Equity linked savings scheme.

Equity linked savings scheme

Equity linked Savings Scheme(ELSS). Friends, today I am going to give you detailed knowledge about The ELSS, in this article. The questions like, What is ELSS? Why is it so important for you?, will be discussed in this article.

Equity Linked Savings Scheme.

What is ELSS?

As I have already written above ELSS stands for Equity Linked Savings Scheme. ELSS is a type of Mutual Fund that gives tax benefits also. You can invest up to Rs 1.5 lac in ELSS schemes and claim for tax rebate accordingly, under section 80C of Income Tax Act 1961. It is a very important investment option for salaried Government Employee.

What is difference between ELSS and Mutual Fund.

There is no fundamental difference between them. Both are Mutual Funds.The only difference between them is tax benefits and lock-in period. You can avail the facility of tax benefits in ELSS. There is a three year lock-in period in ELSS. Your money is invested in stock market in both items. After three years lock-in period you can exit any time from ELSS. You have not to give capital gain tax on it at the time of redemption of your Fund. If you want to continue after three year lock-in period, you may continue. Mutual Funds on the other hand are liquid in nature, it means you can exit from it at any time. Mutual funds are taxable.

How One Can Invest in ELSS?

There are two methods of investment are available for you. You may invest by Lump Sum amount or you may opt for SIP option. Here SIP means Systematic Investment Plan. If you invest in a Mutual Fund in one go, it is called Lump Sum amount, and if you invest a certain amount every month in a Mutual Fund, it is called SIP. It will help you spread the risk and give you the benefit of cost averaging. You can take the help of Any investment adviser of ICICI, kotak Mahindra, SBI, Tata, ABSL, Quantum Mutual Fund. For investing in a Mutual Fund you should have a bank account with Cheque facility and a Pan Card.

So friends if this information is any use for you give your comments and like this article.

How to Get Personal Loan?

How to Get Personal Loan? Everyone of us in our life go through in a phage in which we badly need of money. Be it, our daughter's marriage ceremony or repaying of credit card loan, we need money. When nobody help us, we go to banks and apply for Personal loan, as it is very easy to get. So friends, today, I am going to talk about Personal Loan. I will talk about, what is the process of personal Loan, what is its interest rate, repayment period and everything related to it.

What is the personal Loan

Personal Loan is a type of unsecured loan used by the people for meeting their day to day financial needs. There is no need of any kind of  pledging security or collateral for getting it.

It is very easy to get. All banks either Nationalized or Private offers Personal loan. It is very popular among people. If you have regular source of income like Government Job or Private job, banks easily give you Personal Loan. It is given for following purposes-

• For Marriage expenses.
• For Renovation of house.
• For purchasing Consumer Durable Goods.



How to get Personal Loan

• For Repayment of Credit Card Loans.

Procedure of personal Loan.

Banks have made it very easy to get Personal Loan. They have removed the necessity of Guarantor. Application forms for Personal Loan has been made easy. Ticket fee for agreement has been reduced. Following documents are needed for Personal Loan-

• Latest Salary Slip showing deductions.
• Income Tax Returns of last three years.
• Voter's ID Card or Driving Licence for proof of identity.
• Copy of ration card, Electricity Bill, Passport, Voter's I-card for proof of residence.
• Last six months salary statement of Account where is your salary is credited.
• Pan Card's true copy.

Interest Rate

It is a very costly loan. Usually banks charge interest at the rate of 13 to 15% per annum on Personal Loan. It depends on RBI's Base rate policy. So, take this loan, only if, you have urgently need of short term need of money. 

There are two options of Interest rates offered by banks, one is Fixed Rate of Interest or another is Floating rate of Interest. Both have their own advantage or disadvantage.

In the Fixed rate of interest, interest are fixed for whole repayment period, at the rate of interest, prevalent at the inception of the Loan. In this option, the interest rate is kept stable for entire loan repayment period. If banks increase or decrease the interest rate there will be no effect on your loan as you have already opted for Fixed rate of interest.

In the floating interest rate, interest rate fluctuates according to the RBI's Base Rate Policy. If you opt for this option, your interest rate is often increased or decreased by banks according to the RBI's Base Rate Policy. Most of the people opt for this option.

Repayment period and EMI

The repayment period of the personal loan is generally 3-5 years. The monthly repayment amount or EMI depends upon the proposed repayment period and the rate of interest. If you opt for three years repayment period your EMI will be high and if you opt for five years repayment period your EMI will be low. 

The entire loan amount is divided in to Equated Monthly Installments. This equated monthly installment is called the EMI. The number of equated monthly installments may increase if the entire loan with interest, cost, charges and expenses is not repaid by the stipulated number of equated monthly installment.

Processing charges or other fees.

Banks takes processing charge on every Personal Loan. It depends upon your loan amount. It is generally charged on every lakh rupees of sanctioned loan. Banks cut this processing charge from the personal loan itself. The stamp duty on agreement paper is also charged by bank.

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What is the procedure of Home loan?

Everyone dreams to have his own house. We save money or earn a lot, so that, we can build a dream home. We buy a good Plot and start thinking how to construct a beautiful home. Many of us are of low income group and are not able to have our own home. But you should not be anxious, Government and Banks help you construct your own home. You can apply for Home Loan to any nationalized Bank. Government of India has provided you special facilities of getting Home Loan at lowest interest rates under Pradhanmantri Awas Yojna-Credit Linked Subsidy Scheme. In this scheme borrower can avail the facility of subsidy on interest. which results into lower installment amount and lower interest rate. This scheme has been launched for economically weaker sections, low income groups and middle income groups of society.

One of the primary conditions of the scheme is that you must not own Pucca house either in the name you or your family members which includes you, your wife/husband and children.

Generally bank offers 8.67% interest rate on loan amount. But under this scheme banks provide subsidy on interest which may be a maximum of 2.67 lac and this subsidy is credited to your loan account at the end you complete repaying loan account with all interests. You can not avail such facilities in other loan schemes.

How to get this loan from bank.

1. You have to visit nearest branch of any bank and get Home Loan application form. Before submission of application you must ensure that the piece of land at which you desire to construct home should be either in your name or in your spouse or both. Bank ensures the ownership of land, so that, its market value could be ascertained and if you fail repaying loan amount and becomes bankrupt, bank could recover loan amount by auctioning of the house.
2. You must have original copy of Deed of the land in your custody.  Bank takes its custody before sanctioning loan and keeps it in its possession till the end of repayment.
3. You must have certified copy of Mutation issued by circle office of the area(Original copy of the document needs to be attached with application form). This document too is taken by bank.
4. You must have original copy of Land Possession Certificate.
5. You must have original copy of current revenue receipt issued by Circle Office.
6. You must have layout of the said land sanctioned and passed by Nagar Parishad if the land lies in town area. But if in village area the layout should be counter signed by Mukhia( Head of Gram Panchayat) only.
   
7. You must bear a copy of estimate of entire plan which is prepared by a engineer authorized by Bank. This estimate cost and plan should be in correlation.
8. Legal opinion is prepared by authorized Legal Adviser of the bank. This is meant for ascertaining ownership of the said Land.
9. The evaluation of the said land with MVR and market value is calculated by authorized agent of the bank. He visits the land for physical verification and then reports geo position of the land. He takes pictures of the land. He records longitude and latitude and collect information regarding all sides of the post.
10. If you are a government employee, you must have attach a copy of your Salary Slip.
11. A copy of income tax return or Form-16 is also needed so that your income within tax limits could be ascertained.
12. It is bank's discretion to demand disclosure of details of your property in all forms like share, debenture, gold, ornaments, LIC, and other movable or immovable property.
13. Bank also wants to know about net-worth of invested amount in other savings scheme.
14. You must disclose the name of Nominee who will repay the loan amount in your absence.

After some procedure is followed up, bank make you fill up a affidavit. Then after following some other necessary steps all above said documents are held in possession of bank and first installment of loan is released in your bank account.

Pradhanmantri Awas Yojna-Credit Linked Subsidy Scheme comes in effect in the last when loan amount is disbursed. Bank authority send your details to National Housing Bank which after necessary checks approves the subsidy and sends subsidy directly to the loan account of the borrower.

I hope this information will be very useful to all of you.

What is Mutual Fund.

 What Is Mutual Fund

Mutual fund is a fund where money is collected by general public and it is invested in share market. Compony which collect funds from public is called Asset Management Compony(AMC).

There is a fund Manager for every Mutual fund, who invests the collected fund to the stock market and gets profit. This profit is then distributed to Investors. 

The AMU which manages the fund charges some fees for their service. It is called Expense ratio.

source: pixabay.com

There are so many Mutual Fund companies available in the marked, such as ICICI Mutual fund, SBI Mutual Fund, Kotak Mahindra Mutual Fund, Birla Sun Life Mutual Fund and so on.

 

And there so many schemes of every Mutual Fund. There are Large cap fund, Mid cap fund, Small cap fund, Hybrid fund, ELSS fund, Sector fund etc.

Your money in Mutual Fund is generally invested either in Debt or in Equity.

 

In Debt Fund ,your money is invested in Government securities, Treasury Bills and Debentures.

 

Government issues this instruments to the public to raise fund and gives interest on it.

 

In equity fund your money is invested in The Stock Market. There are so many Equity Mutual Fund also.

What Is An AMC.

Every AMC is managed  by a professional Fund Manager. He decides to invest or disinvest in a particular stocks. 

The performance of every Mutual fund depends on its Fund Manager skills. 

So, before investing in a Mutual Fund one must see the past performance of that Fund Manager.

You can invest in Mutual Fund either by Lump Sum amount or by SIP. 

In SIP you invest in monthly basis. You can open an SIP account by as minimum as 500 rupees per month. 

This account can be opened in any bank with auto Debit facility. Every month on a fixed date your Investment Amount is cut and sent to your AMU, and then you get no. of units. Every Mutual Fund Scheme has a value of its one unit. It is called NAV of that scheme. If you invest 1000 rupees in a mutual fund scheme which NAV is 20 rupees, then you get 50 units of that scheme. After one year if NAV of that scheme is increased to 24 rupees. Your profit will be 200 rupees.

How to grow money triple in six years.

Friends! Today we are living in the age of Materialism. Every things in this world is valued by money. Although it is not hundred percent true. I, too, do not agree with it. But it is a fact that money is playing a vital role in this world. There is a famous proverb-

Money is not god, but it is not less than god.

 We may agree or not agree with this popular saying, but we accept the importance of money. Everyone wants to grow his money legally. Somebody wants to grow their money double or somebody wants to grow their money triple in the shortest period of time. So, I am going to show you how to grow your money triple in the shortest  possible time.

photo source-pixabay.com

The rule of 114

It is called the rule of 114. In this rule, we divide this number with the number of years in which we want to grow our money threefold. For example, if you want to grow your money triple in three years then you have to divide 114 by 3. The result is 38. That means at the rate of 38% interest rate annually, your money will be tripled in three years(Approx). But it is sad, there is no investment tool available to give guaranteed 38% return. Some mutual funds do give this return sometimes or the other, but they do not give guaranty of it.

So, let us see another example: If you want to grow your money triple in 6 years. Let us divide 114 by 6, we get 19. It is the required rate of interest by which you can get your money tripled in six years(Approx).

In order to get our money tripled in 6 years we have to choose an investment option that might give 19% interest rate annually. There are a lot of Mutual funds that give 19% returns in six year(Approx). All you have to do is that invest in a blue chip fund with growth option and stay invested in six years(Approx).

How to secure your daughters future?

In this article I am going to show you a better way to secure your Girls future. Yes, I am talking about Sukanya Samridhi Yojna It is a government plan delivered by Post office. You can get a maximum of up to 8.5% return per annum. You can plan for your Girls Higher education or Marriage. It gives marvelous return.

Salient features

photo source: Pixabay.com

A father or a Guardian can open this account in any nearest Post office in the name of his Daughter. You can open this account in the name of maximum two girl. But, total yearly contribution should not be more than 1.5 lac rupees in a year for both child.

The minimum age of your Daughter should be 10 years. It can be extended up to 21 years of age of girl child. It can be closed at any time after attaining 18 years of age, if your daughter gets married. And partial withdrawal is allowed after getting your girl child 18 years of age.

You can deposit up to 1.5 lac rupees in a financial years either in the name of one girl child or two girl child. But, a minimum of 1000 rupees must be deposited in a financial year. If you do not deposit minimum 10000 rupees in a financial year the account becomes Dormant. And to revive the account you have to pay a penalty of 50 rupees for every Default year.

There is a flexibility in this scheme in terms of  Your contribution. You can deposit either lump sum 1.5 lac rupees in one go or in monthly installment.

So, friends! The Government has a provided you with a tool by which you can secure your daughter future. 

How to get money doubled in four years.

Friends, everyone wants to grow their money Double in short period of time. There are numerous investment tools available to get your money double. In this article, we are going to know, how much interest rate needed to grow your money in to double in a fixed time period. And we will also know how many years are needed for getting your money doubled at a particular interest rate. We will know it with both sides.

The Rule Of  72-

It is called the rule of 72. In this rule we divide 72 by the no. of years. And we get that particular interest rate. By this particular interest rate we can get our money doubled.

For example: If we want our money doubled in 6 years, we divide 72 by 6 and we get 12%. This is the particular interest rate by which we can double our money in 6 years.

If you want your money getting doubled in 4 years you should have your interest rate 18% per annum. Now you have to search for an investment scheme which could give you 18% annual return. You can get this return easily in any good mutual fund scheme.