Investment woes

Dear Friends,I am here posting one of my friends cum 'SEED' Yearly client- Captain.Udhay Kumar and his experince with the Mutual funds investments . he invested in MF and his investment depreciated instead of growth.He shared his dis-comfort with me over phone and also send his post link to me.I would like to post the same here for my... friends here...Hoping this will be usefull unto all of you.You can learn something about investments.Mainly where not to invest and expect massive growth.

Its a kind of alert for all investors.

Link>http://earnfrominternetfree.blogspot.com/2011/01/investment-woes.html

'Investment woes '

Wednesday, January 26, 2011at 1:06 AM

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I had a great learning experience recently, in fact less than a week ago. I learnt that I am financially still very uneducated. I can live with that but what is bitter and unpalatable is the fact that the financial world where we invest our savings to reduce the tax burden and hope for a sizable growth in income, would prefer us to stay that way.

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The year was 2008 and it was the beginning of the year and I was on the look out for a lucrative ELSS option where I could park my 1.0 lacs and avoid taxation on that amount.

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The rest was easy. Very prudently I was advised to diversify my investment into more than two investments and what better than Mutual funds and ULIPs, I was told.

I invested 60000 that year .

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1. Fidelity tax advantage fund - 20000

2. Life Stage pension plan withICICI Prudential - 20000

3. Reliance Mutual fund - 20000

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The rosy picture that was painted suggested that I would be richer by 6-10 lakhs in three years time.Since the lock in period was three years, over the three year period from 2008-10 I had invested 1.80 lakh. So far so good. My wife who is less educated than me but is more shrewd in money matters consulted her friend and came to the realization that we should open a de-mat account and invest directly in the equity market shares every month and let it stay there for long term benefits. Her friend had advised her not to pin high hopes on mutual funds, pension plans and ULIPs. I ignored her advice.

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I resigned my job in 2008 and joined another company where I was not able to survive the probation period and from Oct 08 to Jan 10, I was without a job. In Jan 10 I got a job and was paid for six months and ever since I have not been paid my salary. But things are improving and I will start getting my salary from February.

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Fast forwarding to 2010 . It is the month of January again. I have no money to invest in my mutual funds , pension plans. I have no income, so where is the question of 80CC exemption.I decided to visit my financial partners ICICI Prudential , Reliance Mutual Fund and Fidelity to see what is my current investment worth after 3 years.

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The current investment is listed below.

Name ............Inv amt..... Curr. value...... Surrender value after 3 yrs

1.ICCI Prudential.....60000.... 66000.....61000( 92% of current value approx.)

2. Reliance Mutual fund ......60000......56000....53000 (95% of current value)

3. Fidelity ...................60000 .......56000 ...yet to redeem.

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I have made the redemption request for the first two and should have the 1.14 lacs in two weeks time. Fidelity, I have a few change of bank address issues and will be able to submit my redemption request after 2 weeks.

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I am not sure if the value is going to remain at 56 k or fall further. I don't know if I should spend this money and hope for the best. My wife is still hopeful and I have started listening to her advice. I want to meet that friend of hers who suddenly seems so wise.I have decided to open a de-mat account.

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I am closing in on the half century stage . I am hopeful that I will earn for another 20 years and be able to survive and look after my family of four.

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I have one simple question for the cos. mentioned above ' Are you guys so incompetent that you cannot show a growth of 15% per annum for 3 years, What do you do with the money invested by people like me ?

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