SBI Credit Card with 25, 000 Limit: Low Income, No Credit History Check

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Post demonetization, there have been instrumental rise in efforts for making India a digital economy. Various businesses or service providers who were once accepting only cash are switching to cashless transactions. And banking on this golden opportunity are obviously the banks and wallet companies such as Paytm, PayU, MobiKwik and others.

However the biggest beneficiary has been bank as there has been a huge deposit of cash in their pocket and at the same time, they have witnessed a significant surge in card usage. And to benefit from this further and at the same time generate new customers – SBI will be launching credit card for low income earners with a monthly credit limit of Rs. 25, 000. This card would be available in the market in 2-3 months.

Features of 25, 000 limit card:

Since this is happening for the first time in the history of Indian banking that such as card will be launched. Let’s look at the features of the card:

  1. No strict income criteria: The first eligibility criterion for getting card is monthly income of the applicant. If income is low then chances of getting a card is bleak. However the most striking feature of this card would be that the income cap will be largely reduced. Check out credit cards for poor earners available in the market.
  2. Low credit limit: Since the target audience of SBI is low income individuals; the credit limit available would obviously be very low. And it would be capped at Rs. 25, 000 per month. Normal credit card has limit of minimum Rs. 50, 000. But this should not be a problem for the users of the card, since they get free money for a month to spend in addition to the following exciting feature.
  3. No credit history required: In the current market scenario, any credit approval is granted on the basis of thorough back ground check of the applicant. From fetching the financial transaction history from CIBIL to social profile check; banks are evaluating applicant in every possible way before approving any application. However this card for lower income earning, will require no credit history check.
  4. Fast Delivery: Card would be delivered in a short time period compared to normal card which typically takes average 10 – 15 days to receive by the applicant. The reason for doing this is to tap large prospects base.
  5. Interest rate: It is expected that this card will carry a very low interest rate.
  6. It is also expected that this card will have zero annual and joining fee.


Three entities would be straight away benefitted through this would be the: card user, SBI, and India. Let’s see how:

Card user:

  • Get credit: For honest individuals who were earlier not getting card will now easily get it.
  • Build Credit History: Although there are credit cards for low income earners, not everyone gets card approval. This is due to lack of credit worthiness. However with this card, any person with no credit history but who actually has a capacity to repay money can get the card. Once they start using it and repay the due amount on time, their credit history will start to build. And this directly will increase their likelihood of getting access to higher credit limit cards and loans such as personal, car, home loans and others. Check out personal loan for low income earning individuals.
  • Money saver: In the age of cash backs and reward points, people with no cards were not getting any of these. However once this minimum income requiring card is launched more and more people will get various discounts and eventually they can save money, as they start spending more.

For the bank:

  • New customers: Since the main objective is to make people use card and switch to go cashless, SBI will get new card customers.
  • Profits: As more and more people start using this card, bank will start making profit through the interest earned. Moreover bank can cross-sell more services to these customers. So more service mean more revenue for SBI.

For India:

  • Promote digital economy: The whole objective of currency ban was to push people to transact digitally and rely less on cash. As such card reaches to more and more people, the vision of making India a less cash economy will definitely get a boost.

Once the card is launched, more banks will pitch in to generate more customers and launch such cards.


  • It is expected that State Bank of India will provide this card for their existing bank customers. They will look at the transaction history and based on that this low income card will be given.
  • Even honest Jan Dhan Account users will get this card based on their financial history and subject to bank’s decision.
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Save Money on Electricity Bill – Refrigerator, AC, Geyser

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We often end up spending more on stuffs or unknowingly waste money on utilities which could be controlled. However if you start saving money through following listed ways, it will surely guarantee in making you rich. Some of these options will help in saving you small amount of money or some will help in saving thousand of rupees in a year.

Let’s look at tips on how to save money on electricity bills:

Refrigerators, air conditioners, geysers are the amongst the most power consuming electrical appliances. However you are unknowingly burning money on using them incorrectly which is resulting in higher electricity bills. Let’s consider ways to save money on each of these one by one.


  • Never keep refrigerator in a place where it doesn’t get sufficient air. Atleast keep it in a position where it gets sufficient air from atleast two sides.
  • Also make sure there is no direct sunlight hitting the refrigerator. This results in refrigerator utilizing more power and hence more bill.
  • Never overload fridge. Over crowded space result in insufficient circulation, leading to more energy consumption. Moreover, it will also cause food spoilage.
  • Do not make defrosting a regular practice.
  • Do not keep hard plastic sheet at the base of any object. For e.g. to keep refrigerator away from dust or spills, we often make use of plastic sheets or mats. However if the sheets are very thick, the fridge will consume more energy for cooling the product. So make use of very thin mat.

Air conditioner:

  • Another pocket burner as it consumes highest energy, yet it cannot be avoided. However there are small tips which can help in saving money by reducing electricity bill due to AC.
  • Do not let direct sunlight to directly fall on the outer part of the air conditioner.
  • Regularly clean AC filters.
  • When AC is switched ON, keep doors and windows closed.
  • Many people use blankets or thick bedsheets to prevent themselves from cold temperature due to AC. Such people should switch the AC off for certain time and use fan. The room will continue to give a feeling of coolness. Another option is to set a timer.
  • Another way to reduce electricity bill caused to heavy usage of air conditioner is to increase the temperature from 22 degree to 25 degree. Not everytime you will need cool temperature. This will save good amount of energy.

Health Tip: Remember that prolonged use of AC results in dry and flaky skin problem. This is because AC removes humidity from the room resulting in skin to loose moisture and making it dry. This cause itchiness. And in the long run, lack of skin elasticity due to moisture loss causes wrinkles, giving it an aging appearance. Skin problem is one of the health hazard AC poses besides fatigued body, breathing problems, joint issues such as arthritis, and intolerant to heat.

Interesting read: How to save money on medicines in India.

Water heater or Geyser:

  • We often keep geysers ON until the bucket becomes full or till you bath if if taking shower bath. This results in higher energy consumption and also loss of water. If you have a habit of using bucket full of hot water, then switch the geyser OFF once the bucket is 60%-70% full. The hot water will continue to flow despite of it being OFF. This will definitely save electricity.
  • There are also auto off feature geysers in the market whose main purpose is to automatically switch the appliance OFF when someone forgets to do it.

All the above listed tips will definitely help in decent amount of money every month. And the same can be invested to grow your wealth.

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Switch ELSS Fund, Direct Equity Vs. Mutual Fund, Balanced Fund Importance & More

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Here are few questions commonly asked by mutual fund investors.

Can you switch from one ELSS fund to another with same or different fund house?

Switching ELSS is not allowed to different fund house. However if you want to move from one ELSS fund to another within the same fund then you will have to stop making contribution in the existing fund and start new investment in another.

Also be noted that ELSS funds have a lock-in period of 3 years.

If I plan to invest in multiple SIPs for a longer duration, what date should I start putting money?

There is no golden rule for investing on any day or date to start SIP. There is no return differentiation as in the long run, returns won’t change drastically if they are invested in a same month but at different date. But experts always recommend to invest in the first week of any given month.

Why investing through mutual fund is recommended over direct investment in equity?

Although anyone has an option to investing in equity directly, but investing in it through mutual fund is recommended especially to those who are not enough knowledgable or have time to track market. Reasons are fund managers and their team who manages respective funds are highly skilled and knowledgable. Decisions on what to invest in, when and how much to invest is taken by these managers and their team. It is their job. Investors only role is to go through all the terms and conditions of the fund and select the fund house and put money. Not everyone has time and especially knowledge of selecting best stocks from plethora of options, analyse, when to invest and exit, keep track of economy, market trends to name a few. So for such individuals investing through MF is worth recommended. Basically MF route minimizes losses, as careful evaluation is done before investing. And that’s what makes them easiest and safest way to invest in equity.

Why balanced funds should not be ignored over tax saving funds?

Compared to tax savings ELSS funds, balanced fund offers lower returns. However the risks involved are lesser in case of balanced fund also called as hybrid fund. The reason they are called hybrid is because investment is done in equity and debt in a certain ratio through asset rebalance, which is not possible in case of pure equity funds. The fall in market will not lead to higher losses in case of balanced fund. So for low risk investors, balanced funds offer higher returns compared to traditional options such as PPF, LIC, etc. but lesser returns compared to equity oriented funds which involves higher risk.

When should you invest in short term debt fund?

If your investment horizon is very short e.g. 3 months, then you should opt for short term funds. Other option is liquid fund which is tax efficient. But both these avenues involve risk. So in such case, bank fixed deposit is also a recommended solution.

Is there any mutual fund with zero risk involved?

Answer is NO. Every MF carries risk. So if someone who wants to play completely safe bet then public provident fund, bank fixed deposit, recurring deposit, Sukanya Samriddhi yojana, etc. are worth recommended. Check out zero risk, high return investment options in India.

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How Budget 2017 was different from Earlier Budgets

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By now everyone must be knowing that Union Budget for 2017-2018 was presented by Finance Minister Shri Arun Jaitley on 01st February 2017. However very few of us know that how this budget was different than all the budgets which had been presented over years in India.

Let’s have a look:

Union and railway budget presented in advance: Budget in India were normally announced in the last week of February or in the month of March until the year 2016. However this year, for the first time, announcement of the budget took place in the 1st week of February. One of the objective is facilitating the development work.

Railway budget and union budget presented on same day: The largest transport company in India had a history of presenting the rail budget before the union budget. But in 2017, both these budgets were announced on the same day.

Railway minister did not present the rail budget: Until 2016, the railway budget was presented in the parliament by the Railway minister. However this 92 year old tradition was changed in 2017 budget, as the presentation of rail budget was given by Finance minister Shri Arun Jailey and not Shri Suresh Prabhu, who is the current railway minister.

Economic survey: Since union budget was presented nearly a month in advance, the economic survey date was also preponed and was announced on 31st January 2017.

Read interesting facts on Indian budget.

Digital budget: This year’s budget was presented in a paperless format. Every year hard copies of the circulars are released by the government in paper format and passed on to all the member of parliaments. However in 2017, all the important documents will be made available through Union Budget Information System (UBIS).

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Close HDFC Car Loan in 3 Steps: Visit Bank, RTO & Insurer

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The most important part in fulfilling your dream of owning your favorite car is – getting a car loan and closing the car loan as early as possible. There are multiple banks offering vehicle loan in India and HDFC bank is one of them. It offers various types of loans including car loan.

Most borrowers think that paying last EMI means you are all done. There are steps involved which are equally important before car loan account status can be said to be completely CLOSED.

The three steps for HDFC bank car loan closure are as follows. Each process is explained below in the article.

  1. Visit HDFC bank and get No Due Certificate (NDC) or No Objection Certificate (NOC) and form 35.
  2. Visit regional transport office (RTO) to remove and update the hypothecation in RC book.
  3. Get hypothecation removed from the insurance company record.

Step-1 – Visit bank:

HDFC car loan can only be closed by personally visiting the bank. You cannot close it online or over phone. But before going to the bank for closing the car loan; you need to ask for the loan account balance statement. If there is any balance remaining, you will have to pay the due amount. If you opt for foreclosure, then you will have that amount along with prepayment charge, if any, and then close the account.

You need to carry loan approval letter while visiting the bank. Once the bank verifies the loan account, they will grant approval for a closure. Post approval, they will issue you loan closure/termination letter i.e. NOC or NDC along with the RC copy and Form 35. This form is basically a notice of termination of the hypothecation agreement between the borrower and HDFC bank.

Check out car loan for low income earners.

NDC or NOC: It is the only legal proof that states borrower is free from obligation. Once loan is closed or terminated, it is actually the HDFC bank’s responsibility to provide NDC or NOC to the borrower. Non-availability of this most important document can hinder in following ways:

  • In case of any loan related dispute with HDFC bank, you won’t have any proof showing loan has been completely closed.
  • For any claim to be made to the insurance company, this document is required.
  • If your CIBIL record states that loan is still active, then NDC or NOC will come to your rescue.
  • You cannot sell the car against which loan was taken in the absence of this document.

Step-2: Visit RTO

Once all the formalities are done with the HDFC bank, you will have to visit regional transport office (RTO) where the said vehicle is registered and carry following documents:

  • NOC and/or closure letter issued by the bank.
  • Form 35
  • Photocopy of RC
  • Photograph
  • Receipt showing charges for hypothecation removal
  • Photocopy of vehicle insurance

When you take car loan from HDFC bank, the legal owner of the car owner becomes HDFC bank. But after closing the loan, you will have to remove bank’s name and update your name on the car’s registration certificate (RC). And RTO is the authority to do this. Once RTO verifies all the documents provided by the bank, they will provide a new RC book with hypothecation changed to the new vehicle owner i.e. YOU in this case. Once name is changed, the car finally becomes legally yours. Other option to get hypothecation updation is through agents. But this might incur additional costs but will save your time.

Read more on how to get car loan if you are a CIBIL defaulter.

Step-3: Removal of hypothecation from the insurer:

Finally you will have to get hypothecation removed from the record of insurance company. For removal; car owner i.e. you in this case; will have to provide following documents for verification:

  • NOC or NDC
  • Form 35
  • RC copy bearing your name

Congratulations – the car is completely yours now. Now after a month, check CIBIL records and verify whether bank has updated the records of loan account as closed. If not, immediately ask bank to do so. Pending status in CIBIL record will create problem in getting any type of credit in the future.

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7 Health Insurance Types: Individual, Floater, Top-up, Critical Illness & more

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Every individual’s health is different and needs vary accordingly. However one thing every individual should buy is a health insurance. This is because medical inflation is at rise coupled with lifestyle related diseases. With multiple health insurance insurance plans available in the market, it is confusing especially for a first time buyer to choose a desired plan and most importantly the insurer.

Here are the common health plans available in the already flooded Indian insurance market:

Individual health plan: It is a very basic healthcare plan typically covering treatments undertaken when hospitalized. The cover extends to pre- and post- hospitalization expenses on medication and diagnostics, subject to limits and conditions in the policy.

Family floater plans: This is an extended version of individual health plan. It covers a family by spreading the risk across the members. For instance, a Rs. 2, 00, 000 cover is spread across four members; two adults and two children. This plan is most recommended to those who cannot afford individual plans for every member of the family. Although different families have different healthcare needs, a family floater policy with a sum insured of minimum 10-15 Lakh is highly recommended for families living in metro cities like New Delhi, Mumbai, Chennai, and others. The reason for higher sum insured plan is because in such cities the cost of medical treatment is very high compared to smaller cities like Nagpur, Ahmedabad, Surat, and others.

Read more on family vs. individual plans.

Senior citizen health plans: As they name indicates, these are the plans for individuals who’ve crossed 60 years of age. Such plans come with a lower value of cover, due to the predictable risks associated. If you are a senior person with no health insurance in the kitty, then you should buy a basic health cover to reduce the financial burden on you or your dependents, in case of any hospitalization. But remember that, not many companies in India offer plans for senior as probability of health risks go up as you grow older. And if they do, exclusions create hindrance. This is the reason why medical insurance should be bought at an early age as premium is low as risks are minimal.

Check out what to look for in a senior citizen plan.

Group health cover: Provided by employer to their employees with additional benefits that individual plan do not offer. The most important benefit is that the pregnancy is covered in most of the plans, which typically is not covered in an individual or family floater. And if covered, waiting period is applied.

Hospital cash: Such plan pays a fixed sum for each day spent in the hospital. This sum excludes room rent and medical treatment undergone during the stay at the hospital. It acts as a buffer as it prevents income loss due to hospitalization.

Critical illness plan: Long term critical illness health lists wide range of cost, low incidence critical health conditions such as cancer, stroke, or kidney failure that it covers for 20 years period. Most recommended to individuals having family history of critical ailment or the ones leading a lifestyle which typically leads to such illnesses. It also helps to cover medical bills and other related expenses and acts as a supplement to health insurance plan.

Top-up and super-top up plans: This cover goes beyond the threshold limit or the maximum limit of the existing health insurance policies. For instance, if an individual has an individual cover of Rs. 3, 00,000 and also a top-up cover for 10, 00,000; the threshold limit of 3 lakh will work the best.

If you are not happy with your health plan, then transfer option is also available.

Choosing a right insurer after going through terms and conditions in detail is also a key factor to be considered in addition to the type of plan. It’s your duty to know as much as possible about your policy and its features/benefits.

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How should single breadwinner plan finances

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Financial planning for the individual with following scenario:

Annual Income: 11. 50 lakhs per annum
No. of dependents: 3
Any insurance taken: No
Group cover: Yes. But parents not covered.
Any loans taken: Yes – Personal loan.

Insurance is the most important thing such an individual should buy. Here are the recommendations:

Life insurance: If you are the only earning member in the family with dependent – wife, mother and father, the adequate life cover should be the top most priority. Best and the cheapest option is to buy a term insurance.

Personal Health Insurance: In addition to this, you should buy personal health insurance even if the family is covered by employer i.e. group cover. In case you switch to new job where group cover is not provided then your personal health cover will take care. Adding a maternity cover will further benefit. Read more on reasons to buy personal health policy.

Health insurance for parents: If parents are not covered under the group plan, comprehensive health insurance should be purchased. Although premium would be on a higher side but it’s worth putting money to avoid financial setback when anything happens to the parents leading to hospitalization. In such a scenario, insurer will take care of the expenses.

Get rid of debt: Before such a person falls in a debt trap, personal loan should be paid off as early as possible.

Emergency fund: If there is additional cash in the bank account, then the same should be transferred to a recurring deposit account or a liquid mutual fund. Your aim should be to create a corpus of over 2 Lakhs, which will come to rescue at the time of any emergency.

Cut short unnecessary expenses: Start maintaining day to day expense diary and without fail note down the expenses. This way you can know what expenses were irrelevant so that next time you can control spend.

Go Online: If you shop only at physical stores then give a look at online shopping. Buying stuffs online can benefit in the form of cashbacks or discounts. You can create comparison sheet consisting of price of product at store vs. online. If the difference is significant then buy from there.

Increase earnings: Plan to get a job/business which will increase the earning by 20%+ within 2 years. It is the only to way to beat inflation and meet financial goals such as buying house/car.

Short term plan: Large plan of the accumulated savings should go into debt mutual funds and liquid mutual funds if the goal is to buy own house and a car in the coming years. Check out high risk, high return investments.

Medium to long term plan: Once some of the short term goals are met, start investing in equities. This is recommended to beat inflation and for this 40%-50% of the assets should go into equity or equity linked funds.

The most important point is to revisit the goals after 1-2 year and change the investment strategy accordingly.

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Where to Invest under Section 80C, 80CCC, 80D*, 80CCD, 80CCG

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Everyone who fits in the tax bracket has to mandatorily pay income tax. Although it’s painful; but for the nation’s economy it is very essential. Afterall the money accumulated from tax collection is used by the government for nation welfare projects such as road construction, energy, education system, and many others.

Therefore it is essential to have understanding of all the avenues that helps in tax saving and most importantly build wealth over time. Currently there are multiple investment avenues that take care of your tax liabilities and at the same time provide security to your life and health. Check out zero risk investment products.

These tax savers cover a wide ambit, from tuition fee paid for your child to the preventive health check-up you go for.

SectionWhat can be doneMaximum Investment Limit
80CInvest in EPF, PPF, NSC, NPS, ULIPs, LTA, Children's tuition fee, medical expenses, insurance premiums, 5-year tax saver FD, ELSS, senior citizen's saving scheme, Sukanya Samriddhi Yojana, Home loan principal repaymentRs. 1.5 Lakhs
80CCCClaim tax deduction on contributions to annuity plans from insurance companiesRs. 1.5 Lakhs in conjunction with section 80C
80D*Purchase medical insurance policies for self, family, and parentsSelf and family: Rs. 25,000
Senior Citizen: Rs. 30,000
Self and family + parents: Rs. 50,000
Self and family + senior citizen parents: Rs. 55,000
80CCDContribute to National Pension SystemEmployee and/or employer contribution up to 10% of basic salary and DA** is eligible up to Rs. 1.5 Lakh for tax deduction in conjunction with section 80C benfits under section 80CCC (1&2) as applicable. Additional exemption up to Rs. 50,000 in NPS is eligible for income tax deduction outside the section 80C limit and can be deducted as a deduction under section 80CCE.
80CCGRajiv Gandhi Equity Savings Scheme (RGESS)Deduction available on 50% of the sum invested or Rs. 50,000, whichever is less. Deductions can be claimed for 3 successive years, over and above the section 80C limit subject to complying with other requirements.

Most of us wait till the end of year and hastily plan our tax savers but it should rather be a year round affair.

Just like your provident fund gets deducted every month from salary, your tax planning too should move regularly. Remember, investing too is a form of saving. National Pension System (NPS), home loan, pension funds, insurance, ELSS, etc. are all investments that secure your future.

By taking up a good health and life policy, the gain is not just in terms of taxes, your dependents have it easy even when you are not around.

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Close HDFC Personal Loan in 2 Steps, Imp. Things to After Closure

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It’s a golden rule to repay any type of loan before the term ends. This is because personal loan carries a very high interest rate compared to other loans. So getting yourself out of recurring debt will help in saving good amount of money.

In India, there are multiple avenues to get personal loan such as commercial lenders, co-operative banks, peer to peer lenders, local money lenders, and others.

HDFC bank, India’s top most private bank offers personal loan at an interest rate of 15.75% – 20%. This article provides procedure to close HDFC personal loan in 2 steps as follows:

Step-1: Call their customer care number to get address of the nearest HDFC branch office. You can get their support number by clicking on this link.

Just select your city from the dropdown list. E.g. for top cities – Ahmedabad / Bengaluru / Chennai / Delhi & NCR / Hyderabad / Kolkata / Mumbai / Pune, 61606161 is the calling number. You need to add STD number of the city. If you are an NRI, then visit this link to get the calling number.

Step-2: Once you get the branch details, take your government issued identification document, loan account number for verification to the bank. Bank personnel will then verify all the documents and get loan account details. In case of any remaining due, you will be asked to pay the same.

Points to note: HDFC personal loan closure is not possible online or over phone. You will have to personally visit the bank to close the account.

Check out personal loan for low income earners.

Important things to remember after closing the personal loan account at HDFC:

Considering the fact that HDFC bank charges interest rate of 15.75% – 20%; quick closing of the loan account is the key for the borrower to save money spent on EMI. But closing your account does not necessarily mean, you are all done. There are certain key things you need to do for a successful closure:

  • Collect all the important documents: After HDFC personal loan is closed, collect acknowledgement letter from the bank. Collect all the documents if you have taken loan against property/securities/policy etc.
  • No objection/due certificate: Another important document to ask HDFC bank is the NOC. No objection certificate or no due certificate is officially accepted legal proof of loan account closure. The certificate states that the borrower has made all the repayments and no outstanding balance is pending.
  • Pre-closure acknowledgement receipt: If you have closed your HDFC loan account before end term; then get pre-closure acknowledgement receipt from the bank.
  • Get report from CIBIL: After 60 days of HDFC loan closure, visit CIBIL website and get your personal credit report. Key thing to check is whether bank has updated the loan account record at CIBIL stating loan account closed. If record is not updated, then E-mail HDFC bank to do so at the earliest. E-mailing will help you in case no response is received from the bank.

Read about HDFC credit card payment options.

The reason to do all these is because it will help you in case any disputes arise in the future when you apply for any type of credit or loan or if the bank get back to you stating dues are still remaining.

Various personal loans from HDFC Bank:

  • Loan on credit card: This pre-approved loan Insta Loan and Insta Jumbo loan is for HDFC credit card holder. Loan amount is within the credit card limit for Insta loan. Higher loan amount can be granted in case of Jumbo loan. Other bank’s card holder can also get loan by transferring the balance from other bank to HDFC bank credit card. After transfer you can continue payin the due in EMI.
  • Loan against securities: Instead of selling securities such as equity shares, mutual funds, gold deposit certificates, LIC policies, NSC, KVP; you can get loan by giving these securities to the bank. Interest is charged only on the amount withdrawn from the account and the time for which the amount is utilized.
  • Loan against property: Higher loan is possible by mortgaging your property with the bank. Another benefit is that the EMI is low and higher tenure.

Other types of loans offered are professional loan, loans against assest, and consumer durable loan.

Benefits of taking personal loan from HDFC Bank:

  • Eligibility check in one minute
  • Get loan approved within a day provided all the eligibility criteria are met
  • Faster loan processing
  • No hidden charges
  • Account holders can get special offers on interest rates and other charges
  • Women employees get better rates compared to others
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Investment of Rs.5000 in Mutual Fund for 25 Years Aged Individual

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Mutual fund investments has become popular as risk appetite of individuals have gone up. Here are few queries asked the readers of this blog.

How should an individual aged 25 years and earning Rs. 25, 000 per month invest in mutual fund?

25 years is an excellent age to enter investing in mutual fund through systematic investment plan. If such an individual is ready to invest Rs. 5000 every month in SIP, then long term systematic investing through SIP is recommended. Once such an individual arrives at the time frame for which regular investments are planned, then he/she should assess the risk tolerance and decide on an appropriate asset allocation which can be a mix of equity and fixed income. Then select the funds to start build a portfolio.

Top rated (Rank-1) CRISIL funds for the year 2017 are:

Large Cap1 Year % Returns as on 12Jan2017Small & Mid Cap1 Year % Returns as on 12Jan2017
DSP BR Focus 25 Fund (G)15.4DSP-BR Micro Cap Fund - RP (G)20.5
Kotak Select Focus Fund - Regular (G)18.3Franklin (I) Smaller Cos (G)18.3
SBI Blue Chip Fund (G)12.8Mirae Emerging Bluechip Fund (G)21.2

Finally, review the performance of these funds at least every year and accordingly make changes or rebalance your portfolio to maximize the gains.

What if someone has invested in an ELSS in the year 2015 for 2 years and wants to redeem or take money out?

Equity linked savings scheme or ELSS have a lock-in period of 3 years. It means that unless your investments complete three years, you cannot redeem them.

If someone has Rs 1 Lac and wants to invest for child’s future in mutual fund, how can he go about it?

A sizeable corpus can be created for the child’s future by investing regularly through SIPs in mutual funds. Consider long term goal of minimum 10 years and start investing in the following top rated diversified equity funds by CRISIL (Rank-1):

Diversified Equity1 Year % Returns as on 12Jan2017
Birla SL Advantage Fund (G) 18.5
Birla Sun Life Equity Fund (G)26.1
Birla SL India GenNext (G) 16.2
Principal Emerging Bluechip(G)20.4
Sundaram Rural India Fund (G)31.5

Assuming 1 Lac is deposited in bank, SIP can be started in any of the above two funds for a monthly sum for long term. However it is the duty of the investor to track the performance of the invested fund regularly and assess the growth and realign whether it is moving in the direction of achieving the set financial goal.

Someone who is aged 35 years and has just started investing in mutual funds through SIP in the funds SBI bluechip equity, Birla sunlife top 100, Mirae asset emerging bluechip and BNP Paribas mid cap. Has the investor selected best funds under his/her portfolio or another fund should be invested in?

The fund selection looks good and instead of adding new fund, he/she should increase the allocation to any of the existing investments. This is because, the performance of these funds has been good. Here’s the table showing 1, 3, & 5 year performance.

Name of Fund1 Year3 Year5 Year
HDFC Equity6.3915.7416.06
Mirae Asset India Opportunities7.0518.9219.07
HDFC Top 2008.113.914.63

If this investor still wants to put money in mutual fund, then he/she can try opting for ELSS which carries a lock in period of 3 years.

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