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Goals

What is Goal-based investing? Why do you recommend Goal-based investing?

Before we start investing, it is important to understand the underlying purpose for investment.

It is a big decision, and you would be cutting back on spending your wealth today. There must be some future purpose for this sacrifice which is bigger and outweighs today's pleasure. Whether it is buying your first home, an annual vacation with kids or a fancy car.

A goal is defined by an amount and duration to complete the goal. It doesn't necessarily have to be the accumulation of wealth or assets. It can be an expense that you will anyway incur (kid's college education, retirement, kid's wedding, car, etc.) or something that you aspire for (luxury car, travel around the world, take a break from work, Louis Vuitton bag, etc.)

It is different from simply buying mutual funds. When you buy a mutual fund, you do not know when to exit from it or when you should put more and when you should sell. However, when it is part of a goal (for, e.g., achieve Rs.20lakhs in 5 years) you know what role this fund plays in achieving this result or goal. Think of it like a cricket team. There is a batsman, a bowler, a wicketkeeper and within each there is a pinch hitter, a stable batsman, a pace bowler, a spin bowler, etc. If you just buy a fund, chances are high you are picking a full team of batsmen or a full team of bowlers.

Below are some of the behavioural and financial reasons why goal-based investing is much better.

  1. Avoid under-saving: Most of us under-estimate our future requirements or impact inflation in planning for some of our future events. The goal-based investment methodology allows you not only to plan what your future requirements could be but also how much you need to invest today to achieve that.
  2. Builds discipline: For those new to investing. When you start saving for a goal, a real outcome that you want, the chances are high that you will stick to the discipline of investing to achieve it. In behavioural psychology, this is called 'affect'. The concept that we are more motivated by real things that abstract numbers. Delayed gratification cannot be mastered if the end goal is fuzzy!
  3. Get more from your savings by planning ahead: Using our goal-based investing you'll be able to plan for your future expenses and liabilities. While we have tried to put together a comprehensive list for you to choose from, you can create a custom one too. The earlier you plan and save for the goal, the less you'd have to save, and your savings get more time to multiply (power of compounding: see our blog here on the same) Let's take an example of saving up to buy your next car. Let's say you'd like to save Rs.15,00,000 to buy a Renault Duster. In purely financial terms, you should not take a loan to buy this. Below you can see what we recommended to save to achieve this depending on how far in advance you start saving.
    Minimum Investment Screenshot
  4. Use real-world data to build your target: When you set up a goal to buy a home on Upwardly- for example, Saving to buy a home that costs Rs.1 Crore today, 7 years later. We not only estimate the future cost of this home based on inflation data for real-estate but also suggest the amount you need to invest as down-payment. We estimate this based on your income and annual increments that you could get. We take all the guesswork out of your planning to ensure that you are more likely to achieve your goal.

From a functionality perspective, our platform offers several features to you to track and monitor your goals, fast track or slow down goals, merge goals, make custom goals, etc., to help facilitate your investing.

How do you assess my risk score? Do you do it all?

There are two aspects of Risk. One is your ability to take a risk and your willingness to take a risk. To get to your ability, we look at your demographic details like age, salary, marriage status, children status, etc. to determine your Risk Profile. We would continue to add information to your Risk Profile as time progresses. Depending on your Risk Profile and the prevailing market conditions, we suggest a balanced asset allocation portfolio to you. Your willingness to take risk is completely your choice. You can choose the Balanced Asset Allocation / Aggressive Asset Allocation / Conservative Asset Allocation as per your willingness for Risk and the Asset Allocation that you hold outside of Upwardly’s purview.

How often do you rebalance my portfolio?

We continuously monitor your portfolio and recommend periodic rebalancing to maximise returns for you while taking into account prevailing market conditions, tax implications, switching and exit costs to meet your goals and aspirations. We offer you a flexible and convenient platform to track/switch/redeem/top up your investments at a click of a button. This rebalancing can be done at set periodic levels or when there is a big change in the macro-economic environment in the country/globally.

Can I change the funds in the portfolios you've suggested?

As of now the functionality to change the fund on the suggested Upwardly portfolio does not exist. However, we are working on the same and will provide it in future. Meanwhile, one can also create a portfolio of funds using our cart option and invest in multiple funds of their choice in one go.

Why is there not much difference in my Conservative, Balanced and Aggressive portfolios?

The difference in the estimated time for completion of goal for the Conservative, Balanced and Aggressive portfolios is dependent on the Investment horizon of your goal. In case your investment horizon is short (3 years or less), the difference in the estimated time for completion of goal for the Conservative, Balanced and Aggressive portfolios would not appear to be too much. However, in long horizon goals of 10 years and more, you would see that the difference is substantial.

This is because the compounding impact takes some time to manifest itself materially. The longer the time, the bigger would be the difference.

Can I just try with a token amount? What should it be?

You can try investing on our platform with a token amount. We would suggest putting that money in either a liquid fund or an Ultra Short term fund with Zero exit load. You can invest in these funds and withdraw money without any charges in a very safe manner and abreast yourself with the workings of our platform.

We suggest that you invest Rs.1000 in any of the top three funds and withdraw after a week. Try and place the order before 3 pm to get the allocation faster.

Click here to see these funds.

How do you derive my recommended goal? What's the logic?

The recommended goals are based on your age & life stage. If you are single, female and below 30, we recommend a set of goals that would be most relevant to you today. Similarly, if you are married, male and have kids, our recommendation engine throws up an entirely different set of goals. Most of these goals are important to save for and once you've planned for those, whether on Upwardly or outside, you can start saving for the others.

Why is my allocation within funds the same despite the amount of investment?

The allocation to a particular fund is done as per a percentage in which we want the fund to be there as part of the total portfolio. This does not have any relation with the amount of investment but more on the horizon of investment.

The only case where this matters is when the investment value is less than or equal to Rs.500. Since the minimum investment into any fund is Rs.500, there is no way to split the allocation below this amount.

My present Debt/Equity ratio is 70/30 will this remain throughout the goal? What is my ideal ratio?

This is one of the foundations of the algorithm that we've built.

Ideally, the ratio of debt/equity for an individual is age/(100- age). For example, If you are 30 years old then you should have a debt/equity ratio of 30/70. However, apart from looking at age, other demographics of the customer (marriage status, salary, spouse working status, children, dependents, etc. determine an individual’s Risk Profile. Additionally, we also take a look at the existing market conditions like valuations of the markets, earnings, GDP growth rates, Interest rates, Current Account Deficit, Currency rates, etc. to determine the balanced Debt/Equity ratio for your portfolio at the current juncture.

So while your ideal state is 30:70, the present market situation could recommend 70:30. However, if the horizon of the goal is less than 2 years, it will be factored down to 100% debt.

For anything more than 3 years, the investment requirements are calculated as per your ideal state (30:70) but today's investment will be made as per present conditions.

As time progresses and things change, we would notify you if any changes are to be made to your Debt/Equity allocation to move to your ideal state.

Auto Rebalancing

Will my Goal portfolio have the same funds throughout the duration of the goal?

You can have the same or different funds in your portfolio through the life cycle of the goal. It would depend on a lot of factors like fund performance, goal horizon, market economics, etc.

However, please note that any changes to the funds in your portfolio is done through your consent. Any changes suggested by Upwardly would be sent to you as notification, email, SMS, and only once you approve will the funds in your portfolio be changed.

Can I change the funds in my portfolio?

No. We do not recommend changing the funds in your portfolio as our algorithm automatically picks them. These are carefully selected top funds within each category with above average and consistent performance over the last 5 years. However, if you wish to invest in other funds, you can visit our Top Mutual Funds page and select and invest in funds of your choice. We recommend referring to our rankings of funds.

What happens next after choosing a portfolio?

Once you pick the portfolio, you are directed to the BSE payment gateway page to make a transaction and start your investments. Money is routed directly through the BSE (Bombay Stock Exchange) gateway and transferred to fund houses. Fund units are allocated, and you can track and view them on your Dashboard. You can then SIT BACK AND RELAX, while we monitor your portfolio every day. Each quarter we review your portfolio, and if there is any rebalancing required, we would recommend you the same. Again, at a click of a button you would be able to switch SIPs and funds.

What is dynamic rebalancing?

We follow a very simple investing mantra. Invest low and exit high. When we build your portfolio and decide upon an Equity/Debt ratio, we factor in the prevailing market conditions. If the markets are high (expensive), we reduce your Equity exposure and increase it as and when the markets look attractive. This is done dynamically to minimise losses and ensure higher returns. Since it’s driven by an algorithm that takes in millions of data points, it is completely unbiased and most efficient. We’ve tested our algorithm over that 20 years of market data.

Can I Stop or Pause my monthly investments (SIP)?

Yes, you can pause, stop or restart your SIP investments anytime.

How do I restart my SIP if I’ve paused it?

Upwardly provides the functionality of restarting your SIPs. We would recalculate your Monthly investments considering the duration of the SIP pause and the Goal amount.

Can I withdraw money from goals? How soon will it be credited to my bank account?

Yes, you can withdraw your investments whenever you want. The money would be credited to your bank account within 24-72 hours depending on the type of the fund.

Can I make a partial withdrawal from a Goal as well?

Yes, you can make partial withdrawals from your goals as well. You can also invest more in your goals to accelerate them when you have extra investible money.

How does Upwardly choose which funds to sell when I withdraw from a Goal?

When you withdraw from a goal, we pick the ideal fund to sell from based on taxation, exit loads and risk. All you have to do is enter the amount you'd like to withdraw and leave the rest to us.

Is there a lock-in?

There is no lock-in on these funds. You can withdraw this money anytime. However, you must be mindful of the exit loads of the funds that you invest in before you redeem them.

Can I add more money to a goal at a later stage?

Yes, you can. You can make both one time as well as SIP investments to your existing goals. This would be a good way to fast forward your goals.

Can I change the Debt/Equity ratio?

We give your three options in our portfolio. Conservative, Balanced and Aggressive. You can choose either of these portfolios as per your investment style and requirement. However, we recommend the Balanced portfolio for our customers.

Why is the Debt/Equity different for my wife?

The different Debt/ Equity ratio majorly depends on your age, risk profile and market conditions.

What is the guarantee of returns?

Mutual Funds invest in market linked securities, and therefore there is no guarantee of returns or assured returns. Past performance of the fund does not guarantee future returns. Many of the calculations done are to assist the investors in their decision-making process. The investors must carefully go through the scheme offer documents before investing.

Transactions

What happens once I have opted for a Systematic Investment Plan (SIP) investment with Upwardly?

Once you have opted for a SIP through our platform, upwardly would send you an email with procedure to add Bombay Stock exchange (BSE) as a biller on your bank website. This is just like adding utilities payments like Electricity/Water/Phone on your banking website. Please remember to add BSE as the biller and not the Mutual Fund that you have invested in. It’s a 2 minute process at your end and you can easily do that on your own. Typically it takes 3-5 business days for the SIP mandate to be approved by the bank. Once that is approved, your monthly investments would start. This is a completely paperless process.

Just in case your Bank or the Mutual Fund (that you have opted for) do not have this allow addition of Billers, we would be sending you a NACH mandate form through email. This NACH mandate form needs to be signed by you. Please ensure that you do not make any other modifications on the NACH mandate else your Bank would reject your NACH mandate. Once you have signed the NACH mandate, our logistics partner would contact you and pick up the NACH mandate, and that would be sent to your Bank for registration. Once your Bank has registered this NACH mandate, the amount of your investment would be debited every month from your account and sent to the AMC for investment. Typically, the banks take 15-20 business days to approve this mandate. You would have the option of stopping or pausing this SIP through Upwardly platform as per your choice. You can also directly stop this SIP with the AMC.

How would I know that my investment has been done once I have transferred the funds or my bank account has been debited through a SIP Mandate?

Once your investment is made, you would be receiving a confirmation from both upwardly as well the AMC through email and SMS. You can track your investments on the upwardly dashboard. Additionally, the AMC would also be sending your account statement at the email ID provided by you. You can view your account on the AMC website. You can note your folio number on both these platforms. The AMC generates your folio number, and it is your account number with the AMC (just like your bank account number with your bank). If you face any issues, then please do email us at hello@upwardly.in

When are the Mutual Fund units allocated to me?

Once you have placed your orders at our platform and transferred funds through lump sum / SIP investment, the same are sent to the Asset Management company. The AMC does the fund units allocation. Allocation of units by AMC is subject to realisation of funds at their end. There is also daily deadline given by Asset Management company for placement of these orders and funds. These deadlines and turnaround times (TAT) are different for different for different kind of funds (Equity, Liquid, Debt, etc.). Typically, the fund units can be allocated to you between Tth day (same day as the day of the transaction) to T+2 day ( 2 business days plus the day of the transaction).

How can I make another investment in the same fund that I am already invested in?

All your currently invested funds are visible in your upwardly dashboard. You can click on the INVEST tab on the fund visible in your dashboard and make more investments. You can transfer funds through the payment gateway using Net banking.

What is the minimum or the maximum amount that I can invest in a fund for a Lump sum or SIP investments? Are there any limits to the payment gateway transfer?

Each and every mutual fund scheme has a minimum and maximum amount stipulated by the AMC for both Minimum and Maximum investments. These minimum and maximum limits are specified on the mutual fund scheme page as well as the investment page by upwardly. These limits can be as low as Rs 100 for SIP investments and Rs 500 for lump sum investments. The maximum limits are typically in crores. At times, fund houses can also put restrictions on the maximum amount of the lump sum or SIP investments. The same would be updated by upwardly on our website on the best effort basis. In addition to these limits, your bank could also have a maximum limit on the payment gateway transfers. You can easily increase these limits online on your net banking website by logging into your bank internet account. For some banks, you may be required to visit your bank branch or call on the phone banking numbers to increase these limits.

When I invest in Mutual funds through Upwardly, would my mutual fund units be credited to my Demat account?

AMC and upwardly maintain all investments done through upwardly. But they are not in a Demat account. Maintaining mutual fund units is a costly affair as you would be required to pay annual charges for the maintenance of the Demat account. In addition to the annual maintenance fees, you are also obliged to pay transaction costs for mutual fund debits and credits in the Demat account. Maintaining Mutual fund units with AMC without holding them in the demat account is an equally safe process, and we recommend the same to our customers.

Does Upwardly charge fees for withdrawal of funds?

Upwardly is a Free-to-use platform, for LIFE for now. We do not levy any fee for any purchase or withdrawal of Mutual Funds.

When you withdraw, the mutual fund could charge you an EXIT Fee, and that depends on the Mutual Fund you've bought.

Can I pause or stop my SIP investments? If so how?

Yes, you can Pause or Stop your SIP anytime you want.

Please drop us an email at hello@upwardly.in for the same and please inform us 10 days before the SIP transaction date. You can see the same on your transaction history page.

Can upwardly transact on my behalf and invest or redeem without my consent?

Each and every transaction in your account (purchase/redemption/switch etc.) can and will only be done at your explicit order either online or offline. We do not execute any order without client’s consent.

Withdrawls

I have redeemed/sold my mutual fund, when can I expect my money to come to my bank?

There are deadlines imposed by AMCs for redemption orders depending on the type of fund. Upwardly processes your redemption requests and send them to the AMC based on those deadlines. Depending on the type of fund and the timing of your placement of the order, the credit to your bank account would be done by the AMC between T+1 (one day after placement of redemption request) to T+3 days (three days after the placement of the redemption request). However, some mutual fund schemes invest in international markets than can take up to T+8 days to credit funds in your bank account.

How can I redeem my current investment? Can I also do a partial redemption?

All your currently invested funds are visible in your upwardly dashboard. You can click on the REDEEM tab on the fund visible in your dashboard and redeem your investment in partial or full. For partial redemptions, you can specify the amount or the number of units you want to redeem. The money would be credited to your bank account as per the scheduled time by the AMC.