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Description
This book is divided into two parts. Part I covers Indian financial system, elements of financial planning and ways and means of meeting clients needs through financial planning. Part II presents a commentary on investment concepts, asset classes, investment products and relevant provisions of income tax. It also covers the elements of creating a financial plan, scenario of bond and money market as prevailing in the country. The book forms part of the course material provided by Indian Institute of Banking & Finance to the candidates appearing for the paper on "Introduction to Financial Planning," under their Post Graduate Diploma in Financial Advising (PGDFA) examination. Eminent experts under the guidance of Dr. S.A. Dave, former chairman of UTI, have designed the course. All ardent learners of banking and finance as also the professionals engaged in financial advising field may find this book useful.
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Contents
Part I - Financial Planning
Chapter 1 - ABC of the Indian Financial and Investment Industry
1. Basic Concept
2. The Financial System
3. Types of Financial Markets and Instruments
4. Features of Securities and Financial Markets
5. The Flow of Funds
Chapter 2 - Participants in the Indian Finance System
1. Participants in the Finance Industry
2. Type of Financial Service
3. Intermediaries in the Indian Financial System
Chapter 3 - Indian Economic Environment
1. Introduction to economic and Indian economy
2. Economic Policies and Tools
3. Macroeconomics
4. Impact on investment values of economic indictors
5. Media and Information sources
Chapter 4 - Indian Social Environment & Financial Planning
1. The consumer life cycle
2. Stage by stage analysis
3. Wealth cycle
Chapter 5 - Effective Communication in Financial Counselling
1. Introduction
2. Essentials in financial counseling
3. Profile of the effective counseling
4. Basic communication Principles
5. Elements of non- verbal behaviours
6. Attending and listening skills
7. Counsellor leading responses
8. The question
Chapter 6 - Introduction to Investments
1. Introduction to investments
2. Characteristics of investments
3. Psychological aspects of Investing
Chapter 7 - Meeting Clients Need Through Financial Planning
1. Various views of financial planning
2. The evolution of financial planning as a profession
3. Good practices in financial planning
4. Content of a comprehensive Financial Plan
Chapter 8 - Recommending Financial Planning Strategies to Investors
1. Financial Planning Strategies - Investing for the long term
2. Asset allocation - The strategies tool
3. Comparison of Products
Chapter 9 - Regulation of the Indian Financial System
1. Regulation of the Indian Financial System
2. Regulatory Authorities
3. Self-Regulatory Bodies
4. Ethics in the Securities Industry
Part II - Financial Planning and Wealth Creation
Chapter 1 - Introduction to Financial Planning
1. Background
2. What is Financial Planning?
3. The Role of a Financial Planner
4. Regulatory Controls and Practices
Chapter 2 - Risk Management and Insurance Products
1. Risk management by insurance
2. General Insurance
3. Commercial Insurance
4. Professional Indemnity (PI) Insurance
5. Life Insurance
6. Personal Risk Insurance
7. Regulation
8. Product Producers and Distributors
9. Five Steps to Advising on Life Insurance
10. Provision of Insurance products by Financial Planners
Chapter 3 - Fundamental Investment Concepts
1. The Time Value of Money
2. The Principle of Compounding
3. Risk - Reward Trade-Off
4. Rational Choices
5. Diversification- ‘Spreading Risk’
6. Investment Timing
7. Direct Investments - What are they and who uses them?
Chapter 4 - The Economic Environment
1. Introduction to Economics
2. What is the ‘Economy’?
3. The Finance Sector
4. Different Economic Systems
5. Global economic forces
6. Investment Intermediaries
7. Impact of Government Policies
8. Economic or Business Cycle
9. Effects on Investment Values
10. Approaches to Analysis
11. Media and Information Sources
Chapter 5 - Assets Classes
1. The Assets Classes, their Behaviours and Expected Returns
2. Cash
3. Domestic Fixed Interest
4. Domestic Equities
5. Property
6. International
7. The Role of Derivatives
8. Other Specialist Assets Classes
9. Asset Allocation
Chapter 6 - Investments Products
1. Managed Funds
2. Mutual Funds
3. Portfolio Management Schemes (PSTs)
4. Superannuation and Rollover Funds
5. Insurance Bonds
6. Product Design
7. Examples of Managed funds
8. Evaluating Managed funds
9. Current Trends in Managed Funds
Chapter 7 - Taxation Part 1
1. Principles of Taxation
2. Components of Tax Liability
3. Some other principles of Taxation
4. Taxation of Direct Investments
5. Taxation of Pooled (Managed) Investments
6. self- assessment, returns and Payment of Income - Tax
7. Taxation of perquisites and Fringe Benefits
Chapter 8 - Taxation Part 2
1. Capital Gains Tax
2. Tax Avoidance versus Tax Evasion
3. Gearing and Debt Management
4. Borrowing V. Repayment of Existing Loans
5. Case Studies using Negative Gearing
6. Other Forms of Gearing
Chapter 9 - Estate Planning
1. What is a will?
2. Dying without a will
3. Administration of an Estate
4. How Else may Assets Pass?
5. Dwelling House
6. Powers of Attorney
7. Tax Planning through Wills and Trusts
8. Taxation of terminal Benefits
Chapter 10 - Towards a Financial Plan
1. Working with Clients
2. Gathering Initial Information from the Client
3. Additional Information
4. Meeting the Client’s Objectives
5. Assets Allocation
6. Selection of Investments and Insurance Products
7. Implementation
8. Ongoing Service
Review
Questions
answers
In Summary
Appendices
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Author Details
Indian Institute of Banking & Finance (formerly The Indian Institute of Bankers) was established in 1928. With more than 750 Institutional members and over 2.5 lakh individual members, it is the largest Institute of its kind in the world and is working with a mission "to develop professionally qualified and competent bankers and finance professionals primarily through a process of education, training, examination consultancy/counselling and continuing professional development programs”. The Institute has almost all the banks and financial institutions, public sector, private sector, foreign, cooperative, regional rural banks as members in addition to IT companies and individuals working in the banking and finance sector. The Institute is managed by a Governing Council consisting of Chairmen of different banks and eminent academicians. It offers a number of professional courses in banking and finance.
The flagship programs of the Institute are JAIIB and CAIIB. Other specialised courses are 'Diploma in Treasury, Investment & Risk Management' ,' Diploma in International Banking',' Diploma in Banking Technology' and 'Post Graduate Diploma in Financial Advising'. These programs aim at building skill sets and developing the competence among specialist officers of banks and financial institutions.
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