While planning for emergency funds, liquid funds are your best bet, says Anil Chopra of Bajaj Capital - here is why?
One of the most important instruments of the emergency cashflow planning is the Liquid funds, says Anil Chopra, Group CEO & Director at Bajaj Capital Ltd. He was speaking to Swati Raina in the popular TV show Money Guru.
The awareness about financial planning has gone up manifolds since the aftermath of the Coronavirus pandemic. When it comes to financial planning, the most important aspect is emergency cash flow planning and then other things follow.
One of the most important instruments of the emergency cashflow planning is the Liquid funds, says Anil Chopra, Group CEO & Director at Bajaj Capital Ltd. He was speaking to Swati Raina in the popular TV show 'Money Guru'.
Chopra shared his views on how covid affected people's thinking related to liquid funds. He also explained avenues for investment in emergency funds.
Chopra said due to covid, there has been a lot of changes seen in our society including our mindset too but the biggest change has been seen in financial funding.
Emergency cash flow planning
Emergency cash flow planning is the initial stage in financial planning, followed by child education planning, marriage planning, retirement planning, and so on. However, the greatest impact of the epidemic was on cash flow planning, which impacted its rules as well.
It was formerly thought that having double the amount of your monthly expenses in your bank account was sufficient. However, after facing the pandemic, many people now feel that this amount should be increased by at least 4 to 6 times.
Best options for Emergency Funds
The best option is to invest in the scheme of liquid funds of the mutual funds. Here you can get returns of up to 4-5%. And at the same time, it is also an advantage that you can withdraw your money whenever you want. You will get your money within 24 hours.
Chopra strongly recommended liquid funds of the mutual funds. All the big mutual funds like Tata, Birla, HDFC, etc., all have many different liquid fund schemes in mutual funds, he said.
Liquid funds are the best option to keep your emergency funds safe, he concluded.
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