Johny Johny No Papa

Avinash : No Dude, My Father Does not Allow me to Invest in ELSS. He says he has always invested in PPF and it is the best.

Niraj : He is right Avinash. But we need to Move ahead with times. PPF was the best investment once upon a time. But now we have better options available.

Avinash : Can you please explain this ? I need to talk to my father regarding this.

Niraj : Till 1999, PPF interest rates were 12% p.a. If an instrument was giving you 12% returns, then obviously it becomes a no-brainer and one would invest in it. But From 1999 to 2020, the PPF interest rates have been falling. Now they are at 7.1%. Also, even if someone had invested Rs. 1 Lakh when the interest rates were 8%, this year they will receive interest of 7.1% only.

Avinash : Thats pretty shocking. But 7.1% is also somewhat good na. Bank FD is even lower than that.

Niraj : Absolutely right. Thats why I am not even recommending you Bank FD. The problem is, in future, PPF interests may further go down and we may even see interest rates of 5-6% on PPF.

Avinash : Oh My God !! That would be too low. Will talk to my father about this. But he is pretty against the equity markets. He says, they are risky.

Niraj : He is right. Equity markets are risky When,

1. You invest in them for short term

2. You invest in Stocks without research.

But in ELSS, there is a fund manager who chooses stocks after thorough research. Also, if you invest in ELSS for more than 15 years, the volatility is removed and you create more wealth than PPF.

Avinash : But in ELSS, the maturity is only 3 years.

Niraj : No. The lockin gets over in 3 years. But you can very well stay invested for 15 years (the way you stay invested in PPF for 15 years).

Avinash : This makes sense. I will talk to my father about this and tell him that he is wrong.

Niraj : He is not wrong Avinash. Its just that things have changed and he is not able to keep up with the new opportunities. He needs your help.

We look forward to your valuable comments and feedback.

The Author Prof. Saurabh Bajaj (BE, MBA, FRM, CFGP, AFGP) is CEO with Nidhi Investments, Mumbai. His articles have a readership from 78 Countries across the Globe. He may be contacted on if you have any questions.

(The views mentioned in the article are personal opinion of the author)




Disclaimer : Mutual Fund investments are subject to Market Risks. Please read offer documents carefully before investing.

Published by professorbajaj

Prof. Saurabh Bajaj is an Author, Mentor, Motivational Speaker and Wealth Planner. He has done his MBA from Narsee Monjee Institute of Management Studies (NMIMS) Mumbai, one of the top 10 management institutes in India. He holds the prestigious FRM (Financial Risk Manager) degree awarded by Global Association of Risk Professionals (GARP), USA. Till date, there are less than 15,000 professionals in the world, who have been honored with this degree. He has also been awarded CFGP (Chartered Financial Goal Planner) Certification by AAFM (American Academy of Financial Management). After his MBA, he joined J P Morgan, the second largest Investment Bank in the world. He has worked with J P Morgan as Risk Analyst for more than two years. Prof. Bajaj also holds an Advisory certification awarded by AMFI (Association of Mutual Funds of India). During his stint at Bombay Stock Exchange, he has handled Investment Management and Treasury operations of the BSE Corpus. He has set up an entrepreneurship venture in the field of Wealth Planning and Investment Consulting under the name “Nidhi Investments” and holds the profile of CEO. Prof. Bajaj sits on the Expert Panel of and as Investment Expert. He is actively involved in investor education through his blog which has a readership from 78 Countries all over the world. His articles are also regularly published in , , ,, and . He has been awarded the title of “Best Article Writer” from in Jan 2012 and has been selected amongst “Top 5 Technical Writers” from all over India in Feb 2013. He has been invited by various TV Channels like SPIN TV, CNBC TV18, UTV Bloomberg Etc for programs like "Expert Advice" , "What Markets Want ", "Budget Analysis" etc. He has been invited by Several organisations like Lions Club, Rotary Club, Agrawal Welfare Foundation, Rajasthan Mandal, Agroha Vikas Trust, Union MF, UTI MF, Arthamitra Gurukulam, Vidyalankar Institute of Technology etc for expert lecture on "Smart Investing", "Life is A Celebration", "Financial Freedom", "The Digital IFA" etc. He was ranked 8th Merit at All India level NMAT which got him selected for MBA programme at NMIMS, Mumbai. He did his MBA with Capital Markets as his specialisation. Soft Skills has become an inevitable part of every selection process and teaching learning process these days. The students from small towns and tier II cities, in spite of being talented and well equipped with technical skills, are seen struggling in the selection process. This is because of their lack of exposure to these soft skills. Mr. Bajaj has a zeal for training candidates to develop these skills and has been imparting the same on since last two years. This zeal and passion inspired him to set up his own firm called “Knowledge Circle” which aims to train candidates for soft skills. Till date, he has trained more than 5000 participants from over 220 organizations across various fields of soft skills. He has been associated with MSBTE (Maharashtra State Board of Technical Education) to conduct Soft skills training workshop for the faculties of Polytechnic Colleges in Entire Maharashtra (Mumbai Region, Pune Region, Aurangabad Region and Nagpur Region) since last 8 years. He has also been associated with ICAI (Institute of Chartered Accountants of India) for training CA Students on various topics related to Communications skills, Group Discussions etc. He was invited by Fr. Agnel Polytechnic College, Vashi for a motivational workshop for faculties. He was also invited by Vivekanad Polytechnic College for "Communication Skills and Email Etiquette" training for non-teaching staff. Apart from these, he has conducted “Capacity Building Soft Skills workshop for Faculties” at ITI Gunj, ITI Pusad, ITI Digras and ITI Umarkhed. This was the first ever soft skills workshop for faculties in the history of ITI’s in Vidarbha. He was also invited by Shivaji Education Society to conduct similar Soft skills workshops for the faculties and office staff of Shivaji Junior College Pusad, Shivaji High School Pusad, Shivaji Vidyalaya Belora and Shivaji Vidyalaya Bhojla. He has conducted training workshop on “Effective Presentation Skills” for the relationship managers of HDFC Mutual Fund, Andheri Branch, Mumbai. He has also been invited at College of Management and Computer Science, Yavatmal, College of Dairy Technology, Warud, B N College of Engineering, Pusad, B D College of Engineering, Wardha, College of Engineering and Technology, Akola, Dr.N.P.Hirani Institute of Polytechnic, Pusad etc. for the Guest lecture on “Developing Interview Skills”.

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