Money For Investment

Friends, most of us belong to tech savvy generation who is always looking at newer ways to use technology in his/her daily life. Netbanking is one such innovation of technology in banking space which has revolutionised the whole experience of banking for us.The speed of growth in netbanking has been impressive over last few years ,to say the least.While there is little argument over the fact that use of netbanking has increased and it has made life easier and better for most of us , it is also true that this medium has its own shortcomings as well. Lets examine the various pros and cons of the medium: PROS OF NETBANKING -Why should you accept it. 1. CONVENIENCE - Among the benefits of netbanking, the first thing that stands out head and shoulders above the others is the element of convenience that it brings to our lives.Netbanking allows you to carry out your normal banking transactions at your own time at your own convenience without any restrictions of banking hours as is the case ...

Friends, in the era of ever increasing Internet penetration and ever dependence of mankind on technology , thing which slowly but surely finding its way in our lives is net banking. Net banking simply is carrying out most of your banking transactions through Internet without really visiting the branch premises. The percentage of banks customers moving to netbanking platform has grown manifold . With this other thing which has grown manifold is the instances of people getting scammed by fraudsters on the net. However, there are few tips which if used wisely can minimise such risk, though not completely wipe it. 1. Stay alert from "phising "on Internet There are lot of fraudsters out there trying to get access to your bank account details and passwords. Its not uncommon to find unsolicited mails from "your bank" asking you to verify your account details like account number and password on some pretext or other. These are mails sent by hackers and one should never repl...

Friends, one of the most radical innovations to have happened in banking and financial services domain is the innovation of plastic money or credit cards as they are popularly known. They added a link to the process of development in unit for exchange of goods and services from physical goods to gold/silver coins to paper currency to credit cards finally.Hence, arguably its a very significant product having huge advantages like freedom from carrying wads of notes in your purse,convenience,some free credit period and most importantly credit itself. But, like every product it too needs to be used properly to derive its optimum benefit else it can hurt ones interest as well. So will take all of you through few of the things that we should all be aware before we decide to take a credit card for self/spouse or kids. 1. Life time free credit card may not really be "Free" Who wants to pay annual fees for a credit card? No one and hence the whole market is awash with credit cards whi...

Friends, today will discuss another subject which is of utmost importance to all of us i.e. retirement planning. We all come across too many stories in newspapers/TV about sorry state of senior citizens because of the financial condition that they find themselves in. Some of them are forced to spend their last few years of life in an old age home. So, we all need to plan for the future in such a way that we continue to live our life like we do today even after we have retired. Lets understand the various aspecsts of retirement planning in little detail:- 1. Retirement Planning - For Whom?? Who needs to plan for his/her retirement? Is it menat for self employed?or people working in private organisations?or is it for govt employees?? Who exactly needs to plan for his/her retirement?? The answer to this is all of the above and many more i.e. everyone including you me and our neighbours and his neighbours. This is because a.The average life expectancy ofIndians have gone up and hence there...

Friends, since we are in what insurance guys dream about and call the JFM quarter , I thought it would be prudent to drop few tips to our readers on how to be safe while planning for their taxes this JFM. Why is JFM such a big thing for insurance selling fraternity? Simple, because it is during this qtr that they do most of their yearly business and hence a quarter full of excitement for them.But , in their excitement to garner maximum pie of the business on offer there are times when the agents selling these products try and shove the product down a customer throat without really understanding his needs. Why do they do it ??They do it coz they want to make the most of the JFM qtr and most fundamentally because insurance is a complex product where the sale has to be recommended basis the customers need and requirement. Also as per Philip Kotler, Insurance is an "unsought product" ie a product which people generally dont look to buy. All this makes it a tough proposition to s...

Friends,one common question that most of the investors of ELSS / mutual funds etc have is regarding the mode of receiving the proceeds out of the investment instrument.Most of the ELSS /mutual funds have these options: 1. DIVIDEND Here the fund house pays the investor part of the profits made periodically as dividend. This ensures that the investor gets regular access to liquidity and also is able to reap the benefits of the investment periodically and regularly.It appeals to lot of people who have need for regular liquidity. 2.GROWTH or DIVIDEND REINVESTED Here the fund house retains the profits made in a year and reinvests it for generating more returns next year. This continues till the investor exits from the scheme. This is done take the benefit of compounding of interest in long run by investing the profits made . This is good for people who don't require regular liquidity and are looking at wealth creation over a period of time. Tax Implications under both options:- ...

Freinds, we have all seen all those ads where insurance companies try and sell their products using tax saving as a basic premise rather than insurance itself which is the basic feature of the product.The result is that insurance is sold more as a tax saving tool rather than risk hedging one. So its imperative to analyse whether there are any loopholes or lacunaes in that premise as well. Whether we get the tax benefit that companies claim we get and if yes are there any exclusions?? Lets see the benefits/drawbacks from tax perspective only: 1. Premium upto Rs 100000 is deducted from gross income under Sec 80C and is completely tax free While this is true in most cases what we need to remember is that for us to be able to get the tax benefit the premium paid on insurance should not be more than 20% of the sum assured on the policy becuase only 20% of the SA is tax free, rest is not.SO for instance if you pay RS 35000 as premium for policy of SA of 100000 you can claim tax benefit onl...

WANNA SAVE SOME MORE TAX??? Read on... Freinds, I have discussed in my earlier post various options where we can save tax till Rs 1 lakhs under Sec 80C of the IT Act . But what if we want to save some more tax?? Can we do that?? Are there options which will helps us save tax beyond Rs 1 lakh in Sec 80C?? The answee to all this is an emphatic YES. The IT ACT provides us with an opportunity to save tax by buying medical cover for self/spouse/family. We can save tax over and above Sec 80c if we invest some money in buying medical cover for self/spouse/family. The limit exempted is as under: Rs 15000 - If we buy mediclaim cover for self/spouse/family. Rs 20000 - If the cover is bought for senior citizens. So, go ahead and get yourself a medical cover( mediclaim) from a good provider and ensure yourself from any medical exigencies and also get tax benefit in the process. My suggestion is to do your due dilligence on policy exclusions before you zero in on the medical policy. Most of the ...

Friends , since we all now know that best tool for tax saving is ELSS , lets look at the 5 best ELSS in terms of their performance in last 5 years. No. 5 Franklin India Taxshield NAV : Rs. 174.1 Risk Rating : 3 Overall rating : 5 This is at number 5 pipping Sundaram BNP on acount of excellent Risk Rating.The fund has above 35,000 crore Avg. Mkt. capitalisation and equity exposure is more tha 97& of the assets. Top holdings include Reliance Industries, HDFC, L&T, ICICI Bank and Bharti Airtel. Financial Services, Technology and Energy are the top sectors where the fund is invested. 5 year returns -47% 3 year returns-37% No. 4 Birla Equity NAV : Rs. 76.47 Risk Rating : 5 Overall rating : 4 Birla Equity offers excellent returns from all parameters,but standard deviation of 24.42 , this growth comes with comparatively high risk. The fund has 9394 crorr of AMC with high exposure in Engineering, Services and Financial service sectors. Top holdings include ABB, TRF, Gammon India, Welsp...

WHERE SHOULD I INVEST MY MONEY THIS MARCH?? Folks this is that time of the year once again when we frantically have to plan our investments with a view of saving taxes. Quite a few of us find this quite confusing and tiresome since they don't really have the adequate knowledge about the various products /tools which are available in the market for tax saving purpose. Most of us do the investments based on the recommendations of seniors or friends or colleagues without really giving it a serious thought. Most don't bother to invest with a view of building portfolio for wealth creation while investing as long as they manage to save the taxes to be paid that year. This approach to investing is not correct as it does not help you get the max out of your hard earned money in the long run. So lets examine the various options for tax saving and then see which one is the best for us. The various options available under Sec 80C are as under where you can invest upto 1 lakh and the sa...

Today in this space I would like to deal with one of the most commonly held myths about investing. Even though the savings rate in our country is among the highest in the world (@30%) In India , quite a substantial portion from the overall investment bucket of the retail customer finds itself invested with the aim of saving income tax. This in itself is not bad at all , infact that’s the reason why such tax breaks are offered. But what is worrying is that most of the people don’t have clarity on rules regulations governing such tax breaks. As per the current income tax guidelines, one can avail tax exemptions under section 80C of the IT ACT on the money invested upto Rs 1 lakhs in a financial year. Also the maturity benefits are exempted under Sec 10 10 D of the same Act. The various investment instruments/tools which will help you save tax under these guidelines are as under:- PPF Insurance ELSS ULIPS Housing Loan (principal component repaid). FDs with maturity in excess of 5 years. N...

INVESTMENT TIPS THAT WILL GET YOU A PERFECT FUTURE Ensuring one’s future the insurance way. Those of you who have read my posts on this blog would have figured out that I am not a big fan of traditional insurance plans (Endowment, ULIPs etc) as investment tool. However, just for the record sake let me also state that while I am not too fond of traditional insurance (read endowment etc) plans, I am of the firm opinion that one can NOT afford not to have insurance in his scheme of things. There are quite a few insurance plans which are very useful and a must for each and every one of us .There are few plans which we have to have to ensure that we are not exposed to the vagaries of uncertain life. Let’s look at 5 such investment plans which in my opinion is a must for every individual worth his salt. INVESTMENT NO 1-PERSONAL ACCIDENT INSURANCE Personal accident insurance is a investment plan which provides cover against any financial damage/liability to the subject/policyholder in case of...