Moneylife Foundation and Sanjay Nirupam, member of parliament from North Mumbai, on Sunday organised an educative and interactive seminar on "How to be Safe and Smart with your money" for investors in the constituency.
Founder-Trustees of Moneylife Foundation and veteran financial journalists, Sucheta Dalal and Debashis Basu, addressed the seminar, attended by over 400 people.
During the past few years, India's investor population fell to 80 lakh from 2 crore. According to CMIE, even the mutual fund investment is restricted to just 20 lakh households.
North Mumbai has a large population of small investors whose livelihood depends a great deal on various financial products. However, many a times these small investors end up losing money due to wrong investment decisions or falling prey to a variety of frauds.
"Such investors will have to come together to have a voice," said Ms Dalal. Moneylife Foundation is a step toward this as in just six months since its launch, has more than 2,500 members and the numbers are growing every day. The Foundation offers free membership to all investors. Its core activities include investor education, financial literacy and advocacy.
These days many people are investing their hard-earned money into gold or gold related products, thinking that they will get more return. Mr Basu, the Editor and Publisher of Moneylife magazine, said that gold, which has become the biggest fad these days, is hugely risky at a time when it has reached incredible highs and the rupee is no longer depreciating.
Speaking about investment in real estate, Mr Basu explained that such investment is a good saving, only if you live in it. However as an investment, it is highly risky and much too expensive with other costs like stamp duty, registration and transfer charges, which are high as 8% to 10% of the total cost, he said.
Speaking about keeping one's money safe, Ms Dalal, who is also Managing Editor of Moneylife-the Personal Finance Magazine, said that there are a variety of frauds like chain and pyramid marketing schemes, high credit card costs, internet scams such as Nigerian scams, lottery scam that are taking away large chunk of savings. She also explained how these scamsters operate and advised investors to stay away from such frauds.
The implications of default and its impact on an individual’s credit history and ability to borrow was also discussed.
Many a times investors are lured by fast and big returns and opt out for short-term investment. To avoid such risks, investors should think about long term and fix goals accordingly, said Mr Basu. He showed how one could keep things simple, avoid complications and make steady returns without becoming an expert on markets.
The presentations were followed by a very lively question and answers session. — Moneylife Digital Team