05 September 2014. Source - BSE India.


Compare your investments option here

Rule

You should always save at least 10 percent
of your income
toward your retirement.

Why it works?

  • The 10 percent rule gives people a simple,
    memorable target to work toward,
    (especially if they're starting a serious
    saving regiment for the first time)
  • Depending on how early you start, saving
    10 percent throughout your lifetime could
    well be enough to provide a solid retirement
    investment when you're ready to leave
    the work

Grain of salt

Keeping the same target throughout your
life ignores how much financial situations
and expenses fluctuate throughout
lifetimes, says Finke.

What’s your income?

(It’s OK, not everybody is an Investment Guru)

0 L
21
100 L

Rule

Take your age and subtract it from 100. That is your percentage of Equity Mutual Fund allocation. This is also known as the old rule of thumb.

What’s your age?

(Don’t worry, we won’t let anybody else know)

0
21
100

Rule

The  Rule of 72 states that you can divide the
number 72 by whatever yield (rate of interest)
you are getting to see how long it would take
for your investment to double.

Why it works?

  • Let’s take a look at this example.  Savings
    Account at Bank A pays 1% interest, so 72
    divided by 1 is 72 – it will take an invest-
    ment of Rs. 1,000 (or any amount) 72 years
    to double at a rate of 1 percent
  • On the other hand the current rate on Sav-
    ings Account at Bank B. is 2.4%. 72 divided
    by 2.4 is 30. Therefore it will take 30 years
    for my investment to double in the Savings
    Account at Bank B
  • See how much of a difference a small
    percentage increase can make? Let’s really
    have some fun with this now. If you could
    manage a return of 10% annually you could
    double your initial investment in 7.2 years!
    Or if you could manage a return of 15% you
    would be able to double your investment in

Grain of salt

The Rule of 72can also be used to calculate
interest rate you’ll need to double your
money in a certain amount of years.

What rate of interest are you
getting on your investment?

(Don’t worry, we won’t leak your secret)

0
21
30



The above investment simulation, based on assumed rate of return(s), is for illustration purpose only and should not be construed as a promise on minimum returns and safeguard of capital. Birla Sun Life Mutual Fund / Birla Sun Life Asset Management Company Ltd. is not guaranteeing or promising or forecasting any returns. Investment in Mutual Funds does not assure a profit or guarantee protection against loss in a declining market. Entry / Exit load is not taken into consideration in the above investment simulation.

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