A couple of days back, one of the leading financial newspapers had a detailed article on the captioned subject including the method to calculate your required retirement corpus. One of my very close friends did so and was shocked to find that for her the amount worked out to be close to Rs 6 crores; far more than what she had expected. With this revelation comes the next worry – of finding some way to save this amount.
Let us understand this in detail.
Mr. Rao recently invested Rs 2,00,000/- in the dividend option of a equity scheme of a leading mutual fund house on the suggestion of his financial advisor. Some days back, he got an sms from the mutual fund informing him that a 60% dividend had been declared on the mutual fund scheme and would be credited into his a/c in a few days. Mr. Rao was very happy to hear this and was glad to have made the right investment decision and receive a huge tax free dividend.
A few days later the dividend was credited to his a/c. He was shocked to see the amount. It was around Rs. 12,000/- which was hardly 6 % of his investment amount. He was unable to understand how a 60 % dividend declared could be such a small sum.