Why voting is important for Franklin Templeton Investors

Franklin Templeton evoting on 26th December 2020 – Why voting is important for Investors

Imagine having money but not being able to withdraw it for emergencies or daily essentials.

That’s exactly what investors of Franklin Templeton have gone through in 2020. Not just them, the management too has been in distress and are looking for a solution to solve this crisis.

Here’s what transpired in April 2020:

Franklin Templeton Mutual Fund publicly announced that they wish to wind up 6 credit-focused debt schemes. This was not taken lightly and the issue reached court doors.

Due to the matter reaching court along with lockdown, the winding-up got delayed. But now investors get a chance to vote and decide the fate of those schemes.

Initial Voting Date – 26th-28th December (1st round)

Alloted Voting Time – 9 am (26th Dec) to 6 pm (28th Dec)

First Voting results – Undecided

Voting enrollment – Visit https://evoting.kfintech.com and cast your vote

First round Voting counting – In January 2021

Why voting is important?

Remote e voting is of the essence as the management of Franklin Templeton mutual fund can understand what the investors want. Here are the 6 schemes in question:

1. Franklin India Ultra Short Bond Fund

2. Franklin India Short Term Income Plan

3. Franklin India Credit Risk Fund

4. Franklin India Low Duration Fund

5. Franklin India Dynamic Accrual Fund

6. Franklin India Income Opportunities Fund

From April 2020 to November 2020 these 6 schemes under winding up have received over 11,576 crores from coupons, maturities, and pre-payments. The schemes have been faring well and hence investors are looking to redeem them immediately.

There are 2 scenarios post voting:

YES – If the investors vote for “YES” then as per Regulation 41, they allow the management of Franklin Templeton to decide on the redemption of funds. The trustees can do it themselves or authorize an independent consultant to plan and sell. There will be no need to make a distress sale immediately.

NO – If the investors vote for “NO” then as per rules, the funds will be reopened for investors to redeem or to make new purchases. As many investors want to withdraw their funds, there will be distress selling and the scheme will incur high losses.

Meeting on 29th – Investors can ask Trustees about this decision for the first time since April 2020. Voting will also be allowed in this meeting. Also, the trustees will ask the investors if they want to authorize the trustees to go ahead with the winding-up themselves or want to allow an independent consultant Deloitte to do the deed.

When will investors get their money back?

Please understand that you won’t get your money back in one shot. The redemption of your money will be made in timely installments. Only cash positive schemes (in profit) will be allowed to redeem.

The next round of hearings at the Supreme Court will resume in the 3rd week of January 2021. The results of evoting will be sent in a sealed cover to the court. A decision will be made accordingly.

You can also read – How to create wealth in India within 15 years

After this, the second round of voting will take place to give the investor’s approval for the authorized person to make the selling/redemption.

I believe, voting “YES” will allow you as investors to get the best out of your schemes. If they are sold via a distress sale, then it’s possible you might have to settle with lower or no profits. So vote accordingly.

How to create wealth in India

How to create wealth in India within 15 years

Imagine this – You and your friend are celebrating 30 years of friendship. Both of you are retired, children working abroad, and you’re living your retirement days.

You are disappointed today as your child hasn’t sent you money for this month but your friend is happy. You get shocked to know that he hasn’t asked for money from his child.

Do you know why he doesn’t need to do that?

It’s because your friend started creating wealth at an early age and hence is in a position today where he is enjoying his retirement.

This is the story of many parents who spent everything to educate kids, get them settled, but now have no savings. Hence every month they have to ask their children for money. No parent likes that.

Hence I came up with a solution where you’ll understand “How to create wealth in India within 15 years”.

But before that let’s understand what the meaning of wealth is?

Wealth in simple words is a lot of money, property, and other assets that a person owns. Yes, the total value of all assets that you own (property, savings, and investments) minus all debts will tell you how much wealth you have.

You can also read – How to invest for Long Term and accumulate wealth

Why is wealth creation important?

Wealth creation is a long process and the more time you give, the better it is for you. Investing for 3 years can give you a decent amount but investing for 10-20 years will amplify your savings to a point that you will be self-sufficient.

Also, with each year, expenses are increasing at a faster pace than income earned. If you don’t have an investment plan for your life after retirement, then it will get difficult. Also, the cost of raising children in a country like India is increasing as education expenses have taken a steady hike.

Hence, wealth creation not only helps you be ready for life after retirement but also allows you to retire early.

How to create wealth from nothing?

Yes, you’ve read it right. You can start with as little as 100 rupees too. Here are some investments where you can start your wealth creation plan.

1) SIP’s in mutual funds that will let you grow your income at a risk free pace.

2) Stock market equity funds that are riskier but can provide higher returns.

3) NPS – National pension scheme that allows you to invest until your retirement age of 60 and then get a lump sum amount with interest.

4) PPF – Public provident fund which is risk-free, gives higher interest than fixed deposits and can be kept up to 15 years.

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There are many more avenues of investments like cryptocurrency, property investments, Debt funds, and many more. You can try them out too.

Overall, I added investments that have time and again delivered the best of results and returns. So you can check any of these options and invest accordingly.

Through this you will finally understand “How to create wealth in India within 15 years.

Invest for long term

How to Invest for Long Term and accumulate wealth in 10-15 years

Retirement age in India is somewhere between 58 and 65. While this is the ideal age, people today are looking to retire early before 50 so they can chill and enjoy their life. The only way one can do so is with a huge retirement fund.

Do you want to know how you can create the best retirement investment plan? Well, you’ve come to the right place as I will give you the 3 best invest options in India.

With these, you can invest for long term and accumulate wealth within 10-15 years.

Now, I know how difficult it is to save money in today’s time. But it’s equally important to invest today if you want a better tomorrow. You can

  • Invest in Gold
  • Invest in real estate
  • Invest in mutual funds
  • Invest in stock market
  • Invest in NPS
  • Invest in equity
  • Invest in PPF, etc.

While there are so many options to choose from, I will make it simple for you with 3 options that I feel will work wonders to accumulate your wealth.

1. Invest in PPF:

Public Provident Fund is one of the oldest options in this list. People turn to this to invest for the long term up to 15 years. With an interest rate that has always been above 7% and the power of compounding, you can accumulate a lot of wealth.

Situation 1 – If you invest 75,000 per year for 15 years @ 7.1% interest,

Your Total investment amount – 11,25,000

Total Interest amount – 9,09,105

PPF amount after 15 years – 20,34,105

Situation 2 – Also, if you invest 1,50,000 per year for 15 years @ 7.1% interest,

Total investment amount – 22,50,000

Total Interest amount – 18,18,209

Your PPF amount after 15 years – 40,68,209

Hence you can save anywhere between 20 and 40 lakhs for your retirement within 15 years. So start planning! P.S – I have considered only 7.1% as the overall interest rate but PPF rates are revised every now and then. So you can expect a hike in the rates too.

Click here to check calculation – Retirement planning calculator using PPF

2. Invest in NPS:

NPS also called the National Pension System is an initiative by the Pension Fund Regulatory and Development Authority (PFRDA).

Also known as the longest form of investment, you can invest in this until your retirement age of 60. However, the current rate of interest ranges between 9 to 12%*.

Situation 1 – If your current age is 30 and the retirement age is 60, this means you can invest in NPS for 30 years. If you invest 75,000 per year for 30 years @ 9% interest,

Your Total investment amount – 22.5 lakhs

Total Interest amount – 88.93 lakhs

Total retirement amount – 1 crore 11 lakhs

Situation 2 – Also, if your current age is 30 and the retirement age is 60, this means you can invest in NPS for 30 years. If you invest 1,50,000 per year for 30 years @ 9% interest,

Your Total invested amount – 45 lakhs

Overall Interest amount – 1 crore 78 lakhs

Finally, Total retirement amount – 2 crores 23 lakhs

However, There is another way you can use NPS. If you wish to get 1 crore rupees in your account at your retirement age of 60, you can calculate that too.

Investment goal at 60 years – 1 crore

Your current age – 30

How much will I need to invest every year – 67,306

You can also read – Safe investments with High returns in India

3. Invest in Mutual Funds:

Also, an option that needs no introduction, Mutual funds have proven to be one of the best investments. Using SIP, you can invest directly in mutual funds and witness the power of compounding.

Situation 1 – If you invest 75,000 per year for 15 years @ 9% interest,

Your Total investment amount – 11,25,000

Overall Interest amount – 12,57,774

Finally, Total PPF amount after 15 years – 23,82,774

Situation 2 – However, If you invest 1,50,000 per year for 15 years @ 9% interest,

Your Total investment amount – 22,50,000

Total Interest amount – 25,15,548

Finally, Total PPF amount after 15 years – 47,65,548

Consolation options – Also, There are other investment options like Real Estate, Gold, and Stock Market. You can opt for these too.

In conclusion, If you can understand how much retirement money you need, planning for retirement will become easier. I hope this post helps you invest for long term and plan for a better future.

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