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By:

Kaustubh Kale

10 September 2024 at 6:07:15 pm

Four Methods to Choose Investment

One of the most common questions investors ask is: “Which investment should I choose?” The real answer is that no investment is good or bad in isolation. A simple way to judge any investment is the RRLT framework - Risk, Return, Liquidity and Time Period. Before investing in any product, all four factors should be seen together. 1. Return Return is the reward you expect from the investment. It may come in the form of interest, dividend, capital appreciation or regular income. Naturally, every...

Four Methods to Choose Investment

One of the most common questions investors ask is: “Which investment should I choose?” The real answer is that no investment is good or bad in isolation. A simple way to judge any investment is the RRLT framework - Risk, Return, Liquidity and Time Period. Before investing in any product, all four factors should be seen together. 1. Return Return is the reward you expect from the investment. It may come in the form of interest, dividend, capital appreciation or regular income. Naturally, every investor wants good returns. However, return should be understood properly. It is important to look at the real intrinsic / internal rate of return (IRR) of every investment, especially when cash flows happen at different points of time. A product may sound attractive on the surface, but the actual return may be very different when calculated correctly. 2. Risk Risk is the possibility of losing money whether partially, fully, temporarily or permanently. In some investments, the risk is very low. In others, the value may fluctuate significantly in the short term. Direct stocks, equity mutual funds, gold and real estate can create wealth over time, but they need patience and the ability to tolerate ups and downs. On the other hand, fixed income products may offer stability, but they may not beat inflation over the long term. 3. Liquidity Liquidity means how easily you can convert your investment back into money when required. A savings account is highly liquid. Fixed deposits, mutual funds and stocks are reasonably liquid. Real estate may take time to sell. Liquidity matters because emergencies do not come with advance notice. Before chasing returns, every investor must ensure that enough money is available in liquid instruments for short-term needs and emergencies. 4. Time Period Time Period is the most important filter. The investment product should be selected based on when you need the money. If the money is needed within a few months or one to two years, safety and liquidity matter more than high returns. If the goal is ten, fifteen or twenty years away, growth-oriented assets like equity mutual funds, direct stocks and gold-related instruments can play a larger role. The longer the time horizon, the better your ability to handle short-term volatility. Goal-Based Planning This is where proper financial planning becomes useful. Make a table of your financial goals - home purchase, car, vacation, child education, child’s marriage and retirement. Write the amount required, adjust it for inflation and mention the time left for each goal. Once this is clear, choosing the right investment becomes easier. Investment Avenues Broadly, investment avenues can be divided into two categories - those that help beat inflation and those that mainly provide stability. Equities, equity mutual funds, gold and real estate help in long-term wealth creation by beating inflation. Your long-term financial goals should ideally be invested in this bucket - the one that helps your money grow faster than inflation. For your short-term goals, rely more on bank fixed deposits, recurring deposits, and debt mutual funds. Here, safety and availability of money are more important than high returns. A good investment is not the one that sounds exciting. A good investment is the one that fits your goal. So before investing anywhere, remember RRLT - Risk, Return, Liquidity and Time Period. When these four are aligned with your financial goal, investment decisions become much clearer. (The writer is Chartered Accountant and CFA (USA). Financial advisor. Views personal. He could be reached on 9833133605)

Nurturing Changemakers

The nine days of Navratri celebrate goddesses who embody strength in different forms; valour, compassion, creativity, austerity, devotion, justice, protection, forgiveness and wisdom. In our annual Navratri series, we celebrate the lives of nine women who strive to build happy and safe spaces for themselves and those around them.


Part - 4

 

Name: Sunanda Pawar | Where: Baramati, Maharashtra
Name: Sunanda Pawar | Where: Baramati, Maharashtra

In a world where progress often tends to be measured in terms of economics and infrastructure, there are leaders who redefine development through care, compassion, and human growth. One such leader is Sunanda Pawar who has spent over five decades as a driving force for rural development and women’s empowerment in Maharashtra. As Trustee of the Agricultural Development Trust (ADT), Baramati, she has combined vision, compassion, and practical action to transform the lives of women, especially those from farming communities. Her approach is rooted in nurturing—ensuring that women are not only educated and skilled, but also confident, independent, and respected.


Sunanda’s work is rooted in the understanding that women are the backbone of families and communities and, yet, their potential remains untapped due to lack of access or opportunity.


Her approach has been nurturing—ensuring that women are not merely given aid, but are encouraged to discover their own strengths. Through initiatives spanning education, skill development, health, and social awareness, she has built a quiet revolution—one that uplifts women not just economically, but emotionally and socially as well.


Sunanda’s journey began in 1971 with the ADT where she saw firsthand the lack of opportunities for rural women. Recognizing that education is the cornerstone of empowerment, she spearheaded the establishment of a women’s educational complex in Sharadanagar, Baramati, in 1989. Today, this institution educates more than 6,000 girls from 15 districts across Maharashtra, offering them a chance to dream bigger and achieve more.


In 2006, she founded Sharda Mahila Sangh, a platform to organize and empower women’s self-help groups. Through more than 100 training programs, over 3,000 rural women have received skills in agriculture, food processing, tailoring, computer literacy, driving, and more. By forging partnerships—such as an MoU with Women on Wings from the Netherlands—she ensured that women not only gained skills but also access to markets, packaging expertise, and entrepreneurial confidence.


Perhaps one of her most impactful contributions has been the creation of Bhimthadi Jatra, a national-level exhibition for women entrepreneurs and self-help groups. Over the last decade, it has showcased products from more than 3,000 groups across India, generating revenues of ₹19 crore. This initiative not only provided financial independence but also celebrated women’s creativity and enterprise on a large stage.


Her nurturing spirit extends to young women aspiring for public service. In 2006, under her guidance, ADT established a Police Training Academy for rural girls. The academy has trained nearly 900 girls, with over 540 securing placements in the Maharashtra Police and several in national services like the CRPF—an extraordinary achievement for those once denied opportunities.


Beyond education and livelihood, Sunanda has been a champion of women’s health and dignity. She has led large-scale menstrual health initiatives, training Anganwadi and ASHA workers and reaching over 15,000 girls and women in Baramati alone. With a goal of impacting one lakh women, this programme is breaking taboos, ensuring hygiene, and enabling young girls to continue education without interruption.


With a focus on education, Sunanda nurtures rural girls with guidance on education, culture, and competitive exams through the Swayamsiddha initiative. With Let’s Create Prosperous Villages, she has worked on water harvesting, sanitation, solar energy, and organic farming, helping villages build resilience against droughts and climate challenges. Medical camps, eye surgeries, and sanitation drives further underline her holistic vision of welfare.


For her tireless work spanning five decades, Sunanda has been honored with numerous awards, including the Jijamata Krushi Bhushan Award (2009), Mahila Bhushan Award (2013), and Jeevan Gaurav Award (2015). Yet, her true legacy lies in the countless women she has nurtured into confident change-makers.


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