RETIREMENT SAVINGS FUND - Presenting An open-ended retirement solution oriented scheme having a lock-in of 5 years or till retirement age ...

Page created by Raul Johnson
 
CONTINUE READING
RETIREMENT SAVINGS FUND - Presenting An open-ended retirement solution oriented scheme having a lock-in of 5 years or till retirement age ...
Presenting

                                         RETIREMENT SAVINGS FUND
                                         ( An op e n- e nd e d reti re me nt sol u ti on orie nte d sche me
                                         hav ing a l ock- in of 5 ye ars or ti l l reti re me nt age
                                         (w hicheve r is e arl ie r) )

NFO Period: 29 th Nov - 13 th Dec 2019
RETIREMENT SAVINGS FUND - Presenting An open-ended retirement solution oriented scheme having a lock-in of 5 years or till retirement age ...
What does retirement mean to you?
Happy, Healthy & Wealthy

                        19, F                                                       58, F
                                                       35, F
                        Having enough money to do                                   To stay healthy and do what I
                        the things I want – travel,    To be able to shop without   feel like without worrying
                        start a new career, etc.       checking the price tag.      about money.

                                                       41, M                        56, M
                        25, M
                                                       To be the master of          To do what I want (travel)
                        To be financially free and
                                                       my own time.                 instead of what I am
                        healthy to enjoy the wealth.
                                                                                    supposed to do.

Source: Axis MF Internal Research                                                                                1
RETIREMENT SAVINGS FUND - Presenting An open-ended retirement solution oriented scheme having a lock-in of 5 years or till retirement age ...
What are the typical retirement fears?
48% people worldwide are scared that their corpus will not suffice

                                                                          Difficulty to meet                              Feeling isolated and
                    Declining                                            basic financial needs                                dependent
                     health

                                                       Being laid off                            Financial compromises
                                                         abruptly

Source: Transamerica Centre – Retirement Studies. Data as on Dec 2018.                                                                         2
RETIREMENT SAVINGS FUND - Presenting An open-ended retirement solution oriented scheme having a lock-in of 5 years or till retirement age ...
Life expectancy is increasing
While people want to retire earlier

75                            Life expectancy at birth (years)
                                                                                    The 80+ population has nearly
70
                                                                                    tripled globally over the past
                                                                                    30 years and stands at
65                                                                                  143 million in 2019.

60

55                                                                                      It is expected to further triple to
                                                                                        426 million by 2050 and double
50                                                                                      to 881 million by 2100.

45

40
     1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
                                                India           World

Source: UN World Population Prospects 2019, World Bank. Data as on 31st Mar 2019.                                             3
Typical challenges are here to stay
Manage one’s income in working years for comfortable non-working years

            18-29 yrs                   30-59 yrs                          60+ yrs
            Young Age                   Middle Age                         Old Age

                Education                                                Post Retirement
                                            Wedding
                                                                         Sustenance

                Savings                     Children’s                   Emergency Medical
                                            Education                    Expense

                                            Children’s
                                            Wedding

                                                                                             4
You will retire, but inflation won’t!

     Savings is not investing                                         Savings does not grow money.
                                                                      Investing does.
     Assuming inflation at 5%,
     `1 lakh saved today will be worth only
     `61,391 after 10 years.

     What you can buy today for `1 lakh will
     cost `1.63 lakhs 10 years later.

Above figures and assumptions are strictly for illustration purpose.                                  5
Cost of living is rising rapidly
Are you ready for it?

                Movie ticket                                        Petrol/Diesel         Milk                Rice
                 prices have                                         prices have      prices have      prices have tripled
              increased 5-10x                                      increased 2-3x   doubled over the    in last 15 years
               in last 20 years                                      in 15 years      last 5 years

Source: Axis MF Internal Research, data.gov.in. Data as on 31st Dec 2018.                                                    6
Maintaining health has become an expensive affair

                                                   Health Insurance
                                                   Premium Collection ($ bn)                                5.9

            63 million people fall into poverty                                                     4.8

            each year due to lack of financial                                               4.1

            protection for medical needs
                                                                                    3.6                             3.5

                                                           2.8      2.9     2.9
                                                    2.4
            50% of beneficiaries travel more than
            100 kms to access quality care

                                                   FY 11   Fy 12   FY 13   FY 14   FY 15   FY 16   FY 17   FY 18   FY 19*

Source: ibef.org. Data as on 30th Sep 2019                                                                                  7
Deciding retirement corpus is critical
Inflation will impact monthly expenses

                             6.00                       If you were to retire today

                             5.00                                                                                                                 The earlier you plan to retire, the
                                                                                                                                                  bigger the size of corpus required
Retirement corpus (Rs crs)

                             4.00

                             3.00                                                                                                                 Risk appetite reduces as you near
                                                                                                                                                  the retirement age
                             2.00

                                                                                                                                                  Staying financially disciplined post
                             1.00
                                                                 `1cr corpus will
                                                                 serve for 20 years
                                                                                      `1.5 crs corpus will
                                                                                      serve for 34 years
                                                                                                                     `2 crs corpus will
                                                                                                                     serve for 54 years
                                                                                                                                                  retirement gives more predictability
                             0.00
                                    0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54
                                                                         Years

                                           Corpus @ `1crs       Corpus @ `1.5 crs      Corpus @ `2 crs

Above figures and assumptions are strictly for illustration purpose and does not indicate any future returns. Assumptions: If you were to retire
today with a set corpus, Monthly expense: `50,000 (increasing at an inflation rate of 5%) Retirement Corpus growing at 7% interest rate.
The effect of taxation is not considered.                                                                                                                                                8
So, how prepared are you for retirement?
Key things to consider:

          PRE-RETIREMENT                         POST-RETIREMENT
          Find the right investment product(s)   Be aware of your risk appetite

          Map your investment goals              Decide a reasonable withdrawal rate

          Stay disciplined                       Stay disciplined

          Don’t attempt to time the market       Adjust the withdrawal rate based on
                                                 investment return/real rate
          Adjust your risk appetite with age

                                                                                       9
YOU’LL LIVE LONGER THAN YOU THINK.
WILL YOUR MONEY LAST AS LONG?
                                                                  Presenting

In India, modern medicine has increased life
expectancy by 47% over the last 50 years*.                        RETIREMENT SAVINGS FUND
Have you planned your future accordingly?                         (An o pe n-e nde d retire me nt so lu tio n o r i e nte d sche m e h av in g
                                                                  a lo ck-i n of 5 ye a rs o r till retire me nt a ge (w hi cheve r is earl ier) )

*Source: United Nations Population Fund Report dated April 2019                                                                                  10
Product Construct
The fund aims to help investors with their retirement planning

                                                                 Ideal for young investors
           Aggressive Plan
                                                                 in the early stages of their careers

                                                                 Ideal for 35-45 year old investors
           Dynamic Plan
                                                                 with financial responsibilities

                                                                 Ideal for investors about to
           Conservative Plan
                                                                 enter their retirement years

                                                                                                        11
Product Construct

                      Aggressive Plan                                                         Dynamic Plan    Conservative Plan
                      Equity exposure                                               Equity exposure 65-100,      40-80% debt
                         65-80%.                                                       will be through a          exposure in
                    Rest spread across                                              combination of Hedged &       high quality
                    other asset classes*                                             Unhedged equity. Rest     debt instruments,
                                                                                         spread across            20-40% in
                                                                                      other asset classes*     Equity exposure.

Default retirement age: 58 years. Please refer to SID for detailed investment strategy and asset allocation
* Other asset classes include Debt & Money Market Instruments, Gold ETF and REITs & InvITs.                                        12
Equity Investment Approach

               Risk return tradeoff is likely to be
               favourable over the medium term

               Good ideas can do better irrespective of
               their sector/theme/size

               Focus on fast growing sectors with
               bottom-up stock picking approach

*Investment focus is based on current market outlook and is subject to fund manager
discretion. Investors are advised to refer SID for investment strategy of the scheme   13
Debt Investment Approach

                    The portfolio duration and credit exposures
                    will be decided based on thorough research

                    Flexibility to invest in the entire range of debt
                    instruments across credit/duration spectrum

                    Active duration management

*Investment focus is based on current market outlook and is subject to fund manager
discretion. Investors are advised to refer SID for investment strategy of the scheme   14
Apply disciplined approach to investing
Trying to pick the top or bottom of markets is notoriously difficult

                                         Return (XIRR)                                                                       Regular investing helps ensure you don’t miss out on the best gains

                                                14.0%                             13.5%                                         15.9%                       Illustration
              12.8%
                                                                                                                                                     (Last 39 years in Sensex)
                                                                                                                                                12.9%

                                                                                                                                                                 9.0%

                                                                                                                                                                                4.6%

                                                                                                                                                                                                0.9%

      Invested `1,000 on                 Invested `1,000 on               Invested `1,000 on any
                                                                                                                             Fully invested Missed 10 bestMissed 30 bestMissed 60 bestMissed 90 best
     market high of every year          market low of every year         random date of every year
                                                                                                                                                 days          days          days          days
                                                                            (In this case, 1st Dec)

Past performance may or may not be sustained in future. Source of data: Bloomberg. SIP calculation are done based on monthly SIP (last day of the month). The returns are in XIRR. XIRR calculates the internal rate of return for
series of cash flows. Above chart/figures/data is for illustration purpose and does not indicate performance of any scheme. Data as on 31st Mar 2019. Data calculated based on S&P BSE Sensex Index; Source: Bloomberg.
Above chart/data is for illustration purpose and does not indicate performance of any scheme. In the above chart, missed ‘n’ best days refers to not staying invested to
capture ‘n’ best daily gains in the period from Jan 1980 to Mar 2018. Eg: Missed 10 days means Assuming daily return for the best 10 days (as per daily gains) as 0%.
Data as on 31st Mar 2019. Data calculated based on S&P BSE Sensex Index.
                                                                                                                                                                                                                                 15
A small delay can cost more
Start Early
And benefit from the Power of Compounding

    200.00                                                             SIP In S&P BSE Sensex for last 20 & 25 years
    180.00                                                                                                                                                      `1.7crs
                  Illustration:                                                                                                                                              Cost of
    160.00
                  Monthly SIP of `10,000                                                                                                                                     delay:
    140.00                                                                                                                                                                   `66lacs
                  Investor A: Investing since 25 years
    120.00        Investor B: Investing since 20 years                                   Investor A               Investor B                                       `1.1crs
    100.00

     80.00

     60.00

     40.00

     20.00

       0.00
                     Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year
                      0    1    2    3    4    5    6    7    8    9    10   11   12   13   14   15   16   17   18   19   20   21   22   23   24   25

Past performance may or may not be sustained in future. Source of data: Bloomberg. SIP calculation are done based on monthly SIP (last day of the month).
The returns are in XIRR. XIRR calculates the internal rate of return for series of cash flows Above chart/figures/data is for illustration purpose and does not
indicate performance of any scheme. Data as on 31st Mar 2019. Data calculated based on S&P BSE Sensex Index.                                                                           16
SECURE YOUR
INVESTMENT
GOALS,
NO MATTER
WHAT.
The Axis Retirement
Savings Fund
comes with the
exclusive provision
of iPlus SIP.
(An open-ended retirement solution oriented scheme having
a lock-in of 5 years or till retirement age (whichever is earlier))

                                                                      17
Complimentary insurance cover for long term SIPs*

         We ensure that      iPlus SIP is a special      In an unfortunate
          the investor’s    feature that provides      event of the demise
            planned             investors with          of the investor, the
          investments          complimentary          insurance cover will
        are taken care of      insurance cover         take care of unpaid
                              on long term SIPs         instalments of SIP
                                                           committed by
                                                            the investor

                                                                               18
A SIMPLE EXPLANATION

                   INVESTMENT
                     GOAL OF

                    12 L
`                                                `10,000/month x 10 yrs
                   `                       Mr Kumar starts a ʻiPlus SIPʼ for `10,000/- per month for 10 years.
                                           The life insurance aims to cover the residual component of his goal
                                           and gets activated after 12 successful instalments.

                                                                                                          Insurance

                                        `10,000 x 108 months                                             `10.8L
                                  After 12 SIP instalments, Mr. Kumar becomes eligible for
                                  insurance benefit equal to remaining SIP instalments.
                                  For every SIP instalment paid, the insurance coverage falls by the
                                  monthly SIP amount.

                                                           Mr Kumar's demise post Year 3

       GGOAL                                   In the case of Mr Kumar's unfortunate demise after 3 years, Insurance company will pay `8,40,000 to the
          OAL                                  registered nominee.
    ACAH
       CHIEV
         IEVEDED

                            Insurance                  Investment

                           `8.4L                       ` 3.6L                                                     (120-36 months) x `10,000

                                                                                                                                                         19
Let Axis lend you a helping hand with insurance cover

                                                                                             Commencement of
                        Eligibility                                                                                                                                     Termination of Cover
                                                                                              Insurance Cover
    • Resident individual investors aged                                          • Insurance will commence upon                                                 • Insurance cover lapses immediately
      above 18 years and not more than 51                                           investment of 12 successful SIP                                                upon reaching 55 years of age or if the
      years at the time of submission of SIP                                        instalments. The insurance cover will                                          investor misses 3 continuous SIP
      application.                                                                  be limited to the extent of the residual                                       payments, whichever is earlier.
    • Minimum tenure of SIP is 3 years at a                                         instalments of the SIP upto the age                                          • Partial or full redemption/switch-out
      monthly frequency.                                                            of 55 years subject to a maximum                                               of units purchased under Axis iPlus
                                                                                    of `50 lakhs.                                                                  SIP before completion of the
    • Minimum SIP amount of `1,000 per
      instalment                                                                                                                                                   mandated SIP tenure/instalments.

Some of the key Terms & Conditions are: 1) Only the first unit holder will be eligible for the insurance cover. 2) Nominee will not have any claim if the death of investor occurs before 12 payments of SIP are completed 3) The insurance
cover does not cover market related losses incurred on investment amount.
*Please refer to SID of the scheme for detailed terms and conditions on iPlus SIP facility.
The AMC is offering insurance cover to the investors under iPlus SIP as an additional Opt in facility in the interest of investor and is not acting as an insurance agent for marketing/sales of insurance policies. AMC is not intending/nor
soliciting sale of any insurance services/products. The discretion to obtain the Facility rests with the investor at the time of SIP application.
AMC/Trustee reserves the right to change/modify the terms & conditions.

                                                                                                                                                                                                                                    20
Key features of the fund

    Points                       Description

    Scheme Position              Solution Oriented Product aimed at investing for one’s retirement

    Fund Structure               Open-ended fund with 3 Plans: Aggressive, Dynamic & Conservative

    Lock In                      5 years from the date of allotment of units of the investment plan(s) under the scheme or
                                 till retirement age of unit holder (i.e. completion of 58 years), whichever is earlier

    Minimum Application Amount   First Application: `5,000 and in multiples of `1 thereafter.
                                 Additional Investment: `1,000 and in multiples of `1 thereafter.

    Exit Load                    Nil

    iPlus SIP                    Optionally available

                                                                                                                             21
Product Label & Riskometer
  Axis Retirement Savings Fund - Aggressive Plan                                                                                                 Riskometer
  This product is suitable for investors who are seeking*:
  • Capital appreciation over long term
  • Investments primarily in equity and equity related instruments                                                                                              M
                                                                                                                                            ly    Moderate       od
                                                                                                                                           e
                                                                                                                                        at                           er
  Axis Retirement Savings Fund - Dynamic Plan                                                                                        er                         Hi       at
                                                                                                                                   od     ow                        gh     el
                                                                                                                                                                              y
  This product is suitable for investors who are seeking*:                                                                       M      L
  • Capital appreciation and income generation over long term
  • Investment in equity and equity related instruments as well as debt and money
    market instruments while managing risk through active asset allocation.

                                                                                                                                                                                  Hig
                                                                                                                           Low

                                                                                                                                                                                   h
  Axis Retirement Savings Fund - Conservative Plan
  This product is suitable for investors who are seeking*:
                                                                                                                         LOW                                                      HIGH
  • Capital appreciation and income generation over long term
  • Investments in debt and money market instruments as well as equity                                                  Investors understand that their principal will be
    and equity related instruments                                                                                                  at moderately high risk
  *Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Statutory Details and Risk Factors
Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to `1 Lakh). Trustee: Axis Mutual
Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC). Risk Factors: Axis Bank Limited is not liable or responsible for any loss or shortfall resulting from
the operation of the scheme.
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.

                                                                                                                                                                                         22
THANK YOU!
You can also read