Let us understand that there is a factor of Risk and Return for any investment. It is natural that most of the High Growth assets carry high risk.

Basically, as you move from Cash to Alternate products, your Returns increase along with the risk.

But does that mean, you should keep all your money in bank deposits and post office with average returns of 5 to 6 % post-tax to avoid risk? It is actually a negative return if average inflation of 6% is considered.

You need help from an experienced qualified friend to create a portfolio suitable for your risk profile and future goals. I could do it when I decided to take an early retirement.

Did I plan it at the last moment? Definitely not. Plan B was always ready since 2010 and got triggered in 2019. Yes, my plan could have been more solid, if I would have started preparing much before and at a younger age.

That is the reason, I am trying to share the need for a financial plan with each one of you. Being in Bank for 30 years and helping clients in advising investments,

I thought I could use this knowledge for the benefit of my friends and relatives.

Be free to connect with me in case, you too wish to have a concrete goal-based plan according to your risk profile.

1. Cash and Bank Balance

2. Fixed Deposits/ Post Office

3. Government securities

4. Debt Mutual Funds

5. Hybrid Mutual Funds

6. Equity Mutual Funds

7. Large-cap equity shares

8. Mid-cap equity shares

9. Small-cap Equity shares

10. Exotic and Alternate products

No assets can give you very high returns (over risk-free returns) consistently forever.

If someone is promising you extraordinary returns on a very consistent basis, then you need to be very cautious.

I remember one of my friends had approached me to invest in goat farming. As per him, I should buy a goat, which will, in turn, give regular milk and also multiply in numbers over a year.

I was shocked and asked him to bring the goat to my house. He was furious and left the house in anger.

After a few years, when we met, he was already in another business selling MLM (Multi-Level Marketing) products. My sincere request to all is always to stay invested in organized and regulated markets.

Please watch the “Madoff” web series on Netflix.

Bernard Lawrence Madoff was an American fraudster and financier who was the mastermind of the largest Ponzi scheme in history, worth about $64.8 billion.

Also, watch “Bad Boys Billionaire” (especially the episode of Subroto Roy) on Netflix. So be it the USA or India, Greed is the same everywhere, and many of them are out there ready to exploit it.

It’s your hard-earned money, so invest in assets, which give better (not extraordinary) returns over risk-free returns. Dreaming to live happy and contented life is much better than, trying to become a billionaire in one night.

Unless you have abundant sources of money at your disposal.

We will discuss, the Goal-based projected cash flow example as a case study in the next article.

A portfolio balancing risk and return to suit your goal is more important.

Take care and please do feel free to call upon me to plan your financial life.