After reading La Papillion’s and Derek’s blog posts on how they invested their parents’ money, I also desire to share how I invested the amount of money from my dad. Because our circumstances will vary, our collection allocations will vary also. The money didn’t come from my father, rather, the amount of money came into being because we sold a flat and bought a fresh one. Rather than using the sales proceeds from the old flat to cover the new flat, we retained the sales proceeds as cash and took out a loan.
Strictly speaking, it is my father’s money, because he covered the old smooth. However, it might also be viewed as taking right out a home equity loan that I am accountable for paying down (there is absolutely no change in the level ownership). The amount of money became a joint investment, and we set up a fresh joint bank or investment company, CDP and stockbroking take into account the investment (in hindsight, this is an important step as it allows us to check how the account does). The terms of the accounts are similar, it is “capital guaranteed” in the sense that I must repay the loan by the end of the loan tenure.
It’s hurdle rate is the loan interest of 2.6% (HDB concessionary loan interest). However, the investment horizon is much longer, at almost 30 years. Because both my father and myself are share investors and because of the very long time horizon, we invested the money in a portfolio of shares and cash. After reading the 2 2 gentlemen’s blogs and reviewing my own experience, I believe our parents’ investing experience and the way the money is viewed to have a very huge impact about how the money is eventually invested. Over the first factor, my father is a talk about investor, so he is very more comfortable with investing the amount of money in the stock market.
In contrast, my mom has a bad experience with the unit and stocks trusts, so she is only comfortable with bank preference shares. On the second factor, if the money is viewed as a stand-alone account with capital guarantee, then more than likely I’d have invested it mainly in bonds and preference shares.
On the other hands, if the amount of money can be regarded as a loan for my very own portfolio, the amount of money would be committed to shares. There would be minimal change in the chance urge for food. In my case, the amount of money was seen as a joint investment of both my father’s and my money. So while the money was invested in stocks, it has a reduced risk hunger since my father’s money is involved.
Only good shares would be chosen, with the first indication of trouble, the particular stocks would be sold-out. This has resulted in smaller income but also less deficits compared to my very own account. Thinking back, managing my father’s money has turned into a full circle. I imagine a true amount of us could have the same experience as me.
- No TDS if interest is up to Rs. 5000 within a financial calendar year
- Know The Non-Current Assets
- It is assumed you have retired on or following the relevant preservation age group
- Establishing Rapport
When I was in university, I would suggest to him which stocks to buy (I was not trained in stock analysis then), so in a sense, I was assisting to take care of his money. When the stocks and shares made money, I would feel very proud of my recommendations. But when the stocks and shares lost money, I’d quietly disappear completely expecting it would be forgotten with time. Through the full days of the Asian Financial Crisis, losses were not in the region of 30-40%, it was almost a complete wipe-out!
But my dad never blamed me for the deficits. Today Fast forward to, we are actually officially entrusted with our parents’ money. I guess just about everyone has grown to be more practical and accountable in controlling the money, understanding that the money is hard-earned and earmarked for our parents’ pension. Taking smaller dangers and making smaller revenue is more important than taking larger risks and making bigger profits. The greatest satisfaction in managing my father’s money is not in viewing how much cash have made for the account, but in viewing the satisfaction on my father when he views how well the accounts is doing. This, if you ask me, is precious.
They come in all shapes and sizes, some left wing quite, others, like Pound, very reactionary, much I love him as a poet however. Look to seeing it forward. It could start as a hub maybe. Give me a few days and I’ll email it for you. I have some good, super-geek buddies that could love to help the cause.
And I still have a few cable connections in the news headlines business that owe me favors. OK Bunco, you put it all down and I’ll make an effort to jazz it up a bit. But how would we disseminate it? I’m not all that hot on technology. I’m just a word man. Actual the Fed is both government and private, as unusual as that sounds. But the purse strings are held by the Treasury Department. However, my thoughts were more along the line of a public referendum demanding either removing the Fed or an appropriate financial infusion to balance the overall economy and pay back the debt.