10 Rules to Get Out of Debt

Debt is mainly the result of excessive consumption or ill-considered financial habits. Debt, a financial set back, results in stress to the individual and his/her family amongst many others.

But there are some basic tips to get out of debt as listed below:

1. Analyze historic financial expenses

Knowing your past is the best way not to repeat the same mistakes. Pull out your account statements and list your expenses over the past few months. Next, identify consumption patterns that need to be reviewed.

2. Prepare budget

Simplicity is the key to success: expenses are deducted from income. Avoid dividing your expenses into multiple categories. The more complex it is, the more likely it will be left out.

3. Be honest and realistic

You must accept the fact that changes to the monthly budget are necessary from time to time. Distinguish essential expenses that do not change every month (rent, gas, etc.) from those that can be reduced or eliminated (unused subscriptions, dining out) and unexpected expenses.

However, a budget that is too strict often leads to abandonment. Determine a realistic monthly amount for debt repayment. It is better to take your time and be consistent than to rush everything and get discouraged.

4. Track your budget

Mobile applications can make your job easier, but regardless of the tool, periodic monitoring helps you control expenses and avoid returning to bad habits.

5. Establish an adapted game plan

Generally, it is best to pay high interest rate debt first. Whatever the balance, they cost the most. However, don’t neglect the psychological aspect of a repayment plan. If for any reason, a debt bothers you, prioritize it.

In all cases, it is suggested that you focus on one debt at a time, while making sure you make the minimum payments on the others.

6. Consider loan consolidation

Increased debt can be a source of stress. Loan consolidation makes it possible to group them together in a single loan, which greatly facilitates budgetary management.

However, it can have a negative impact on your credit score and you may be required to permanently close the financing accounts it covers. The credit associated with these accounts would therefore no longer be available to you, which is not necessarily a bad thing if you try to get out of debt.

7. Choose an appropriate limit

Once you have reached a more comfortable debt level, avoid returning to your bad habits by keeping your credit limit below your monthly income.

8. Generate a secondary source of income

If your conditions allow, temporary income support is a sacrifice that may be worth the cost. But be careful not to do this at the expense of your health.

9. Put on sale what is no longer used to repay debts

Getting rid of things is never easy. But it’s a way to get some money back and reduce debt.

10. Do not isolate yourself

There is no embarrassment in wanting to take charge of your finances. Talking about it openly can offer some relief and moral support. It is the same with your financial security advisor who could propose practical solutions to get you out.

Inherited Wealth in India: What to do & what not

Have you ever wondered what you would do with an inherited wealth such as cash/property/jewelry etc. in India ?

This article helps in how to make good use of inherited wealth and avoid wasting money.

Here are the tips:

Planning: The very first step is planning. Never start making use of money as soon as you get it. Take advantage of the first few months to develop a plan, along with expert advice to use and invest money. It can be naturally tempting to start spending your inheritance, but it may be smarter to set a waiting time and use this time to decide how to make the wealth grow.

Seek expert advice for financial planning: If you do not have knowledge of investments and financial terminologies, then seek a financial advisor’s help. A financial planner can help you develop a strategy that works best for your situation, and devise an investment plan according to your risk appetite.

Consider taxation: The good news is that, in India, there is no tax on inherited wealth or property. However when you make use of the inherited money or property in order to generate wealth then you become tax liable. And your financial consultant is the best person to guide on taxation, especially when you do not have knowledge of this subject. Do not think that generating a large sum will go unnoticed. Ask your advisor about the necessary taxes according to the type of inheritance received and income generated out of it. Anyone would love to stay rich and hate paying taxes. But still as a responsible citizen, paying taxes helps government in nation building.

Take legal help: We often hear long legal cases because of inherited wealth. And only a lawyer can help you resolve any potential legal issues. So before making any use of money received, consult a lawyer.

Invest wisely and make some extra profit: Everyone wants to make money out of money. You will come across various high return investment products but not every product will offer you guaranteed high returns. It’s likely to get attracted to risky, illegal, or possibly scammy investment products requiring high investment and claiming to give highest returns. So it is best advised to look for a safe investment, which earns a little each year and at the same time keeping pace with the market.

Do not show off: If you start talking about the money you’ve received, you may start noticing how your circle of friends and family growing. People from the past will suddenly want to come closer again, but they may only be interested in what they can get from you.

Do not invest in business: Even though you may have a substantial amount of money in your possession, don’t invest in a new business without knowing complete details. Take expert’s advice before putting money.

How Inflation Affects Savings & Why Never Keep Money Idle

When we think about saving, the idea of ​​keeping the money idle in your house is not good. It is true that, if you put money in your cupboard/anywhere in the house for years, in the end you get a very important savings fund. The problem is the final value of that money saved at home. If you save Rs. 20,000, you will have the same Rs. 20,000, but that money may not allow you to buy the same stuff as before because of the inflation i.e. it’s value of your money goes down.

In this sense, when inflation is taken into account in our savings and consumption decisions, it is better explained why it is not a good idea to leave the money under the mattress.

What is inflation?

Inflation is the increase in the price of goods and services over time. Banks typically defines inflation as the increase in the general level of prices, for example, in the consumer price index (CPI).

This index, created from the price of different products and services in the shopping basket, marks inflation at all times. The CPI of a specific month is compared with that of a year earlier to see its variation. If prices increase there is inflation, but if prices fall, deflation occurs.

When inflation rises, prices are more expensive, while savings are lower because rupee is worth less and less. This means that with the same money you can buy fewer products and services and, therefore, you lose purchasing power.

How is inflation controlled?

There are different types of inflation that affect both the general and the personal economy. Depending on what inflation is, the measures adopted for its control affect us in one way or another. For example, high inflation is controlled by rising interest rates, which has negative consequences for those who have loans or mortgages.

When the rates rise, it tries to contain inflation and stabilize prices, because there is less demand for money through loans. On the contrary, when the rates fall, mortgages become cheaper, customer demand increases, but, at the same time, the profitability of savings is lower.

How does inflation affect savings?

The goal of saving money is to obtain the highest possible return. In general, the higher the interest rate, the greater the profits for the saver. However, this performance would have to be subtracted from inflation to know what the final gain is. That is, when rates are high, inflation is also high, so we must discount this, while, if inflation is 0, we should not subtract anything from the perceived returns.

For this same reason, it is not a good idea to save money i.e. keep it lying idle, because money loses value over time, suffering the effects of inflation. Money is devalued with inflation, which means that, if we keep Rs. 20,000 unused, with 3% inflation at the end of the year, even if we have the same amount, its purchasing power will be decreased by Rs. 600.

6 Consequences Credit Defaulters Have to Face in India

There are certain mistakes which make life miserable. And one such mistake is a credit card / loan defaulting. These two words can shackle your life in a big way and their consequences are simply very terrible. And not many of us are aware of the impact of defaulting.

Depending on the type of credit or loan taken and lender, the consequences differ.

Here are the consequences defaulters have to face:

Account closure:

To those who are not aware of what happens when you default, banks will first close your account (loan or credit card), marking it as a delinquent or non-performing asset (NPA). This happens after 90 days of non-payment.

Banks will report your default status to the credit bureaus. Now if you apply for a credit card or loan elsewhere, your credit report will be fetched by the applicant bank from the credit bureaus. This report contains personal/professional/business contact details, loan or credit card details, repayment history, debt status, and many others. And most likely your application will be rejected. This rejection is further reported to the credit bureau. Remember multiple applications also has a negative impact on credit score.

Harassment by collection agency:

Account closure by the bank is not the end. The real trouble starts when banks pass on your case details to the collection agency or recovery agents. Their only objective and business is to get banks their money back and that’s what they work for. Banks hire in thousands to reduce their non-performing assets and pay commission which is certain percentage of the amount recovered.

So first, defaulter will get multiple phone calls from the collection agency asking for making the complete repayment along with the interest. If this does not solve their objective, they will not mind entering your home or office and start harassing you for recovering the money. If this too fails, then get ready to see your belongings to being taken away forcefully by the collection agencies.

Additional reading: Credit card for defaulters.

Home/Car/Bike Seizure:

If you have taken loan for car/bike/home and default on EMI, then be ready to face the worst. All your hard earned belongings will be taken under control by the banks and becomes their property. And they can do anything with the seized assets. Mostly they put it on auctioning to recover from the losses. So you will see all your assets getting auctioned in front of you. This certainly will give you sleepless nights.

Check out how cibil defaulter can get personal loan.

Contact employer:

While taking any credit card or loan, if you mention employer’s name then bank or collection agency may approach your company.

Legal action:

If the debt amount is huge, then be ready to face legal action. You will have to start appearing for court proceedings.
Remember money is not free. And everyone has right to recover the money and so has the bank. And irrespective of the reason for default, you are likely to face above mentioned unavoidable consequences.

Harass guarantors:

If the loan taken has guarantor involved then in addition to the defaulter, guarantor will have to face harassment by the recovery agent.

Reducing the impact of default:

Impact of defaulting can be reduced by talking in advance with the lender. For e.g. if you think that your job is at risk and you have taken home loan, then you should talk with the lender beforehand and explain the condition. If your past repayment history is good, lenders may reduce the EMI and increase the tenure. Personally visiting them should help in such scenario. Do not hesitate. In fact, lender can assist in giving more solutions to your problem.

Improve Credit Score: 11 Tips & Reasons for Poor Score

Credit score is the gateway to the credit world. It is a three digit number which either helps you in achieving dream such as (buying home/car) or break the dream. Your credit worthiness is evaluated on the basis of this number.

This three digit number given out of 900 is statistically derived for every individual after evaluating their credit payment history (loan or credit card). Poor the number, higher would be the rejection chances of your loan or credit card application and vice-versa.

So what factors affect your credit score and how to improve the same?

Here are 11 ways to improve your credit score:

Pay bills on time:

Whether you are having financial crunch or not, make a habit of paying loan EMI/credit card bill before the due date. Because frequent late/missed payment badly impacts the credit score. So you are at loss in two ways – loss of money as you will have to pay extra money to the lender in the form of late payment fee with higher interest. And getting credit in the future becomes difficult as chances of rejection increases, since you have been a late payer in the past.

But sometimes, even a timely payer can miss paying the bill on time. Either he/she forgets to remember the last date. In such cases, make a habit to opt for direct debit facility. So on a prefixed date, money will be automatically debited from your bank account and paid to the card company or loaner. And this way, possibility of missed payment is nil.

Do not keep or apply for too many cards / loans:

Keeping too many cards in the wallet has become a status symbol. Flaunting it will not going to make you a rich person. But using the card as a rich person (when you are not the one) will definitely make you poor soon. If not this, then it will definitely affect your CIBIL score. Because in the eyes of lender, too many credit card or having too many loans, is a sign of credit hungry. Remember “Greed Kills”. So always rely less on credit be it credit card or loan.

Do not utilize complete credit keep it less than 60%:

Higher transaction limit on your credit card does not mean you have to ardently utilize it every month fully. Use your transaction limit wisely and do not overspend or use credit to the full limit. Once in a while is OK. But repetitive habit results in poor CIBIL score. It is recommended to utilize not more than 40% of your credit limit.

Do not apply for enhancing the limit:

Individuals have an habit of completely relying on credit cards. And this is an opportunity for the card companies to offer you credit enhancement. If they do not offer, then individuals ask lender to offer increase the credit limit. In both the cases, the card user is at risk. Because enhancing the credit card limit too often/applying for it multiple times, affects your CIBIL score. Because in the eyes of CIBIL, enhancement means person relies too much on credit. And such individuals can pose risk to the lender in the future.

Pay due amount fully:

Your monthly card statement has one enticing line. Minimum balance due is just Rs. X. This number is very small compared to the total due amount. Individuals think that paying minimum balance does not harm in any way. But this is not true. Lenders get an opportunity to trick you and then charge higher interest. And at the same time, lenders send this transaction details to the credit bureaus (e.g. CIBIL), which results in bad credit score. In the eyes of lender such individuals are at higher probability of turning into defaulter in the future and are not credit worthy.

Do not apply at too many lenders after rejection:

It’s very common that when you apply for a credit card or loan, it gets rejected. This mainly happens because of no credit history or poor credit history. But such individuals then approach to other lenders for their credit requirement. However this is an incorrect approach. After the rejection, your first objective is to understand the reason and act on improving the credit score. Applying at too many lenders is an invitation to poor credit rating.

Check out personal loan for poor CIBIL score.

Do not stop using credit:

If an individual is in debt, then the very first action they take is stop using the credit card in order to pay-off the debt first. However this is not recommended. Ideally you should continue using the credit card, though in small frequency and with smaller transaction amount. But never stop using it completely, because it leads to decreasing credit score.

Read about credit card habits that affect credit score.

Keep credit mix balance:

In the eyes of the lender, if an individual has only unsecured loans in his/her kitty then they view it negatively. Instead if they have a healthy mix of secured and unsecured loan then the risk is low for the lender. Keeping balanced credit mix helps to prevent negative impact on credit score.

Get CIBIL report once every 2 years:

If you have cleared all the loans/ended credit card, then verify whether CIBIL records have been updated or not. This is because, many times banks fail to update CIBIL about the transactions on time. And in the meantime if you apply for another loan/credit card and it gets rejected, then your credit score takes a hit. So always check CIBIL report.

Check tips on how to get CIBIL score.

Become guarantor, but be careful:

Generosity can be risky at times. If you become guarantor to someone and if that person defaults payment in the future, then the guarantor is the person lender will approach for making the due payment. And at the same, the credit score of guarantor will be impacted. So be careful when becoming guarantor whether you do it for your family member or friends.

Offer add-on card, but remember you are also at the risk:

If your credit score is good then lender often makes you eligible to apply for an add-on card in addition to the primary card you already hold. This card can be taken for your family member. But what many people do not know is that, in case of defaults made on add-on cards, the credit score of primary card holder also gets affected. So as mentioned above for guarantor, be careful for whom you are taking secondary card for. Credit rating agencies are emotionless and not at all generous like you.


Above mentioned tips are very simple. But still people do not take their credit repayment seriously or do not understand it’s importance. And they end up affecting their credit score. Good rating is extremely important for finance need. So always keep an objective of getting best score and achieve your dream.

2 Wheeler Loan for Low Income (Rs.4000-15000) Earners: Income Reqd. by 18+ Lenders

Sales of two wheelers (scooters, motorcycles and mopeds) in India has been rising since last 5 years. Here’s the data from Society of Indian Automobile Manufacturers (SIAM) showing the domestic sales trend of two wheeler:


Despite this meteoric rise in demand for 2 wheelers, many people still cannot afford to buy their own vehicle. Because, for such individuals the cost is a concern. And for such individuals who cannot buy because of money, two wheeler loan is the solution.

There are multiple eligibility criteria before a two wheeler loan application is approved. And the most important being the income. It is the only factor through which lenders evaluate whether the applicant has repayment capacity. Although lenders also consider CIBIL score to judge credit worthiness of the applicant. Income is the very first thing checked.

Read about 2 wheeler loan for students.

Listed below is the minimum monthly income required by two wheeler loan providers in India:

Since two wheelers are not very expensive (assuming you are not buying a very high end bike). The income eligibility criteria is not very high compared to car, home and personal loan.

Name of the bankMinimum Monthly Income Required
HDFC BankRs. 7, 000 - Rs. 8, 000
Tata CapitalIncome not mandatory
Mahindra FinanceNo income proof required
IndusInd BankRs. 10, 000
State Bank of IndiaRs. 5, 000 - Rs. 6, 500
Tamilnad Mercantile BankRs. 6, 250
Hero FincorpNo income proof required
United Bank of IndiaRs. 15, 000
Muthoot CapitalRs. 8, 000 (salaried) - Rs. 10, 000 (self employed)
Central Bank of IndiaRs. 10, 000
Karnataka BankRs. 4, 000 - Rs. 5, 500
Punjab National BankRs. 10, 000
Bank of MaharashtraRs. 25, 000
Dena BankRs. 8, 250
Oriental Bank of CommerceRs. 10, 000
Allahabad BankRs. 15, 000
Indian Overseas BankRs. 5, 000
Syndicate BankRs. 4, 500

There are many other prominent lenders (listed below) offering loan for bikes, but their income requirement is not available.:

  1. ICICI Bank
  2. Canara Bank
  3. Bank of Baroda
  4. Bajaj Finserv
  5. IndusInd Bank
  6. Fullerton India
  7. Bajaj Finance
  8. L&T Finance & others

There are some lenders who do not ask for any income or income proof. However these lenders ask for guarantors, employment/business and residential stability, bank statement.

Other features in 2 wheeler loan:

Loan amount: Not all banks offer 100% finance for the two wheeler. Typically 85% – 95% of the invoice price of the vehicle is provided.

Pre-closure: Since the loan amount is small, it is recommended to close the loan as early as possible before the standard tenure. Although financiers will charge a small fee for pre-closure, it is worth doing it. This has two important benefits – credit score will be positive and money is saved as burden of EMI reduces.

Start building credit score: If you are taking loan for the first time for 2 wheeler, then it is an excellent opportunity to start building your credit score. Since loan amount is small, regularly paying-off EMI will put you in good book of lender and credit bureau. Apart from regular EMI payment before last date, you need to follow very simple rules to improve credit score –

  1. Never pay minimum balance and always pay in full
  2. Never show hunger for too much of credit. And do not apply for too many credit applications in a short span of time.
  3. Never do card settlement
  4. Stay away from balance transfer
  5. Do not spend over the credit limit

7 Financial Decisions/Investments Working Women Should Make

It’s a male dominated industry – we’ve often heard or read this many times. However things have changed and women are equally creating mark for themselves in every area. Since families are becoming more and more nuclear i.e. husband and wife working in different cities/countries away from their parents, and their children studying in another location away from their parents. And with rising lifestyle related ailments, securing financial future has become very essential for independent working women.

So what should working women do in order to make herself and family financially secure? Here are the financial tips for working women:

Buy health insurance: Although this is not an investment product which will earn money. But it saves money. Every married/single working women should buy a health insurance covering their family i.e. husband, child & her parents. If you are the only doting daughter wishing to give best retirement life to the parents, then it’s a definite buy. This is because in the golden years, health problems are very common. So instead of relying on personal savings of parents/husband/her own, medical insurance will take care of most of the expenses. And very small amount of money will have to shell out from personal savings.

If your parents have crossed age limit of 60 years, then there are health plans for seniors offered by companies. Although the premium is high but they are worth it. So this is the reason why it is recommended to buy health insurance at a young age, be it men or women.

Get added as nominee: Even if you are working, you should get your name added as a nominee in important investments made by your husband such as term insurance, fixed deposit or any other. If you fail to do so and something unfortunate happens to your husband then legal route will have to be taken to claim the money, which is a very cumbersome and painful process in India.

Buy life insurance: As the earning power of women increases, the responsibility of securing the financial future of her family has importance. Because in an event of death, permanent disablement, accident, there has to be someone who can take care of her family (husband and children) and her parents or siblings. So life insurance is highly recommended to both working married and single women.

Invest in child plan: If child is totally dependent on women and providing best education and life to your child is your dream, then child plan is a must product in the investor’s kitty. This is because when anything unfortunate happens to you, then the sum assured will take care of your child’s education and moreover the interim premiums will be waived off. Few of the plans also offer partial withdrawal feature which can be used for medical treatment of the child during the policy term. So if you consider your child and his/her happiness precious then do not neglect child plan.

There are many companies offering insurance plans especially for children as follows:

Child Plans

Life Insurance CompanyName of Child Plan
Max Life InsuranceShiksha Plus Super Plan
Future Genius Education Plan
HDFC LifeYoungStar Super Premium
YoungStar Udaan
Aegon ReligareAegon Life EduCare Advantage
Birla Sun LifeVision Star Plan
Kotak LifeChild Assure
ICICI Pru LifeSmart Kid Solution
PNB MetLifeCollege Plan
Smart Child
Bhavishya Plan
Smart Platinum
Easy Super
Money Back Plan
SBI LifeSmart Scholar
Smart Champ

Sukanya Samriddhi Yojana: If you have a girl child then opening a Sukanya Samriddhi Account (SSA) should be one of the investment product. Launched in the year 2015, the scheme is especially for girl child and offered interest rate of 8.6% for the financial year 2016-2017. The minimum investment per year is Rs. 1000 and only one account can be opened per child. You need to invest till 14 years and the scheme matures after 21 years from the date of opening the account. The maturity amount is very high. For e.g. if you invest Rs. 50, 000 per year then the maturity amount would be Rs. 24, 45,599 for the total investment of Rs. 7, 00,000 @ interest rate of 8.6%. Read more about SSA.

SIP: Womens are the best savers. And one way they can create wealth through dedicate savings is by investing in mutual fund. Through systematic investment plan, investing in top performing funds, women can generate high returns provided you are ready to take risk as MF investments are subject to market risk. Therefore you should take advice of financial advisor before putting your hard earned money in MF and also to teach yourself about it.

Here are the top performing equity funds and the returns generated. All these funds have a crisil rating of 1.

Top Rated Funds with Highest Returns

Mutual Fund Name% Returns - 1 Year% Returns - 3 Year
ICICI Pru Top 100 Fund (G)28.916.6
Kotak Select Focus Fund - Regular (G)3024.5
SBI Blue Chip Fund (G)18.320.4
HDFC Growth Fund - Direct (G)26.317.1
Kotak Select Focus Fund - Direct (G)31.525.7

Source: www.moneycontrol.com

Invest in zero risk instruments: If you are zero risk investor, then there are many investment products offering guaranteed returns as follows:

Zero Risk Investment ProductInterest Rate p.a. for Apr'17-Jun'17
5 Year Term Deposit7.7%
Public Provident Fund7.9%
5 Year National Savings Certificate7.9%
Bank's Savings Account4.00%
Post office monthly income scheme7.6%
Sukanya Samriddhi Yojana8.4%
5 Year Recurring Deposit7.2%
Kisan Vikas Patra7.6%

Cheque Bounce: Impact on CIBIL Score, Penalties & Legal Action

Amongst the many factors which impacts your CIBIL score is a cheque bounce. Even if you are financially very alert and always pay attention to your bank balance sometimes it might happen that you fail to check your bank balance and later when you deposit the cheque with your lender for making your credit card payment or loan EMI, you get a notification from the lender that your cheque has bounced. And this can create negative impact as your financial record comes into question. In banking industry, a bounced cheque is called as dishonoured or bad cheque.

So let’s understand what happens when cheque bounce.

Penalty on Bounced Cheque

There can be many reasons for cheque bounce such as insufficient funds in your bank account, details mismatch (for e.g. the signature does not match to the one in your bank record). In such scenario, you might be categorized as a defaulter. And in return, bank puts penalty along with a late payment fee which is nearly Rs. 200 to Rs. 700. In addition to this, banks also charge outward return penalty of nearly Rs. 300 and a cheque inward return penalty of Rs. 100. These two charges vary for each bank and the account type held. Normally charges are very high on premium accounts.

Impact on CIBIL Score

Even a single bounced cheque can affect your CIBIL score. And this might create problem in the future when applying for a loan or credit card irrespective of the lenders you apply to. This is because every lender first checks for the applicant’s CIBIL score in order to judge whether the person is credit worthy or not. Therefore always pay a special attention and never not let your cheque bounce/make late payment. Of course if everything is correct at your end the issue is at the lender’s end, you can always justify the same to the lender and the same will be resolved amicably.

Legal Action

If you have made a payment via cheque to any company, banking institution or others but it bounce, then in such case these companies can take criminal action against you. However the company will first send you a cheque memo notice. And the payee will be given a 3 months time to make the payment. But if cheque bounce even after that, then be ready to get prosecuted legally. And if it is found that you are a frequent defaulter then get ready to go behind the bar along with your bank account getting ceased permanently.

In case of EMI cheque getting bounced, banks are authorized to auction the security but only after the defaulter had been issued a notice before auctioning. But as per RBI guidelines, if the value of cheque is over 1 crore and the default happen more than 4 times then only auctioning can be done. As per the guidelines of Reserve Bank of India, bank can also deduct money from your account on a pre-fixed date. If the bank balance is less, then you will also be charged additional fees.

Reasons cheque can bounce

There are many reasons to this and two most important ones we’ve already discussed above i.e. lack of sufficient funds in your account and a signature mismatch with bank’s database. Other reasons are:

  • Incorrect date mentioned.
  • Depositing the cheque prematurely even if it is post dated.
  • Technical/system error such link or power failure.

So always stay alerted especially when making due payment on your credit card or loan because a poor CIBIL score can affect you financially in the future.

Achieve Financial Freedom in 8 Simple Steps

Steps to Achieve Financial Freedom

Do you wish to get all or few of these:

  • New Car
  • Big House
  • Early Retirement
  • Quality life for your children
  • Freedom from loan

Like we all love freedom we also need financial freedom for our better future. So how to become financially secured and achieve freedom? Does it require only investing money or even more? Let’s check out best ways to achieve financial freedom:

Avoid Changing Portfolio

To get freedom from changing portfolio frequently, you should select funds very carefully. Limit number of funds to 5 in your portfolio and never keep fund of only one category and always pay attention to correct asset allocation. For every financial goal, strategy should be different and always make an habit of periodically reviewing your portfolio.

Budget Planning

For this it is important to prepare household budget and avoid unwanted expenses. These days you can get great discounts both online and in-store. So always take benefit from it. You can save money on medicines, healthcare costs etc.

Tax Planning

For tax saving, you should never buy insurance and most importantly never wait for the financial year to end while planning for taxes instead you should plan it at the start of the financial year. Never fall prey to marketing gimmicks and invest in non-profitable tax saving instruments. Include tax planning in your investment plan and keep monitoring the same frequently.

Loan Payment

To get freedom from loan, always keep aside emergency fund and plan your savings in such a way that you have sufficient funds that will last for 6 months. Give primary importance on paying for the car, home, personal & other loans. You can withdraw money from the low return investment products. And never take loan for small things.

Early Retirement

If you are planning to retire before time then start saving from today itself. Start investments in equity mutual funds at an young age. With increased age and income, you can invest more money and at the same time make changes in your portfolio keeping inflation in mind.

Never worry for retirement

While in job, always keep fund for retirement separate and start investment from young age itself. Invest in equity mutual fund via SIP. Also purchase sufficient health and life insurance at an young age so that premium would be less. Your portfolio should include more of equity than debt.

Save money for children’s future

Re-plan your investments once child is born. Regularly keep some funds separate for your kids. While saving for their education, marriage etc. always keep inflation in mind. Make sure not to use money which you are keeping aside for your child.

Emergency Fund

Uncertainty looms over everyone be it salaried people, businessman or others. So keeping sufficient funds during contingencies has become utmost important. Emergency fund should be kept for small house repairs such as painting, medical expenses etc. Not considering for such unforeseen expenses can kill your monthly budget.

Having More Than One PAN Card – Penalty, How to Surrender

Having More Than One PAN Card

PAN or Permanent account number is a identity card must to have with every Indian citizen most importantly. It’s use is not limited to filing IT returns, opening bank account, investments and many others. However every a person should have only one pan card on his name and having multiple/duplicate PAN card is an offence and might result in person receiving legal notice from the government and will be penalized for Rs. 10, 000.

Person might have more than one PAN card in following cases:

  • He might have applied for the same when moving to a different house
  • He might have applied for PAN card multiple times and each time new PAN card was issued by the income tax department

How to Surrender Duplicate PAN Card

  • Online Surrender: To surrender duplicate PAN card via online, visit http://incometax.sparshindia.com/pan/newPAN.asp and fill all the required details
  • Manual Surrender: You can write a letter to NSDL TIN Facilitation Centres or UTI PAN Centers informing them about having more than one card. You should include all the important details such as PAN to be surrendered and retain, full name, contact details (E-mail, phone, address), date of birth.

You can get contact details of TIN FC/PAN centers here: https://www.tin-nsdl.com/tin-facilities.php. You need to select your state and location to get list of all the centers. Once you send all the details, you’ll receive acknowledgement from the IT department.

Points to remember:

  • Always keep a copy of acknowledgement letter received by the IT department. This might be helpful, when someone misuses information on PAN and this receipt will come to your rescue
  • Scan this copy and keep it save in your E-mail so that it can be retrieved any time in the future
  • No need to re-contact IT department for intimation on whether PAN has been cancelled by them or not.