After every 2 months RBI (Reserve Bank Of India) has its monetary policy. In the monetary policy the RBI decides to either retain or cut the repo and reverse repo rates for the banks, depending on various factors like inflation, credit scenarios, liquidity etc. When the RBI cuts the repo rates, the banks also sub-sequently cuts their interest rates of loans (like home loan, personal loan, education loan, vehicle loans etc) thus they become cheaper to avail for the general public. Hence it sort of boosts the economy. But to stay in business, banks also cut the interest rates of fixed deposits and saving accounts. Interest rates on saving and FD's has fallen from 12% per annum to 7.25% per annum on an average. Today if you think depositing your funds in FD's, the post tax and inflation adjusted returns are nothing but peanuts. Various debt funds prove to be effective asset class in this scenario. They have out performed FD as asset class by giving 8.50% to as high as 12% per...

He was 30. He decided to take a loan and buy a house like the rest of his friends. For the next twenty years he paid an EMI of Rs.50000.However, this EMI of his became an impediment in his investment path and because he failed to do an SIP. After 20 years, he at 50 is without a job. He lives in the same house and can’t sell it. Life has come a full circle as he stands at the crossroads of life wondering what to do. A wife, parents and two children with just a house to live and a few lakhs in the bank with a long life ahead. These are those rare moments when one wishes for a shorter life. As he stood there wondering what went wrong, he could see something very clearly. “His EMI had hurt his progress?” Had he lived in a rented house which in those days would have cost him Rs 20,000 and had he invested the balance Rs 30,000 in an SIP instead, the wealth he would have made would have been Rs 6 cr. instead of the few lakhs that he currently had. Even if he were to li...