Name - Pratibha Mishra

Roll No. - 20222937

B.A. (H) Economics (1st year)

Q. Prepare 5 savings plans and evaluate them on the factors mentioned below:
● Risk
● Liquidity
● Rate of return
● Inflation
● Restrictions and fees

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Assuming the monthly income as 1,00,000. Computing returns after 15 years.

1. First Plan

Channels Amount (Monthly) Returns

Systematic Investment Plan 40,000 2,05,73,821 (12.2%)

(SIP)

Public Provident Fund (PPF) 12,500 40,68,209 (7.1%)

Savings Account 20,000 45,50,802 (3%)

Life Insurance 5000 -

Health Insurance 2000 -

Other Expenses 20,500 -

Total 1,00,000

❖ This is not a high risk plan.

❖ Liquidity is high.
❖ The rate of return would be average if not high.
❖ A fee of 100 rupees is to be paid if SIP exceeds the value of 10,000.
❖ There is an emergency fund in this plan.
 2. Second Plan

Channels Amount (Monthly) Returns

SIP 45,000 1,33,81,071 (6.1%)

PPF 10,000 2,71,214 (7.1%)

Fixed Deposit 20,000 61,57,112 (6.6%)

Life Insurance 6000 -

Health Insurance 3000 -

Other Expenses 16000 -

Total 1,00,000

❖ This is a high risk plan as a big part of the income is invested in SIP.
❖ The overall liquidity is moderate.
❖ The rate of return would be high.
❖ Inflation could prove to be an undesirable situation.

3. Third Plan

Channels Amount (Monthly) Returns

SIP 30,000 1,35,09,182 (10.84%)

PPF 7000 1,89,850 (7.1 %)

Fixed Deposit 25,000 76,96,391 (6.6%)

Savings Account 20,000 45,50,802 (3%)

Health Insurance 5000 -

Life Insurance 3000 -

Other Expenses 10,000 -

Total 1,00,000

❖ This is a moderately risky plan.

❖ Liquidity is moderate.
 ❖ Rate of return is less.
❖ Moving hand-in-hand with inflation.

4. Fourth Plan

Channels Amount (Monthly) Returns

SIP 40,000 2,05,73,821 (12.2%)

PPF 6000 1,62,728 (7.1%)

Government Bond (SBI 30,000 1,04,50,354 (8%)

Magnum Gilt Fund)

Health Insurance 2000 -

Life Insurance 2000 -

Other Expenses 20,000 -

Total 1,00,000

❖ This is a risky plan.

❖ Liquidity is almost none.
❖ Rate of return is high.
❖ This plan enables to stay hand-in-hand with Inflation.

5. Fifth Plan

Channels Amount (Monthly) Returns

SIP 35,000 1,58,20,045 (10.84%)

PPF 10,500 2,84,775 (7.1%)

Savings Account 20,000 45,50,802 (3%)

Government Bonds 20,000 69,66,903 (8%)

Health Insurance 1000 -

Life Insurance 2000 -

Other Expenses 11,500 -

Total 1,00,000

❖ This is a moderately risky plan.

❖ Liquidity is less.
❖ Rate of return is also moderate.
❖ This plan stays behind inflation.