What Investment mistakes you made that you want others to avoid?

letmein said:
No, not really. Some really bad advice has been posted so far, especially comparing debt investments with equity and the blanket recommendation being given to invest in [equity] MFs, irrespective of your situation or risk profile.
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Share your insights .. help us improve.
 
Rockfella said:
Experts feel LIC is a slow burn scam/doesn't have much worth. I will never get one. Try to find a way out :neutral:
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LIC plans are garbage. The only profits are made by the agents by making gullible boomers but their shitty Endowment/Annuity plans.
My parents have one such plan set up in my name for 25yrs and now are asking me to pay the premium every year for the next 15yrs with a crappy return rate of 3.7%. I would rather surrender this policy and buy LIC shares for better returns.
letmein said:
No, not really. Some really bad advice has been posted so far, especially comparing debt investments with equity and the blanket recommendation being given to invest in [equity] MFs, irrespective of your situation or risk profile.
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There have been some screw-ups in debt MFs last year and the confidence amongst investors is shaken. The path that this country is taking under the current right-wing regime is to make it more profitable for the industrialists at the expense of common people. So expect equities to keep performing better and better.
 
pauldmps said:
LIC plans are garbage. The only profits are made by the agents by making gullible boomers but their shitty Endowment/Annuity plans.
My parents have one such plan set up in my name for 25yrs and now are asking me to pay the premium every year for the next 15yrs with a crappy return rate of 3.7%. I would rather surrender this policy and buy LIC shares for better returns.
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It is driven by incentives for the agents. 3.7% is less than India's inflation%. Get rid of it .. sooner the better.
 
Ok so with my (and wife's) in progress LIC policies, I called up their CC today and found that for my policy which goes till 2046, I have till now paid 2.42L and surrender value is 3.46L. In excel I calculated IRR if I keep paying premium like now and IRR is 5%.
For my wife, I am yet to ask.
 
raksrules said:
Ok so with my (and wife's) in progress LIC policies, I called up their CC today and found that for my policy which goes till 2046, I have till now paid 2.42L and surrender value is 3.46L. In excel I calculated IRR if I keep paying premium like now and IRR is 5%.
For my wife, I am yet to ask.
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Get all of it and put in some MFs ;)
peachesontheway said:
try to look at BSE/ Nifty and google about the top shares being displayed there........you can also go for new startup shares which u might thing will grow in future....like infibeam which deals with the ccavenue payment system.......read read read and than read some more. .... bit by bit you will get to know things. Read about G-Secs/ SDLs, bonds etc broaden your knowledge base and you will get to know how simple fraudulent msgs over whatsapp can lead to drop of a share price over night.
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Problem is it is hard to know which stock will become a multibagger.
 
JMP said:
Depends on the quantum of investment.
Below 25L Motilal Oswal S&P 500, Nasdaq 100 and other international funds are useful.
For corpus >25L Charles Schwab is much better.

Any direct investment in the US will need your attention on -
* Currency conversion (5% TCS, LRS limit - $250,000 per year).
* US Tax compliance
* Indian Tax compliance
* CA expense
* Fund expense

It is best to understand these things well before beginning as penalties can be huge.
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Isn't Charles Schwab for like HNI/UHNI?
About tcs deduction above 7 or 7.5 lacs remittance. Can the individual claim the same at the time of filing itr? What is the point behind this tcs thing?
Rockfella said:
Then we keep on investing even more OR at least don't withdraw any money. After 2008 crises and covid last year market levelled out within 1/2 years. People who withdrew funds were at a huge loss, the ones who remained invested eventually gained.

Before 2008 crises:
View attachment 102798
When it hit:
View attachment 102799
Back up in 2010!
View attachment 102800

Before Covid.
View attachment 102801
After covid struck:
View attachment 102802
Back up and .. rocket run? :)
View attachment 102803
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Read up Japan's lost decade. My point is it will be hard for people, including myself, to stay invested if it goes on for so long.
raksrules said:
Ok so with my (and wife's) in progress LIC policies, I called up their CC today and found that for my policy which goes till 2046, I have till now paid 2.42L and surrender value is 3.46L. In excel I calculated IRR if I keep paying premium like now and IRR is 5%.
For my wife, I am yet to ask.
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Not even beating or equal to inflation.
 
I probably know answer to this but still asking...

I have about $2000 in my US Bank Account. Is there a way I can invest them in shares in US directly? I do not have US address and no active Visa too and I am in India. I do have SSN though.


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If I surrender my LIC policy and the gains I get from it, are they taxable?
 
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raksrules said:
I probably know answer to this but still asking...

I have about $2000 in my US Bank Account. Is there a way I can invest them in shares in US directly? I do not have US address and no active Visa too and I am in India. I do have SSN though.


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If I surrender my LIC policy and the gains I get from it, are they taxable?
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I think yes contact Drivewealth.
About LIC, I am not sure. But still contact your tax consultant. Do let us know. I was at loss in all of them so didn't bother ha ha


Is anyone here investing in debt funds? If yes then which one and why?
 
raksrules said:
How do I contact LIC for surrender value. Also less than 5% means I will get less than 5% of my amount paid?

I am invested in MO S&P 500 Mutual Fund for international exposure.
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you go to your LIC home branch and they'll tell you on spot the exact surrender value. surrender it. it'll be just 20 mins process
 
becool773 said:
The TAT for the funds to be back in your account after surrendering is 48 hours. They might take more than that being sarkari babus. Send a mail to IRDA then?
Investing in debt funds?
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The lady on call told me 10 working days and told me I have to submit..

  • Adhaar Card Copy
  • PAN Card Copy
  • Policy Original document
  • Cancelled Cheque
  • Request letter
  • 2 forms (available in their office)
 
JMP said:
Having planned allocations allows one to manage risk better.
There is no end to human greed, the mind always wants more. Attaching a goal to a particular gives metrics and clarity.
Eg: What's the minimum amount required, Is the target amount achieved?

We don't ever travel without knowing the destination, similarly, we make plans for most other important things in life, why should investments be any different? Metrics in my opinion is just as important for personal goals, as professional goals.

Depends on the quantum of investment.
Below 25L Motilal Oswal S&P 500, Nasdaq 100 and other international funds are useful.
For corpus >25L Charles Schwab is much better.

Any direct investment in the US will need your attention on -
* Currency conversion (5% TCS, LRS limit - $250,000 per year).
* US Tax compliance
* Indian Tax compliance
* CA expense
* Fund expense

It is best to understand these things well before beginning as penalties can be huge.

I would recommend going with the Nifty50 or similar Nifty index instead. Much less headache and expense.
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Best answer dear and I am with you on this!
 
becool773 said:
Isn't Charles Schwab for like HNI/UHNI?
About tcs deduction above 7 or 7.5 lacs remittance. Can the individual claim the same at the time of filing itr? What is the point behind this tcs thing?
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Expenses involved only make sense if the corpus is high enough, hence 25L+.
Charles Schwab needs an initial deposit of USD 25000, but they are like Zerodha - no charges for equity delivery or ETFs (I don't know how things work for Intraday, not into that). Subsequent top-up amounts can much smaller amounts like our regular lump sum investments in India.

TCS is mandatory irrespective of the amount, even if you spend 5 USD on your credit card 5% TCS is debited.
We get the 5% refunded in 5 - 10 days if the total annual FCY expenditure is less than 7L, exceeding that one needs to claim for refund/adjustment while filing returns.

The point is to discourage Indians from moving their capital abroad and extract as much tax as possible. Any remittance of foreign exchange already mandates one furnish a PAN number and complete FKYC, this serves no purpose other than making things more cumbersome.
 
choose shares>>> check the previous years profit/performance of the company>> buy few at a time.

for eg. ITC is standing from 1910.....its still going good....and I hardly doubt that liqour companies will go down along with the cigarettes' companies.....It just my personal views...... it will be helpful to me also if someone guide me too on this .
 
peachesontheway said:
choose shares>>> check the previous years profit/performance of the company>> buy few at a time.

for eg. ITC is standing from 1910.....its still going good....and I hardly doubt that liqour companies will go down along with the cigarettes' companies.....It just my personal views...... it will be helpful to me also if someone guide me too on this .
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Please don't get into the fallacy of past results = future profit. Yes Bank is an example.

I own ITC myself, and while it is a good defensive stock, it is not for everyone. You need to ask why almost every stock in the Nifty 50 peer group has been outperforming it.
1) Failure to spinoff other businesses like FMCG or Hotels, causing a drag on the stock
2) ESG investing is gaining ground, maybe not so much in India, but it will cause FIIs to reevaluate holding in what is essentially a tobacco company.
3) Most investors are attracted to it because it pays a steady dividend. To me, this is the biggest red flag. Government run PSUs act like this because they don't care about the retail shareholder. A company which is growing should not pay a dividend, instead it should reinvest the profits into its business. Sadly, I think management has run out of ideas or are happy with status quo. Unfortunately, India does not have a strong activist shareholder base, else the current management would have been long gone. Not to mention that dividends are the least tax-effective way of rewarding shareholders.

There was an excellent 'Open letter to ITC Board of Directors' that I read on a blog a few months ago. If I find it, I'll append it to my post. It stated quite eloquently what is wrong with ITC and its management.
 
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