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<p dir="ltr">Systematic Investment Plan (SIP) is an investment option wherein the investors may regularly invest in a pre-specified mutual fund scheme at periodic intervals. The investments continue to be made irrespective of whether the markets are going up or down. Retail investors continued to invest in mutual funds through SIP, was evident as the monthly SIP inflows in March 2020 have continued to hover above Rs. 8,000 crore mark for the 16th consecutive month.

If one has ever invested in mutual funds, the folio number is the address where the mutual fund units are housed. A folio number is to mutual funds, what bank account number is to bank. Like one may have multiple bank accounts with different banks and even multiple savings/ deposit accounts with the same bank, one may also have numerous folios with a single mutual fund house and across various mutual funds. 

Mutual funds offer a wide range of investment options to the investors, to suit different risk profiles, investment horizon, and financial goals. An investor may choose to invest in equity schemes, debt schemes, hybrid schemes, solution-oriented schemes, index funds, etc. as per their financial plans. One of the primary financial goals for a parent is planning for their child’s education. With high emotional value attached to this goal, one always intends to plan the best for his/ her children. 

<p dir="ltr"><span id="docs-internal-guid-3fef93dd-7fff-650d-4fa5-fabb8d141577">One would have often read a standard disclaimer for investing in mutual funds, &ldquo;</span>past performance is not a guarantee for future returns.&rdquo; This disclaimer tends to emphasise the fact that the historical returns generated by mutual funds may not be repeated in future periods. When one is investing in equity markets, one may not expect linear returns, and the returns may be volatile.

KYC stands for 'Know Your Customer' and is one of the obligations every investor must fulfil before investing in mutual funds. Through the KYC process, the market participants fetch relevant records of the investors to establish a unique identity for the investors in the mutual funds' records. 

<p dir="ltr"><span id="docs-internal-guid-213348f3-7fff-2b85-30c4-677af3324ae1">It is often said, &ldquo;</span>one should not put all his eggs in one basket.&rdquo; Experts suggest investors must spread their investments across different asset classes, e.g., equity, debt, real estate, etc. Different asset classes have different risks and rewards associated with them, and it becomes crucial for the investors to balance the risk-reward trade-off to smoothen their investment journey.

The Hon’ble Finance Minister presented the Union Budget 2020 on 1st February 2020, which has proposed specific changes to the present income tax rates, which will be applicable for the financial year 2020-21 and subsequently, Finance Act 2020 has also been enacted. However, the new tax rates carry certain caveats before the taxpayers can adopt the reduced rates. As such, both the existing & new tax rate structures will continue to co-exist. 

<p dir="ltr"><span id="docs-internal-guid-9a859db7-7fff-214b-eea0-4ebc228a88fa">Don&rsquo;t let this be a singular moment in time. I think it&rsquo;s a lesson of a lifetime. You get to read about such situations only in books or get anecdotal references when someone talks about tough times. Having lived through this lockdown many of you will have a chance to build lives which use this experience as foundational base. Post this experience, like every moment in time we will get two paths going forward.

Mutual funds are steadily emerging as one of the most preferred investment products amongst the retail investors for the benefits they bring on the table, including professional fund management at lower costs, diversification, preferential taxation rates for equity funds, etc. However, it is crucial to stay committed to the investment philosophy at all times. 

<p dir="ltr"><span id="docs-internal-guid-89bd439b-7fff-a711-d50c-46b48a940124">The post-retirement phase of life is generally seen as &lsquo;the second innings&rsquo; wherein one intends to fulfil their dreams and aspirations, which could not be fulfilled earlier due to commitments. Post-retirement, it is natural that people have reduced income. So, it is paramount to plan well for retirement so that the pending dreams do not face financial constraints.&nbsp;</span></p>