Earn a better rate of interest than what the bank has been paying you, try savings in the Public Provident Fund (PPF).
Savings in the PPF have been popular for quite some time. They earn a good rate of interest. But remember they are for the long term .PPF deposits earn interest of 11 % per annum. At this rate, it is a very attractive investment option. Interest is credited to the account in the month of March every year. The interest earned is fully exempt from income tax.
Compare this with a time deposit with a bank. Many private banks do offer interest rates of 10.5 % - 11 % on deposits, placed with them, for periods ranging from 1 to 2 years. But any interest earned in excess of Rs.10, 000 per annum will be subject to a deduction of tax by the bank at the rate of 10 % from your interest amount.
In the PPF Account, the minimum amount that can be deposited in one financial year is Rs.100 and the maximum amount which can be deposited is Rs.60, 000. The amount so deposited can be made over the whole of the 12 months of the financial year in convenient installments up to a maximum of 12 in number. The financial year would mean April-March. The PPF scheme is open to both individuals and to the Hindu Undivided Family. Further, anyone can make deposits on behalf of their minor children also. Money invested in PPF, will be available to you after a period of 15 years. You can also opt to extend the period for another 5 years. However in case you need money, you can take a loan from the third financial year. Withdrawals are allowed from the 7th financial year.
One special feature which makes investment in PPF unique, is that this investment cannot be attached by court.
Tax Benefits
If you are an Income Tax Assessee then any investment in the PPF makes it eligible for deduction at the rate of 20 % under Section 88 of the Income Tax Act, 1961. So if you have invested a sum of Rs.10, 000 for the whole year, the deduction available to you would be Rs.2, 000. If you have invested say Rs.60, 000 the deduction available to you would be Rs.12, 000.
Where can one go to open a PPF?
Go to a Head Post Office, Selection Grade or notified nationalised banks, like the State Bank of India It is also possible to transfer your PPF account from one HPO to any branch of SBI or nationalised branch and vice versa.
Get around that taxman
Why pay that income tax? Instead invest your funds in the National Savings Certificate VII Issue. It is an ideal way to save money and at the same time reduce your tax burden. Quite an attractive option, too. Your investment nearly doubles in amount, in a period of six years.
The National Savings Certificate VII Issue is an ideal way to beat the tax payer’s claim on your income (legally of course) and at the same time it is a good short term option to save your money.
Unlike the Public Provident Fund, which does not issue any certificates for the amount deposited by you, certificates accompany investments in National Savings Certificates. Certificates are available in convenient lots of Rs.100, Rs.500, Rs.1, 000 and in bigger lots of Rs.5, 000 and even Rs.10, 000. The minimum investment is Rs.100 and there is no maximum limit.
Interest applied to National Savings Certificates is currently at the rate of 11.50 percent, compounded half-yearly and payable to you only on maturity (i.e., at the end of six years). If you invest Rs.1000, this will become Rs. 1,956 at the time of maturity.
Just like the Public Provident Fund, investment in National Savings Certificates is eligible upto Rs.60, 000 for a 20 percent rebate under section 88 of the Income Tax Act. If you are an artiste, playwright, sports person or musician then the limit is increased to Rs.70, 000 and you can get a 25 percent rebate under section 88 of the Income Tax Act. Interest up to Rs.12, 000 per annum is exempt from Income Tax under section 80-L of the Income Tax Act.
In case, you are looking at long term investments, then all you have to do is to buy National Savings Certificates every year for six years. The certificate of Year 1 will mature at the end of Year 6 and the same amount can be re-invested in Year 7. Then in Year 8 use the amount invested in Year 2 and so on.
You can use a combination of Public Provident Fund and National Savings Certificates to get a mix of both short term and long term savings.
How to Apply
National Savings Certificates can be purchased from any Head Post Offices, Sub-Post Offices and also Branch Offices. However if you want this facility to come to your doorstep, then just call your ‘friendly neighbourhood’ agent, who will promptly bring the forms to you for filling and later on even deliver the certificates.
The National Savings Certificate VII Issue is an ideal way to beat the tax payer’s claim on your income (legally of course) and at the same time it is a good short term option to save your money.
Unlike the Public Provident Fund, which does not issue any certificates for the amount deposited by you, certificates accompany investments in National Savings Certificates. Certificates are available in convenient lots of Rs.100, Rs.500, Rs.1, 000 and in bigger lots of Rs.5, 000 and even Rs.10, 000. The minimum investment is Rs.100 and there is no maximum limit.
Interest applied to National Savings Certificates is currently at the rate of 11.50 percent, compounded half-yearly and payable to you only on maturity (i.e., at the end of six years). If you invest Rs.1000, this will become Rs. 1,956 at the time of maturity.
Just like the Public Provident Fund, investment in National Savings Certificates is eligible upto Rs.60, 000 for a 20 percent rebate under section 88 of the Income Tax Act. If you are an artiste, playwright, sports person or musician then the limit is increased to Rs.70, 000 and you can get a 25 percent rebate under section 88 of the Income Tax Act. Interest up to Rs.12, 000 per annum is exempt from Income Tax under section 80-L of the Income Tax Act.
In case, you are looking at long term investments, then all you have to do is to buy National Savings Certificates every year for six years. The certificate of Year 1 will mature at the end of Year 6 and the same amount can be re-invested in Year 7. Then in Year 8 use the amount invested in Year 2 and so on.
You can use a combination of Public Provident Fund and National Savings Certificates to get a mix of both short term and long term savings.
How to Apply
National Savings Certificates can be purchased from any Head Post Offices, Sub-Post Offices and also Branch Offices. However if you want this facility to come to your doorstep, then just call your ‘friendly neighbourhood’ agent, who will promptly bring the forms to you for filling and later on even deliver the certificates.
Other Ways of Saving Money
Saving and investment opportunities can be through Real Estate, Gold, Stocks and Shares, Insurance Schemes and Mutual Funds as well. Several of these offer multi-dimensional avenues. Each has to be considered in terms of Risk, Returns and Liquidity, and any financial decision has to be taken with these golden principles in mind.
Investment in stocks and shares is a risky business at any time, though returns may be high. It also needs an in-depth understanding of the investments, other than in initial public offerings (IPO), cannot be done directly. Transactions have to be carried out through brokers on the floor of the stock exchange.
Gold and real estate are sound investment avenues, but they need large outlays of money, particularly real estate. Returns are unpredictable. Liquidity, while high in the case of bullion, is very low as far as real estate is concerned.
Insurance schemes offer good investment opportunities. LIC has schemes to meet various needs and the payment is staggered in ways to suit individual pockets and earning patterns. Choose the one that best meets your requirement in terms of lock-in period, returns, and tax benefits. Insurance schemes have an added advantage in that most allow the investors to avail of loans for various purposes. With the imminent opening up of the insurance sector, more attractive schemes are sure to come into the market.
Government schemes like Public Provident Fund are also attractive to investors, as they offer tax benefits as well as loan facilities. Savings can be spread out or a chunk deposit can be made each year. The Risk factor is very low, though returns as well as liquidity can be classified as only average.
Mutual Funds are all the rage at present as investment instruments. The main plus points are the facts that liquidity is very high, and, even with a small sum, affordable by working women and men, and with no particular knowledge of the stock market, one can invest in blue-chip shares. The investment decisions are left in the hands of a professional. Risk can range from low to high, depending on the company and scheme chosen. Care has to be taken to research the background of the company floating the funds, the philosophy of the fund manager and the fees charged by the company, which can affect returns.
Unit Trust of India ( UTI) offers a wide variety of schemes, and they combine with tax benefits and insurance cover to form attactive packages. Risk here is low, returns high to medium and liquidity is the same.
Study the schemes and select one that meets your requirements in terms of returns and maturity. With such a wide range of choices, the investor would do well to keep the golden principles of Risk, Returns and Liquidity in mind, and decision.
Investment in stocks and shares is a risky business at any time, though returns may be high. It also needs an in-depth understanding of the investments, other than in initial public offerings (IPO), cannot be done directly. Transactions have to be carried out through brokers on the floor of the stock exchange.
Gold and real estate are sound investment avenues, but they need large outlays of money, particularly real estate. Returns are unpredictable. Liquidity, while high in the case of bullion, is very low as far as real estate is concerned.
Insurance schemes offer good investment opportunities. LIC has schemes to meet various needs and the payment is staggered in ways to suit individual pockets and earning patterns. Choose the one that best meets your requirement in terms of lock-in period, returns, and tax benefits. Insurance schemes have an added advantage in that most allow the investors to avail of loans for various purposes. With the imminent opening up of the insurance sector, more attractive schemes are sure to come into the market.
Government schemes like Public Provident Fund are also attractive to investors, as they offer tax benefits as well as loan facilities. Savings can be spread out or a chunk deposit can be made each year. The Risk factor is very low, though returns as well as liquidity can be classified as only average.
Mutual Funds are all the rage at present as investment instruments. The main plus points are the facts that liquidity is very high, and, even with a small sum, affordable by working women and men, and with no particular knowledge of the stock market, one can invest in blue-chip shares. The investment decisions are left in the hands of a professional. Risk can range from low to high, depending on the company and scheme chosen. Care has to be taken to research the background of the company floating the funds, the philosophy of the fund manager and the fees charged by the company, which can affect returns.
Unit Trust of India ( UTI) offers a wide variety of schemes, and they combine with tax benefits and insurance cover to form attactive packages. Risk here is low, returns high to medium and liquidity is the same.
Study the schemes and select one that meets your requirements in terms of returns and maturity. With such a wide range of choices, the investor would do well to keep the golden principles of Risk, Returns and Liquidity in mind, and decision.
What is the Unit Scheme - 1964?
Attractive tax free saving at this price
Under the US 64 Scheme one unit with the face value of Rs.10 is available for sale at a price of Rs. 14.20 (Jan2001). If you have some money to spare, you could buy units and get attractive dividends at the end of the financial year i.e., June 2001. All dividends are tax – free.
What is the Unit Scheme – 1964?
It is the mother of all mutual fund schemes. Launched in 1964, it has a unit capital of Rs.13, 857 crores invested by over 2 crore unit holders all over the world. The scheme is an open ended scheme as both individuals and institutions can invest in the units. The objective of the scheme is to provide a regular income to the investors once in a year.
The US-64 is a balanced scheme i.e., it invests its funds in both equities as well as debt securities. The income in the form of dividend is generally distributed during the month of July every year. During July, UTI offers the sale of units at a price, which is the lowest in the whole year. After that UTI progressively increases the sale price of each unit. As UTI declares dividends, investors who invest at any time of the year (but before the book closure) are entitled to dividends in July. (Dividend is declared on each unit that you buy.)
Should you need your money for any emergency, UTI offers to repurchase the units. Sale and repurchase prices of units are announced every month by UTI through advertisements in many newspapers. The current repurchase price (the price that UTI buys your units for) of each unit is Rs.14.00. These rates are applicable till the end of November 2000.
The scheme provides for nomination facility and hence you can nominate anyone to receive the money. Investors can purchase units in the electronic form with NSDL. This makes it a convenient way of holding securities instead of locking up the certificates in a cupboard.
What makes this scheme attractive?
The track record of the UTI in paying dividend on this scheme for all these years has been very good. In the last 4 years the dividends have been as follows: in 1996-97 - 20.00 %, in 1997- 98 - 20.00 %, in 1998-99 - 13.50 % and in 1999 – 2000 – 13.75%.
The dividends that the investor receives enjoy benefits under Section 10 (33) of Income Tax Act, 1961 which means that the income received is totally tax-free.
How to apply?
Units can be bought from any agent of UTI, Brokers or directly through UTI. Sale is open to: Resident individual investors including minors, Trusts, Societies, Corporate Bodies, HUFs, Banks, Companies and also to non-resident investors including individuals, minors, HUFs, Companies and Overseas Corporate Bodies (OCBs) with repatriation/non-repatriation benefits. Minimum investment is Rs.2000/- without any maximum limit.
Now, if you are still not convinced about this savings scheme, you could blow up your money on that attractive suit you have been eyeing everyday! The choice is yours!
Under the US 64 Scheme one unit with the face value of Rs.10 is available for sale at a price of Rs. 14.20 (Jan2001). If you have some money to spare, you could buy units and get attractive dividends at the end of the financial year i.e., June 2001. All dividends are tax – free.
What is the Unit Scheme – 1964?
It is the mother of all mutual fund schemes. Launched in 1964, it has a unit capital of Rs.13, 857 crores invested by over 2 crore unit holders all over the world. The scheme is an open ended scheme as both individuals and institutions can invest in the units. The objective of the scheme is to provide a regular income to the investors once in a year.
The US-64 is a balanced scheme i.e., it invests its funds in both equities as well as debt securities. The income in the form of dividend is generally distributed during the month of July every year. During July, UTI offers the sale of units at a price, which is the lowest in the whole year. After that UTI progressively increases the sale price of each unit. As UTI declares dividends, investors who invest at any time of the year (but before the book closure) are entitled to dividends in July. (Dividend is declared on each unit that you buy.)
Should you need your money for any emergency, UTI offers to repurchase the units. Sale and repurchase prices of units are announced every month by UTI through advertisements in many newspapers. The current repurchase price (the price that UTI buys your units for) of each unit is Rs.14.00. These rates are applicable till the end of November 2000.
The scheme provides for nomination facility and hence you can nominate anyone to receive the money. Investors can purchase units in the electronic form with NSDL. This makes it a convenient way of holding securities instead of locking up the certificates in a cupboard.
What makes this scheme attractive?
The track record of the UTI in paying dividend on this scheme for all these years has been very good. In the last 4 years the dividends have been as follows: in 1996-97 - 20.00 %, in 1997- 98 - 20.00 %, in 1998-99 - 13.50 % and in 1999 – 2000 – 13.75%.
The dividends that the investor receives enjoy benefits under Section 10 (33) of Income Tax Act, 1961 which means that the income received is totally tax-free.
How to apply?
Units can be bought from any agent of UTI, Brokers or directly through UTI. Sale is open to: Resident individual investors including minors, Trusts, Societies, Corporate Bodies, HUFs, Banks, Companies and also to non-resident investors including individuals, minors, HUFs, Companies and Overseas Corporate Bodies (OCBs) with repatriation/non-repatriation benefits. Minimum investment is Rs.2000/- without any maximum limit.
Now, if you are still not convinced about this savings scheme, you could blow up your money on that attractive suit you have been eyeing everyday! The choice is yours!
What is the Unit Scheme - 1964?
Attractive tax free saving at this price
Under the US 64 Scheme one unit with the face value of Rs.10 is available for sale at a price of Rs. 14.20 (Jan2001). If you have some money to spare, you could buy units and get attractive dividends at the end of the financial year i.e., June 2001. All dividends are tax – free.
What is the Unit Scheme – 1964?
It is the mother of all mutual fund schemes. Launched in 1964, it has a unit capital of Rs.13, 857 crores invested by over 2 crore unit holders all over the world. The scheme is an open ended scheme as both individuals and institutions can invest in the units. The objective of the scheme is to provide a regular income to the investors once in a year.
The US-64 is a balanced scheme i.e., it invests its funds in both equities as well as debt securities. The income in the form of dividend is generally distributed during the month of July every year. During July, UTI offers the sale of units at a price, which is the lowest in the whole year. After that UTI progressively increases the sale price of each unit. As UTI declares dividends, investors who invest at any time of the year (but before the book closure) are entitled to dividends in July. (Dividend is declared on each unit that you buy.)
Should you need your money for any emergency, UTI offers to repurchase the units. Sale and repurchase prices of units are announced every month by UTI through advertisements in many newspapers. The current repurchase price (the price that UTI buys your units for) of each unit is Rs.14.00. These rates are applicable till the end of November 2000.
The scheme provides for nomination facility and hence you can nominate anyone to receive the money. Investors can purchase units in the electronic form with NSDL. This makes it a convenient way of holding securities instead of locking up the certificates in a cupboard.
What makes this scheme attractive?
The track record of the UTI in paying dividend on this scheme for all these years has been very good. In the last 4 years the dividends have been as follows: in 1996-97 - 20.00 %, in 1997- 98 - 20.00 %, in 1998-99 - 13.50 % and in 1999 – 2000 – 13.75%.
The dividends that the investor receives enjoy benefits under Section 10 (33) of Income Tax Act, 1961 which means that the income received is totally tax-free.
How to apply?
Units can be bought from any agent of UTI, Brokers or directly through UTI. Sale is open to: Resident individual investors including minors, Trusts, Societies, Corporate Bodies, HUFs, Banks, Companies and also to non-resident investors including individuals, minors, HUFs, Companies and Overseas Corporate Bodies (OCBs) with repatriation/non-repatriation benefits. Minimum investment is Rs.2000/- without any maximum limit.
Now, if you are still not convinced about this savings scheme, you could blow up your money on that attractive suit you have been eyeing everyday! The choice is yours!
Under the US 64 Scheme one unit with the face value of Rs.10 is available for sale at a price of Rs. 14.20 (Jan2001). If you have some money to spare, you could buy units and get attractive dividends at the end of the financial year i.e., June 2001. All dividends are tax – free.
What is the Unit Scheme – 1964?
It is the mother of all mutual fund schemes. Launched in 1964, it has a unit capital of Rs.13, 857 crores invested by over 2 crore unit holders all over the world. The scheme is an open ended scheme as both individuals and institutions can invest in the units. The objective of the scheme is to provide a regular income to the investors once in a year.
The US-64 is a balanced scheme i.e., it invests its funds in both equities as well as debt securities. The income in the form of dividend is generally distributed during the month of July every year. During July, UTI offers the sale of units at a price, which is the lowest in the whole year. After that UTI progressively increases the sale price of each unit. As UTI declares dividends, investors who invest at any time of the year (but before the book closure) are entitled to dividends in July. (Dividend is declared on each unit that you buy.)
Should you need your money for any emergency, UTI offers to repurchase the units. Sale and repurchase prices of units are announced every month by UTI through advertisements in many newspapers. The current repurchase price (the price that UTI buys your units for) of each unit is Rs.14.00. These rates are applicable till the end of November 2000.
The scheme provides for nomination facility and hence you can nominate anyone to receive the money. Investors can purchase units in the electronic form with NSDL. This makes it a convenient way of holding securities instead of locking up the certificates in a cupboard.
What makes this scheme attractive?
The track record of the UTI in paying dividend on this scheme for all these years has been very good. In the last 4 years the dividends have been as follows: in 1996-97 - 20.00 %, in 1997- 98 - 20.00 %, in 1998-99 - 13.50 % and in 1999 – 2000 – 13.75%.
The dividends that the investor receives enjoy benefits under Section 10 (33) of Income Tax Act, 1961 which means that the income received is totally tax-free.
How to apply?
Units can be bought from any agent of UTI, Brokers or directly through UTI. Sale is open to: Resident individual investors including minors, Trusts, Societies, Corporate Bodies, HUFs, Banks, Companies and also to non-resident investors including individuals, minors, HUFs, Companies and Overseas Corporate Bodies (OCBs) with repatriation/non-repatriation benefits. Minimum investment is Rs.2000/- without any maximum limit.
Now, if you are still not convinced about this savings scheme, you could blow up your money on that attractive suit you have been eyeing everyday! The choice is yours!
Banking
Saving Money the Traditional Way
Women's empowerment - a lot of it is about money. Women have been discarding their limited traditional role of tending the home fires, to come out and work shoulder to shoulder with men for quite some time now, but it is only of late that they are getting to play a part in deciding what to do with the money earned. Finance has traditionally been a man's province and women have long considered it unfeminine to be knowledgeable about money matters. Thankfully, the mindset is changing and more and more women, faced with the responsibility of handling finances, are trying to come to grips with various types of investment and savings avenues.
Saving and investment opportunities can be broadly classified under the heads of Banks, Non-banking Finance Companies (NBFCs) and Company Deposits. Several of these offer multi-dimensional avenues. Each has to be considered in terms of Risk, Returns and Liquidity, and any financial decision has to be taken with these golden principles in mind.
Banks represent the least risk as savings avenues. But they also offer the least returns. Liquidity is also not particularly high. With liberalisation of the Indian economy has come competition, which in turn has ushered in some innovative and attractive savings schemes from banks, both Indian and foreign. All banks offer savings bank (SB) and current account services. The former is aimed chiefly at individuals, non-trading organisations and institutions, the purpose being to meet all banking transaction needs as well as offer a means of saving. The philosophy is 'Save while you can, Draw if you must', as one bank puts it. Current Accounts cater to businessmen, corporate bodies and institutions which operate their accounts frequently, there being no limit on the number of transactions in this account. Besides these, banks offer fixed deposit schemes of various types. These are aimed at helping individuals plan for future expenditure, like children's education, marriage and housing needs.
The terms of the deposits can be chosen to suit individual needs. Shop around for the best interest rate and for schemes like Autosweep, which automatically transfers any funds above a specified limit in SB accounts to Fixed Deposits. Recurring Deposit schemes offered by most banks are a way to build up savings through regular monthly deposits of fixed sums for a selected period of time. Such schemes are ideal for salaried people. Again, shop around for the best features on offer. Many banks offer specialised schemes for NRIs. These also include investment in securities, shares, company deposits and immovable property. The watchword for any bank saving scheme is SAFETY. Keep this in mind while looking at investment/savings avenues.
NBFCs were popular saving avenues at one time, offering high returns. However, risks were proportionately high and liquidity poor. Competition forced the interest rates to fantastic highs, causing investors to flock to the mushrooming finance companies. However, their popularity crashed when such companies folded up rapidly, leaving thousands of investors in financial ruin. Now, NBFCs no longer accept deposits. Many manufacturing companies take fixed deposits, offering rates of interest that are higher than banks. The risk factor is also high and the money is locked in for varying periods.
Women's empowerment - a lot of it is about money. Women have been discarding their limited traditional role of tending the home fires, to come out and work shoulder to shoulder with men for quite some time now, but it is only of late that they are getting to play a part in deciding what to do with the money earned. Finance has traditionally been a man's province and women have long considered it unfeminine to be knowledgeable about money matters. Thankfully, the mindset is changing and more and more women, faced with the responsibility of handling finances, are trying to come to grips with various types of investment and savings avenues.
Saving and investment opportunities can be broadly classified under the heads of Banks, Non-banking Finance Companies (NBFCs) and Company Deposits. Several of these offer multi-dimensional avenues. Each has to be considered in terms of Risk, Returns and Liquidity, and any financial decision has to be taken with these golden principles in mind.
Banks represent the least risk as savings avenues. But they also offer the least returns. Liquidity is also not particularly high. With liberalisation of the Indian economy has come competition, which in turn has ushered in some innovative and attractive savings schemes from banks, both Indian and foreign. All banks offer savings bank (SB) and current account services. The former is aimed chiefly at individuals, non-trading organisations and institutions, the purpose being to meet all banking transaction needs as well as offer a means of saving. The philosophy is 'Save while you can, Draw if you must', as one bank puts it. Current Accounts cater to businessmen, corporate bodies and institutions which operate their accounts frequently, there being no limit on the number of transactions in this account. Besides these, banks offer fixed deposit schemes of various types. These are aimed at helping individuals plan for future expenditure, like children's education, marriage and housing needs.
The terms of the deposits can be chosen to suit individual needs. Shop around for the best interest rate and for schemes like Autosweep, which automatically transfers any funds above a specified limit in SB accounts to Fixed Deposits. Recurring Deposit schemes offered by most banks are a way to build up savings through regular monthly deposits of fixed sums for a selected period of time. Such schemes are ideal for salaried people. Again, shop around for the best features on offer. Many banks offer specialised schemes for NRIs. These also include investment in securities, shares, company deposits and immovable property. The watchword for any bank saving scheme is SAFETY. Keep this in mind while looking at investment/savings avenues.
NBFCs were popular saving avenues at one time, offering high returns. However, risks were proportionately high and liquidity poor. Competition forced the interest rates to fantastic highs, causing investors to flock to the mushrooming finance companies. However, their popularity crashed when such companies folded up rapidly, leaving thousands of investors in financial ruin. Now, NBFCs no longer accept deposits. Many manufacturing companies take fixed deposits, offering rates of interest that are higher than banks. The risk factor is also high and the money is locked in for varying periods.
A safe haven for your money Kisan Vikas Patra
The Kisan Vikas Patra allows you even small investments of Rs.100 at one time. There is no maximum amount that you can invest. The interest accrued on your investment is added back every year. The effective rate of interest works out to 11.25 per cent. And a sum of Rs.1, 000 invested in the beginning of the year 2000 will give you Rs.2, 000 in June 2006.
Buying a certificate is not at all difficult. The Kisan Vikas Patra is available at designated branches of the Post Office. Investment can be made in multiples of Rs.100, Rs.500, Rs.1, 000, Rs.5, 000 and Rs.50, 000. The certificate can be encashed at the Post Office where it was issued. If you are in another city, approach the Officer-in-charge of that Post Office with full details including the identity slip of the holder.
In case you need the money earlier, you can either take a loan or surrender your certificate. However surrendering the certificate can be requested only after two and a half years and the interest that you would receive would be much less. Unlike the PPF there is no facility to take a loan on the certificate from the issuer. But you can take a loan from the bank, by offering it as collateral for a loan.
Unlike the National Savings Certificates or the Public Provident Fund, there are no tax benefits on this scheme.
Buying a certificate is not at all difficult. The Kisan Vikas Patra is available at designated branches of the Post Office. Investment can be made in multiples of Rs.100, Rs.500, Rs.1, 000, Rs.5, 000 and Rs.50, 000. The certificate can be encashed at the Post Office where it was issued. If you are in another city, approach the Officer-in-charge of that Post Office with full details including the identity slip of the holder.
In case you need the money earlier, you can either take a loan or surrender your certificate. However surrendering the certificate can be requested only after two and a half years and the interest that you would receive would be much less. Unlike the PPF there is no facility to take a loan on the certificate from the issuer. But you can take a loan from the bank, by offering it as collateral for a loan.
Unlike the National Savings Certificates or the Public Provident Fund, there are no tax benefits on this scheme.
Equity Linked Savings Schemes (ELSS)
If you want to participate in the thrill of the stock markets, but are not gutsy enough to do it on your own, try this mutual fund scheme. Investments in the ELSS will give you a taste of what bulls and bears are all about. It will also give you a tax rebate of 20 percent.
The Equity Linked Savings Schemes (ELSS) give their investors the option of saving tax while participating in the growth of the capital market.
An investment of up to Rs.10,000 under ELSS qualifies under Section 88 of the Income Tax Act, 1961. Other tax advantages offered include inflation indexing of any capital gains, tax liability and lower tax rates on redemption of units.
As per the ELSS guidelines issued by the Central government, mutual funds have to ensure that at least 80 percent of the funds are invested in equities and equity-related instruments. Investors can sell back their units to the mutual fund at the NAV-based repurchase price after the lock-in-period of three years.
The value of your investment will depend on how the markets have behaved over a period of time and the ability of the mutual fund to maximise returns.
ELSS is ideal for:
i) Small investors as it is a simple way of investing in the stock market.
ii) Investors who may not have a lump sum to invest in order to save tax. Open-ended ELSS allows them to invest at various points depending on the availability of funds, as well as take advantage of cost averaging.
The Equity Linked Savings Schemes (ELSS) give their investors the option of saving tax while participating in the growth of the capital market.
An investment of up to Rs.10,000 under ELSS qualifies under Section 88 of the Income Tax Act, 1961. Other tax advantages offered include inflation indexing of any capital gains, tax liability and lower tax rates on redemption of units.
As per the ELSS guidelines issued by the Central government, mutual funds have to ensure that at least 80 percent of the funds are invested in equities and equity-related instruments. Investors can sell back their units to the mutual fund at the NAV-based repurchase price after the lock-in-period of three years.
The value of your investment will depend on how the markets have behaved over a period of time and the ability of the mutual fund to maximise returns.
ELSS is ideal for:
i) Small investors as it is a simple way of investing in the stock market.
ii) Investors who may not have a lump sum to invest in order to save tax. Open-ended ELSS allows them to invest at various points depending on the availability of funds, as well as take advantage of cost averaging.
Tips on how to save your money
You can save a lot of money if you only set your mind. Little things go a long way. Follow these tips and see the difference it will make to your monthly budget.
Turn off lights and other appliances, when you leave the room.
Cook using a pressure cooker. It uses lesser quantity of LPG gas.
Bring your lunch to work rather than eat out.
Arrange for a Car Pool .
Make a shopping list and stick to it. Don't indulge in impulsive buying.
Buy store brand foods instead of national name brands. They are cheaper
Shop for groceries on a full stomach.Save on electricity bills. Change over to tubelights.
Only wash full loads in your washing machine.
Have only one extra set of sheets for each bed size in the house. This helps in terms of clutter also.
Ask yourself "Do I need it?" "Do I need it now?"
Water is not just for bathing, try drinking some instead of Coke.
Borrow books from the library (and whatever else they offer).
If you really want to own a book, try to buy second hand.
Picnics are a nice alternative to eating out.
Plan your trips so as to save on fuel costs.
Turn off lights and other appliances, when you leave the room.
Cook using a pressure cooker. It uses lesser quantity of LPG gas.
Bring your lunch to work rather than eat out.
Arrange for a Car Pool .
Make a shopping list and stick to it. Don't indulge in impulsive buying.
Buy store brand foods instead of national name brands. They are cheaper
Shop for groceries on a full stomach.Save on electricity bills. Change over to tubelights.
Only wash full loads in your washing machine.
Have only one extra set of sheets for each bed size in the house. This helps in terms of clutter also.
Ask yourself "Do I need it?" "Do I need it now?"
Water is not just for bathing, try drinking some instead of Coke.
Borrow books from the library (and whatever else they offer).
If you really want to own a book, try to buy second hand.
Picnics are a nice alternative to eating out.
Plan your trips so as to save on fuel costs.
Tips on how to save your money
You can save a lot of money if you only set your mind. Little things go a long way. Follow these tips and see the difference it will make to your monthly budget.
Turn off lights and other appliances, when you leave the room.
Cook using a pressure cooker. It uses lesser quantity of LPG gas.
Bring your lunch to work rather than eat out.
Arrange for a Car Pool .
Make a shopping list and stick to it. Don't indulge in impulsive buying.
Buy store brand foods instead of national name brands. They are cheaper
Shop for groceries on a full stomach.Save on electricity bills. Change over to tubelights.
Only wash full loads in your washing machine.
Have only one extra set of sheets for each bed size in the house. This helps in terms of clutter also.
Ask yourself "Do I need it?" "Do I need it now?"
Water is not just for bathing, try drinking some instead of Coke.
Borrow books from the library (and whatever else they offer).
If you really want to own a book, try to buy second hand.
Picnics are a nice alternative to eating out.
Plan your trips so as to save on fuel costs.
Turn off lights and other appliances, when you leave the room.
Cook using a pressure cooker. It uses lesser quantity of LPG gas.
Bring your lunch to work rather than eat out.
Arrange for a Car Pool .
Make a shopping list and stick to it. Don't indulge in impulsive buying.
Buy store brand foods instead of national name brands. They are cheaper
Shop for groceries on a full stomach.Save on electricity bills. Change over to tubelights.
Only wash full loads in your washing machine.
Have only one extra set of sheets for each bed size in the house. This helps in terms of clutter also.
Ask yourself "Do I need it?" "Do I need it now?"
Water is not just for bathing, try drinking some instead of Coke.
Borrow books from the library (and whatever else they offer).
If you really want to own a book, try to buy second hand.
Picnics are a nice alternative to eating out.
Plan your trips so as to save on fuel costs.
GET A PIGGY BANK
Go back to when you were a child. Get a Piggy Bank. Place your Piggy Bank whereevery member of the household can see it, and ask everyone to "feed it". Takethe time and effort to contribute to it and set an example for your children.Let them know that it acts as a family emergency fund. Encourage participationby everyone towards this fund. Let them know for what kind of emergency wouldthe fund be used. You could mention:
• Repair orreplacement of household items – for instance a broken shower -- appliances youcan not do without.
• Automobilerepairs, and in that time money for temporary or alternate transportation.
• Travelexpenses generated due to family emergencies or functions.
• Unexpectedexpenses incurred during a vacation.
• Unexpectedmedical expenses.
When your family knows how hardyou are trying to save money, they will surely help and you just can't go wrongsaving money.
• Repair orreplacement of household items – for instance a broken shower -- appliances youcan not do without.
• Automobilerepairs, and in that time money for temporary or alternate transportation.
• Travelexpenses generated due to family emergencies or functions.
• Unexpectedexpenses incurred during a vacation.
• Unexpectedmedical expenses.
When your family knows how hardyou are trying to save money, they will surely help and you just can't go wrongsaving money.
DO DISCOUNT SCHEMES HELP SAVE? OF COURSE!!!
Discount schemes have gained a dubious reputation in recent times and some consider them to be `cheap options’. But discount schemes are in fact great bargains and work in more than one way. Here is how:
• It is smart to keep a look out for discount schemes. When you go shopping, eating at restaurants (happy hours), buying your drinks and especially when you buy the monthly grocery supply. Keep a watch for price-offs, one-on-one offers, discount coupons etc.
• You don’t have to forgo your favourite brand while doing this. But you can be certain that most of your favourite brands will also come up with schemes at some point of time.
• If the shelf life of the product is long, why not stock up an extra supply when the promotion scheme is on?
• Remember, you don’t have to go out of your way to keep track of discount schemes. When you go shopping, or order your purchases over the telephone ask the sales person to give you the list of products that are currently being featured in the promotion sector.
• Shopping this way helps in making a substantial amount of saving. The funds can be used to buy indulgences and small luxuries!
• It is smart to keep a look out for discount schemes. When you go shopping, eating at restaurants (happy hours), buying your drinks and especially when you buy the monthly grocery supply. Keep a watch for price-offs, one-on-one offers, discount coupons etc.
• You don’t have to forgo your favourite brand while doing this. But you can be certain that most of your favourite brands will also come up with schemes at some point of time.
• If the shelf life of the product is long, why not stock up an extra supply when the promotion scheme is on?
• Remember, you don’t have to go out of your way to keep track of discount schemes. When you go shopping, or order your purchases over the telephone ask the sales person to give you the list of products that are currently being featured in the promotion sector.
• Shopping this way helps in making a substantial amount of saving. The funds can be used to buy indulgences and small luxuries!
SUPER SMALL SAVINGS
Remember the old idea of dropping some coins in a pot, which will be broken after it gets filled up. Like the old adage, drops of water make an ocean, keep your petty savings in a treasure box, and open it only in the need of hour. You’ll definitely find it as a pleasant surprise, that these small savings have accumulated into a treasure, substantially meeting your needs.
HOW TO EARN WHILE YOU SAVE
How do you earn when you are investing your savings? You can earn more than whatyou can earn on investments of your savings. The marketing outfits for certaininvestment organisations often offer the investors cash incentives of 1% or morefor the investments made through them. This is because they share theircommission with the investors, which may not be available to the investmentsmade directly by you. So, if you have decided to invest your savings, do sothrough the marketing intermediaries who offer incentives for the investmentsmade through them. But remember, the intermediaries are only for the investmentsand not for servicing requirements.
HOW TO SAVE WHILE YOU SPEND
It is possible if you plan and organize your spending properly.
A. Today, most of the consumer products are coming with attractive options for the consumers to promote their products. These products are offered at lower prices, while the quality remains same, by sharing their publicity expenses with other marketing organizations.
B. Retail chains offer substantial discounts as compared to the market prices.
Keep a watch on such offers and buy products when you feel that the savings can be substantial. But one word of caution – don’t get carried away by offers. Buy the products only if you need them.
A. Today, most of the consumer products are coming with attractive options for the consumers to promote their products. These products are offered at lower prices, while the quality remains same, by sharing their publicity expenses with other marketing organizations.
B. Retail chains offer substantial discounts as compared to the market prices.
Keep a watch on such offers and buy products when you feel that the savings can be substantial. But one word of caution – don’t get carried away by offers. Buy the products only if you need them.
SEVEN FABULOUS TIPS TO HOLIDAY SPENDING
“I love the holidays! What make them extra special are the gifts I receive. Speaking about gifts, as much as I love receiving them, when it comes to returning the favour it burns a deadly hole in my pocket”, cries Blossom Mendes, 24, sales executive.
Well here are some tips that will help you get through.
1. Curb your spending
This season opt for some low-cost but attractive gifts. Just because you’ve always been known as a fabulous gift-giver, it doesn’t mean you go overboard with your spending.
2. Be the early bird
Start shopping before the holiday season begins. Not only will you reap cool bargains, but it will also provide you with ample time to comparison-shop. Discount coupons, shopping offers are what you should be on the look out for.
3. Chuck credit facilities
With the holiday season approaching, many companies provide deferred billing options, allowing you to shop now and pay the bill three to six months in the future. What you might not realize is, if you can’t afford items now you won’t be able to afford them when the bill arrives, either. Pay now, instead.
4. Put your talents to some use
If you’re the artsy or crafty type, use your creative skills in making a gift for your loved ones. Not only will it be appreciated much mores, but will also substantially reduce your holiday-related spending costs.
5. Group gifting session
Get your friends to participate in a secret buddy gift exchanging session. All you got to do to choose a secret pal, is write their names on slips of paper, put them in a bowl, and then pick one name each. With a limit on the gift prices, now you end up wishing all your friends fair and square. Buying just one instead of several is a huge way to keep your costs down.
6. Plan ahead
Obviously you have a rough idea of how much you will be need for gifting. Set up a holiday gift-giving fund. Put aside Rs.100-200 each week just for holiday purchases.
7. Give your best
Don’t be stressed by your lack of finances. Always bear in mind that even the best present you purchase won’t compete with your presence. Make time to hang out with family and friends. Then wrap up the memories, and share them from year to year.
Well here are some tips that will help you get through.
1. Curb your spending
This season opt for some low-cost but attractive gifts. Just because you’ve always been known as a fabulous gift-giver, it doesn’t mean you go overboard with your spending.
2. Be the early bird
Start shopping before the holiday season begins. Not only will you reap cool bargains, but it will also provide you with ample time to comparison-shop. Discount coupons, shopping offers are what you should be on the look out for.
3. Chuck credit facilities
With the holiday season approaching, many companies provide deferred billing options, allowing you to shop now and pay the bill three to six months in the future. What you might not realize is, if you can’t afford items now you won’t be able to afford them when the bill arrives, either. Pay now, instead.
4. Put your talents to some use
If you’re the artsy or crafty type, use your creative skills in making a gift for your loved ones. Not only will it be appreciated much mores, but will also substantially reduce your holiday-related spending costs.
5. Group gifting session
Get your friends to participate in a secret buddy gift exchanging session. All you got to do to choose a secret pal, is write their names on slips of paper, put them in a bowl, and then pick one name each. With a limit on the gift prices, now you end up wishing all your friends fair and square. Buying just one instead of several is a huge way to keep your costs down.
6. Plan ahead
Obviously you have a rough idea of how much you will be need for gifting. Set up a holiday gift-giving fund. Put aside Rs.100-200 each week just for holiday purchases.
7. Give your best
Don’t be stressed by your lack of finances. Always bear in mind that even the best present you purchase won’t compete with your presence. Make time to hang out with family and friends. Then wrap up the memories, and share them from year to year.
HOW TO SAVE ON UTILITY BILLS
Every day we make choices that affect how much energy we use and pay for. Follow the steps given below and you can save money without sacrifice or discomfort. Here are some simple steps you can take to reduce your utility expenses.
Water
Install new high performance, water-saving showerheads. It will cut the cost of your showers in half. Take shorter showers. Set a timer to remind you when time is up. Set the water to less than full force.
With tub baths, keep water levels below three inches.
As far as faucets go don’t leave the water running while shaving. Fix leaky faucets. Install water-saving faucet aerators on sinks you use the most.
When washing dishes don’t run hot water continuously for rinsing. Use a basin or pan. Don't fill basins deeper than needed. Use leftover wash water for soaking.
Refrigerator and freezer
Set the refrigerator to 38-40 degrees F. Place a thermometer near the thermostat to check setting. Set stand-alone freezers to 0 degrees F.
Locate refrigerators and freezers away from heat registers and stoves, if possible. Leave two to three inches clearance around the back, sides and top. Vacuum coils behind or underneath refrigerator twice a year. Clean coils help the compressor run less and last longer.
Keep the door closed. Open the door once to unload several items, instead of opening the door several times in a row.
Lights
Turn off lights when you don't need them.
Install lower wattage bulbs in overhead fixtures. Use floor and desk lamps for close-up work. Keep bulbs and fixtures clean. Dirty fixtures reduce light intensity by as much as 25 percent. Avoid "long-life" light bulbs or "energy buttons" except in hard to reach fixtures. They put out less light and don't save energy.
Install fluorescent lamps in rooms with lights on more than 2 hours a day. Compact fluorescent lamps produce a warm light and fit in many fixtures.
Cooking
Cook several meals at the same time.
Cover pans to cook food faster. Use pans that fully cover the burner. Avoid warped pans on electric burners.
Turn off the oven and burners a few minutes before food is done. It will continue to cook. Preheat the oven only when baking bread and cakes.
Use an electric skillet, microwave oven or toaster oven whenever possible.
TV, radio and stereo
Turn them off when you're not watching or listening.
Besides putting money in your pocket, saving energy is good for the planet. With a little care from everyone, we'll leave cleaner air, more fish in the streams and more resources for future generations.
Water
Install new high performance, water-saving showerheads. It will cut the cost of your showers in half. Take shorter showers. Set a timer to remind you when time is up. Set the water to less than full force.
With tub baths, keep water levels below three inches.
As far as faucets go don’t leave the water running while shaving. Fix leaky faucets. Install water-saving faucet aerators on sinks you use the most.
When washing dishes don’t run hot water continuously for rinsing. Use a basin or pan. Don't fill basins deeper than needed. Use leftover wash water for soaking.
Refrigerator and freezer
Set the refrigerator to 38-40 degrees F. Place a thermometer near the thermostat to check setting. Set stand-alone freezers to 0 degrees F.
Locate refrigerators and freezers away from heat registers and stoves, if possible. Leave two to three inches clearance around the back, sides and top. Vacuum coils behind or underneath refrigerator twice a year. Clean coils help the compressor run less and last longer.
Keep the door closed. Open the door once to unload several items, instead of opening the door several times in a row.
Lights
Turn off lights when you don't need them.
Install lower wattage bulbs in overhead fixtures. Use floor and desk lamps for close-up work. Keep bulbs and fixtures clean. Dirty fixtures reduce light intensity by as much as 25 percent. Avoid "long-life" light bulbs or "energy buttons" except in hard to reach fixtures. They put out less light and don't save energy.
Install fluorescent lamps in rooms with lights on more than 2 hours a day. Compact fluorescent lamps produce a warm light and fit in many fixtures.
Cooking
Cook several meals at the same time.
Cover pans to cook food faster. Use pans that fully cover the burner. Avoid warped pans on electric burners.
Turn off the oven and burners a few minutes before food is done. It will continue to cook. Preheat the oven only when baking bread and cakes.
Use an electric skillet, microwave oven or toaster oven whenever possible.
TV, radio and stereo
Turn them off when you're not watching or listening.
Besides putting money in your pocket, saving energy is good for the planet. With a little care from everyone, we'll leave cleaner air, more fish in the streams and more resources for future generations.
SIMPLE MEANS TO AUTOMATIC SAVINGS
For most people, mastering the art of handling money is truly a challenge. It’s really difficult for us to do it, difficult for us to admit that we don’t know how to do it and it wasn’t really something we were taught while growing up. As kids, our parents bailed us out when we ran out of pocket money. Hence, we never really learned. Here are five simple ways in which you can better your financial status today.
1. Sign Up For Automatic Savings: Most banks offer an automatic savings plan. Have a certain amount diverted to another account and promise yourself that under no ordinary circumstances will you touch it. To make sure this happens, don’t get an ATM card for this account.
2. Get More Out Of Your Paycheck: Have a long, hard look at your salary statement in terms of the benefits that you’re offered. Pay strict attention to the amounts allotted to health care, daycare, and ensure that you’ve got yourself the right plan that is ‘you’ specific.
3. Stop Before You Purchase: Think twice before you buy anything you didn’t intend on purchasing. The easier way to do it is to tell yourself that you’ll come back and purchase it the next day. If you’re shopping for something online, leave the item in your cart and get off the site. In a day’s time, you might reconsider your decision.
4. Your Financial Arms: Make sure that you keep a tab on all your financial arms -- your bank account, your credit cards, your financial statements and so on. Paying your bills on time and reducing the balances of your credit cards is a good start.
5. Get Yourself A Debit Card And Use It: Debit cards are really the best bet! You don’t have to worry about getting in over your head in credit card debt, you’re never surprised by bills and always have a certain amount at your disposal.
Paying attention to each of these and following up with them on a day-to-day basis could go a long way in improving your financial status.
1. Sign Up For Automatic Savings: Most banks offer an automatic savings plan. Have a certain amount diverted to another account and promise yourself that under no ordinary circumstances will you touch it. To make sure this happens, don’t get an ATM card for this account.
2. Get More Out Of Your Paycheck: Have a long, hard look at your salary statement in terms of the benefits that you’re offered. Pay strict attention to the amounts allotted to health care, daycare, and ensure that you’ve got yourself the right plan that is ‘you’ specific.
3. Stop Before You Purchase: Think twice before you buy anything you didn’t intend on purchasing. The easier way to do it is to tell yourself that you’ll come back and purchase it the next day. If you’re shopping for something online, leave the item in your cart and get off the site. In a day’s time, you might reconsider your decision.
4. Your Financial Arms: Make sure that you keep a tab on all your financial arms -- your bank account, your credit cards, your financial statements and so on. Paying your bills on time and reducing the balances of your credit cards is a good start.
5. Get Yourself A Debit Card And Use It: Debit cards are really the best bet! You don’t have to worry about getting in over your head in credit card debt, you’re never surprised by bills and always have a certain amount at your disposal.
Paying attention to each of these and following up with them on a day-to-day basis could go a long way in improving your financial status.
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