1.

GENERAL INFORMATION

1.1 ABOUT THE INDUSTRY

 FINANCIAL INSTRUMENT :

Financial instruments are monetary contracts between parties. They can be created, traded,
modified and settled. They can be cash (currency), evidence of an ownership interest in an entity or
a contractual right to receive or deliver in the form of currency (forex); debt
(bonds, loans); equity (shares); or derivatives (options, futures, forwards).

Financial instruments are contracts for monetary assets that can be purchased, traded, created,
modified, or settled for. In terms of contracts, there is a contractual obligation between involved

parties during a financial instrument transaction.

International Accounting Standards IAS 32 and 39 define a financial instrument as "any contract
that gives rise to a financial asset of one entity and a financial liability or equity instrument of
another entity".

Financial instruments may be categorized by "asset class" depending on whether they are equity-
based (reflecting ownership of the issuing entity) or debt-based (reflecting a loan the investor has
made to the issuing entity). Foreign exchange instruments and transactions are neither debt- nor
equity-based and belong in their own category.

 Types

Financial instruments can be either cash instruments or derivative instruments:

 Cash instruments – instruments whose value is determined directly by the markets. They can
be securities, which are readily transferable, and instruments such as loans and deposits, where
both borrower and lender have to agree on a transfer.
 Derivative instruments – instruments which derive their value from the value and characteristics
of one or more underlining entities such as an asset, index, or interest rate. They can
be exchange-traded derivatives and over-the-counter (OTC) derivatives. Some of the more
common derivatives include forwards, futures, options, swaps, and variations of these such as
synthetic collateralized debt obligations and credit default swaps.
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 1.2 WORLD MARKET

 Instruments of International Financial Markets :

It is the market for instruments denominated in foreign currencies with a maturity of different
periods from one day to one year. This includes borrowing and lending of funds, of short-term
nature.

It includes internationally traded instruments like treasury bills, bank certificates of deposits,
commercial paper, bankers’ acceptances and repurchase agreements and other short-term asset-
backed claims. This market is needed for MNC’s operations as it provides liquidity to them.

1. Foreign Exchange Market

2. Derivative Products
3. International Currency Market
4. Eurocurrency Market
5. European Monetary System – EMS
6. Money Market Instruments
7. Equity Financing in the International Markets
8. Balance of Payments

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1.3 INDIAN MARKET
Some examples of Financial Instruments in India are:
 Money Market Funds (also known as liquid funds)
 Bank Fixed Deposit (Bank FDs)
 Post Office Savings Schemes (POSS)
 Public Provident Fund (PPF)
 Company Fixed Deposits (FDs)
 Bonds and Debentures
 Mutual Funds

Instruments traded in the Indian capital markets:

Equities:
Equity is a capital market instrument that businesses issue to raise money. It also goes by the name
equity share. You can acquire ownership and voting rights in a firm by purchasing its shares. Until
you sell the shares on the secondary market or the business is liquidated, you retain a portion of the
company. Additionally, you get share in the company’s gains and losses, and dividends are given
out for the earnings. The performance of the company, which affects the investor’s return,
determines how much the share value will rise.
Equity has historically produced larger returns than other capital market assets while it is a high-risk
investment.
Preference shares:
These shares have a preference over equity shares (holders). They are those that receive first
consideration when dividends or liquidation proceeds are paid out. According to this rule,
preference shareholders must get dividends or other payments before equity stockholders.
Preference shareholders do not have voting privileges within the firm, nevertheless. Unlike equity
shares, preference shares are often not traded on the secondary market. The various types of
preference shares are:
 Redeemable: The issuing company has the option to subsequently choose repurchase to
redeem the preference shares
 Irredeemable: The redemption happens only upon liquidation of the company
 Convertible: Preference shares may be converted to equity shares at a later date

3
Mutual Funds:
Mutual fund remains the most popular means to invest in capital markets. While mutual fund are
not directly traded in the markets on a real-time basis, the funds invest directly into instruments that
are traded on capital markets. There are various types of mutual fund with varied risk / return
profile. Here are the most basic types of mutual fund:

Debt mutual fund: Invests in debt instruments including bonds, T-bills, commercial paper etc.,
Balanced mutual funds: These funds invest in both equity and debt mutual fund, this is ideal for someone with
moderate risk profile and safe, modest returns.
Debt instruments:
To finance capital-intensive projects, both governments and businesses issue debt instruments. Debt is a kind of
borrowing with no ownership rights in the organization that is issued on primary or secondary markets. The
term of the debt instruments is typically short, after which the issuing corporation is required to refund the
principal.
Monthly, quarterly, semi-annually, or yearly, interest payments are made. Municipal, governmental, and
corporate bonds and debentures are examples of debt instruments. Debt investments are less risky as compared
to equity investments. However, the default risk might be greater if the issuing company’s financial situation is
poor. Therefore, you must invest in debt instruments after examining the issuing company’s credit rating and
financial situation.
Derivatives:
Capital market tools known as derivatives derive their value from an underlying asset. Bonds, equities, metals,
commodities, money, and so on are all examples of underlying assets. These instruments are traded mostly for
speculative purposes, although they may also be used for arbitrage and hedging. Derivatives are, therefore, ideal
for seasoned investors in the financial market as they are seen as being more volatile and risky than stocks.
Futures and options contracts are traded in secondary markets in India.
Exchange-traded funds:
Using ETFs, a lot of individuals may pool their money to invest in bonds, stocks, or gold on the capital market.
Most ETFs are registered with the Securities and Exchange Board of India (SEBI) and have characteristics of
both shares and mutual funds. ETFs are similar to mutual funds and are beneficial to investors who wish to
invest in an index, a basket of equities, or a commodity.

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 1.4 MAJOR COMPANIES IN THE INDUSTRY

 Central Banks
 Retail and Commercial Banks
 Credit Unions
 Savings and Loan (S&L) Associations
 Investment Banks
 Brokerage Firms
 Insurance Companies
 Mortgage Companies

1. Central Banks
Central banks are the financial institutions responsible for overseeing and managing all other
banks. In the United States, the central bank is the Federal Reserve Bank (Fed), which is
responsible for conducting monetary policy and supervising and regulating financial institutions.
Individual consumers do not have direct contact with a central bank. Instead, large financial
institutions work directly with the Fed to provide products and services to the general public.

2. Retail and Commercial Banks

Traditionally, retail banks offered products to individual consumers, while commercial banks
worked directly with businesses. Today, most large banks offer deposit accounts, loans, and limited
financial advice to both consumers and businesses.
Products offered at retail and commercial banks include checking and savings accounts, certificates of
deposit (CDs), personal and mortgage loans, credit cards, and business banking accounts.
Internet banks offer the same products and services as conventional banks, but they do so through
online platforms instead of brick-and-mortar locations. Internet banks may allow consumers to
carry out banking services via computer, mobile device, Automated Teller Machine (ATM), or by
calling a customer service line. Using your phone and the bank's app, you can deposit checks into
your account by taking a picture of your check.

3. Credit Unions
A credit union is a type of nonprofit financial institution providing traditional banking services and
is created, owned, and operated by its members.
Historically, credit unions used to serve a specific and shared demographic group, also known as

5
the field of membership. The commonality might be based on employer, a geographic area, or
membership in another type of group.
Credit unions are not publicly traded and only need to make enough money to continue daily
operations, so they often can afford to provide reduced fees and better interest rates than banks.

4. Savings and Loan (S&L) Associations

Savings and loan associations provide individual consumers with checking accounts, personal
loans, and home mortgages. Financial institutions are owned by their customers or community. A
savings and loan is a type of thrift that is required by law to produce a certain number of loans
secured by residential real estate, but the aim of most savings and loans is to lend for residential
mortgages.

5. Investment Banks
Investment banks are financial institutions that provide services and act as an intermediary in
complex transactions—for instance, when a startup is preparing for an initial public offering (IPO),
or when one company is merging with another. They can also act as a broker or financial advisor
for large institutional clients such as pension funds. Investment banks help individuals, businesses,
and governments raise capital through the issuance of securities.

6. Brokerage Firms
Brokerage firms assist individuals and institutions in buying and selling securities among available
investors. Customers of brokerage firms can place trades of stocks, bonds, mutual funds, exchange-
traded funds (ETFs), and some alternative investments.

7. Insurance Companies
Financial institutions that help individuals transfer the risk of loss are known
as insurance companies. Individuals and businesses use insurance companies to protect against
financial loss due to death, disability, accidents, property damage, and other misfortunes. These
companies can also include the self-insurance programs of other financial institutions such as a
savings and loan holding company

8. Mortgage Companies
Financial institutions that specialize in originating or funding mortgage loans are mortgage
companies. While most mortgage companies serve the individual consumer market, some

6
specialize in lending options for commercial real estate only. Mortgage companies focus
exclusively on originating loans and seek funding from financial institutions that provide the
capital for the mortgages. Many mortgage companies today operate online or have limited branch
locations, which allows for lower mortgage costs and fees.

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1.5 HISTORY OF COMPANY

Trade name Angel One

Type Public

 BSE: 543235
Traded as
 NSE: ANGELONE

ISIN INE732I01013

Industry Financial services

Founded 8 August 1996; 26 years ago

Founder Dinesh D. Thakkar

Headquarters Ackruti Trade Center, Andheri (E),

Mumbai, Maharashtra, India

Area served India

Key people  Dinesh Thakkar

(Chairman & MD)

Services  Stockbroker
 Equity trading
 Commodities
 Portfolio management services
 Mutual funds
 Life insurance
 Health insurance


Website www.angelone.in

8
Angel Broking was incorporated on 8 August 1996 as a private limited company .Later, Angel
Broking was incorporated as a wealth management, retail and corporate broking firm in September,
1997.In November 1998, Angel Capital and Debt Market Ltd. gained membership of National Stock
Exchange as a legal entity. The company opened its commodity broking Division in April, 2004. In
November 2007, Birla Sun Life Insurance joined hands with Angel Broking for distribution of its
insurance products .The International Finance Corporation bought an 18% stake in Angel Broking
for ₹152 crore (equivalent to ₹457 crore or US$57 million in 2023) in December 2007. The
company opened an office in Karol Bagh, New Delhi in October 2012.

In January 2013, a probe found the company and two other entities involved in fraudulent and unfair
trade practices in transactions of shares of Sun Infoways during Feb-May 2001. As a
result, SEBI restrained from taking new clients for a period of two weeks. Angel filed an appeal
against the SEBI order which was dismissed by the Securities appellate tribunal. Angel Broking
began offered shares through an initial public offering in September 2020, and was listed on
the Bombay Stock Exchange and the National Stock Exchange on 5 October 2020.

The company rebranded as Angel One in 2021.

Angel One started journey as a traditional stock brokerage firm in the year 1996. Angle One always
felt that empathy is really important for our customers. Since the beginning, They focus has always
been “what the customer wants” and then to match the right technology to fulfill their needs. That is
how Angel One journey and use of technology started keeping customers at the centre stage. This
led They in growing our geographical presence all over the country..

Gradually, Angel One changed into a Digital-first company to provide our clients personalised
financial journeys via a single app. Angel One began “Digital Journey” in the year 2019 by offering
an end-to-end digital investment solution to our customers.

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1.6 MAJOR SERVICIES

The company offers multiple online trading apps. Services include online stock broking,
depository services, commodity trading and investment advisory services, personal loans and
insurance, portfolio management services, IPOs business and mutual funds distribution.

online
stock
broking

mutual
depositry
funds
service
distributi-on

commodi-ty personal
trading loan

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 2. PRIMARY STUDY

2.1 LITRATURE REVEIW

A. Shanmuga Priya et. al. ( 2015) have conducted a study on “A Study on the Awareness of
Personal Financial Planning Among Pharma Students in Chennai City” The main objective of
study is To evaluate the knowledge of the pharmaceutical Students with regard to financial planning.
The research design is descriptive in nature. The designed questionnaire was administered among
B.Pharm. Students attached to top five colleges in Chennai city. The samples were selected by
Random sampling method from the list of students attached to top five colleges. Lottery method was
adopted in choosing the samples. The key finding of this study is that pharmaceutical students are
much pessimistic about their savings and budget. Very few pharmaceutical students are confident
about managing their money. High percent of pharmaceutical Students are very much known about
the importance of maintaining their financial records and also they maintain it to have control over
their expenses and equal percent of students fail to maintain their financial records.

Dr.P.V. Mohini ( 2018) has conducted a study on “A Study on Awareness of Personal Financial
Planning Among Households in Visakhapatnam City” The main objective of the study is to
assess the awareness of households on personal financial planning. The researcher prepared
questionnaire that measures the level of awareness about preparing financial planning, knowing
economic and social benefits. The survey examines the respondents‟ awareness about personal
financial planning. The researcher prepares three questions to measure the level of awareness on
respondent’s knowledge, skills and their views on socio economic benefits. The present study uses
the survey research methodology. A questionnaire was prepared to measure the levels of general
awareness on financial planning, preferences and risk perceptions of select households. After pilot
testing and fine tuning, the questionnaire was administered to a group of people. The data obtained
was analyzed using standard statistical techniques like Cross Tabs, Chi Square, mean and
percentage. Major finding of the study is that majority of the respondents (91%) are willing for
adoption of financial planning. Interestingly, while all the female respondents expressed willingness
to adopt financial planning practices only 87% of the males nodded a positive.

Maarten van Rooij et. al. ( 2009) have conducted on “Financial Literacy and Retirement
Planning in the Netherlands” The complexity of financial decisions households are faced with has

11
increased to unprecedented levels. At the same time, recent research documents large differences in
economic knowledge among households and indicates that household financial skills may be
inadequate to cope with the increasing responsibility for making retirement decisions. In this paper,
we examine the relationship between financial knowledge and Retirement planning in the
Netherlands. For this purpose, we have designed a customized module for the DNB (De
Nederlandsche Bank) Household Survey. We identify a strong and positive association between
financial knowledge and retirement planning. Using information on economics education when
young, we show that the nexus of causality goes from literacy to planning rather than the other way
around.

(Avni Patel, 2016)Planning in the

Avni Patel et. al. (2016 ) have conducted studty on “Awareness & attitude of investors
regarding personal financial planning” the main objective of study are To analyze awareness of
Personal Financial Planning among residents of Gujarat ,To analyze attitude regarding personal
financial planning among residents of Gujarat and To check financial literacy among residents of
Gujarat. A descriptive research design has been used to conduct a survey of 600 samples.
Convenience sampling technique had been used for the same. Samples were selected from four
major cities of Gujarat. Considerable percentage of the Urban India now has a higher disposable
income. The number of products available for investments and their complexity has increased with
confusions regarding returns generated by them. People face scarcity of time in managing their hard
earned money. The increasing complexity of financial products makes it important for an individual
to seek experts’ opinion in managing one’s Personal finances. This is where Financial Planning as
an approach to managing personal finances helps an individual to fulfill life’s numerous goals with
available resources. Study shows that awareness of financial products is fair in India. Financial
Planning is positively related with financial literacy. This research will try to find awareness of
financial planning, attitude of investors for the same. Samples have been taken from selected cities
across Gujarat and Convenience sampling technique has been used for the same. Structural Equation

Modeling technique has been used for the development of financial planning model.A (Avni
Patel, 2016)vni Patel, 2016
Tan Hui Boon et. al. (2011) have study conducted on “Financial Literacy and Personal
Financial Planning in Klang Valley, Malaysia” This paper suggests that most individuals who
have yet ensued personal financial planning were held back by their financial literacy level. In this
paper, we link the financial literacy level of individuals with their engagement in personal financial
planning. Primary data was collected within Klang Valley via self-administered questionnaire
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survey, and the relationship was examined using the cross tabulation method. The findings suggest
that in contrast to their non-financially literate counterparts, the readiness of the financially literate
individuals is reflected in their involvement in the multiple aspects of personal financial planning.
However, further exploration into public’s perceptions revealed that even though many see the
significance of setting financial goals and objectives in life, there remains a knowledge gap at an
individual’s level that hinders one from effectively managing the financial affairs. Interestingly
though, the public appeared to be hesitant in relying on the professionals in financial practices to
realize their goals. There remain rooms for greater efforts from the various stakeholders to improve
the current state of play and to ensure that the embedded benefits of personal financial planning are
far-reaching.

Sharon M. Danes et. al. (1999) have conducted study on “Financial Planning Curriculum For
Teens: Impact Evaluation” The purpose of the study is to assess the impact of a high school
financial planning curriculum on the financial knowledge, behavior, and self-efficacy of 4,107 teens
nationally. Statistically significant changes were found in financial knowledge, behavior, and self-
efficacy both immediately after studying the curriculum and three months after completing the
curriculum. About half the teens had gains in knowledge, a third had gains in behavior, and 40%
increased their confidence in managing their money.

Robert S. Stawski et. al. (2007) have conducted study on “Goal Clarity And Financial Planning
Activities As Determinants Of Retirement Savings Contributions” Retirement counselors,
financial service professionals, and retirement intervention specialists routinely emphasize the
importance of developing clear goals for the future; however, few empirical studies have focused on
the benefits of retirement goal setting. In the present study, the extent to which goal clarity and
financial planning activities predict retirement savings practices was examined among 100 working
adults. Path analysis techniques were used to test two competing models, both of which were
designed to predict savings contributions. Findings provide support for the model in which
retirement goal clarity is a significant predictor of planning practices, and planning, in turn, predicts
savings tendencies. Two demographic variables—income and age—were also revealed to be
important elements of the model, with income accounting for roughly half of the explained variance
in savings contributions. The results of this study have implications for the development of age-
based models of planning, as well as implications for retirement counselors and financial planners
who advise workers on long-term saving strategies.

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Douglas A. Hershey et. al. (2007) have conducted study on “Psychological Foundations of
Financial Planning for Retirement” Little is known about the psychological mechanisms that
underlie financial planning for retirement. Most studies of financial planning and investing have
used demographic indicators (e.g., age, gender, income) to predict individual differences in saving.
In the present study, a model of Planning is tested in which psychological indicators (future time
perspective, retirement goal clarity, and self-rated financial knowledge) are posited to mediate the
relationship between demographic indicators and saving behaviors. Path-analytic techniques were
used to test the model, based on data from 265 middle-aged working adults. Analyses revealed
substantial support for the role of psychological factors in the retirement planning process. Findings
have theoretical implications for the development of psychologically based models of planning, as
well as applied implications for those who seek to understand the psycho motivational forces that
underlie tendencies to plan and save.

David J. Ekerdt et. al. (2001) have conducted study on “Selling retirement in financial planning
advertisements” The nature of, and course toward, retirement are perennial issues that the financial
services industry bids to define. We used a sample of print advertisements for retirement financial
planning from 1997 to 1998 to examine how advertisers create structures of meaning for retirement.
The model customer was an individual, conscientious and self-reliant, typically male, and
financially sophisticated. Worthy traits notwithstanding, ads suggested to readers that saving for
retirement is a difficult and anxious task, the complexity of which the companies stood ready to
manage. The savings goal Ð retirement itself was depicted in only a minority of ads, underscoring
its life-course givenness and desirability. Ads with an image of retirement showed an emancipatory
life stage of active leisure underwritten by necessary financial security. The ultimate commodity for
sale here was rationality of a remote and near kind an eventual retirement that is controllable, and a
financial path to that state that is routine and orderly.

Kimberley Powell et. al. (2001) have conducted study on “The Financial Transition To Mature-
Age Motherhood” This paper explores the relationship between childbearing expectations and
financial savings patterns among a group of mature-age, first-time mothers and examines how this
relationship affects the transition to motherhood. Mature-age women who had previously expected
to remain childless are less likely to have saved, thus making the transition to parenthood more
stressful and complex. Adjustments to financial stress as a result of disrupted opportunities for
saving and investing are explored. Qualitative data from the Dunedin Mature Mothers Study is

14
presented to highlight how constraints in women's financial well-being affect mothers' employment
arrangements, spending power, and provision of parenting resources.

Sweta Tomar et. al. (2021) have conducted study on “Psychological determinants of retirement
financial planning behavior” Various studies raise concerns over the pervasive poverty among
women after retirement. Although much research is available on retirement planning, the advent of
behavioral finance and the integration of psychological concepts with financial planning and saving
behavior have made the phenomenon more critical. This study focuses on how the interaction
between financial literacy as a cognitive characteristic and retirement goal clarity, future time
perspective, attitude toward retirement, risk tolerance, and social group support as psychological
characteristics influence women’s retirement planning behavior. We use partial least squares
regression through PLS-3 with Multi Group Analysis to test a set of theory-based hypotheses. Our
results reveal a positive association of future time perspective, retirement goal clarity, and social
group support with retirement planning behavior, which are moderated by financial literacy. Future
time perspective and retirement goal clarity also play mediating roles. Our study has implications for
financial planning professionals, advisors, and consumers.

Annamaria Lusardi et. al. (2011) have conducted study on “Financial literacy and retirement
plannig in the united states” examine financial literacy in the United States using the new National
Financial Capability Study, where in they demonstrate that financial literacy is particularly low
among the young, women, and the less-educated. Moreover, Hispanics and African-Americans score
the least well on financial literacy concepts. Interestingly, all groups rate themselves as rather well-
informed about financial matters, not withstanding their actual performance on the key literacy
questions. Finally, we show that people who score higher on the financial literacy questions are also
much more likely to plan for retirement, which is likely to leave them better positioned for old-age.
Our results will inform those seeking to target financial literacy programs to those in most need.

Rob J. Alessie et. al. (2011) have conducted study on “Financial literacy, retirement preparation
and pension expectations in the netherlands” We present new evidence on financial literacy and
retirement preparation in the Netherlands based on two surveys conducted before and after the onset
of the financial crisis. We document that while financial knowledge did not increase from 2005 to
2010, significantly more individuals planned for their retirement in 2010. At the same time,
employees’ expectations about the level of their pension income are high compared to what
retirement plans may realistically provide. However, financially knowledgeable employees report

15
lower expected replacement rates and acknowledge higher levels of uncertainty. Moreover using
instrumental variables estimates for financial knowledge, we find a positive effect of financial
literacy on retirement preparation. Employing the panel feature of our dataset, we show that
financial knowledge has a causal impact on retirement planning. Our findings suggest that the
formation of pension expectations might be an important mechanism contributing to the impact of
financial literacy on planning.

Baljit Kaur et. al. ( 2018) have conducted study on “Impact of age,gender, income, education
and financial literacy toward retirement planning among generation ‘Y’ in Malaysia” The
main aim of this study is to analyze the impact of age, gender, income, education and financial
literacy towards retirement planning among generation Y in Malaysia. Recognizing the importance
of retirement planning from a younger age, 150 set of questionnaires distributed to respondents. The
questionnaire was developed based on past literature and the validity, normality and reliability of the
test was made. The independent variables used to measure the retirement planning among
Generation Y include age, gender, income, education and financial literacy. Descriptive and
explanatory research design was used for this research. The collected data was then analysed using
SPSS.22 using the final sample of 137 respondents. Overall the findings shows income, education
and financial literacy are significant variables contributing to the retirement planning among
Generation Y in Malaysia. It also found that age and gender were insignificant to retirement
planning among Malaysia’s Generation Y. The results of this study are to understand the impacts
contributing to retirement planning and for government and policy makers to review the existing
social security framework. It has come a time to introduce financial literacy in school and
educational institutions to empower the younger generation with a sound knowledge of financial
know how in order to have a comfortable retirement.

G Surendar et. al. ( 2017) have conducted study on “Financial Literacy and Financial Planning
among Teachers of Higher Education – A Comparative Study on Select Variables” This study
is conducted as a sample study in historically reputed district i.e., Warangal of Telangana State with
the help of structured schedule. The study found that the level of financial literacy among the
teachers of higher education is satisfactory. Further, no significant difference is found in the
perception of Technical and Non-Technical teachers towards the financial literacy and financial
planning. The study focused on factors of financial literacy and personal financial planning among
teachers of higher education. It found that the level of financial literacy among the teacher of higher
education is satisfactory. It is also found that the majority of technical and non-technical teachers of

16
higher education have a high level of financial literacy are aware of various aspects of personal
financial planning and are able to plan on their own irrespective of their subject of profession.

Robinson et. al. (2004) have study conducted on “Behavioral and Wealth Considerations for
Seeking Professional Financial Planning Help” This study uses a proprietary survey of Canadians
to examine factors that lead people to seek professional financial planning help. The main
hypothesis is that financial self-efficacy will positively predict whether one seeks help. We also
examine the effects of subjective and objective financial stress and wealth on the decision to seek
help. We find that wealth, self-efficacy, and objective financial stress are predictors of help-seeking
behavior. Individuals with high subjective financial stress are less likely to seek financial help, but if
they are high in self-efficacy they become more likely to seek financial help.

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2.2 INTRODUCTION ABOUT TOPIC

What Is Financial Planning?

Financial planning is the practice of putting together a plan for your future, specifically around how
you will manage your finances and prepare for all of the potential costs and issues that may arise.
The process involves evaluating your current financial situation, identifying your goals and then
developing and implementing relevant recommendations.

Financial planning is holistic and broad, and it can encompass a variety of services, which we detail
below. Rather than focusing on a single aspect of your finances, it views clients as real people with a
variety of goals and responsibilities. It then addresses a number of financial realities to figure out
how to best enable people to make the most of their lives.

Financial planning is not the same as asset management. Asset management generally refers to
managing investments for a client. This includes choosing the stocks, bonds, mutual funds and other
investments in which a client should invest their money.

However, the same professionals who offer asset management services can also offer financial
planning. A financial planner is effectively one type of financial advisor. Advisors can earn
certifications focused on financial planning, the most notable of which is “certified financial planner
(CFP).”

 Things to consider while doing financial planning are:

 Time Horizon and Goals:

 Risk Tolerance:
 Liquidity Needs:
 Inflation:
 Need for Growth or Income
 Six step process of Financial Planning
1. Self-assessment:
Clarify present situation, this is a preliminary step someone has to complete prior to planning their
finance. Doing a self-assessment enable a person to understand their present wealth status
and responsibilities. Self-assessment should contain following

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  Prospective retirement age
 Main source of income
 Dependents in family
 Expenses and monthly savings
 Current investment status

One should identify their wealth status prior to move with financial planning.

2. Identify financial, personal goals and objectives

Each individual aspires to lead a better and a happier life. To lead such a life there are some needs
and some wishes that need to be fulfilled. Money is a medium through which such needs and wishes
are fulfilled. Some of the common needs that most individuals would have are: creating enough
financial resources to lead a comfortable retired life, providing for a child's education and marriage,
buying a dream home, providing for medical emergencies, etc. Once the needs/ objectives have been
identified, they need to be converted into financial goals. Two components go into converting the
needs into financial goals. First is to evaluate and find out when it is needed to make withdrawals
from investments for each of the needs/ objectives. Then person should estimate the amount of
money needed in current value to meet the objective/ need today. Then by using a suitable inflation
factor one can project what would be the amount of money needed to meet the objective/ need in
future. Similarly, one need to estimate the amount of money needed to meet all such
objectives/needs. Once person have all the values, they need to plot it against a timeline.

3. Identify financial problems or opportunities:

Once goals and current situation are identified, the short fall to achieve the goal can be assessed.
This short fall need to be covered over a period of time to full fill various need at different life
stages. Since future cannot be predict, all the contingencies should be considered will doing
financial planning. a good financial plan should hedge from various risk. A flexible approach should
be taken to cater to changing needs and should be ready to reorganize our financial plan from time to
time.
4. Determine recommendations and alternative solutions:
Now review various investment options such as stocks, mutual funds, debt instruments such as PPF,
bonds, fixed deposits, gilt funds, etc. and identify which instrument(s) or a combination thereof best
suits the need. The time frame for investment must correspond with the time period for goals.

19
5. Implement the appropriate strategies to achieve goals: Until person put things into action
everything is waste. Necessary steps needs to be taken to achieve financial goals this may
include gathering necessary documents, open necessary bank, demat, trading account, liaise with
brokers and get started. In simple terms, start investing and stick to the plan.

6. Review and update plan periodically.

Financial planning is not a one-time activity. A successful plan needs serious commitment and
periodical review (once in six months, or at a major event such as birth, death, inheritance). Person
should be prepared to make minor or major revisions to their current financial situation, goals and
investment time frame based on a review of the performance of investments.

 Types of Financial Planning

A financial planner may offer a variety of services to you. These services will often be considered in
concert with one another. This helps the planner put together an overall plan that considers all
aspects of your current situation and future aspirations.

Tax planning: Financial planners often help clients address certain tax issues. They can also figure
out how to maximize your tax refunds and minimize your tax liability. Certain advisors may also be
able to actually help you with preparing your taxes and filing your annual taxes.

Estate planning: Estate planning seeks to make things a bit easier for your loved ones after you die.
Preparing a will may be part of a financial planner’s services. Estate planning also helps prepare for
any estate tax you may be subject to.
Retirement planning: It is the event which occurs in everyone’s life. It is one of the important type
of financial planning. Mostly you will hear that people set their financial goals for their retirement
income due to rising inflation and rising standard of living. You will have to start your saving and
investment early in your life for your retirement so that you do not have to compromise on standard
of living during retirement.
Reasons for doing Retirement planning can be understood with the following:
 Life expectancy
With advancement in technology life expectancy is likely to increase. Which means a person
Would be spending a large amount of time in his post retirement period. Thus, one need
have a regular income to sustain living which is only possible if prepared for it when earning.

20
  Medical emergencies
With age come health problems. With health problems, come medical expenditure which
may make a huge dent in post-retirement income. Failure here could lead to liquidate
(sell) assets in order to meet such expenses. Remember Mediclaim’s do not
always suffice.

 Nuclear families
Independence is the new way of life, gone are the days when people use to have an entire
cricket team making a family. Today's youth prefer not more than two children. With
westernization coming in, the culture of joint family is changing. Most prefer
independence and stay away from their family. Hence people have to develop a corpus to
last them through their retirement without any help from family.
 No government sponsored pension plan
Unlike the US and UK where they have IRA and state pension respectively as social security
benefit during retirement, the government of India does not provide such benefits. So,
persons are responsible for themselves now.

Philanthropic planning: Philanthropic planning is a powerful way for individuals to give to the
charities they believe in and care about to ensure the charities' long-term futures while also meeting
personal planning objectives. It’s always nice to give something to people who need it or help a
cause close to your heart. Financial planning can help you ensure you’re doing it efficiently and
getting all the tax benefits you’re eligible for.
Education funding planning: If you have children or other dependents who wish to pursue a
college degree, you may want to help them to pay for it. Financial planning can help make sure you
are able to do so.
Investment planning: Once should make your investment plan to achieve your goals in your life.
Your investment plan is always based on your savings. Once you know your amount of savings, you
can take the help of financial adviser for various investment opportunities like: fixed income,
investment in stocks, gold, Forex market, bonds, mutual funds, etc. You can either invest lump sum
amount or you can start systematic investment plan (SIT) for a long term to fulfill the long term
financial goals. Insurance planning: A financial planner can help you evaluate your insurance needs.
Some financial planners are also licensed insurance agents and can sell you insurance themselves.

21
  Concept & Significance of the Study

Financial Planning is an integral part of any individual life, especially in this modern world where
value of everything is expressed in terms of money. The active working span of human life is short
as compared to the life span. This means people will be spending approximately the same number of
years in after retirement what they have spent in their active working life. Thus it becomes important
to save and invest while working so that person will continue to earn a satisfying income and enjoy
a comfortable lifestyle. Financial Planning enables a person to identify their goals, assess the current
position and takes necessary steps to achieve the goals. Financial Planning is not just about
investment planning but it is about life time planning. Thus through proper financial planning a
person can have a easy and secured financial life.
 Scope

The scope of study is getting familiar with various investment avenues available in market. To study
the life stages of an individual and to identify their risk tolerance, income flow, life goals and
current investment. Study should cover all areas of the individual’s financial needs and should result
in the achievement of each of the individuals goals.
The scope of planning will include the following:
 Risk Management and Insurance Planning
 Investment Planning
 Retirement Planning
 Tax Planning

22
2.3 OBJECTIVE OF STUDY

 To know awareness about financial planning.

 To know factors considered for investment for financial planning.
 To know satisfaction from financial planning

23
 3. RESEARCH METHODOLOGY

3.1: Research Design

3.2: Data Collection Techniques and Tools
3.3: Sample Design
3.4: Limitations
3.5: Scope of Study

3.1. Research Design

The study is about to find various avenues available for an individual to invest and ways to achieve
long term and short term financial goals through financial planning. It intend to study the pattern in
which individual allocates his savings in various asset class. It describes the awareness of
investor about various alternatives available to them.
 Type of Research Design: Descriptive Research Design
 Research Equipment: Questionnaire
 Sampling Technique: Non- probability convenience sampling method
 Sampling frame : Vyara region
 Sample Size: 106 samples
 Sample Design: Data has been presented with the help of bar graph, pie-charts, line graphs
etc.

3.2. Data collection techniques and tools

For the purpose of data collection researcher took help of both primary data and secondary data
collection method.

Primary data
Primary data are those, which are collected afresh and for the first time, and thus happen to be
original in character. This method was used by means of Personal Interview, wherein researcher had
face-to-face contact with the persons.. Scope was kept open for detailed discussion at the discretion
of the interviewee. Where there was a time crunch a structured procedure was followed wherein
predetermined questions were put forward. The other method was adopted in primary data collection
was Questionnaires. This was used to assist a more structured form of information. The information
thus obtained was standard and in a more unbiased form. It assisted to collect data from a large
sample size. The pattern adopted was a general form of questionnaire. Questions are in dichotomous
24
(yes or no answers), multiple choice and open-ended question.

Secondary data
Secondary data means data that are already available i.e., the data which is already collected and
analyzed by other. To get a better understanding and to have a larger exposure on the subject this
method was used. Methods use was data available on worldwide web, articles in newspapers,
financial industry reports, Financial Planning board of India reports and article, reports published by
Government of India, etc. Support was also provided by the project guide by giving inputs from
his years of experience.

3.3. Sample Design

Sample design was based on principles of sample survey. Sample was decided on socio-
demographic factors such as income and age group. Sampling unit was geographical unit where the
research was carried in Gujarat. Source list for respondents was not predetermined it was on random
basis. The various parameters on which the research was to be conducted are:

•Awareness of financial Planning

•Alignment of life goals and financial goals
•Investment distribution in various asset classes
•Decision influencing investment

3.4. Limitations
 Lack of respondents.
 Unwilling to reveal financial position.
 In technical term it can be said as access to information. Many of are not comfortable
to disclose our financial affairs openly.
 Time: Due to lack of time availability of respondent and the period which can be used to
collect data was short the research could not be conducted on a large sample size.

3.5. Scope of the Study

The scope of the study is getting familiar with various investment avenues available in market. To
study the life stages of an individual and to identify their risk tolerance, income flow, life goals and
current investment. Study should cover all the areas of the individual’s financial needs and should

25
result in the achievement of each of the individual goals.
The scope of planning will include the following:

 Risk management and insurance planning

 Investment planning
 Retirement planning
 Tax planning

26
 4. DATA ANALYSIS AND INTERPRETATION

 Age

Demographic variable Category Frequency Percentage

Below 20 23 21.7%

21 – 40 55 51.9%
Age
Above 40 28 26.4%

Total 106 100 %

Interpretation: We can see that in above figure 51.9% of the respondents age group is 21 –
40 , 26.4% of respondents age group is above 40 and Respondents age group below 20 are
with 21.7%.

27
  Gender

Category Frequency Percentage

Male 56 52.8%

Gender Female 46 43.4%

Prefer not to say 04 3.8%

Total 106 100 %

Interpretation- The distribution is skewed towards male respondents. Here we can see more
respondents than female respondents as the data was collected randomly. Male with 52.8 % and
female with 43.4 %.

28
  Income

Demographic variable Category Frequency Percentage

Below 2,00,000 37 34.9%

Income level 2,00,000 – 5,00,000 50 47.2%

Above 5,00,000 19 17.9%

Total 106 100 %

Interpretation – We can see in the above figure that the Income level of the respondents in which
the majority of respondents have income from 2 – 5 lacs with 47.2 % , Below 2 lacs with 34.9% and
Above 5 lacs with 17.9%.

29
  Education level

Demographic variable Category Frequency Percentage

Schooling 14 13.2%

Education level Graduation 46 43.4%

Post graduation 36 34%

PhD 10 9.4%

Total 106 100 %

Interpretation – We can see in the above figure the educational background of the respondents in
which the majority of the respondents are Graduate with 43.4 %, Post graduate with 34%, Schooling
with 13.2% and PhD with 9.4 %.

30
 1. Awareness level of people about financial planning

Category Frequency Percentage

Yes 96 90.6%

No 10 9.4%

Total 106 100%

Interpretation – We can see in the above figure that Majority of the people are aware about the
financial planning with 90.6 % and there are less no. of people with 9.4 % they are not aware about
it.

31
 2. Have you set your financial goals?

Category Frequency Percentage

Yes 81 77.76%

No 15 14.4%

NA 10 7.84%

Total 106 100%

Interpretation: Majority of the respondents has set their financial goals with 77.76% and the
respondents with 14.4 % have yet not set their financial goals and the people with 7.84 5 are not
aware about the financial planning.

32
 3. Do you invest for Future?

Category Frequency Percentage

Yes 36 34.56%

No 60 57.6%

NA 10 7.84%

Total 106 100%

Interpretation: Majority of the people has not invested for their future with 57.6% and the
respondents with 34.56% have invested for their future due to their implementation of their financial
goals.

33
 4. Most preferable avenue where people invest

Category Frequency Percentage

Equity market 19 18.24%

Life insurance 32 30.72%
Gold 15 14.4%
Fixed deposit 23 22.08%
Other 7 6.72%
NA 10 7.84%
Total 106 100%

Interpretation: Majority of the respondents with 30.72% invest in life insurance, Respondents with
22.08% invest in fixed deposit , Respondents with 18.24% invests in the Equity market, respondents
with 14.4% invest in gold and remaining respondents invest in other items.

34
 5. Satisfaction level of people about their previous investment.

Category Frequency Percentage

Yes 80 75.84%

No 16 15.36%

NA 10 7.84%

Total 100 100%

Interpretation: Majority of the respondents are satisfied with their previous investments with
75.84% and the respondents with 15.36% are not satisfied with their previous investments.

35
 6. Sources of information people refer to make investments decision

Category Frequency Percentage

News Paper, publication and Media 21 20.16%

Professionals 21 20.16%
Agent /Broker 38 36.48%
Friends, Peer group, etc. 16 14.4%
NA 10 7.84%
Total 106 100%

Interpretation: The respondents have various sources of the information from where the
respondents refer the information to take decision, Majority of the respondents have Agents and
broker as their source of information with 36.48%, Respondents use the source of News Paper,
publication and Media and Professionals with 20.16% and remaining respondents use the source of
information as Friends, peer group, etc. for investments decision making.

36
 7. Investments objectives

Category Frequency Percentage

Principle safety 17 16.32 %

Maintaining standard of 36 34.56%
living
Meet future expenses 35 33.6%
Safeguard against 8 7.68%
contingencies
NA 10 7.84%
Total 106 100%

Interpretation: Majority of the respondents have investments objective to maintaining

standard of living with 34.56% and meet future expenses with 33.6% , Objective as Principle
safety with 16.32% and objective as Safeguard against contingencies with 7.68%.

37
 8. How frequently people invest

Category Frequency Percentage

Monthly 40 38.4%
Quarterly 15 14.4%
Annually 25 24.0%
Half yearly 11 10.56%
Single /one time 8 4.8%
NA 10 7.84%
Total 106 100%

Interpretation: Majority of the respondents invest Monthly with 38.4%, Respondents invest
Annually with 24.0%, Respondents invest Quarterly with 14.4% and Respondents invest Half yearly
with 10.56% and the Respondents invest for single time with 4.8%.

38
 9. Do you have enough time to manage your investment affairs?

Category Frequency Percentage

Yes 72 69.12%

No 24 23.04%

NA 10 7.84%

Total 106 100%

Interpretation: Majority of the respondents have enough time to manage their investment
affairs with 69.12% and the respondents with 23.04% have not enough time to manage their
investment affairs.

39
 10. People rate their current understanding about financial planning.

Category Frequency Percentage

Very good 11 10.56%

Good 49 47.04%
Neutral 19 18.24%
Poor 14 13.44%
Very Poor 3 2.88%
NA 10 7.84%
Total 106 100%

People rate their current

understanding about financial
planning
60

50
49
40

30

20
19
10 14
11 3
0
1 2 3 4 5

Interpretation: Majority of the respondents have Good understanding about their current financial planning
with 47.04% , Neutral understanding about their current financial planning with 18.24%, poor understanding
about their current financial planning with 13.44%, Very good understanding about their current financial
planning with 13.56% and very poor understanding about their current financial planning with 2.88%.

40
 FINDINGS

 51.9% of the respondents are male and with the age group of 21-40 Majorities of the
respondents have income (Yearly) is 2 lacs to 5 lacs.
 90.6% of the respondents are aware about the financial planning and they are setting their
financial Goals.
 77.76% of the respondents have set their financial goals but the majority of the people have
not invested for their future.
 Most preferable Avenues for the invest is Life insurance, FD and Equity market. And
75.84% of the respondents are satisfied with their previous investments.
 36.48% of the respondents make their decision for the investment through the source of
Agent/ broker and 20.16% of professionals, Only 14.4% of respondents who take the source
as friends group.
 34.56% of the people has objective to invest is to Make their standard of living better and
33.6% for meet future expenses. 38.4% of the respondents invest frequently every month.
 61.12% of the respondents have enough time to manage their invest affairs, and 47.4% of
respondents have Good understanding about their current investment.

41
 CONCLUSION

Most of the respondents are aware about the financial planning and they are setting the goals for the
financial planning but they are not implementing it into practice, the respondents motive of the
investment is to have better standard of living and to meet future expenses and they have various
sources for decision making for their investments are Agent/ Broker and professionals and the
respondents have enough time to manage their Investments activities and having good
understanding about their current investments.
To conclude the project report, some of are aware of the financial planning and some of the people
are not aware about the financial planning so there is a need to enhance awareness about financial
planning among individuals.
By implementing the recommended strategies, individuals can gain the knowledge and skills needed
to make informed financial well-being, and secure their financial future. Furthermore, initiatives to
increase financial awareness can have a positive impact on society by promoting economic stability
and reducing financial insecurity.

42
 RECOMMENDATION

 Based on the research findings, several recommendations were formulated to increase

awareness about financial planning. These recommendations include implementing financial
literacy programs in school and collages, organizing workshop and seminars on personal
finance, leveraging digital platform for financial education, and collaborating with
employers and financial institutions to provide workplace financial wellness programs.
 Some of are aware but they have lack of knowledge and understanding about financial
planning , that all the people should to educated by the financial institutions like Banks,
NBFCs, Broking firms etc. so that the people get better understanding about their
investments and financial planning.

43
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PLANNING IN THE UNITED STATES.
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PERSONAL FINANCIAL PLANNING. 5(11).
 Baljit Kaur, Z. H. (2018). IMPACT OF AGE, GENDER, INCOME, EDUCATION AND
FINANCIAL LITERACY TOWARDS RETIREMENT PLANNING AMONG
GENERATION ‘Y’ IN MALAYSIA. 3.
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Malaysia.
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planning information sources and knowledge outcomes.
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Households in Visakhapatnam City. 8(4), 11.
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Professional Financial Planning Help.
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 Kimberley Powell, J. G. (n.d.). The Financial Transition To Mature-Age Motherhood.
 m, S. (n.d.). Financial Planning Curriculum For Teens: Impact Evaluation.
 Maarten van Rooij, A. L. (2009). Financial Literacy and Retirement Planning in the
Netherlands.
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AND PENSION EXPECTATIONS IN THE NETHERLANDS.
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 ACTIVITIES AS DETERMINANTS OF RETIREMENT SAVINGS CONTRIBUTIONS.
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Websites

 http://www.reliancecapital.co.in/
 http://www.fpsbindia.org/
 http://profit.ndtv.com/Personal Finance/Insurance.aspx
 http://profit.ndtv.com/2008/01/16190747/Compare-Different-Insurance-Pl.html
 http://business.rediff.com/report/2009/may/15/perfin-types-of-life-insurance.htm
 http://www.mywealthguide.com/persnl.htm
 http://www.kingswoodconsultants.com/Lifetime Financial Planning.html
 http://www.businessgyan.com
 http://www.itrust.in/financial-planning/article.action/What-Is-Financial-Planning-India
 http://www.dnaindia.com/money/report union-budget-2009-10-highlights 1271503
 http://finance.mapsofworld.com/savings/india/household.html

45
A STUDY AWARENESS ABOUT FINANCIAL PLANNING

QUESTIONNAIRE:

1. Name:

2. Age
a) Below 20
b) 21 – 40
c) Above 40
3. Gender
a) Male
b) Female
c) Prefer not to say
4. Income level (Yearly)
a) Below 2 Lacs
b) 2 – 5 Lacs
c) Above 5 Lacs
5. Education Level
a) Schooling
b) Graduate
c) Post Graduate
d) P.H.D
6. Are you Aware about Financial Planning?
a) Yes
b) No
7. Have you set your financial Goals?
a) Yes
b) No
8. Do you invest for Future?
a) Yes
b) No
9. Which is the most preferable avenue where you invest?
a) Life insurance
b) Fixed deposit
c) Equity Market

46
 d) Gold
e) Others

10. Are you satisfied with your previous investment?

a) Yes
b) No
c) Neutral
11. From which sources you refer the information regarding your investments decision?
a) News Paper, publication and Media
b) Professionals
c) Agent /Broker
d) Friends, Peer group , etc
12. What are your Investment Objectives?
a) Principle safety
b) Maintaining standard of living
c) Meet future expenses
d) Safeguard against contingencies
13. How frequently do you invest?
a) Monthly
b) Quarterly
c) Half yearly
d) Annually
e) Single/One time
14. Do you have enough time to manage your investment affairs
a) Yes
b) No
15. How would you rate your current understanding of financial planning?
a) Very Good
b) Good
c) Neutral
d) Poor
e) Very poor

47
48