explore youe reasons and benefits for selecting a particular bond , you have just inherited 30,000...

explore youe reasons and benefits for selecting a particular bond , you have just inherited 30,000 and would like to invest the loney in a conservative investment as you prepare for retirement ten years from now . describe the factors you woukd consider in evaluating a mutal fund investment

Solutions

Expert Solution

If I stand to retire 10 years from now and I inherited 30,000, I woudl invest it in conservative mutual funds i.e either Debt mutual funds or Balanced Mutual funds.

Benefits for investing in Debt based Mutual funds:

1. My capital is protected. Money would be re-invested by mutual fund companies in debentures or bonds that pays return in the form of interest. Hence, Capital is not disturbed as in case of equities.

2. Liquidity: Unlike Fixed Deposits, money is liquid and can be withdrawn anytime when required. There can be a lock-in period but lock-in period would be limited to 1 year to 3 years depending upon scheme.

3. Tax Benefits: In long term, these provide more tax benefits than fixed deposits. Holding funds for more than one year would make your investment liable for long term capital gains, you can avail indexation benefits for long term fund investments.

4. Systematic Withdrawl Plans: Since you would be at retirement age after 10 years, you can schedule systematic investment plan to meet your monthly expenditure.

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

Case: You have just inherited a large sum of money and you are trying to determine...

Case: You have just inherited a large sum of money and you are trying to determine how much you will get after retirement and how much you can spend now. For retirement you will deposit today (January 1,2015) 2,500,000 euros in a bank account paying 4.55% compounded annually. You do not plan on touching this deposit until you retire in five years (January 1, 2020) and you plan on living for 20 additional years and then drop dead on December...

You have just inherited $590,000. You plan to save this money and continue to live off...

You have just inherited $590,000. You plan to save this money and continue to live off the money that you are earning in your current job. If you can invest the money in a bond that pays 4.03 percent interest annually, how long will it be before your inheritance is worth $1 million? (If you solve this problem with algebra round intermediate calculations to 5 decimal places, in all cases round your final answer to 2 decimal places, e.g. 8.72.)...

You have just inherited $100,000 tax free. You have three options. Invest in a savings account...

You have just inherited $100,000 tax free. You have three options. Invest in a savings account at your local bank at 1% annual return. Invest the the S&P 500 with an anticipated return of 12% annual return, though there is always some risk as the past is not always an indication of the future.. Invest in your business with an anticipated return of 24%, but with moderate risk due to the changing business environment. Which option would you pursue and...

You have just inherited $1,000,000 and are considering a number of investment options. Among the investment...

You have just inherited $1,000,000 and are considering a number of investment options. Among the investment projects offered you there is a service/gas station whose present owner is asking exactly $1,000,000 for it. The information he has provided you indicates that the sales and the expenses of the station have been relatively stable for the past 10 years. In fact, the present owner claims that he is so confident about the performance of the station that he is willing to...

What reasons do you have to choose a particular mass or avoid it? a. Use: The...

What reasons do you have to choose a particular mass or avoid it? a. Use: The center of mass in a free rotation problem. b. Use: The fixed point in a rotational problem. c. Use: The point were the largest force is applied. d. Avoid: The axis of the net force. e. Avoid: The line of zero angular momentum Note: There can be more than one answer.

Congratulations! You have just inherited 250 acres of land in south Texas. An oil company approached...

Congratulations! You have just inherited 250 acres of land in south Texas. An oil company approached you and offered you a one 1/2 percent (0.005) royalty for the rights to your oil. Given the following information, answer the questions below. Size = 250 acres Porosity of oil zone rock = 20 % Recoverable Oil = 30 % You do not need to consider the cost of the wells. Thickness of oil zone = 20 feet Oil saturation in pores =...

Benefits of QuickBooks Now that you have just about completed the course what overall benefits do...

Benefits of QuickBooks Now that you have just about completed the course what overall benefits do you see QuickBooks can provide to a business. What types/sizes of businesses will benefit from using QuickBooks? Explain as if you were presenting to a business owner encouraging them to purchase and use QuickBooks. Explain in depth

Suppose a particular test of cognitive ability has been found to have great practicality in selecting...

Suppose a particular test of cognitive ability has been found to have great practicality in selecting members of a high school debate team. How much practicality would this same test have for the following situations? Law school application Art school application A police hostage negotiation unit Executive level positions in a labour union Actors in a theme park who spend their day dressed in a character costume

You have just inherited $590,000. You plan to save this money and continue to live off the money that you are earning in your current job.

Imagine that a client has just inherited $100,000 and is considering investing in the company you...

Imagine that a client has just inherited $100,000 and is considering investing in the company you have analyzed by purchasing common stock. What is your recommendation ? The company has improved cash flow compared to last year. Buy or pass? Buy. Why? Explain in 150 to 200 words.

Subjects