Invest-Inn

Your Profile and aggration

2011-08-19T06:50:00.003+05:30

Home Insurance

2010-08-23T21:38:00.002+05:30

Home Insurance protects your home from natural & man-made disasters and shelters the structure & contents of your home. The Policy covers the losses occurred to the building (structure) of your home or to its contents due to natural and man-made catastrophes.

What are the risks covered under Home Insurance?
Home Insurance protects the building and contents of your home against natural and man-made calamities like fire, earthquakes, storms, cyclones, tempests, tornadoes, hurricanes, floods or inundation, lightning strike, explosion, landslides, impact by vehicles or aircraft, and bursting or overflowing of water tanks and pipes. It also covers the contents (jewelry also) of your home in case of Burglary

What are the optional covers available?
The optional covers include Terrorism and Additional expenses of rent for alternative accommodation.

What do you mean by Alternative Accommodation?
Alternative Accommodation is an optional cover to the policy. If you are forced to shift to an alternative accommodation because your home is destroyed by an insured peril, then you will also be covered against the additional rent.

Is the sum insured calculated differently for structure of home & it contents?
Yes, the sum insured is calculated differently for the structure & for its contents, Sum Insured for the structure is calculated based on the Reconstruction value. Whereas the contents of your home such as furniture, durables, clothes, utensils, jewelry, etc. - are to be valued on market value basis i.e. the current market value of similar items after depreciation. Depreciation does not apply for jewelry.

What is the Reconstruction value?
Reconstruction value is defined as the cost incurred to reconstruct the home if it is damaged.
What is the procedure to calculate sum insured for the structure of home?
The Sum insured is calculated by multiplying the built up area of your home with the construction rate per sq. feet.

Does Home Insurance cover any loss to my Jewelry?
Yes, it covers loss to jewelry due to burglary or robbery but has a certain limit to it.
I have a rented house, how can I buy Home Insurance?
You have got an option to take a cover which guards the contents of your home against fire, other natural calamities, terrorism and burglary. It includes Household Appliances, furniture & fixtures, Jewelry etc.

If I use my Home for business purposes, can I insure it?
No, Home used for business purposes are not covered.

If we friends share a home, can we go for Home Insurance?
Yes, each one of you can buy a separate Home Insurance Policy for your part of asset.

Invest Inn
Pune, Mumbai, Maharashtra, India

Health Insurance

2010-08-23T21:19:00.003+05:30

What is Health Insurance?
It is a contract between the Insurer & the Insured wherein the former agrees to pay to the latter hospitalization expenses to the extent of an agreed sum assured in the event of any medical treatment out of an illness or an injury. In the nutshell the Health Insurance is a policy which covers you & your family against medical expenses due to sickness, accident etc. The Insured in return has to pay a regular premium to the insurer.

Why you need Health Insurance?
It is indubitable that Health Insurance has become an important element in one’s life owing to increasing medical costs these days & uncertain environment; it comes to your rescue acting as precautionary measure in today’s tough time while acting as a life saver boat in case of any medical contingency. If you don’t have Health Insurance, you end up paying hefty medical bills in the event of hospitalization out of illness or injury, therefore insuring your family against Health Insurance is a must thing & should surely be a part of your regular financial planning. All we have is our health which needs to be protected & taken care of by acquiring the best health insurance policy suited for us.

Types of Health Insurance Plans
Health Insurance Plans are segregated into three categories, firstly the Mediclaim Plans by Non-Life or General Insurance Companies, secondly the Hospitalization Cash Policy by both Life & Non-Life Insurers and thirdly the Critical Care Plans offered by both Life & Non-Life Insurers.
Mediclaim Policy is basically a reimbursement plan offered by General Insurers wherein the insured gets reimbursed of the total bill amount of the medical expenses to the extent of an agreed sum assured. It includes the room charges, ICU charges, surgery & doctor charges etc. It includes a lot of exclusions which the policy holder must read before buying the Mediclaim.
The Mediclaim includes the following two further categories:
1) Family Floater Plan: It is a very common plan these days which covers your entire family under one premium payment giving coverage to the family members together. This plan is being offered by almost all the General Insurance Companies with a specific criterion of covering individuals in the age group between 90days and 55years.
2) Group Mediclaim Insurance: It is the second variant of Mediclaim which covers a group of individuals simultaneously. This form of insurance includes the category of Employer’s Health Insurance Cover wherein the sum assured normally varies between Rs. 15,000 and Rs.5,00,000.
Hospitalization Cash Policy is a plan offered by both Life & Non-Life Insurers wherein the Insured gets pre-determined cash benefit on a daily basis irrespective of the hospitalization expenses being incurred. It is not a fully comprehensive health insurance plan because it doesn’t cover the cost of medical treatment but pays lump sum amount to the policy holder on per day basis during the treatment/hospitalization. It acts a complimentary plan to the Mediclaim plans. Offer Hospital cash benefit plan among Non-Life Insurers.
Critical-Care Plan: It is offered by both Life & General Insurers covering an individual for certain specified critical illnesses like cancer, stroke etc. This is also offered as a rider by Life Insurance companies for quite some time now attached to their Life Insurance Plans. You must take a cover either as a rider or as a standalone plan in your portfolio.

Health Insurance Tax Benefits
Health Insurance products are eligible for tax benefits under section 80D of the Income Tax Act, 1961. Premium paid under health insurance holds a tax deduction upto Rs 15,000 for you, your spouse and dependent children.
Further more you can also claim another Rs. 15, 000 for tax deduction for your parents, in case of senior citizens (65 years or more) the above deductions are increased to Rs. 20,000
Family Floater Plan-in detail
For instance a person wants a health insurance for himself, his spouse & their children, the Family Floater plan offers insurance coverage to the entire family under one premium payment. Let’s take an example wherein the person insures himself, his spouse & the dependent children with the individual insurance plans with a sum assured of Rs. 1 lakh each, he ends up paying premium ranging between Rs. 1000 - Rs. 2000 for each family member. On the other hand if the person would have opted for the family floater plan with the sum assured of Rs. 3 lakhs, the total premium would surely be less than the separate premium payments in individual health insurance plans. Moreover the separate health plan holds the cover of only Rs. 1 lakh as against Rs. 3 lakh in case of the Floater plan thus helping the family in case the medical treatment costs go beyond that.

Cashless Hospitalization
Cashless settlement implies that an individual doesn’t have to settle a hospital bill out of his pocket; rather the bill gets settled directly by the insurance company. When you buy a Health Plan you are issued a Health Card along with the policy documents which would entitle you to get cashless claim at any of the company’s network hospitals.

What do you do in case of a claim?
You should walk into a network hospital & get the treatment done & the bills paid through the Health Card. In case of hospitalization you need to give the card number to the network hospital, you must pre-authorize from the TPA (Intermediary between the Insurance Company & the hospital) & will process the cashless settlement after the verification of your policy details. You should know the formalities required for cashless settlement as some insurance companies are required to be notified 48 hours before hospitalization.
If you don’t opt for cashless settlement, you need to settle bills at the hospital and get them reimbursed later.

Health Insurance Covers & Benefits
• Room & Boarding expenses: There are further limits to this feature varying from company to company.
• Ambulance Charges: They are normally covered upto Rs. 1000.
• ICU charges, doctor, consulting, anesthetist and surgeon fees, operation and other diagnostic and surgical material costs are covered.
• Day-Care expenses such as Chemotherapy, Dialysis & Radiotherapy etc.
• Pre & Post Hospitalization Expenses which normally are 30 days prior and 60 days after hospitalization.
• Cashless Hospitalization is offered by almost all Non-Life Insurers.
Important Pointers in Health Insurance
• You must read the policy exclusions & the limitations in various covers properly before buying a Health Insurance plan because you should know what all covers your policy include & exclude.
• You should note the number of network hospitals covered in the Insurer’s list of network hospitals as this will help you to get cashless & hassle-free claim.
• You must read the names of critical diseases being covered before buying a Critical-Care plan.
• You must know that the medical expenses incurred within the first 30 days of buying the health insurance plan are not covered unless the injury has occurred out of an accident.
• You must disclose all the Pre-Existing diseases to the insurer before buying the health plan as the insurer doesn’t cover them, now a day’s General Insurers have started covering these diseases normally after 3-4 years varying from company to company.

How much Health Insurance one should have?

2010-08-23T21:03:00.003+05:30

Start early
One must buy health insurance at an early stage because the premiums are lower when you are young and the rate of increase in health insurance premium is directly proportional to your age. Health insurers assume that at an early age the chances of making a claim are lower, as against the person who takes health insurance at a later age say 40 years and is more prone to suffer from diseases. Moreover if claims are not made in any particular year, it is likely that the insurer might increase the cover provided or/and reduce the cost of premium.

The importance of Health Insurance can’t be ignored in today’s world of expensive medical care & looking at its benefits at a younger age, one must insure himself/herself against any medical injury/illness early in life.

How much of cover is needed
The requirement for Health Insurance varies from individual to individual. It depends upon the factors such as your age, current annual income & expenses, marital status, family background etc.

Age: During the early years of your life you might require a simple health policy to cover the expenses that would be incurred if you fall ill or meet with an accident. The possibility of occurrence of critical diseases is low at this age therefore a higher cover is not required. As you grow old you should keep increasing your sum assured/cover.

In case of higher age when you could be more prone to some of the critical diseases, you can get the Critical Care Rider added to your health policy- because this is the time when you need to guard yourself from a major financial setback. Make sure that your family is not burdened with any kind of financial consequences due to major illnesses.

Marital Status: If you are married it’s a good idea to ensure that your spouse is also covered against any medical emergency. Go for a Family Floater Plan wherein you and your spouse will be covered under one policy (one premium). In case your wife is salaried, you must make sure that she is covered under employee insurance also if it is available as the Group Insurance covers for Maternity expenses. After the birth of your child you can get your child also included in the Family Floater Plan.

Family Background: If you have a family history of some diseases like Diabetes, take a shield of Critical Care plan which will cover you against all these major illnesses that you might be prone to.

Income & expenses: Go for a higher health insurance cover if you think that the cost of your family’s medical treatment would be higher (higher room fare etc). Therefore a lot depends upon how much is your family’s current expenses & income. If you wish to take a high quality room during hospitalization then you must opt for a higher sum assured health cover.

Money Transfer to India comparison

2010-03-03T00:38:00.013+05:30

I am sure you might try lot of ways to find best exchange rates or best possible way to transfer money to India. Recently I had a situation where I had to send the money urgently to home and lost lot of money with bad exchange rate in hurry. I learnt a good lesson and I thought I would post some useful tips to transfer the money to India. Hope you will like it
Parameters we usually look for:

Exchange Rate
No of days for transfer
Service/Transaction Fee
Refunds
Security
Transaction Limit

Now a day’s 5th parameter is not a big problem as almost every transaction is secured over the Internet. 2nd parameter is crucial and depends on you How many days required for transaction and at what time transaction happened.Some of the service providers to transfer money to India: Western Union, ICICI, HDFC, Citibank & Remit2India. There might be many others but which I am not aware.

Current Exchange rates on Forex
1 US Dollar (USD) = 45.9448 Indian Rupee (INR)

Western Union:
1 US Dollar (USD) = 45.2902995 Indian Rupee (INR)
Western Union Fee $10.00 No. of days for transfer: 3 Business Days
Customer Support: Good

It is very quick and fast but the service charges very high and you loose lot of money for transaction charges. The main advantage is we can send money to a small town/village in India within hours of our transaction. Advertises widely and have tied up with Indian Postal Service. They have thousands of location in every corner of the world and the money can be picked up anywhere. The only disadvantage is that it is quite expensive i.e. $39 for upto $3000. Also there is a limit on the maximum amount transferable. Service from Indian and Nationalized Banks

Citibank:
1 US Dollar (USD) = 45.6189 Indian Rupee (INR)
Fees: Varied; No. of days for transfer: Same or 5 Business Days
Customer Support: Good
If you have Citibank account in UK and India and if someone has debit card with them in India, this is faster than WU but there would be a limit to withdraw money using Debit card. Usually Citibank offers Rs 1.30 less than market exchange rate as transfer is done instantly. I found that it offers better exchange rate than WU. The Citibank Rupee Checking Account allows you transfer your money from abroad to India. HSBC India presently offers FREE Remittances through FastCHEQUE and FastCLICK from USA. HSBC India also offers NRI accounts and other NRI services for NRI's around the world. Special features include
1. Checks - You can fund your account by Personal Check/Certified Check/Cashiers Check or Drafts.
2. Wire Transfers/Telegraphic Transfers - From any local bank in your city to your Citibank Rupee Checking Account
3. Online Transfers - Currently for US Customers only from any US Bank Account to your Citibank Rupee Checking Account
4. Citibank Global Transfers - From your local Citibank Account to your Citibank Rupee Checking Account for customers in select regions
5. Electronic Funds Transfer - Rupees from your local India bank to your Citibank Rupee Checking Account
6. Dial-to-Transfer - This unique facility helps you transfer funds electronically from your bank in the United States to your Citibank Rupee Checking Account in India.

ICICI:
1 US Dollar (USD) = 45.4905 Indian Rupee (INR)
Fees: Rs 25; No. of days for transfer: 3 Business Days
Customer Support: Average
Usually ICICI gives lot of offers and say they would give better exchange rate. It might be true but it would take lot of time to credit the money to our Indian account. They say that no service fee but they always charge it !

Remit2India:
1 US Dollar (USD) = 45.45 Indian Rupee (INR)
Fees: $ 3- $ 25; No. of days for transfer: 3 to 5 Business Days
Customer Support: Average
As per the ratings, this is one of the popular and most used service providers currently. This would give better exchange rate, if you were bit clever. Exchange rate is different if we transfer money through NRE and the more we transfer the better the exchange rate. They would inform that we would get Rs.1000 on offer but they won’t credit immediately. We need to mail them and pursue them to do it

HDFC:
1 US Dollar (USD) = 45.56 Indian Rupee (INR)
Fees: Rs 25; Non HDFC Rs 0.75/1000; No. of days for transfer: 1-2 Business Days
Customer Support: Good
This is actually affiliated with Remit2India but offers best service in terms of quick delivery and exchange rate. Might be same exchange rate as Remit2India but faster than them in delivery. The problem with Remit2India and HDFC are that exchange rates are indicative as at transfer date and may vary little bit after the actual transfer. Citibank tells us immediately what is the amount we will receive after the conversion.
Depends on your need, you can decide which service provider to use. Wish you all the best.

SBI:
1 US Dollar (USD) = 45.54 Indian Rupee (INR)
Fees: $15*- $ 30 or No Fees*; No. of days for transfer: 2 to4 Business Days
Customer Support: Good

Offers best service in terms of quick delivery and exchange rate. Might be greater exchange rate as Remit2India but faster than them in delivery.
All INR remittances are free irrespective of amount.
Conversion to foreign currency at a firm rate, displayed on the website.
Instant* Transfer to over 15,000 branches of State Bank Group
Electronic credit facility to accounts in all branches of SBI and associate banks and nearly 33000 branches of 100 other banks in India.
Instant pay by debit or credit card up to $1000 (own account with SBI: $2500).
Send money to account with any bank.
7. Give standing instructions for regular remittances.

IKobo: The safest, fastest and most convenient way to send money online. Provides money transfer services all over the world.

Cash2India: Claims to be "The Oldest and Most Trusted Online Money Transfer Service"
Travelers Express/ MoneyGram International: Offers money order, international money transfer, official check, bill payment, share draft and gift certificate programs.

SendMoneytoIndia.com - Send money to India online - Cheapest way to Transfer money to Indian Cities and Villages online and Sending Money Abroad.

Xoom.com -
Fees: $ 3- $ 15 or No Fees; No. of days for transfer: 1 to 5 Business Days
Customer Support: Poor

Xoom is a San Francisco, USA based company that provides secure and easy money transfer facility to India. The sender should have a bank account or credit/debit card and internet access. The recipient need not have either of these facilities. When the money is sent to India through Xoom, it is made available for recipient to pick up or deposited in a bank account This service is entirely web based service

Tags: Cash2India, Citibank, compare, Exchange Rate, HDFC, ICICI, Ikobo, India, Money Transfer, NRI, Remit2India, SBI, Western Union, Xoom, WellsFargo

Tax Calculator

2010-01-21T21:32:00.001+05:30

Tax Calculator for Income Tax India - FY 2009 2010

https://docs.google.com/fileview?id=0B-7NIyK1pWgPNmZmZmNjZmEtZDQ3My00ZjdiLThkMTUtZDc3ZGI2MmRiNzQz&hl=en

Please find attached Tax Calculator

Welcome to Invest-Inn!!!We provides a variety of services to address the problems and questions you may face as an investor. You can find various tips and resources that will help you saving your hard earned money. There are lots of financial schemes and services available with us. Many of them provide you guaranteed returns, high interest rates and tax savings.
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Product
I. LIC Policy.1.Money back, 2.Endowment, 3.Whole life, 4.Children money back 5.Pension plan.II. Vehical Insurance with money back Scheme.III. Postal Savings: 1.NSC 2.KVP 3.PPF 4.R.D 5.MIS, 6.Time Deposits. IV. General insurance products -1.Auto insurance 2. Health insurance 3.Senior citizen 4. Medical insurance 5. Shopkeepers insurance 6. Fire InsuranceV. Fixed Deposits. VI. Unit Trust of India .VII. PAN Card.VIII. Personal Insurance.IX. LIC Agent, Insurance Agent.

About Invest Inn:
We take a strategic approach to helping our clients. Our experience with many insurance groups in many industries gives us the ability to know what will work for you and your budget.
We just don’t sell “We customize as per your requirement”

Visit us/ Call For more Details at
Suvarna
LIC,PPF Postal, Auto insurance.
Invest-Inn, Pune
Ph: 9423532005
Mail:money_insurance@yahoo.com

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LIC what should you know

2010-01-21T08:43:00.001+05:30

Admission Of Age:

Age is the main basis of calculation of premium under life insurance policies. The following are accepted as evidence of age:

* Certified extract from Municipal or Local Body’s records made at the time of birth.
* Certificate of Baptism or Certified Extract from Family Bible, if it contains age or date of birth.
* Certified Extract from School or College records, if age or date of birth is stated therein.
* Certified Extract from Service Register in the case of Govt. employees and employees of Quasi-Govt. Institutions or
* Passport issued by the Passport Authorities in India.

Payment Of Premium:

* By cash, local cheque (subject to realization of cheque), Demand Draft at Branch Office.
* The DD and cheques or Money Order may be sent by post.
* You can pay your premiums at any of our Branches as 99% of our Branches are networked.
* Many Banks do accept standing instructions to remit the premiums. So by providing a standing instruction to your Bank to debit your account for the premium amount and send it vide a banker’s cheque to LIC, on the due dates and months mentioned on your policy bond.
* Through Internet : Payment of premiums can be made through Internet through Service Providers viz.HDFC Bank, ICICI Bank, Times of Money, Bill Junction, UTI Bank, Bank of Punjab, Citibank, Corporation Bank, Federal Bank and BillDesk.
* Premium payment can also be made through ATMs of Corporation Bank and UTI Bank.
* Premium payment can also be made through Electronic Clearing Service (ECS) which has been launched at Mumbai, Hyderabad, Chennai, Kolkata, New Delhi, Kanpur, Bangalore, Vijaywada, Patna, Jaipur, Chandigarh, Trivandrum, Ahmedabad, Pune, Goa and Nagpur, Secunderabad & Visakhapatnam. A policyholder having an account in any Bank which is a Member of the local Clearing House can opt for ECS debit to pay premiums. The policyholders wishing to use this system would have to fill up a Mandate Form available at our Branches/DO and get it certified by the Bank. The certified Mandate Forms are to be submitted to our BO/DO.

Policy can be anywhere in India.
* Citibank Kiosks at Industrial Assurance Building, Churchgate, New India Building, Santacruz, Jeevan Shikha Building, Borivili are dedicated for collection of premiums through cheques.

Days Of Grace:

* Policyholder should pay the premiums on due dates. However, a grace period of one month but not less than 30 days will be allowed for payment of yearly/half-yearly/quarterly premiums and 15 days for monthly premiums.
* When the days of grace expire on a Sunday or a public holiday, the premium may be paid on the following working day to keep the policy in force.
* If the premium is not paid before the expiry of the days of grace, the policy lapses.

Revival Of Lapsed Policy:

* If the policy has lapsed, it can be revived during the life time of the life assured, within a period of five years from the date of the first unpaid premium but before the date of maturity subject to certain conditions.
* The Corporation offers three convenient schemes of revival viz., Ordinary Revival, Special Revival and Installment Revival. Policies can also be revived under Loan-cum-Revival and SB-cum-Revival schemes.
* Request for revival may be made to the Branch Office servicing the policy.

Change Of Address And Transfer Of Policy Records:

* The policyholder should immediately intimate the change of his/her address to the Branch Office servicing the policy. The correct address facilitates better service and quicker settlement of claims.
* Policy records can also be transferred from one Branch Office to another for servicing, as requested by the policyholder.

Loss Of Policy Document:

* The Policy Document is an evidence of the contract between the Insurer and the Insured. Hence the policyholder should preserve the Policy Bond till the contracted amount under it is settled.
* Loss of the Policy Document should be immediately intimated to the Branch Office where it is serviced.

Loans:

* Loans are granted on policies to the extent of 90% of Surrender Value of the policies which are in force and 85% of the Surrender Value in case of policies which are paid-up, inclusive of the cash value of bonus. The rate of interest charged at present is 9% p.a. payable half-yearly.
* Loans are not granted for a period shorter than six months. The Conditions and Privileges printed on the back of the Policy Bond states whether a particular policy is with or without the loan facility.

Relief To Policyholders:

* The Corporation generally allows concessions on payment of premiums, settlement of claims, issue of duplicate policies, etc when the policyholder are affected by natural calamities such as droughts, cyclones, floods, earthquakes, etc.

Nomination:

* Nomination is a right conferred on the holder of a Policy of Life Assurance on his own life to appoint a person/s to receive policy moneys in the event of the policy becoming a claim by the assured’s death. The Nominee does not get any other benefit except to receive the policy moneys on the death of the Life Assured. A nomination may be changed or cancelled by the life assured whenever he likes without the consent of the Nominee.
Ensure nomination exists in the policy for easy settlement of claims.

Assignment:

* Assignment means transfer of rights, title and interest. When an assignment is executed, all rights, title and interest in respect of the property assigned are immediately transferred to the Assignee/s and the Assignee/s become the owner/s of the policy subject to any lawful condition made in the assignment.
* Assignment can be either conditional or absolute. On assignment (other than to LIC), Nomination automatically stands cancelled. Hence, when such a policy is reassigned, the policyholder will have to make a fresh nomination to avoid delay in settlement of claim.

Survival Benefit/Maturity Claims:

* LIC settles survival benefit/maturity claims on or before the due date.
* Policyholder are intimated well in advance by the Branch Office which services the policy regarding the payment, and the necessary Discharge Voucher is also sent for execution by the assured. In case the policyholder does not get any intimation from the Branch Office concerned, he/she should contact them, quoting the Policy Number.
* Survival Benefit payment up to Rs.60,000/- are settled without insisting for Policy Bond and Discharge Voucher.

Death Claims:

* If the life assured dies during the term of the policy, death claim arises. The death of the policyholder should be immediately intimated in writing to the Branch Office where the policy is serviced along with the following particulars:
1. The No./s of the policy/ies
2. The name of the policyholder
3. Death Certificate issued by concerned Authority
4. The date of death
5. The cause of death and
6. Claimant’s relationship with the deceased
* On receipt of the intimation of death, necessary claim forms are sent by the Branch Office for completion along with instructions regarding the procedure to be followed by the claimant.
* The claims which have arisen after a period of three years are treated as non-early claims and settled within 30 days from the date of receipt of all requirements.
* The claims that have arisen within a period of two years from the date of commencement of the policy, are treated as early claims and investigation is compulsory in such cases.
* The claim is usually payable to the nominee/assignee or the legal heirs, as the case may be. However, if the deceased policyholder has not nominated/assigned the policy or if he/she has not made a suitable provision regarding the policy moneys by way of a Will, the claim is payable to the holder of a Succession Certificate or some such evidence of title from a Court of Law.
* The Corporation grants claims concessions under certain Plans whereby payment of full sum assured is made, subject to the deduction of unpaid premiums with interest till the date of death and unpaid premiums falling due before the next anniversary of the policy, in the event of the death of the life assured within a period of six months or one year from the date of the first unpaid premium, provided premiums have been paid for at least three years and five years respectively.

Claim Review Committee:
The Corporation settles a large number of Death Claims every year. Only in case of fraudulent suppression of material information is the liability repudiated. This is to ensure that claims are not paid to fraudulent persons at the cost of honest policyholders. The number of Death Claims repudiated is, however, very small. Even in these cases, an opportunity is given to the claimant to make a representation for consideration by the Review Committees of the Zonal office and the Central Office. As a result of such review, depending on the merits of each case, appropriate decisions are taken. The Claims Review Committees of the Central and Zonal Offices have among their Members, a retired High Court/District Court Judge. This has helped providing transparency and confidence in our operations and has resulted in greater satisfaction among claimants, policyholders and public.

Insurance Ombudsman:

* The Grievance Redressal Machinery has been further expanded with the appointment of Insurance Ombudsman at different centers by the Government of India. At present there are 12 centres operating all over the country.
* Following type of complaints fall within the purview of the Ombdusman
a) any partial or total repudiation of claims by an insurer;
b) any dispute in regard to premiums paid if payable in terms of the policy;
c) any dispute on the legal construction of the policies in so far as such disputes relate to claims;
d) delay in settlement of claims;
e)non-issue of any insurance document to customers after receipt of premium.
* Policyholder can approach the Insurance Ombudsman for the redressal of their complaints free of cost.

Initiatives In Policy Servicing Areas:

* All 2048 Branches of LIC are fully computerized covering all policy servicing aspects to give prompt computerized services from new policy introduction, acceptance of renewal premium, revivals, loans, etc to final claims settlement.
* Green Channel facility has been introduced for the speedy completion of proposals.
* Payment of premiums can be made through internet through service providers, viz., HDFC Bank, ICICI Bank, Times of money, Bill Junction, UTI Bank, Bank of Punjab,Citi Bank, Corporation Bank, Federal Bank and Billdesk.

Grievance Redressal Machinery:

* A machinery for redressal of policyholders� grievances exist in all the offices of the Corporation. These are headed by designated Officers who are available at their respective Offices every Monday between 2.30 pm and 4.30 pm. except holidays. Policyholder can approach these officers to get their grievances redressed.
* The Designated Officers at the various offices of the Corporation are :
At Branch Office --- Sr./Branch Manager
At Divisional Office --- Marketing Manager
At Zonal Office --- Regional Manager (Mktg)
At Central Office --- Executive Director (Mktg/IO/CRM)

Citizens’ Charter:

* Citizens' Charter was presented to the Nation in November, 1997. In the Charter the bench marks were prescribed for 30 servicing areas.

LIC FAQ

2010-01-21T08:37:00.002+05:30

What is Insurance?

Insurance is a common way people protect themselves from huge financial losses. Basically you pay a small amount each month for "protection" against a potentially financially devastating situation.

What Is Life Insurance?

Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against.

The contract is valid for payment of the insured amount during:

* The date of maturity, or
* Specified dates at periodic intervals, or
* Unfortunate death, if it occurs earlier.

Among other things, the contract also provides for the payment of premium periodically to the Corporation by the policyholder. Life insurance is universally acknowledged to be an institution, which eliminates 'risk', substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner.
By and large, life insurance is civilisation's partial solution to the problems caused by death. Life insurance, in short, is concerned with two hazards that stand across the life-path of every person:

1. That of dying prematurely leaving a dependent family to fend for itself.
2. That of living till old age without visible means of support.

Who Can Buy?

Any person who has attained majority and is eligible to enter into a valid contract can insure himself/herself and those in whom he/she has insurable interest.

Policies can also be taken, subject to certain conditions, on the life of one's spouse or children. While underwriting proposals, certain factors such as the policyholder,s state of health, the proponent's income and other relevant factors are considered by the Corporation.

Insurance Tips

1. Always insure yourself at and early age
2. Always spread your risk with different type of plan
3. Always take a policy which gives money back option
4. Always take a Term Insurance for lower premium
5. Always nominate your nearest relative
6. Always pay premium on time
7.Insure all members of your Family
8. When your policy mature's there must be a company to pay you. Always buy insurance from a reputed Company as insurance is always for a longer period.
9. Check the companies claim settlement ratio.
10. Take insurance upto 15 times of your income

Insurance For Women

Prior to nationalisation (1956), many private insurance companies would offer insurance to female lives with some extra premium or on restrictive conditions. However, after nationalisation of life insurance, the terms under which life insurance is granted to female lives have been reviewed from time-to-time.

At present, women who work and earn an income are treated at par with men. In other cases, a restrictive clause is imposed, only if the age of the female is up to 30 years and if she does not have an income attracting Income Tax.

With Profit And Without Profit Plans

An insurance policy can be 'with' or 'without' profit. In the former, bonuses disclosed, if any, after periodical valuations are allotted to the policy and are payable along with the contracted amount.

In 'without' profit plan the contracted amount is paid without any addition. The premium rate charged for a 'with' profit policy is therefore higher than for a 'without' profit policy.

Keyman Insurance

Keyman insurance is taken by a business firm on the life of key employee(s) to protect the firm against financial losses, which may occur due to the premature demise of the Keyman.

Tax Benefits available for various Life Insurance plans.

The aggregate amount of deduction under all the relevant sections viz. section 80C, section 80CCC and section 80CCD shall not, exceed
Rs.1 Lakh..

1) Deduction from Income for payment of Premium (Sec. 80C).

(a) Life Insurance premia:
The insurance premia paid for a policy is eligible for deduction. The premium paid should not be in excess of 20% of capital sum assured.

(b) Contribution to Deferred Annuity Plans :
The premia paid for a Deferred Annuity , provided such contract does not contain a provision to exercise an option by the insured to received a cash payment in lieu of the payment of annuity is eligible for deduction.

(c) Contribution to Pension/Annuity Plans :
Contribution to New Jeevan Dhara-I and New Jeevan Akshay-V Schemes of LIC are qualified for rebate under this section.

2) Income tax exemption on Maturity/Death Claims proceeds under Section 10(10D)

All the benefits payable under a Life Insurance policy are tax free. However in cases the premium paid in excess of 20% of the capital sum assured within a year, benefits paid excess of premiums will be taxable. The benefits from a key man Insurance policy and any sum received under Sec 80DD, Sub-section (3) are also taxable.

3) Jeevan Nidhi Plan & New Jeevan Suraksha - I Plan (U/s. 80CCC)
Amounts paid from the taxable income to premiums of the above annuity are deductible.

4) Deduction under section 80D
Medical Premium paid for a Health Insurance policy is deductible to the extent of Rs. 15000 for an assessee and/or his family members’ policiy/s. A separate exemption to the extent of Rs. 15,000 for premiums paid for an assessee’s parents is also available. If any one or both of the parents are Senior citizens, then an enhanced exemption limit of Rs. 20,000 is available.
Section 80D also covers payment of premium exclusively for Critical Illness Rider.

5) Jeevan Aadhar Plan (Sec.80DD)

Premium paid for LIC’s Jeevan Aadhar Plan (for the maintenance of an handicapped dependent) is eligible for deduction from the total income to the extent of Rs.50,000 and to the extent of Rs.75,000/- where handicapped dependent is suffering from specified severe disability.

6) Exemption in respect of commutation of pension under Jeevan
Suraksha & Jeevan Nidhi Plans. (Section 10(10A):
A payment received by way of commutation of pension from Jeevan Suraksha & Jeevan Nidhi Annuity plans is exempt from tax

What we provide in LIC

2010-01-21T08:35:00.000+05:30

Life Insurance is a powerful tool to cover your unforeseen risks that can affect your family in your absence. It also works as
a saving instrument which can help you in planning for your children’s education, daughter’s marriage, pension, retirement benefits or for any defined goal.

As Life Insurance and LIC Agents, we specialise in providing the following insurance services in Pune:

- LIC Policy / Life Insurance Policies
- Pension Plans
- Child / Children Insurance Pol (Education and Marriage)
- Health Insurance Policy
- Tax Saving Plans and Insurance
- Woman's Plans and insurance policy
- Senior Citizens Plans and Insurance Policy
- Retirement Solutions and Insurance Policy
- Endowment and Whole life Insurance

LIC is a great option for Investment + Income Tax Saving + Insurance.
I am an LIC agent from Pune. To know more about LIC Policies (short term and Long term):
Related to : LIC Agent Pune consultant Jeevan Anand Market Plus Pune Insurance Advisor Broker Endowment Money back policy term pure risk retirement solution pension annuity children kids future daughter marriage Jeevan Tarang Whole life jeevan akshay.
Preferred Regions: Pimpri Chinchwad, Pune camp, kalyaninagar, koregaon park, hinjewadi, katraj, dhankwadi, singhgad road, kothrud, deccan, shivajinagar, yerawada.
Solicits : Entire Pune & India

Contact : Life Insurance Agent Pune.
Mobile : 9423532005

Know Your Life Insurance

2010-01-21T08:31:00.003+05:30

Life insurance in India made its debut well over 100 years ago.

In our country, which is one of the most populated in the world, the prominence of insurance is not as widely understood, as it ought to be. What follows is an attempt to acquaint readers with some of the concepts of life insurance, with special reference to LIC.

It should, however, be clearly understood that the following content is by no means an exhaustive description of the terms and conditions of an LIC policy or its benefits or privileges.

For more details, please contact our branch or divisional office. Any LIC Agent will be glad to help you choose the life insurance plan to meet your needs and render policy servicing.
Insurance Vs. Other Savings
Contract Of Insurance:
A contract of insurance is a contract of utmost good faith technically known as uberrima fides. The doctrine of disclosing all material facts is embodied in this important principle, which applies to all forms of insurance.

At the time of taking a policy, policyholder should ensure that all questions in the proposal form are correctly answered. Any misrepresentation, non-disclosure or fraud in any document leading to the acceptance of the risk would render the insurance contract null and void.
Protection:
Savings through life insurance guarantee full protection against risk of death of the saver. Also, in case of demise, life insurance assures payment of the entire amount assured (with bonuses wherever applicable) whereas in other savings schemes, only the amount saved (with interest) is payable.

Aid To Thrift:
Life insurance encourages 'thrift'. It allows long-term savings since payments can be made effortlessly because of the 'easy installment' facility built into the scheme. (Premium payment for insurance is monthly, quarterly, half yearly or yearly).
For example: The Salary Saving Scheme popularly known as SSS, provides a convenient method of paying premium each month by deduction from one's salary.
In this case the employer directly pays the deducted premium to LIC. The Salary Saving Scheme is ideal for any institution or establishment subject to specified terms and conditions.
Liquidity:
In case of insurance, it is easy to acquire loans on the sole security of any policy that has acquired loan value. Besides, a life insurance policy is also generally accepted as security, even for a commercial loan.

Tax Relief:
Life Insurance is the best way to enjoy tax deductions on income tax and wealth tax. This is available for amounts paid by way of premium for life insurance subject to income tax rates in force.
Assessees can also avail of provisions in the law for tax relief. In such cases the assured in effect pays a lower premium for insurance than otherwise.

Money When You Need It:
A policy that has a suitable insurance plan or a combination of different plans can be effectively used to meet certain monetary needs that may arise from time-to-time.
Children's education, start-in-life or marriage provision or even periodical needs for cash over a stretch of time can be less stressful with the help of these policies.
Alternatively, policy money can be made available at the time of one's retirement from service and used for any specific purpose, such as, purchase of a house or for other investments. Also, loans are granted to policyholders for house building or for purchase of flats (subject to certain conditions).

How to rebuild an investment portfolio after recession

2009-10-25T10:31:00.000+05:30

Don't swing for the fences. To get even after a 28% loss, you have to gain 37%. But that doesn't mean you should load up on risky funds to make up for lost time. You'll just increase the odds that you'll lose more money.

Two important statistical measures will help you get a handle on risk. The first, beta, tells you the fund's relationship to an index, such as the Standard & Poor's 500-stock index. A fund with a beta of 1 rises and falls in lockstep with the index. A fund with a beta of 1.1 will rise 10% more and fall 10% more than the index. Conversely, a fund with a beta of 0.9 will rise 10% less and fall 10% less than the index.

Another useful measure is standard deviation, which tells how much you can expect a fund to vary from its average. The higher the standard deviation, the more volatile the fund. The standard deviation of the S&P 500 the past three years is 19.6. AIM China fund has a standard deviation of 37.6, so you can expect that its performance will be roughly twice as volatile as the S&P 500. You can find a fund's beta and its standard deviation by putting the fund name or ticker into any Get a Quote box at money.USATODAY.com. Scroll down to Risk Measures.

•Don't go to cash After taking a mauling from a bear market, many investors want to give up on stocks and bonds and move to money market mutual funds or bank CDs. But savings rates are so low that you'll earn close to nothing: The average money fund yields 0.05%, or $5 on a $10,000 deposit. Factor in inflation and taxes, and you'll earn less than nothing.

True, a 0.05% return is better than a big loss. But you have your best chance of getting back to even in stocks. Recovery time for a bear market depends on the severity of the downturn, says Jeff Hirsch, editor of the Stock Trader's Almanac. Hirsch thinks the market won't make new highs until 2011.

•Don't give up. Unless your retirement plan is to keel over at your desk, you need to lick your wounds and keep going. Even if you have a pension and Social Security, you'll need savings to maintain your standard of living.

How do you recover from the market's drubbing?

•Save more. The only sure-fire way to make up losses is to increase your savings. For example, suppose you earn $50,000 and contribute 5% of your salary to a 401(k) plan. You get 3% raises every year. If you earn 6% a year, you'll have $260,500 after 30 years. Bump up your contribution to 7%, and you'll have $364,000.

If you're investing in a 401(k) plan, bumping up your savings by a percentage point or more could be surprisingly painless, because your contributions are before taxes. For example, suppose your gross salary is $50,000. You pay 25% in federal taxes and 5% in state taxes, and you contribute 5% of your salary, or $48 a week, to your 401(k). Increasing your contribution 2 percentage points, to 7%, will decrease your take-home pay by just $13 a week.

•Make a plan. If you want a reasonable shot at retirement, you'll need to know how much money you'll need when you retire. Fortunately, you can find plenty of help estimating your retirement needs. Fidelity (www.fidelity.com), (www.troweprice.com) and Vanguard (www.vanguard.com) all have excellent online programs for figuring out how much you'll need to save for retirement.

If you feel you need a financial planner, consider a fee-only planner — preferably one that charges you by the hour, not by commission. You can find fee-only planners at www.napfa.org. You can also buy financial planning by the hour at the Garrett Planning Network at www.garrettplanningnetwork.com.

•Don't ignore dividends. Although red-hot growth stocks make the headlines, it's the stodgy dividend payers that do the heavy lifting over the long term. The S&P 500 has gained 867% the past 30 years without dividends. With dividends reinvested, the index has soared 2,200%.

•Keep expenses low. If your plan offers two similar funds, choose the one with the lowest annual expenses.

•Find an asset allocation plan. Once you've figured out how much you need to save, figure out how much of your money should be split between stocks, bonds and money market securities. The more time you'll have before you need to spend your money, the more you should have in stocks. If you have 20 to 30 years before retirement, for example, you should have 70% or more of your investments in stocks.

Web	investinn.blogspot.com

NRI CENTRE

2009-10-25T10:18:00.001+05:30

Welcome to NRI Centre. We have made an attempt here to furnish important features applicable to Non-Resident Indians (NRI) and People of Indian Origin having foreign nationality and residing in foreign countries. (PIO).

Before entering to technical part of the subject we wish you to know the concept of insurance clearly; to identify the proper type of policy; to know the premium structure of the policy and to get the doubts, if any, on our different insurance plans clarified through your agent or LIC Branch Office.

Concept of insurance and different types of plans:

Life risk cover i.e. financial protection to the family in case of an unforeseen event- say death, illness, disability on account of accident, etc –is the main purpose of insurance. But, it is also seen as a ‘compulsory savings’ leading to creation of wealth which can be utilized for education/marriage of children; for old age provision; for construction of house; etc. Policies are taken to get exemption from Income Tax and to assign these to financial institutions as collateral security while availing different type of credit facilities including housing loan. In order to meet various socio-economic needs of different people, LIC has designed more than 40 types of plans which include whole life policies, endowment policies with a definite term, joint life policies, money back policies having provision for periodical lump sum payments called survival benefits, term insurance policies which have low premium but high risk cover, pension plans, children plans, Unit Linked Plans which provide an opportunity to invest in capital market, etc. etc.

Each of our plans has distinct features covering certain type of benefits. The selection depends on your needs. Details of plans are available under the option ‘products-insurance plans’. Each plan is given a table number for identification purpose. e.g. Table 14 refers to Endowment Plan which is most popular in India.

Calculations of premium:

Once short listing of two to three plans is made, you would proceed to know the premium rates & calculations. For this, you should decide the term of policy, Sum assured, Mode of payment of Premium ( Yearly, Half yearly, Quarterly or Monthly ) and whether you require additional benefits like accident benefit. You may go to the option :‘tools - premium calculator’ for knowing the premium amount to be paid for the policy of your choice. Thereafter, you would be required to know the formalities to be completed for obtaining the desired type of policy.

Requirements to take a policy of insurance:

Submission of prescribed proposal form ( Form No. 300 in majority of the cases )is the basic requirement. Medical report may be required to assess the health of the proposer. Proofs of age and income, agent’s recommendations, special reports in case of any deformity or history of major illness, etc. would be required to evaluate the risk. This process is called ‘Underwriting’ and it is done in India based on the facts appearing in proposal form and allied papers. If the proposed life is acceptable and sufficient amount is received towards the First Premium, acceptance letter would be sent to the proposer and policy bond would be issued in due course.

Jeevan Saral

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Jeevan Saral Plan 165 and Jeevan Saral Plan 185

Plan Details:

This plan is appropriate for employees seeking life cover through Salary Savings Schemes. This is an Endowment Assurance plan where the proposer has simply to choose the amount and mode of premium payment. The plan provides financial protection against death throughout the term of the plan. The death benefit is directly related to the premiums paid. The Maturity Sum Assured depends on the age at entry of the life to be assured and is payable on survival to the end of the policy term. It also offers the flexibility of term and a lot of liquidity.

Eligibility:

Minimum Age: 12 Yrs (completed) Maximum Age: 60 Nearest Birthday Term: Minimum 10, Maximum:35 Age at maturity: Maximum 70 years

Premium:

Minimum premium: Rs 250 per month for entry age upto 49 years and Rs.400 per month for entry age 50 years and above. The premium shall be in multiple of Rs.50 per month.
Premium Mode:Yearly, Half yearly, Quarterly and Monthly under Salary SavingScheme.

Survival Benefits: The sum payable at maturity however differs for different entry ages and terms. On Maturity the individual will receive maturity sum assured, plus Loyalty additions, if any.

Death Benefit: 250 times the monthly premium together with loyalty additions, if any, and return of premiums excluding first year premiums and extra/rider premium, if any, is payable in lump sum on death of the life assured during the term of the policy.

Maturity Benefit: The Maturity Sum Assured plus Loyalty additions, if any, is payable in a lump sum. Accidental Death and Disability Benefit

Supplementary/Extra Benefits: These are the optional benefits that can be added to your basic plan for extra protection/option. An additional premium is required to be paid for these benefits.

Surrender Value: Buying a life insurance contract is a long-term commitment. However, surrender values are available on earlier termination of the contract. The surrender value will be the greater of the guaranteed surrender value and special surrender. The plan also allows for partial surrenders.

Guaranteed Surrender Value: The policy can be surrendered after it has been in force for at least 3 full years. The Guaranteed Surrender value will be equal to 30% of the total amount of premiums paid excluding the premiums for the first year and all the extra premiums and premiums for accident benefit / term rider.

Salary Trend in India, How much you can expect!

2008-01-25T04:08:00.000+05:30

Indian IT professional’s salary increase one of the highest in world

According to recently released 2007 salary survey, typical Indian software professional got an average salary increase of 18.7% in 2007, an improvement over 18.3% increase recorded in the previous year.
This is revealed by a nation-wide survey carried out by IDC India for CyberMedia group’s flagship publication, covering 2,806 IT professionals. This number is one of the highest in the world. Compare this to roughly 2.7% to 3.3% average salary increase in US.

Employee Break-up by Salary and Experience

The average annual salary drops from Rs 5.7 lakh to Rs 5.4 lakh, despite the average hike touching 19.8%, with aggressive hiring of freshers at basic salary levels
(Dataquest survey)

Difference between Gross Salary and Net Salary

Gross Salary is inclusive of all the remuneration payable to an employee.
while Net salary is only the take-home salary. i.e, Gross salary earned minus the deductions towards ESI, EPF, PT, Insurance etc..

Cost To the Company (CTC): all the expenses to calculate the CTC of an employee i.e.

1. All the components of the salary.
2. All the perks that are being given for the candidate (i.e) - bonus, incentives, reimbursement of medical/telephone/petrol, benefits extended thro' various schemes like housing/vehicle/furniture/ A/C/ etc....
3. All the contributions that the company makes for the employees like PF,SUPER ANNUATION, GRATUITY,MEDICAL INSURANCE, ETC. should also be included in calculating the CTC of an employee.

Take Home Salary
Take a simple example of take-home salary calculation. For this, from the gross package one has to deduct professional tax, income tax, mediclaim premium, investment in tax saving instruments and provident fund contribution from the total salary
As you can see when Total salary increases Percantage of Actual or Take home salary goes down.

So take care when you discuss your CTC with HR.

Latest salary package for freshers in MNC...

Figure in Lacs/Annum

Accenture------------------------2.1
Adobe----------------------------5.7
Amazon--------------------------5
Attrenta--------------------------8
Caritor ---------------------------2
CISCO----------------------------4
Computer Associates------------4.5
CTS-------------------------------2.1
DE Shaw--------------------------6
Deloitte---------------------------7
Fiorano ---------------------------5
Flextronics (HSS) ---------------3
Google ---------------------------12
GE --------------------------------3
HCL ------------------------------2
Hexaware -----------------------2.1
IBM ------------------------------5
Impulsesoft ---------------------4.5
Interra Systems ----------------4.6
Induslogic -----------------------4.2
Infosys Systems ----------------1.8
Kanbay --------------------------3.25
Kritical ---------------------------5.6
MBT ------------------------------2.5
Microsoft ------------------------7.8
Mindtree ------------------------3
Motorola ------------------------3.6
Nvidia---------------------------2.1
Oracle ---------------------------4.2
Patni(PCS) ----------------------1.7
Perot ----------------------------2.5
Polaris ---------------------------2
SAP Labs ------------------------4
Samsung ------------------------4.6
Satyam --------------------------2.25
STM -----------------------------4.5
Sun Microsystems --------------5.0
Syntel ---------------------------2.05
Tata Elxsi -----------------------1.9
Tavant --------------------------3.6
TCS -----------------------------1.8
T-Mobile ------------------------8.0
Trilogy --------------------------7.5
Verizon -------------------------3
Virtusa --------------------------2.4
Wipro ---------------------------2.1

This is not a conclusive / affirmative data. This is just provided for reading purpose., no claims, guarantees on the accuracy of the above data is given.

Should I Buy Real Estate or wait?

2008-01-25T00:20:00.000+05:30

"Is now a good time to buy real estate?"

The short answer is, "it depends." People are either optimistic or pessimistic about their personal financial life and they are the same way about more macro economic topics like housing and jobs. Each month, surveys are conducted to measure Consumer sentiments to try and get a reading on the likelihood people will purchase in the near future.The topic of real estate is a pretty split camp. There are rational and compelling reasons to be optimistic or pessimistic about housing and it doesn't really matter what part of the country you live in.

Reasons to be pessimistic about real estate

1. House prices are falling in parts of the country. Why buy in a declining market?
2. Cost of ownership on a monthly basis is higher than renting.
3. Taxes and home owners insurance are too high.
4. Prices of homes are too high.
5. Houses take time to sell. With less people being able to buy, it will take even longer.
6. When I will be back in India (Duration in USA)

Reasons to be optimistic about real estate

1. Real estate is a relatively safe investment over the long run.
2. Prices continue to appreciate in 2/3rds of major metro areas.
3. Interest rates are at near historic lows.
4. Buy now while mortgages are still relatively easy to get.
5. Everybody needs a place to live. Why not own it and get the tax break associated with ownership?

The one thing has changed about real estate over the past nine months is Nobody would recommend buying a home without financial reserves. In the recent past, house prices were shooting up so quickly, it was impossible to save enough money fast enough to even out. During this time, getting into a house at any cost was a smart move. Everybody don't believe that same philosophy still holds true.

Experts think 20% appreciation will continue to hold up. It is no longer smart to pay anything to get into a house and it is no longer smart to purchase homes with no financial reserves.If the "credit crunch" we're seeing now turns out to be more than a passing trend, it can have a major impact on the entire economy. It all goes back to whether you're an optimist or a pessimist. Expert believe this will be a lasting trend. Financial markets are resilient and innovative and predict the mortgage of choice for most Americans will soon be FHA. Yes, this subprime backlash will soon be remedied by the most classic of saves, the government bailout.

News said that Washington DC is being strongly lobbied to raise FHA loan limits to match conforming. This means that except in the highest priced States and neighborhoods, FHA loans will be just as competitive and available as any other option. With mortgage insurance and the backing of the US government, there won't be a bank that will be afraid to make this loan and there won't be an investor who won't buy it.

To answer the original question, "Should I buy real estate now?", so It depends on if you have reserves. If you're an optimist, You should have six months of reserves in cash, CDs or savings that will pay all your mortgage and other monthly obligations if you lose your job, or have to make a major repair to the home. Reserves also allow a seller to hold out a maximize their sales price in a less demanding market.

Economic pessimists shouldn't buy unless they have a year of reserves for the same reasons. For everyone else who would someday like to own a home, now is the time to start saving and reducing your debt. With home prices stabilizing, for now the best action you can take is to save money.

Basics of Mutual Fund

2008-01-24T23:27:00.000+05:30

A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal
A mutual fund is a professionally-managed form of collective investments that pools money from many investors and invests it in stocks, bonds, short-term money market instruments, and/or other securities. In a mutual fund, the fund manager, who is also known as the portfolio manager, trades the fund's underlying securities, realizing capital gains or losses, and collects the dividend or interest income.
The investment proceeds are then passed along to the individual investors. The value of a share of the mutual fund, known as the net asset value per share (NAV), is calculated daily based on the total value of the fund divided by the number of shares currently issued and outstanding.

You could make money from a mutual fund in three ways:

1) Income is earned from dividends declared by mutual fund schemes from time to time.
2) If the fund sells securities that have increased in price, the fund has a capital gain. This is reflected in the price of each unit. When investors sell these units at prices higher than their purchase price, they stand to make a gain.
3) If fund holdings increase in price but are not sold by the fund manager, the fund's unit price increases. You can then sell your mutual fund units for a profit. This is tantamount to a valuation gain.

What are the different types of Mutual Funds?

Mutual fund schemes may be classified on the basis of their structure and their investment objective

A. By Structure

1. Open-ended Funds
An Open-ended Fund is one that is available for subscription all through the year. These do not have a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value (NAV) related prices.

2. Close-ended Funds
A Close-ended Fund has a stipulated maturity period, which generally ranges from 3 to 15 years. The fund is open for subscription only during a specified period. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the Stock Exchanges.

B. By Investment Objective

1. Growth Funds
The aim of growth funds is to provide capital appreciation over the medium to long term. Such schemes normally invest a majority of their corpus in equities. Growth schemes are ideal for investors who have a long-term outlook and are seeking growth over a period of time.

2. Income Funds
The aim of Income Funds is to provide regular and steady income to investors. Such schemes generally invest in fixed income securities such as bonds, corporate debentures and Government securities.
Income Funds are ideal for capital stability and regular income. Capital appreciation in such funds may be limited, though risks are typically lower than that in a growth fund.

3. Balanced Funds
The aim of Balanced Funds is to provide both growth and regular income. Such schemes periodically distribute a part of their earning and invest both in equities and fixed income securities in the proportion indicated in their offer documents.
This proportion affects the risks and the returns associated with the balanced fund - in case equities are allocated a higher proportion, investors would be exposed to risks similar to that of the equity market.
Balanced funds with equal allocation to equities and fixed income securities are ideal for investors looking for a combination of income and moderate growth.

4. Money Market Funds
The aim of Money Market Funds is to provide easy liquidity, preservation of capital and moderate income. These schemes generally invest in safer short-term instruments such as Treasury Bills, Certificates of Deposit, Commercial Paper and Inter-Bank Call Money. Returns on these schemes may fluctuate depending upon the interest rates prevailing in the market.
These are ideal for corporate and individual investors as a means to park their surplus funds for short periods.

C. Other Equity Related Schemes

1. Tax Saving Schemes
These schemes offer tax rebates to the investors under specific provisions of the Indian Income Tax laws. (ELSS) and Pension Schemes

2. Index Schemes
Index Funds attempt to replicate the performance of a particular index such as the BSE Sensex or the NSE S&P CNX 50.

3. Sectoral Schemes
Sectoral Funds are those which invest exclusively in specified sector(s) such as FMCG, Information Technology, Pharmaceuticals, etc. These schemes carry higher risk and restricted to specific sector.

What are the benefits of investing in a mutual fund?

The benefits of investing in mutual funds are as follows -

1. Access to professional money managers - Experienced fund managers using advanced quantitative and mathematical techniques manage your money.

2. Diversification - Mutual funds aim to reduce the volatility of returns through diversification by investing in a number of companies across a broad section of industries and sectors. It prevents an investor from putting "all eggs in one basket". This inherently minimizes risk

3. Liquidity - Open-ended mutual funds are priced daily and are always willing to buy back units from investors. This mean that investors can sell their holdings in mutual fund investments anytime without worrying about finding a buyer at the right price.

4. Tax Efficiency - Mutual fund offers a variety of tax benefits. Please visit the tax corner section or consult your tax advisor for details.

5. Low transaction costs - Since mutual funds are a pool of money of many investors, the amount of investment made in securities is large. This therefore results in paying lower brokerage due to economies of scale.

6. Transparency - Prices of open ended mutual funds are declared daily. Regular updates on the value of your investment are available. The portfolio is also disclosed regularly with the fund manager's investment strategy and outlook.

7. Well-regulated industry - All the mutual funds are registered with SEBI and they function under strict regulations designed to protect the interests of investors.

8. Convenience of small investments - A mutual fund on the other hand allows even individual investors to hold a diversified array of securities due to the fact that it invests in a portfolio of stocks. A mutual fund therefore permits risk diversification without an investor having to invest large amounts of money.

What are the different plans that mutual funds offer?

Mutual Funds offer various investment options. Some of the important investment options include:

1. Systematic Investment Plan (SIP)
The investor is given the option of preparing a pre-determined number of post-dated cheques in favor of the fund. The investor is allotted units on a predetermined date specified in the offer document at the applicable NAV.

2. Systematic Encashment Plan (SEP)
As opposed to the Systematic Investment Plan, the Systematic Encashment Plan allows the investor the facility to withdraw a pre-determined amount / units from his fund at a pre-determined interval. The investor's units will be redeemed at the applicable NAV as on that day.

3. Growth Option
Dividend is not paid-out under a Growth Option and the investor realizes only the capital appreciation on the investment (by an increase in NAV).

4. Dividend Payout Option
Dividends are paid-out to investors under the Dividend Payout Option. However, the NAV of the mutual fund scheme falls to the extent of the dividend payout.

What are the types of risks?

For mutual fund investments, risks would include variability, or period-by-period fluctuations in total return. The value of the scheme's investments may be affected by factors affecting capital markets such as price and volume volatility in the stock markets, interest rates, currency exchange rates, foreign investment, changes in government policy, political, economic or other developments.

1. Market Risk: At times the prices or yields of all the securities in a particular market rise or fall due to broad outside influences. When this happens, the stock prices of both an outstanding, highly profitable company and a fledgling corporation may be affected. This change in price is due to "market risk".

2. Inflation Risk: Sometimes referred to as "loss of purchasing power." Whenever the rate of inflation exceeds the earnings on your investment, you run the risk that you'll actually be able to buy less, not more.

3. Credit Risk: In short, how stable is the company or entity to which you lend your money when you invest? How certain are you that it will be able to pay the interest you are promised, or repay your principal when the investment matures?

4. Interest Rate Risk: Changing interest rates affect both equities and bonds in many ways. Bond prices are influenced by movements in the interest rates in the financial system. Generally, when interest rates rise, prices of the securities fall and when interest rates drop, the prices increase

5. Investment Risks: In the sectoral fund schemes, investments will be predominantly in equities of select companies in the particular sectors. Accordingly, the NAV of the schemes are linked to the equity performance of such companies and may be more volatile than a more diversified portfolio of equities.

6. Liquidity Risk: Thinly traded securities carry the danger of not being easily saleable at or near their real values. The fund manager may therefore be unable to quickly sell an illiquid bond and this might affect the price of the fund unfavorably. Liquidity risk is characteristic of the Indian fixed income market.

7. Changes in the Government Policy: Changes in Government policy especially in regard to the tax benefits may impact the business prospects of the companies leading to an impact on the investments made by the fund.

ULIPS are a long term Investment

2008-01-24T06:26:00.000+05:30

I have recently come across agents selling ULIP's as three year plans. You might hear them ask you to invest for just three years and then reap the benefits.
All this in my opinion is miselling. Investing in ULIP's work only if your investment horizon is more than 10 years.

Below is an illustration of returns from HDFC Unit Linked Endowment Plus based on term of the plan.
These illustrations are for a 34 year male. Assuming returns of 10% per annum the following is what the figures look like.

Term : 3 years
Premium : Rs.25,000 per annum
Sum assured : Rs.1,25,000
Total premium paid : Rs.75,000
Fund balance at the end of 3 years : Rs.68,976
Net return on investments : Loss of Rs.6,024 on principal

Term : 10 years
Premium : Rs.25,000 per annum
Sum assured : Rs. 1,25,000
Total premium paid : Rs.2,50,000
Fund balance at the end of 10 years : Rs.3,17,657
Net return on investments : 7.17%

Term : 15 years
Premium : Rs.25,000 per annum
Sum assured : Rs. 1,87,500
Total premium paid : Rs.3,75,000
Fund balance at the end of 15 years : Rs.7,37,790
Net return on investments : 8.07%

Term : 20 years
Premium : Rs.25,000 per annum
Sum assured : Rs. 2,50,000
Total premium paid : Rs.5,00,000
Fund balance at the end of 20 years : Rs.13,01,447
Net return on investments : 8.43%

Term : 25 years
Premium : Rs.25,000 per annum
Sum assured : Rs. 3,12,500
Total premium paid : Rs.6,25,000
Fund balance at the end of 25 years : Rs.13,01,447
Net return on investments : 8.62%

Clearly, if you look at the net returns, investment in ULIPs only work if you plan to stay invested for long term. If someone is selling you a ULIP for a time frame of 3 to 5 years, it will not work. All he is doing is mis-selling

Investment returns for government issued bonds is also around 8%. After investing for 20-25 years we get around 8.5% interest rate.

Tips

Do not exit before the Ulip matures.
If you need to withdraw, do it partially, and only if there's an emergency.
Take 100 per cent equity exposure when the maturity is over five years away.
Review you life cover needs and increase the cover, if required.
Use top-up facility to deploy surplus funds.

What should you do in case of a road accident?

2008-01-24T06:00:00.000+05:30

If there is an accident causing injury or damage to any person, animal, vehicle or property, the driver of that vehicle should render all possible help to the injured.

He should also report the matter to the nearest police station, within 24 hours of the occurrence of such accident. According to the provisions of Section 134 of the Motor Vehicles' Act, the driver/owner of the vehicle involved in an accident is responsible to convey the injured to the nearest hospital or clinic. The doctor so approached shall be duty bound to render necessary medical aid or treatment without waiting for any procedural formalities.

Here are some Do's and Don'ts, in the event of an accident

Do's

Keep calm
Switch off the car engine
Apply parking brakes
Switch on hazard warning lights
Cordon off the area of accident
Help the injured
Take down the names and addresses of the witnesses and registration numbers of the vehicles involved
Report the matter to the police and
Take down the name and the number of the policeman who arrives at the scene

Don'ts

Do not panic
Do not argue with any one and
Do not handle the injured unless it is necessary as a life saving measure

How to Avoid Insurance Claim Rejection of Your Car

2008-01-24T05:49:00.000+05:30

These days denial of insurance claim on motor vehicles is getting increasingly common. They constitute to the majority of consumer cases in consumer forums and courts. Here we are covering the important points you should keep in mind while purchasing insurance for your vehicle and while you make a claim.

Provide authentic documents.
While purchasing insurance most of the customers negotiate for discounts which results in agent or executive suggesting unfair means to get the same. One such common method in vehicle insurance is a fake No Claim Bonus (NCB) certificate while purchasing a new insurance policy. The insurance agent believes it and gives you a 20% discount.
But if unfortunate events happen and you put a claim on your new insurer he does all the checks including your NCB claim on the previous policy. And this is where they would find a reason to reject. Remember, Insurance companies usually do not do these checks while selling you the insurance (which they should ideally do) and trust you for all that you say but they check every single document when it comes to passing a claim. Looking from economic perspective this makes sense too! So if we give wrong information or fake document to purchase a policy then we are actually buying a piece of paper of no value.

Do not lie to claim investigation officer.
This is most important; tell the exact incidence, even if you think that a slight modification would save you lots of questions or money. Remember claim officers inspect 10 – 15 cases a day and are well experienced to identify the truth. On finding things fishy they may submit a negative report.

Purchase commercial insurance
If your vehicle is used commercially. Its only slightly expensive (about 8 – 10%) but in the unfortunate condition will get you the claim. And people who use popularly commercial vehicles like Indica DLE, Tavera, Qualis, TATA Sumoetc. need to patient for getting claims as more than usual investigations are done for such vehicles under private motor vehicle insurance.

File your claim and keep communicating
File your claim and keep communicating with your insurer while they process it in order to assist them if something is missing or incomplete and henceforth avoiding any rejection. Also it is advisable to maintain a photocopy of all the documents or written communication that you do.

How to dispute an Incorrect Charge?

2008-01-24T05:08:00.000+05:30

Online Shopping, Chargeback Rights & How to Dispute a charge?

What if goods or services I ordered are delivered defective, old or not delivered at all?

Well for those who do not know MasterCard and Visa have chargeback policies in place to prevent such frauds over internet which are applicable in India in similar fashion as they are applicable in developed nations.
If the merchant doesn’t provide you with the goods and services promised within specified time here is what you need to do.

1. Send e-mail or letter to merchant describing the order you placed and problems that you are facing with that and ask him to resolve it within specified time.
2. Keep a copy of the communication that you do.
3. If merchant does not resolve the problem and provide you with what was promised then ask him to refund your money.
4. If merchant refuses to return the money or does not respond to your communication at all. Contact your credit card company and tell them you would like to dispute a charge on your account.
5. Give your information to the credit card company over the phone. Some companies will send you a form to complete, sign and return. These forms often require an explanation of the situation, as well as copies of any receipts. Charge dispute forms are also available on websites of many companies. You can fill that form and send it to the address mentioned directly via registered post or courier. We have included dispute a charge form of ICICI Bank, HDFC Bank and HSBC Bank here.
6. Wait to hear the resolution. Your credit card company is obligated to respond to you within 30 days of receiving your completed form.

Chargeback is not limited to online shopping.
When you get your card statement you should examine it thoroughly to identify any incorrect charges. There could be multiple reasons of incorrect charges. Few are listed below.

1. Neither incurred nor authorised the above transactions
2. Charged twice or thrice for the same transaction
3. The transaction amount incurred different from amount charged.
4. Hotel reservation was cancelled on time but you have been billed a No-Show Charge.
5. Already paid the transaction amount by other means and the evidence is available.
6. ATM Transaction attempted did not dispense or partially dispensed cash (copy of ATM slip attached).
7. Never received the ordered merchandise.
8. Cancelled the transaction(s)/returned the goods, but did not receive credit/refund for the same.
9. Received defective merchandise/goods and had returned the goods to the merchant which he accepted.
10. Cancelled Membership/Subscription/Booking but still being charged.

In all the disputes cited above you would be required to provide supporting document.
It is advisable that you keep transaction related documents like charge slips credit notes, bill or e-bill etc till you are satisfied with the goods and see the correct charges appearing in the statement.
When you file a dispute the charge would be reversed by the bank immediately on receipt of the complaint. You typically get 60 days from statement to file such a complaint. The issuing bank then pursues the matter with the merchant and based on the final decision you get a complete waiver of the charges or are asked to pay the reversed amount in a specified time.
Do not give up if your dispute gets denied. Determine if there is additional information you can provide. Ask your credit card company about your options.

For More inofrmation on Credicard policy visit RBI
http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=2627&Mode=0

For filing complaint against credit card company, click on below link
http://www.rbi.org.in/scripts/helpdesk.aspx

"Every credit card (CC) holder should be aware of CHARGE BACK;
the only protection for customers.

What is 'charge back' and how does it work?
If a customer is unhappy with a purchase thru CC, s/he can demand for 'charge back' so that banks will reverse the amount billed on CC. That is, bank will cancel that purchase & will not pay the amount to merchant. Net result is customer need not pay for that faulty product or unsatisfactory purchase. The charge back can be claimed within 180 days of the purchase date."

Post Office Savings Schemes

2008-01-23T21:55:00.000+05:30

This section of InvestInn offers information about various savings and investments plans available to residents of India via. Indian Post offices. These schemes are popular among each and every section of society as they offers higher returns without any risk loss. i.e. Guaranteed returns.

Current Small Savings Schemes With Main Features

Post Office Time Deposits
Post Office Recurring Deposits
Post Office Monthly Income Scheme [Post Office MIS]
National Savings Certificates [NSC]
Kisan Vikas Patra - [KVP]
Public Provident Funds [PPF]
Deposit Scheme for Retiring Government Employees.
Deposit Scheme for Retiring Employees of Public Sector Companies.
Postal Life Insurance

1. Post Office Time Deposits

Post office Time deposit scheme is a type of fixed deposit account offered by Department of post, Government of India at all post office. This saving plan is best for those investors who want to deposit a lump sum for a fixed period. Investor gets a lump sum (principal + interest) at the maturity of the deposit, where rate of interest on investment depend on the term of deposit.

Who can open

A single adult or two adults jointly,
A pensioner to receive/credit his monthly pension,
Group Accounts by Provident Fund,
Superannuation Fund or Gratuity Fund, Authority controlling funds of the Sanchayika. Public Account by a local authority/body,
Institutional Accounts by the Treasurer of Charitable Endowments for India, Trust Regimental Fund & Welfare Fund,
A cooperative society / cooperative bank or scheduled bank on behalf of its members, clients or employees
Gazetted Officer in his official capacity.
[ Non Resident Indian / HUF can not open the account. ]

Nomination facility
Nomination facility is available under Post office Time Deposit scheme.

Amount Required
Minimum amount required: Rs.200/-. Maximum Amount : No Limit

Time / term of investment
Time Deposits can be made for the periods of 1 year, 2 years, 3 years and 5 years.

Interest Rates

Period of deposit--- Rate of Interest per cent/ per annum
1 YEAR ----------------6.25
2 YEARS ---------------6.50
3 YEARS ---------------7.25
5 YEARS ---------------7.50

2. Post Office Recurring Deposit Accounts

Who can open :

A single adult or two adults jointly,
A guardian on behalf of a minor or a person of unsound mind; or
A minor who has attained the age of ten year, in his own name.

Where can be opened :
At any post office.

Maturity
Period of maturity of an account is five years.

Deposits
Sixty equal monthly deposits shall be made in an account in multiples of Rs. five subject to a minimum of ten rupees.

Defaults in deposits

Accounts with not more than four defaults in deposits can be regularized within a period of two months on payment of a default fee.
Account becomes discontinued after more than four defaults.

Interest & Repayment on maturity

On maturity of the accounts opened on or after 1st March, 2003, an amount (inclusive of interest) of Rs. 728.90 is payable to a subscriber of Rupees: Ten denomination account.
Amount repayable, inclusive of interest, on an account of any other denomination shall be proportionate to the amount specified above.

Pass Book
Depositor is provided with a pass book with entries of the deposited amount and other particulars duly stamped by the post Office.

Premature closure
Premature closure of accounts is permissible after expiry of three years provided that interest at the rate applicable to post office savings account shall be payable on such premature closure of account.

Continuation after maturity
Permissible for a maximum period of five years.

3. Monthly Income Scheme [Post Office MIS]

Who can open
A single adult or 2-3 adults jointly.
More than one account can be opened subject to maximum deposit limits.

Where can be opened
At any post office.

Maturity
Period of maturity of an account is six years.

Deposits
Only one deposit shall be made in an account.

Deposit limits
Minimum: rupees one thousand.
Maximum: rupees three lakhs in case of single and rupees six lakhs in case of joint account. Deposits in all accounts taken together shall not exceed Rs. three lakhs in single account and Rs. six lakhs in joint account. The depositor’s shares in the balances of joint accounts shall be taken as one half or one third of such balance according as the account is held by 2 or 3 adults.

Interest

Interest @ 8 per cent/ per annum, payable monthly in respect of the accounts opened on or after the 1st March, 2003.
In addition, bonus equal to ten per cent of the deposited amount is payable at the time of repayment on maturity.

Pass Book
Depositor is provided with a pass book with entries of the deposited amount and other particulars duly stamped by the post Office.

Premature cloasure
Premature closure facility is available after one year subject to condition.

Closure of account
Account shall be closed after expiry of 6 years, bonus equal to ten per cent of deposits shall be paid alongwith principle amount.

Income Tax relief
Income tax relief is available on the interest earned as per limits fixed vide section 80L of Income Tax, as amended from time to time.

4. National Savings Certificates [NSC]

Who can purchase

An adult in his own name or on behalf of a minor,
A minor,
A trust,
Two adults jointly,
Hindu Undivided Family.

Where available
Available for purchase/issue at Post Offices.

Maturity
Period of maturity of a certificate is six Years.

Nomination / Transferability

Nomination facility is available.
Certificates can be transferred from one post office to any other post office.
Transfer from one person to another person permissible in certain conditions.

Denomination / Deposit limits

Certificates are available in denominations (face value) of Rs. 100, Rs. 500, Rs. 1000, Rs. 5000 & Rs. 10,000.
There is no maximum limit for purchase of the certificates.

Interest/maturity value

With effect from 1st March, 2003, Maturity value a certificate of Rs. 100 denomination is Rs. 160.10.
Maturity value of a certificate of any other denomination shall be at proportionate rate.
Interest accrued on the certificates every year is liable to income tax but deemed to have been reinvested.

Premature encashment
Premature encashment of the certificate is not permissible except at a discount in the case of death of the holder(s), forfeiture by a pledgee and when ordered by a court of law.

Place of Encashment/discharge on maturity
Can be encashed/discharged at the post office where it is registered or any other post office.

Income Tax relief

Income Tax rebate is available on the amount invested and interest accruing every year under Section 88 of Income tax Act, as amended from time to time.
Income tax relief is also available on the interest earned as per limits fixed vide section 80L of Income Tax, as amended from time to time.

5. Kisan Vikas Patra [KVP]

Kisan Vikas Patras (KVPs) are available at all Head Post Offices and authorized post offices throughout India. The KVPs are measured as the most safe investment tool, as it has the backing of the Government of India. The principal is assured (guaranteed) and it is deemed to be a safe avenue for investing your money. KVP is suitable for an increase in investment as it accumulates money at a fixed rate, and money doubles at the end of the specified period. It is for those looking for guaranteed returns.

Who can purchase

An adult in his own name or on behalf of a minor,
A minor,
A Trust,
Two adults jointly.

Where available
Available for purchase/issue at Post Offices.

Maturity amount / period
With effect from 1st March, 2003, invested amount doubles on maturity after Eight Years and Seven months.

Nomination
Nomination facility is available.

Denomination / Deposit limits

Certificates are available in denominations (face value) of Rs. 100, Rs. 500, Rs. 1000, Rs. 5000, Rs. 10,000 & Rs. 50,000.
There is no maximum limit for purchase of the certificates.

Tax Benefits
No income tax benefit is available under the scheme. However the deposits are exempt from Tax Deduction at Source (TDS) at the time of withdrawal.

Place of Encashment/discharge on maturity
Can be encashed/discharged at the post office where it is registered or any other post office.

6. Public Provident Funds [PPF]

Who can open account under the scheme
An individual :

in his own name,
on behalf of a minor of whom he is a guardian,
a Hindu Undivided Family.

Where to open an account

at designated post offices throughout the country and
at designated branches of Public Sector Banks throughout the country.

Maturity period

The account matures for closure after 15 years.
Account can be continued with or without subscriptions after maturity for block periods of five years.

Nomination
Nomination facility is available.

Deposit limits

Minimum deposit required is Rs. 500 in a financial year.
Maximum deposit limit is Rs. 70,000 in a financial year.
Maximum number of deposits is twelve in a financial year.

Loans
Loans from the amount at credit in PPF account can be taken after completion of one year from the end of the financial year of opening of the account and before completion of the 5th year. The amount of withdrawal cannot exceed 40% of the amount that stood to credit at the end of fourth year preceding the year of withdrawal or at the end of preceding year whichever is lower.

Withdrawal
Premature withdrawal is permissible every year after completion of 5 years from the end of the year of opening the account.

Transferability

Account can be transferred from one post office to another post office,
from a bank to another bank; and
from a bank to post office and vice-versa.

Pass Book
Depositor is provided with a pass book with entries of the deposited amounts, interest credited every year and other particulars duly stamped by the post Office.

Interest
· Interest at the rate, notified by the Central Government from time to time, is calculated and credited to the accounts at the end of each financial year. · Present rate of interest is eight per cent / per year since: 1st March, 2003.

Income Tax relief

Income Tax rebate is available ‘on the deposits made’, under Section 88 of Income tax Act, as amended from time to time.
Interest credited every year is tax-free.

Komal Jeevan

2008-01-23T12:20:00.000+05:30

'KOMAL JEEVAN' introduced w.e.f. 14th November, 2002. This is a money back plan with guaranteed addition and payment of premiums ceases on the policy anniversary immediately after the child attains 18 years of age.

The Komal Jeevan plan is specially made for the children between age of 0 to 10 years. This paln guarantees a return @ 7.5 % p.a on Sum Assured. Premium payments are limited upto the 18 years of the child. Special Benefits can be added to the policy to ensure FINANCIAL SECURITY of your child even in your absence

This policy is suitable for parents who wants to secure money for there children’s higher education. It can be availed by parents having children aged between 0 to 10 years.

Features

Parents can propose the child's life.

Risk under this plan will commence either after 2 years from the date of commencement of the policy or from the policy anniversary immediately following the completion of 7 years of age by the child, whichever is later. No medical examination of the life to be assured would be required under this plan.

Premiums are payable upto a term equal to 18 minus the age of the child at entry.

In most cases, Father would be the proposer. But, if Mother has an income of her own, can also propose the policy. If both parents are not alive legal guardian can propose.

Policy can be gifted by grand parents, elder sisters or brothers and uncles both from paternal or maternal side, by taking a single premium policy for love and affection. In such cases also, the policies will be proposed by father, mother or legal guardian.

Benefits

1. Installment Benefits:

The Sum assured under this plan will be paid installments at periodic intervals provided the policy is in force for full sum assured as under:

1. 20% on policy anniversary after completing age 18
2. 20% on policy anniversary after completing age 20
3. 30% on policy anniversary after completing age 22
4. 30% on policy anniversary after completing age 24

2. Guaranteed additions:

Payable along with sum assured either on death within the term or on policy anniversary after attaining age 26 years. The policy has to be kept in full force at Rs.75 per thousand for each policy year to receive this benefit.

3.Death Benefit:

1.In case of death of life assured before the commencement of risk, the policy is cancelled and premiums paid are refunded.
2.After the commencement of risk, if the life assured dies before policy matures, full sum assured plus guaranteed additions are payable without deduction of earlier installment benefits paid.

4.Loyalty Additions:

Special benefit on maturity - Loyalty Additions depending on policy duration and sum assured are paid on maturity.

5.Premium Waiver Benefit:

Premium Waiver Benefit available with some extra premium amount.

6.Term Rider Benefit:

Term Rider Benefit can be availed by the proposer to the extent of 20% of the basic sum assured under the policy not exceeding Rs.1,00,000/-. The benefit will be payable in case the proposer dies before the policy anniversary on which the child is 18 years last birthday.

Restrictions

1. Children (both boys and girls) from 0 to 10 years of age are eligible.
2. Minimum Age at Entry : 0 years
3. Maximum Age at Entry : 10 years
4. Maturity Age : 26 Years
5. Mode of Premium : Single Premium, Yearly, Half-Yearly, Quarterly, SSS.
6. Minimum Sum Assured Rs.1,00,000/-
7. Maximum Sum Assured Rs.25,00,000/- within the overall permissiable limit of Rs.50,00,000/-
8. Policy will be issued only in multiples of Rs.25,000/-
9. Loan against the Policy is not available.

Exclusions

Suicide: This policy shall be void if the Life Assured commits suicide at any time on or after the date on which the risk on the policy has commenced but before the expiry of one year from the date of the policy. In case of death due to suicide during this period, the Corporation will not entertain any claim by virtue of this policy except to the extend of a third party's bona fide beneficial interest acquired in the policy for valuable consideration of which notice has been given in writing to the office to which premiums under this policy were paid, at least one calendar month prior to death.

Jeevan Anand

2008-01-23T12:04:00.000+05:30

Features
Jeevan Anand is a With Profit assurance plan. The plan is a combination of the Whole Life Plan and the most popular Endowment Assurance Plan. It provides pre-decided Sum Assured and bonuses at the end of the stipulated premium paying term, but the risk cover on the life continues till death.

Special Features

Moderate Premiums
High bonus
High liquidity
Savings oriented.

Premiums are usually payable for the selected term of years or until death if it occurs during the term period. This policy not only makes provisions for the family of the life assured in the event of his early death but also assures a lump sum at a desired age. The lump sum can be reinvested to provide an annuity during the remainder of his life or in any other way considered suitable at that time.

Benefits

Survival Benefits
Sum Assured along with all vested bonuses payable at the end of the premium paying term ( Endowment term).

1. Accident Benefit
The Double Accident benefit is available during the premium paying term and thereafter up to age 70. The premium for this has been built into the tabular premium rates. Maximum accident cover available under this plan will be Rs. 5 lakh ( this limit excludes accident benefit taken under other plans).

2. Premium Stoppage
If payment of premiums ceases after at least three years' premiums have been paid, a free paid-up policy for a reduced Sum Assured will be automatically secured provided the reduced sum assured, exclusive of any attached bonus, is not less than Rs. 250/-. The reduced sum assured will become payable on the event as stipulated in the policy..

Bonus
If it is a ‘with profits’ policy note that every year the LIC distributes its surplus among policyholders to ‘with profits’ polices in the form of bonuses. Substantial bonuses have been declared in the past after each valuation of policy liabilities.

Death Benefits
Sum Assured along with vested bonuses are payable on death during the premium paying term and when policy ceases. An amount equal to the Sum Assured is payable if death occurs after the premium paying term.
Simple Reversionary Bonus accrues during the premium paying term and is payable at the end of the premium paying term or on earlier death along with final additional bonus, if any. No Bonus is paid on death after the premium paying term.

Policy Parameters

Min Max Entry Age: 18-65
Sum Assured: 100000-No Limit
Term: 5-57

Mode of Payment: Monthly, Quarterly, Half Yearly, Yearly, Small Saving Scheme
Max Maturity Age: 75 Years
Policy loan available: Yes

Suitable For
Being an endowment assurance + whole life policy, this plan is apt for people of of all ages and social groups who wish to protect their families from a financial setback that may occur owing to their demise. The amount assured if not paid by reason of his death earlier will payable at the end of the endowment term where it can be invested in an annuity provision for the rest of the policyholder's life or in any other way he may think most suitable at that time.

Can NRIs take LIC Policy?

2008-01-23T11:14:00.000+05:30

1. Can NRIs take Rupee - Currency Policy of LIC ?
Yes.

2. Can NRIs take Foreign - Currency Policy of LIC ?
In India, LIC markets only Rupee - Currency Policy. If all premiums are paid in foreign curreny the proceeds will be paid in foreign currency otherwise the same will be paid proportionately.

3. What are the types of schemes offered by LIC to NRIs ?
All individual schemes marketed by LIC in India are available to the temporary NRIs holding Indian Passports. Foreign Nationals of Indian origin can take LIC policies during their stay in India. However, joint life plans having term insurance element and plans having health insurance are not allowed.

4. Does LIC offer Overseas Medical Insurance for people visiting abroad ?
No, LIC does not have any scheme of visitors Medical Insurance for people traveling abroad.

5. How can an NRI pay the premium under the policy ?
The manner of payment of premiums under the policy is as follows.

a) For Rupee Policies on NRIs

By direct remittance from abroad through Banking Channels in approved manner (preferably by Indian Rupee drafts drawn in favour of LIC of India) or by remittances through postal channels like Foreign Money Order.

By payment out of funds held in Non-Resident (External) Account or Foreign Currency (Non- Resident) Account with a Bank in India.

By cheques drawn by Non- resident policy holder on Bank Accounts held in India in his own name (either solely or jointly with another member of the family) whether or not the account has been designated as non-resident.
By cheque drawn on account maintained by resident parent or spouse of policy holder in their own name or joint names with other close relatives.

By the absolute Assignee in India wherever such policies have been absolutely assigned to a resident in India.

By the employers in respect of policies issued to their employees who have been deputed abroad by them.

Premiums can be paid in cash by a resident parent or spouse of the non-resident policyholder subject to his / her submitting a letter stating the relationship with the policyholder.

Premiums due on policies issued to Indian students who have gone abroad for higher studies may be collected in Rupees out of the Resident Bank Account in India or any of their representatives in India by cash or cheques.

Note:In respect of premiums collected in cash from sources mentioned in iii) to viii), it should be noted that the policy moneys cannot be paid abroad in foreign exchange but has to be paid in

India only.

b) For policies held on foreign register of LIC:
Premiums on foreign currency / Rupee policies issued by overseas of LIC and held on their foreign register should be collected only in foreign currency.

Index

2008-01-23T03:58:00.000+05:30

Welcome to investinn.blogspot.com, provides a variety of services to address the problems and questions you may face as an investor. Discussed countless strategies how to save money and increase cash flow, and how to skyrocket your success.

Here we tried to give you maximum information on Financial front. We expect that it will be helpful to you. We added number of categories for better browsing from insurance to Tax. we provide helpful investing information and resources to help you understand investing basics, and to help you to come with your own personal investing strategy.

Category:

Auto Insurance : Information on 1. What should you do in case of a road accident?, 2. How to Avoid Insurance Claim Rejection of Your Car , 3. Auto Insurance, 4. United India Auto Insurance

Be Smart : Strategies so that you can live in a smart way 1. NRI: Investing in India or in USA??? 2. Where to invest in times of inflation? 3. Credit Card- Watch out for the Common Mistakes 4. Ways to Make Your Credit Cards Work for You

Credit Card : What care you need to take while in camoufladge industry. 1. How to dispute an Incorrect Charge?, 2. Credit Card- Watch out for the Common Mistakes 3. Ways to Make Your Credit Cards Work for You

Insurance : Money is never importanct than life so we cover 1. Insurance Basics and 2. Steps to Insurance?

Investment : Money Management Tips 1. Basics of Mutual Fund, 2. ULIPS are a long term Investment , 3. Fixed Income: Playing safe! 4. Pension Plans: Planning for old age 5.SIP: All you need to know 6. 5 things to look at in an FD 7. PPF vs NSC: What's the difference? 8. Post Office Savings Schemes , 9. Everything you wanted to know about PPF

LIC : All about LIC policies and its benefits. 1. Insurance Cover, Do we need , and 2. Life Insurance Corporation- LIC Plans, 3. Komal Jeevan , 4. Jeevan Anand

NRI : NRI are always in dilemma, we tried to focus on some topics 1. Should I Buy Real Estate or wait?, 2. Can NRIs take LIC Policy?, 3. Imporatant reasons why NRIs must invest in India 4. NRI: Investing in India or in USA???

Postal Saving : Risk free returns 1. Everything you wanted to know about PPF , 2. Post Office Savings Schemes, 3. PPF vs NSC: What's the difference?

Salary : Minimize your tax outgo, maximize what you keep 1. Salary Allowance: Save Income Tax, 2. Design a tax-smart "Salary Package" for maximum Take Home, 3. Salary Trend in India, How much you can expect!

Tax : Be a tax paysaver not tax payer, helping to stretch your money 1. Everything you wanted to know about PPF , 2. Salary Allowance: Save Income Tax , 3. SIP: All you need to know 4. Design a tax-smart "Salary Package", 5. Fixed Income: Playing safe!, 6. Pension Plans: Planning for old age , 7. 5 things to look at in an FD , 8. ASSESSMENT YEAR 2008-2009

Why Us : Know better about Invest-Inn and FAQ in Why Us

Calculator:

Different types of Calculator to know the exact figures.

1. Take Home Salary 2. Income Tax (In Detail) 3. LIC Premium 4.Mutual Fund- NAVs 5. PPF 6. Human Life Value 7. Tax E-Filing: Online Tax file 8. Loan- EMI Basic

Everything you wanted to know about PPF

2008-01-23T03:42:00.000+05:30

The Public Provident Fund (PPF) is one of the most popular investment options. Here are some frequently asked questions on this subject

What is the actual yield on the 11 per cent annually compounded return?
If you are in the 34.5% bracket, the tax equivalent yield amounts to 16.79 per cent. It amounts to 14.10 per cent and 12.22 per cent, if you are in the 22 per cent or 10 per cent tax brackets. This means that if you want a similar return, you will have to scout for an investment that offers you these returns putting the risk factor at the forefront.

What is the investment leeway offered?
You can invest anywhere from Rs 100 to Rs 60,000 in a year. This can be put in one lumpsum or a maximum of 12 monthly installments, but it should be in multiples of Rs 5. In fact, you can use the PPF account as a recurring deposit by making it a point to put aside a fixed amount from your income every month. Unlike a bank recurring deposit, you don't need to put the same amount every month.

Since the amount invested will vary month-to-month and year-to-year, how is it computed?
The rate of interest will be calculated on the lowest balance in the account between the close of the fifth day and the end of the month and will be credited to your account at the end of the year. So, to get the maximum out of your investment, deposit the amount in the first few days of the month.

What if I am desperately in need of funds?
Then you can opt either for a partial withdrawal (only one a year) or take a loan on your PPF account. A second loan can be taken only after the first is totally repaid.

Can I do both simultaneously?
No. You can take a loan only after two years from the end of year in which the initial subscription was made. A partial withdrawal is permissible only from the fifth year from the end of the year in which the initial subscription was made. For all practical purposes, it means from the seventh year onwards.

How expensive is the loan?
Very cheap. If you manage to repay the principal within 36 months, you are subject to just 1 per cent per annum as the rate of interest. In case you fail to repay it by then, it goes up to 6 per cent per annum. But this rate of interest is payable out of your non-taxable income.

Up to what limit is the loan sanctioned?
Up to 25 per cent of the balance to your credit at the end of the second year immediately preceding the year in which the loan is applied for.

Up to what limit is partial withdrawal permissible?
An amount not exceeding 50 per cent of the amount that stands to your credit at the end of the fourth year, immediately preceding the year of withdrawal, or at the end of the preceding year -- whichever is lower -- less the amount of loan, if any, which still has to be repaid.

For how long can I maintain my PPF account?
Though it says 15 years, it actually works out to be a 16-year period since an individual is allowed to make his last contribution in the 16th financial year. Even if the contribution is made on the last day, the tax rebate still holds though no interest on the amount will be earned.

What about continuing with my account after this period?
Sure, but at a block of five years. And, you can continue extending this in five-year blocks till it touches 30 years.

Do these extensions require me to continually invest?
No. If you merely retain your balance, it will earn the 11 per cent as interest until withdrawal.

What if I want a withdrawal during the extension period?
If you are just retaining the balance in your account, you can withdraw the entire sum in one or more installments at the commencement of each extended period. However, not more than once a year. If you have been continuing with fresh subscriptions, then you can withdraw up to 60 per cent of your balance at the commencement of each extended period in one or more installments, but not more than once a year.

Do I have to notify the bank about my PPF account being extended?
Yes. The Central Board of Direct taxes has stipulated that after 15 years, the tax benefits under Section 88 will not accrue unless the option for continuance is exercised.

Where can I open up my PPF account?
At head post offices, selection grade sub-post offices, State Bank of India and its subsidiary banks, and selected branches of nationalised banks.
or You can contact us at:
Invest-Inn

Salary Allowance: Save Income Tax

2008-01-23T02:59:00.000+05:30

A HEFTY gross package that’s reduced to near peanuts at the net level due to taxes is of little utility. And there’s no use blaming the tax mandarins for this. There are ways and means to structure your salary package to ensure maximum tax-efficiency. The trick lies in using perks and allowances to your advantage.

It is prudent that Basic Pay and dearness allowance, which do not find any exemption, should be kept to a basic lower limit depending on the employee’s designation and salary.

What is Allowance:
It is the amount received by an individual paid by his/her employer in addition to salary. Under section 15 of the Income Tax Act, 1961 these allowance are taxable excluding few condition where they are entitled of deduction/ exemptions.

Under Income Tax Act following types of allowance are defined

Allowances ............

1.House Allowances
The exemption of House Rent Allowance (HRA) received is exempt to the least of the following:
HRA received the period during which the rental accommodation is occupied by the employee in the previous year.

Excess of rent paid over 10 percent of salary.
50% of the salary, if the rented accommodation is situated at Mumbai, Calcutta, Delhi or Chennai and 40% of salary in other cities. The salary is taken for the period during which the rental accommodation is occupied by the employee in the previous year.

Salary:
Includes basic salary and dearness allowance if terms of employment so provide but does not include any other allowance. However, any commission payable at a fixed percentage of turnover achieved by the employee is included.

2.Entertainment Allowances
Any amount received by the employee, as entertainment allowance is taxable as salary. However, deduction is available to the employee if he has been:

In continuous service with the present employer from a date before April 1, 1955, and Receiving Entertainment Allowance from his present employer continuously from a date before April 1, 1955 till the year for which the income is to be taxed.

The amount of deduction available is restricted to least of the following:

In case of government employees: Rs. 5,000; 20% of salary; or amount of entertainment allowance granted during the previous year.
In case of non-Government employees: Rs. 7,500; 20% of salary; amount of entertainment allowance granted during the previous year, or
Amount of entertainment allowance received during the financial year 1954-55. Salary means basic salary and excludes all allowances, benefits or perquisites.

3.Transport Allowances
Transport allowance provided to an employee for commuting between his residence and the place of his duty shall be exempt up to Rs. 800 per month. However, in case blind or orthopaedically handicapped employee's, a sum of Rs. 1,600 per month is exempt from tax.

4.Education Allowances
Education allowance of Rs. 50 per month per child for up to 2 children of the employee is exempted. In case the children are in hostel, the exemption available is Rs.150 per month per child for up to 2 children.

5.Special Allowances
The following allowances are exempt from tax:

Expenses incurred on conveyance in the performance of duties of office;
Cost of travel on tour or on transfer;
Daily ordinary charges incurred by the employee on account of absence from his normal place of duty during a tour;
Expenditure on a helper where such helper is engaged for the performance of the duties of office;
Allowances granted for encouraging the academic research and training pursuits in educational and research institutions; or
Expenditure incurred on the purchase or maintenance of uniform for wear during the performance of the duties of office.

6.Leave Travel Assistance
LTA is paid for meeting travelling expenses incurred by an individual as also family members (this includes only the spouse, two children and dependent parents, brothers and sisters) while on holiday in India. The amount of exemption depends upon the mode of journey. This exemption is available in respect of 2 journeys undertaken in a block of four calendar years.

7.Medical Allowances
This exemption is available in respect of :

Reimbursement upto Rs.15,000 for medical treatment of the employee and family members.
Reimbursement of expenditure incurred by an employee and family members in approved hospitals, dispensaries etc.
Group medical insurance for an employee and family members or reimbursement of premium paid by an employee for medical insurance.
For medical treatment abroad, the actual expenditure incurred, including on travel and stay abroad of the patient and one attendant (if permitted by the RBI). The ceiling for the gross total income excluding the amount to be reimbursed is Rs.2 lakhs.
Medical treatment of the employee whose family is outside India; Travel and stay abroad of the employee or his family including one attendant accompanying the patient for medical treatment.

8.Lunch and Refreshment
Refreshment at free or concessional rate is not taxable.
Exemptions of medical expenses incurred by or on behalf of the employee

The following medical facilities provided to an employee are exempt from income tax:
Treatment of an employee or his family in any hospital maintained by the employer;
Reimbursement of any medical expenditure actually incurred by the employee for himself or his family :
In any hospital maintained or approved by the Government, any local authority; or For prescribed diseases or ailments in any hospital approved by the Chief Commissioner, or

9. Dearness Allowance
Dearness Allowance (DA) is paid to the employees to compensate them for the erosion in their wages due to increase in the price level. The system of payment of DA has its own diversity and disparity in the pattern of payment of remuneration to employees. It not only differs from industry to industry but also within the same industry.

A fairly large number of industrial establishments in the country pay a separate allowance known as the dearness allowance to supplement the wages of their employees. It includes any payment made to protect the employees against the inflation and rising prices, such as, dearness allowance (DA), variable dearness allowance (VDA), interim relief, dearness pay, etc. Since the payment of dearness allowance is not occupation specific, therefore, the information collected during the survey covered all the employees in the sample units.

10.Other Special Allowances

Children Education Allowance
Tribal Area Allowance
Hostel Expenditure Allowance
Remote Area Allowance
Compensatory Field Area Allowance
Counter Insurgency Allowance
Border Area Allowance
Hilly Area Allowance

Design a tax-smart "Salary Package" for maximum Take Home

2008-01-23T02:50:00.000+05:30

How to design a tax-smart salary package?

There are plenty of opportunities for reducing the amount of income tax you pay.

move from Tax Payer To Tax Saver!!!

Corporate India is witnessing unprecedented growth. Consequently, the demand for savvy talent is also growing apace. In a bid to attract and retain the best people in their fold, companies are competing with one another in offering high salary with attractive perks.

Realising that the income tax takes away a good portion of the pay packet, and also that individual needs differ, companies often consult their employees in designing their own salary packages.

Here is a checklist to help you work out tax-smart salary and perk options:

Major Tax- be smart

1. Interest paid on housing loan is deductible u/s 24 up to Rs 1.5 lakh (Rs 150,000) on self-occupied property, and without any limit on a rented out house.

2. The repayment of housing loan from specified sources is also deductible, irrespective of whether the house is self-occupied or given on rent within the overall ceiling of Rs 1 lakh (Rs 100,000) under Section 80C, taken together with contributions to other avenues under its umbrella.

3. Where the accommodation provided to the employee is taken on lease by the employer, the perk value is the actual amount of lease rental, or 20% of the salary, whichever is lower. Understandably, if the house belongs to a family member who is at a low or nil tax zone, the family benefits. Yes, the maximum benefit accrues when the rent is over 20% of the salary.

4. Chauffeur-driven motorcar provided by the employer has no perk value. True, the company would pay FBT (fringe benefit tax). It is @30% on 20% of the value, thereby bringing down the effective rate to 6%. Better still, if the employee owns the car and the employer pays the cost of petrol and maintenance.

5. Contributions up to Rs 1 lakh per annum to a Superannuation Fund (SAF) of the employee are not taxed, either as fringe benefit in the hands of the employer or as perk in the hands of the employee.

6. Contributions to certain specified schemes (Company PF, PPF, NSC, life insurance LIC , etc.) qualify for a deduction u/s 80C from gross total income with an overall ceiling of Rs 1 lakh. PPF has a ceiling of Rs 70,000 to contributions made to the accounts of self and minor children whereas the contributions to accounts of self, wife and children (major or minor) attract the deductions.

7. Employer's contribution to Company PF in excess of 12% of an employee's salary is taxable. Employee contributes an equal (or higher) amount to his PF account. Again, any excess over 27% of salary contributed by the employer to Company PF and SAF put together is to be treated as a taxable perk.

8. Any death-cum-retirement gratuity received up to Rs 3.5 lakh (Rs 350,000) -- subject to certain conditions -- is tax-exempt.

9. Leave Travel Allowance (LTA) given as reimbursement of expenses incurred by the employee and his family for travelling while on leave is exempt, once in two years.

10. Transport allowance for commuting between residence and place of duty is exempt up to Rs 800 per month.

11. Reimbursement, not exceeding Rs 15,000 in a year, for medical treatment from any doctor for himself and his family members is tax deductible.

12. Under Section 80D of the Income Tax Act, a deduction up to Rs 10,000 paid as medical insurance premiums on the health of an assessee, the assessee's spouse, dependent children or parents is allowed. Where an individual has insured a senior citizen (dependent parent), a higher ceiling of Rs 15,000 is available.

13. Professional tax paid by a salaried employee (around Rs 2,500 p.a.) is deductible under Section 16(iii).

14. As a tax-smart strategy, the salary (basic + DA) "should be low", the rest should come by way of such allowances on which the employer pays FBT; the employee, then, does not have to pay any tax thereon.

15. ESOP has been brought under the purview of FBT by Budget-07.

Other tax- be smart

In respect of HRA, the least of the following is exempt from tax under Section 10(13A):

(a). 40% of salary (50% for Mumbai, Kolkata, Delhi and Chennai).
(b). HRA for the period the house is occupied by the employee.
(c). The excess of rent paid over 10% of salary.

Please note that an employee who lives in his / her own house, or where s/he does not pay any rent, is not eligible for this exemption. If you are staying in a house belonging to your family members (preferably not your wife), start paying rent to the owner and ask for HRA from your employer.

1. A helper engaged at home for the performance of the duties of an office or employment of profit is not considered as a perk.

2. If the employer employs a gardener for the building premises belonging to the employer, it would not be treated as a perk. The possibility of it being extrapolated to other servants is logical.

3. Perk value of concessional loan to the employee for purchase of house or motor cars shall be the difference between the interest payable calculated at the rate of interest for similar loans charged by SBI, and the actual interest charged.

4. Loan for medical treatment specified in Rule-3A is exempt, provided it is not reimbursed under any medical insurance scheme. Where it is reimbursed, the perquisite value shall be charged from the date of reimbursement on the amount reimbursed but not repaid against the outstanding loan taken specifically for this purpose.

5. Small loans from the employer up to Rs 20,000 in the aggregate are exempt.

6. Expenses on meals provided to the employee during his hours of duty are not treated as perks.

7. Employer pays FBT on the value of any gifts to an employee. Gifts up to Rs 50,000 in a year received without consideration by an individual from any person are tax-free in the hands of the donee. However, there is a risk that the IT Department may claim that such gifts are in lieu of salary.

8. Employer pays FBT on the value of the facility of credit cards and expenses for the club.

9. Where an employer transfers a movable asset to an employee directly or indirectly, the perquisite value shall be the actual cost to the employer minus the cost of normal wear and tear @10% for each completed year during which such asset was put to use. In the case of motor cars, the normal wear and tear would be @20% whereas in the case of computers, data storage and handling devices, digital diaries, printers, etc. it would be @ 60%. These do not include household appliances (i.e., white goods) such as washing machines, microwave ovens, mixers, hot plates, ovens, etc.

10 .Uniform allowance to meet the expenditure incurred on the purchase or maintenance of uniform for wearing during the performance of the duties of an office or employment of profit is exempt from tax.

11. Expenses for soft furnishings (table linen, curtains, etc.), including their maintenance at the residence in the case of employees who entertain guests at home for official purpose are also exempt.

12. Goods at concessional rates, membership of professional associations, subscriptions for technical and business journals and newspapers are not considered as taxable perks.
Payment or reimbursement by the employer towards bills on telephones and cellular is not a perk.

Tail End

It is unlikely that good employers would add the FBT payable by them as a part and parcel of the pay package. For instance, take the case of chauffeur-driven car, which has a cost to the company of Rs 120,000. FBT has to be paid on 20% of this amount. The tax payable works out at Rs 7,416 (= 30.9% of 20% of Rs 120,000) only.

By A Shanbhag

United India Auto Insurance-

2008-01-22T04:03:00.000+05:30

Motor Package and Liability only Policies

United India has been in the forefront of designing and implementing complex covers to large customersInrurance Cover. We are discussing Insurance package, Coverage & policies

These details you cant find anywhere.

What Insurance Cover

Motor vehicle which includes private cars, Motorised Two wheelers and Commercial vehicles excluding vehicles running on rails

Who can Insure ?

Owners of the vehicle, Financiers or Lessee, who have insurable interest in a motor vehicle.

Insured's Declared Value (IDV)

(a) In case of vehicle not exceeding 5 years of age, the IDV has to be arrived at by applying the percentage of depreciation specified in the tariff on the showroom price of the particular make and model of the vehicle.

(b) In case of vehicles exceeding 5 years of age and Obsolete models (manufacture of those vehicles which have been stopped by the manufacturers), they have to be insured for the prevailing market value of the same as agreed to between the insurer and the insured.

(a) Package Policy - Section I

Section I (Own Damage - OD) of Package Policy :

Section I of package policy covers loss or damage to the vehicle and / or accessories due to

Accidental external means
Fire, Self ignition, lightning
Burglary, house breaking or theft
Terrorist activity
Riot, Strike and Malicious Damage
Earthquake
Flood, cyclone and Inundation etc
While in transit by rail, road, air, elevator, lift or inland waterways
Landslide or workslide

None of the above perils can be excluded from the scope of a policy.

Loss or damage to accessories by burglary/house breaking/theft

For private car it is covered
In case of Motorised Two Wheelers this can be covered on payment of an additional premium at 3% of the IDV of such accessories
Loss or damage to Lamp, Tyres, mudguard and / or bonner side parts, bumpers etc., can be covered on payment of additional premium. This is applicatble only to Commercial Vehicles.
If the vehicle is disabled in an accident, cover is provided for the reasonable cost of the following :

Its removal to nearest reapirers
The cost of reasonalble repairs immediately necessary
subject to the limit provided for.

(a) Package Policy - Section II

Section II (Liability) of Package Policy :

Liability to third parties bodily injury and or death and property damage
Personal accident cover for the owner driver for a specified sum insured
The following are payable under Section II of the Package Policy subject to the limit of liability laid down in the Motor Vehicles Act :

The insured's legal liability for death / disability of third party
Loss or damage to third party property
Claimant's cost as decided by the court
All costs and expenses incurred with company's written consent
In case of death of an Insured person, entitled to indemnity for a liability incurred under this policy, his legal representative will be indemnified in place of insured, if he observed all conditions as the insured himself.

What is not payable under the policy ?

Contractual liability.
War perils, nuclear perils and drunken driving
Consequentail loss, Depreciation, Wear and tear, mechanical or electrical break down
Damage suffered due to driving the vehicle under the influence of intoxicating liquor or drugs
Claims arising outside the geographical area specified in the policy
Claims arising whilst the vehicle is used in contravention of the limitations as to use
Claims arising when the vehicle is driven by a person without valid driving licence

(b) Liability Only Policy

As per Section II of the package policy

Discounts

The following are the discounts available on the premium payable.

Vintage Cars - Cars manufactured prior to 31.12.40 and duly certified by the Vintage and Classic Cars Club of India :
A discount of 25% on the OD rates is available. Policies issued covering these vehicles are Agreed Value Policies.
No Claim Bonus :
Ranging from 20% to 50% depending on the number of claim free years.
Automobile Association Membership Discount :
Discount of 5% on the Own Damage premium subject to a maximum of Rs. 200/- for private cars and Rs. 50/- for Motorised Two wheelers only.
Discount for Anti Theft Devices :
A discount of 2.5% on the OD component of premium subject to a maximum of Rs. 200/-. Device approved by the ARAI, Pune - installation of the same in vehicle certified by the Automobile Association of India.
Concession for vehicles laid up for continuous periods exceeding 2 months
50% discount on the OD premium on the vehicle specialy designed / modified for use of the blind, handicapped and mentally challenged persons
Use of vehicles withing Insured's premises/sites :
A discount of 33 1/1 % on the tariff rates is permissible.

Extension of Cover on payment of additional premium

Additional premium is payable to extend the cover under the Package and Liability Only policies in case of the following :

The Geographical area may be extended to include
a) Bangladesh b) Bhutan c) Nepal d) Pakistan e) Sri Lanka f) Maldives by charging additional premium of Rs. 500/- per vehicle in case of package policy and Rs.100/- per vehicle in case of Liability only Policy.
Personal Accident covers are available to names and unnamed persons travelling in the Motor Vehicles including employees.
In case of vehicles belonging to Embassies / Consulates etc., where the "import duty" element is not included in the IDV the premium for Own Damage shall be loaded by 30%.
Electrical / Electronic Fittings :
Electrical / Electronic Fittings which do not form part of the vehicle manufactured and imported have to be specifically covered separately by paying additional premium of 4% on the value of such fittings.
CNG / LPG-Bi-fuel Kits :
Vehicles fitted with CNG/LPG Bi-fuel kits have to be separately declared and premium is chargeable at 4% on the value of such kit.
Fibre Glass Fuel Tanks :
An additional premium of Rs.50/- for OD cover for all vehicles except Miscellaneous Type of Commercial Vehicles : for Miscellaneous Type of Commercial Vehicle it is Rs. 100/-.

Other Information

(I) Transfers :

In case of change of ownership, please ensure to effect the transfer of Insurance policy within 14 days from the date of transfers of ownership.

(II) Change of Vehicles :

A vehicle can be substituted by another vehicle for the same class, for the balance period of a policy subject to adjustment of premium, if any, on prorata basis from the date of substitution.

Note

Particulars of cover, liability and exclusion given above are not complete or exhaustive.

Please contact us for our office for complete details

Imporatant reasons why NRIs must invest in India

2008-01-22T03:46:00.000+05:30

It is time Non-Resident Indians and foreign investors took note of India.
Not just because a much publicized report has predicted that the Indian economy will become one of the world's largest by year 2050 -- which is anyway too far out to invest for.
But because there are real changes happening here; changes which will have a significant impact on India's prospects in the next decade. The opportunity is here and it is beckoning you.
It was in July 1991 that Dr Manmohan Singh, the then finance minister of India, presented his first Union Budget. India was in a crisis then and drastic measures were needed to tide over the emergency. The two-stage devaluation of the rupee marked a turning point in the Indian history. Talk of import substitution was replaced by export promotion. What transpired over the last 13 years or so is for all to see.

External sector
It is widely thought that India's external sector performance will continue to be good. To believe this, one needs to look at the outsourcing revolution that is taking place across the globe, in not only the services but also the manufacturing and research sectors. On the investment side, liberal rules and better and well-regulated markets are drawing in capital to fund India's growth.
Crises
Unfortunately, the same degree of success is not evident when it comes to India's finances.
The numbers pretty much tell the story. But one needs to keep in mind that during this period the world witnessed several crises involving Mexico (1995), South-East Asia (1997), Russia (1998) and then, of course, the global economic slowdown that followed the stock market meltdown in early 2000. These crises spread to other countries too. But the impact on India was more muted than one would have expected.
As the Reserve Bank of India often highlights, this is so because of the 'resilience' of Indian economy. This resilience is clearly illustrated in the overall economic growth posted by India over the last many years (last 10 year average of 6.1 percent p.a) and the benign inflationary environment
But then this is history. And investing today requires a good understanding on what can be expected going forward. This is where one can take a break from numbers and list out five big reasons you should invest in India.

1. You can't ignore the resilience

It has been close to 20 years since the reforms process started, with the main push coming with the twin devaluations in 1991. During this period numerous developments have taken place that have contributed to the resilience of the Indian economy.
Key amongst these are the opening up of the Indian economy to foreign investment, strengthening of the domestic financial system, liberalization of imports, rationalization of interest and exchange rates, a more conducive environment for investing in industry, and of course, the people-intensive services sector.

This resilience is clearly reflected in the fact that average economic growth rates have moved up (peaking at 8.2 percent in the financial year ending March 2004) and India has emerged as one of the fastest growing economies in the world. Even the change in the government has not stymied growth completely (in fact, there is an improvement in overall growth rates).
Going forward the benefits of these measures will become more pronounced as focus shifts to implementation. Coupled with the expected shift in the demographics which should see a larger share of the Indian population falling in the 'working class' age bracket, the Indian economy can be expected to perform better over the next decade.

2. Renewed focus on agriculture, infrastructure

In recent years there has been a renewed focus on two key but long ignored segments of the Indian economy – agriculture (about 22 percent of the economy) and infrastructure. The focus on agriculture and related activities, which supports approximately 65 percent of the Indian population, should provide a new thrust area for economic growth.
Although the results will take time to show, when they do, the impact will be huge. An increase in output, productivity and value-add will lead to higher income levels for India's large rural population. This will aid investment and consumption activity leading to higher overall economic growth in the long term.

Steps
Belatedly the government has taken note of the poor state of infrastructure. Highway development, power sector reforms and substantial investment in building a pan-India telecom/internet network are just three of the several new initiatives underway which will help improve the quality of infrastructure.
An overall improvement in infrastructure will add to the competitiveness of the economy. Of course, in the interim, as these projects are implemented, the economy will get a boost as investment demand will surge (for example to build roads you need among other inputs people, machinery, steel and cement).

3. Benefits of foreign direct investment

Undeniably, foreign direct investment (FDI) inflows have stagnated in recent years (though interest in India is unarguably increasing). But its significance cannot be lost (we only need to look at China to understand this). Not only does FDI augment domestic capital and help increase productive capacity of the economy, it also brings in with it world class technology, processes and products/services, and jobs.
The benefits of these lessons are likely to be more pronounced in India, which is way behind developed countries. This should help the economy leapfrog in some sense, boosting productivity and competitiveness. Higher productivity could again trigger a virtuous circle of higher incomes, higher consumption activity and even higher investment.

4. The global outsourcing boom

Whenever one talks about outsourcing, Indian business process outsourcing companies come to mind. More often than not, the understanding is that the BPO is a call centre. Rightly so, given that this is where it all started. But there is much more to this outsourcing boom than is commonly understood. Fortunately, India stands to benefit from it in a great measure.
Some examples of the kind of 'outsourcing' work that could find its way to India: research and development for various products and services (including pharmaceuticals), manufacturing of auto parts (forgings, et cetera) and complete IT departments and networks. As confidence in India's abilities grows, more value-added work would come through.
Competitiveness in this sector would be sustained by declining/stagnating infrastructure costs (a case in point is the declining telecom rates which are a key cost for BPOs) and ample supply of skilled manpower.
As outsourced services tend to be people intensive (in 2002 it was estimated that 4 million jobs in the sector and support services will be created by 2008), significant benefits could be reaped by India over the next decade. Higher employment and better incomes would once again contribute significantly to overall economic growth.

5. Well-regulated and deep capital markets

The Indian stock and debt markets (including banks and mutual funds) are well regulated by the Securities and Exchange Board of India and the RBI. Not that there are no irregularities that are committed (we are still trying to book all the culprits of the scams that rocked the country in 1992 and 2000). But the overall regulatory environment has improved dramatically in recent years.

Measures
Redressal measures are well laid out and this makes it easier to protect one's interest. In terms of infrastructure the Indian institutional framework is improving rapidly, backed by a strong financial system. By some measures Indian markets compare with the best globally!
In terms of choice, the Indian markets are right up there. Be it stocks, mutual funds, deposits or life insurance. The market is deep and liquidity is no major concern for individual investors.
India today offers a great investment opportunity. To make the most of it, investors need to take adequate precautions while committing funds to India. One way you can minimize the risk of fraud or bad advice is by selecting a credible financial advisor.

Finally, a note of caution. There will be ups and downs. Things may even not turn out the way one expects them to. But then if you have done your home work well, you stand a better chance of meeting your goals

NRI: Investing in India or in USA???

2008-01-22T03:12:00.000+05:30

Everyday we came across hundreds of Non-Resident Indians (NRIs) who are debating whether or not to shift all or a part of their savings to India. In many instances the thought is triggered by the recent run up in Indian stock and property prices and not by a 'real need' i.e. the intention is usually to speculate and make some quick money. For such NRIs, we have little to offer other than guidance on what probably could be better reasons to consider investing in India.
We also come across NRIs who are looking at India from a 'real need' perspective. This note will help them take several steps forward in planning their India exposure.

What is a 'real need'?

Take for instance you have parents in India for whom you wish to provide a monthly income. Or say you are planning to relocate to India in the future and therefore want to accumulate some local currency (i.e. Rupee) denominated assets. Or maybe you wish to diversify your portfolio of assets by taking exposure to India. These are just a few examples of a real need.
Before you, an NRI, get down to actually investing in India, there are three critical questions that you need to answer or get answered; all questions are broadly linked to each other and answers to them will form the basis of your investment planning.

1. What is the objective for investing.
2. How much of your savings that are abroad should be in India.
3. what are the likely prospects of the Indian Rupee and how will it influence the answer to the second question.

Clear on the objective
Before making any investment, it is imperative that you be clear on the objective/s for investing your money. Unless you are clear on what your goal/objective is, no one can help you. The objective/need, some of which have been mentioned above, needs to be well-defined both in terms of the desired result and the tenure.
So if you are planning for retirement, one critical question that must be answered is 'where are you likely to settle down post-retirement'?

Once you are clear on your objectives, which by no means is an easy task, you should look at your asset allocation and ascertain whether the same is geared to meeting your objectives. In all probability you will need the help of an expert to reach a conclusion. It is here that you will have to decide in which asset class to invest, in what proportion and in which country (as you have options apart from India).

Allocation
Let's take an example to understand how you should go about allocating money to India. Suppose your objective is to plan for your retirement ten years from now; you plan to settle down in India. Presently, you reside in say the USA and most of your monies are invested in US Dollar-denominated assets.

There are two ways you can go about allocating your assets for this need.

1. One, you can take a neutral view on the currency and deploy the required sum of money in India that will help you take care of your retirement. This will ensure that in case there are some adverse currency movements between now and the time of your retirement, you need not worry much about the same; your assets, and thereby the income they generate, and your expenditures are in the same currency i.e. Indian Rupee.

2. The other option is that you allocate your assets depending on where you believe the risk-adjusted return will be maximum i.e. you take a view on the currency and basically bet that when you approach retirement, your investments would have generated a better return, after factoring in the appreciation/depreciation in the Indian Rupee.
In our view it is best that you take a neutral view on the currency for that portion of your assets which you ultimately wish to transfer to India to meet your needs.

Parents
Let's take another objective that NRIs often have - to provide a regular income to their parents and/or other dependents in India. Usually the methodology adopted by NRIs is to set aside a lumpsum, the income generated from which takes care of the need of the parents/dependents. Here again you need to decide whether to invest the lump sum in India or to invest in assets denominated in other currencies as well.
Given that the money is 'sacred' for the parents/dependents, it is probably best you take measures to reduce the volatility in the income generated i.e. take less risk. One way to reduce the overall risk is to avoid taking on the risk that any adverse currency movement may have on returns. Ideally, in such circumstances one should opt for Rupee-denominated assets which generate steady tax-efficient returns.

Where the Rupee headed?

And this brings us to the third question - Where is the Indian Rupee headed? A cautious view would be a gradual decline, in the range of 3.0% - 5.0% every year. However, if India were to get its act right as far as attracting foreign investment is concerned, the foreign currency inflows could support the Rupee. We would recommend that you opt for the cautious view
(India still runs a hefty fiscal deficit and relies on imported crude oil).
But then if the currency is likely to persistently depreciate by 3.0% - 5.0% p.a., is it not better to invest in assets that are denominated in currencies which are likely to strengthens (as this would add to overall returns)? This may not necessarily be true.

Stock Market

Take for example the prospects that the Indian stock markets hold out for the next 3 - 5 years. In our view, the returns from a well diversified carefully selected basket of stocks should be about 15.0% compounded annual growth rate (CAGR). Warren Buffett, arguably the most successful investor ever, estimates the long-term return from US equities to be about 6.0%. Well, that is quite a spread; it takes care of currency depreciation and more.
Even if you compare debt instruments, the 10-Year government bond in the US yields 4.6% while the comparable Indian bond yields 7.6% (as on the 28th of September 2006); a spread of 3.0%.
Of course the spread would vary from time to time; but as any economist will tell you, the interest rate differential between comparable bonds denominated in different currencies tends to reflect the expected change in the exchange rate of the currencies over a period of time i.e. you are probably getting a higher rate of interest in India via-a-vis the US because over a period of time, one expects the Indian currency to depreciate against the US Dollar to the extent of the differential (ofcourse there are many other factors that impact interest rates and exchange rates and therefore the result may turn out to be different).

To conclude, in our view, it is best to avoid taking a call on the currency when it comes to "deploying assets" to take care of 'real needs'.

Fixed Income: Playing safe!

2008-01-22T03:05:00.000+05:30

Over the last few years, an overbearing concern for investors in the fixed income (and small savings) segment was rationalisation of interest rates. Attractive returns offered by small savings schemes (like National Savings Certificate - NSC and Public Provident Fund - PPF) coupled with tax sops, in the midst of a soft interest regime, was a dichotomous situation. The general consensus was that interest rates on the small savings schemes would be trimmed down and brought in line with prevalent market rates. However, the authorities chose to leave the rates unchanged. Instead a rather novel approach to rationalisation was adopted.

For example, some schemes (like Deposit Scheme for Retired Government Employees) were discontinued; similarly, small savings schemes were put outside the investment purview of entities like trusts and Hindu Undivided Family (HUF). In other cases the benefits were trimmed, for example the 10% maturity bonus on Post Office Monthly Income Scheme (POMIS) was scrapped. Interestingly, most of these changes were implemented outside of the Union Budget.

At present, we are faced with a situation wherein the interest rate cycle has turned around and interest rates are moving northwards. The Reserve Bank of India's recent move to hike the Cash Reserve Ratio (CRR) bears testimony to the same. Clearly, any reduction in interest rates on small savings schemes seems unlikely at this stage.

From an investor's perspective, the portfolio of fixed income instruments that offer tax sops (under Section 80C) is a comprehensive one. NSC and tax-saving bank fixed deposits can find place in the investor's portfolio who wishes to invest for relatively shorter time frames. Conversely, those planning to provide for long-term needs like retirement and child's education can employ PPF. Similarly, other schemes (sans tax benefits) which provide for specific needs like providing regular income i.e. POMIS and Senior Citizens Savings Scheme are also in existence.

Where to invest in times of inflation?

2008-01-22T02:57:00.000+05:30

First, let's demystify the jargon. Inflation is a situation where there is 'too much money chasing too few goods'. In such times buyers bid up prices of scarce products/services. The scarcity could be caused by supply issues or a faster than expected rise in demand. Irrespective of what causes inflation, the impact is the same. The value of the currency you are holding declines.

Let's explain this with the help of an example. Suppose the Indian Rupee was freely exchangeable with only one commodity - crude oil. Let's assume the conversion rate is Re 1 = 1 barrel of crude (wish it were true!). Now there is tension in the Gulf region resulting in reduced supply. Due to the subsequent rise in price of crude oil in international markets, we would now have to pay more Rupees for every barrel of oil. Suppose crude prices rise by 10%. The new exchange rate will be Rs 1.1 = 1 barrel of crude. In real terms (i.e. in terms of the commodity) the value of the Rupee would have declined from 1 barrel of crude per Rupee to only 0.91 barrel of crude per Rupee. This is the erosion in the value of the currency that we are talking about. Also note that while the Indian Rupee may be appreciating vis-a-vis other currencies, in the 'real sense' there is an erosion in value.
Another important fallout one can expect due to rising inflation is higher interest rates. The central banks aim to reduce demand in the economy by raising the cost of money.
We are not going to debate whether or not interest rates will rise or the Indian Rupee will depreciate going forward. This we will leave to the experts. If you wish to have a go, click here for the What if Yield Calc. We will focus on what to do in times of inflation.
When making fresh investments or evaluating your existing holdings in potentially inflationary times you need to keep two things in mind:

The possibility of higher interest rates
The erosion in the value of the currency

What you should avoid?
Fixed income instruments life fixed deposits and relief bonds that have long maturities
Other long term debt instruments like long term debt funds
Shares of companies that are unable to pass on the rise in raw material costs to their consumers i.e. they are not price setters.

Where should you invest?

1. Commodities

The key factors that determine the price of a commodity like gold for example (mine output for one) are different from factors that impact the value of other investments like shares and bonds. Investing in commodities therefore helps in diversifying the risk element in your portfolio. Not to suggest that they will surely do well but in inflationary times, but people do increase their allocations towards commodities. (Read more on gold)
Furthermore, gold can now be deposited with institutions like the State Bank of India. While this will earn you a very marginal interest, it will nevertheless take care of storage costs etc.
Investing in a commodity takes care of the risk arising due to erosion in value of the currency (since most currencies are priced in US Dollars).

2. Stocks
When it comes to beating inflation, few asset classes can better stocks. For example, over the last three years stocks have returned in excess of 15% p.a. (the BSE Sensex), beating inflation, which averaged about 5% - 6% p.a., by a very large margin. If one were to use a diversified mutual fund as a benchmark for stocks, the difference would have been even larger!
However, stocks carry significant risk, especially if one is attempting to build his/her own portfolio of stocks. For those who wish to minimise this risk, equity mutual funds are the best option.
For the more adventurous type, two sectors that are relatively immune to inflation are pharmaceuticals and software.

3. Inflation indexed bonds
Such bonds compensate you for the rise in inflation (or the decline in the purchasing power of the currency). Unfortunately in India such bonds are not on offer for us individuals (though the RBI has spoken about reintroducing them in today's policy). But with the RBI permitting Indians to invest abroad, one can always buy them in international markets.

4. Short term deposits and funds
These instruments will give you the required liquidity you need while ensuring that you do not lose out in case interest rates were to rise.

5. Property
Property is again a preferred avenue of investment as in such times prices tend to rise upwards in line with the increase in cost of construction. The only deterrent here is that the minimum amount you need to invest here is substantial and beyond the reach of most investors. An alternative can be real estate mutual funds, which are very popular in international markets. Apparently, SEBI is considering allowing such funds in India.

To conclude, it is important that at all times investors should ensure that their portfolios are well diversified, taking into account their needs and aspirations.

Pension Plans: Planning for old age

2008-01-22T02:45:00.002+05:30

A lot of investors take pains to plan for their short-medium term needs like buying a car or providing for children's education. While this is a good thing, they must also show the same enthusiasm while planning for long-term needs, in particular retirement planning.
An inevitable outcome of the brisk pace at which our economy is growing is a decline in the purchasing power of currency i.e. inflation. Put simply, a product that costs Rs 100 at present, would cost Rs 105 a year from today, assuming that prices rise at 5%. This is the impact of rising prices over just 1-Yr, over a 30-Yr period, assuming that inflation continues to rise at 5%, the same Rs 100 product will be available at Rs 432.
It is apparent that if investors are not prepared to counter the looming prospect of rising prices, retirement (when income ceases, but expenses continue) can be a challenging phase. Another factor that needs to be considered is changing lifestyles.
Keeping this in mind, investors must plan for retirement in a manner so as to ensure that their finances are sound enough to provide for their expenses and to help them in maintaining their desired lifestyles. This is where pension plans can play a vital role.

What are pension plans?
When an individual opts for a pension plan, he has to pay a fixed amount, known as the premium, to the insurance company, over a pre-determined period of time, known as the term of the policy. The premium (net of expenses) will be invested by the insurance company in various instruments to earn returns and build a corpus over the term of the policy. The amount paid as premium is eligible for deduction under Section 80C of the Income Tax Act, upto an upper limit of Rs 100,000.

How pension plans work
At the time of opting for the pension plan, the policy holder defines his retirement age (known as vesting age in industry parlance); at this age, typically, he will be provided with one-third of the accumulated corpus as a lump sum payment. This lump sum payment (subject to a maximum of one-third of the corpus) is tax-free in the hands of the policy holder. The balance amount (accumulated corpus less lump sum payment) is converted into a monthly income, also known as annuity. In other words, the policy holder can choose to invest the balance sum with any life insurer to obtain a monthly income for the rest of his life. The period over which he will receive the monthly income is known as the annuity period; the monthly income is taxable as per the policy holder's tax slab.
In a plan, wherein there is a lag between the policy holder making the lump sum payment to the insurance company, and he receiving annuities, is known as a deferred annuity plan.
Another form of annuity is the immediate annuity wherein the policy holder pays a lump sum amount upfront and the insurance company begins paying the annuity immediately. In India most insurers offer deferred annuities, with only the Life Insurance Corporation of India (LIC) providing immediate annuities.
Like any other investment, if the pension plan is taken earlier on, the returns can be that much higher, as the benefits of compounding set in. Also, most insurers offer the option of increasing the premium over the policy term, which can be availed of by the policy holder as his income rises.
While LIC offers good traditional pension plans, most of the private insurance companies, offer ULIP (unit linked insurance plan) based pension plans, thus offering a wider choice to investors.

An important feature of most pension plans available in the Indian market is the absence of an insurance benefit. For instance, Bajaj Allianz UnitGain Easy Pension Plus does not offer any life insurance cover. On the other hand, ICICI Prudential LifeTime Super Pension offers the policy holder the option to opt for a life insurance cover. But it must be understood that the policy holder will have to bear the cost of insurance. The charges (i.e. premium for life cover) would be deducted from the pension plan premium paid by the individual and the same would impact his returns

SIP: All you need to know

2008-01-22T02:45:00.001+05:30

Regular visitors and clients of Personalfn appreciate the importance of the systematic investment plan (SIP) route of investing in mutual funds. However it is surprising to note that it takes difficult times (read volatile markets) for the investing community at large, to appreciate the importance of such a handy facility.
Simply put, investing via an SIP entails making regular investments (generally) in smaller denominations as opposed to making an one-time lump sum investment. The intention is to capitalise on the volatility in equity markets by lowering the average purchase cost. While few would dispute the utility that an SIP can offer, there is a flipside to the same as well. In this article, we discuss the pros and cons of SIP investing.

How an SIP helps...
1. Lowers the average purchase cost
Perhaps the single most important advantage offered by an SIP is the opportunity to lower the average purchase cost. This is achieved in periods when equity markets experience a turbulent patch. Since the investment amount for each installment is fixed, the investor gains by receiving a higher number of units. An example will clarify this better. Suppose the monthly investment installment is Rs 1,000 and the fund's net asset value (NAV) is Rs 50; this will lead to 20 units of the fund being credited to the investor. However, in the next month on account of the volatile markets, the fund's NAV falls to Rs 40. This will lead to a lowering in the average purchase cost; as a result, the investor will have 25 units credited to his account. In other words, an SIP can help investors benefit from volatility in equity markets.

2. Induces disciplined investing
Lack of disciplined investing is one of the major reasons for investors not achieving their financial goals. For example, often monies that are kept aside for investment purpose end up getting used for extraneous purposes. As a result, the investor is even further divorced from his goals. An SIP ensures that the investor continues to be invested in a disciplined manner and thereby stays on course to achieve his financial goals.

3. Lighter on the wallet
An often heard excuse for not investing is lack of monies. SIP takes care of this problem by lowering the minimum investment amount. For example, while the minimum investment amount for a lump sum investment in a diversified equity fund could typically be Rs 5,000, for an SIP it can be as low as Rs 500. As a result, investing via the SIP route becomes lighter on the wallet.

4. Makes market timing irrelevant
Alongwith cricket and movies, timing the market ranks as a popular pastime. Investors have an inexplicable urge for timing markets and trying to get invested when markets have bottomed out. It's a different matter that timing markets to perfection and doing so consistently is beyond most investors. An investment via the SIP route makes market timing irrelevant. On account of the on-going investments, investors can afford to bid adieu to one of their favourite pastimes and concentrate on more pressing matters.

When an SIP won't deliver...
1. In rising marketsAn SIP could fail to deliver on its proposition of lowering the average purchase cost, if equity markets rise in a secular manner. Such a scenario is fairly possible over shorter time periods. As a result, investing via an SIP could prove to be more expensive vis-a-vis a lump sum investment. Hence, the solution lies in opting for an SIP that runs over an appropriate time frame, say at least 12-24 months.

2. A directionless SIPBy a directionless SIP, we are referring to an SIP that is not a part of an investment plan or an aimless SIP. It should be understood that an SIP is not an 'end'; instead, it is the 'means' to achieve an end. Hence starting an SIP in isolation is unlikely to be of too much help. Instead, the SIP should form part of an investment plan aimed at achieving a predetermined objective.

3. An SIP in the wrong fundInvesting via the SIP mode doesn't improve the prospects of a wrong fund. A poorly managed fund stays that irrespective of the investment mode. Its shortcomings will not be eliminated by an SIP. Hence the key lies in first selecting a well-managed fund that is right for the investor and then investing in it via an SIP.
As can be seen, the SIP mode of investing has a fair number of advantages to offer; conversely, there can be instances when it may not deliver as expected. Investors on their part should make well-informed investment decisions after acquainting themselves of both the pros and cons.

5 things to look at in an FD

2008-01-22T02:36:00.000+05:30

A fixed deposit (FD) probably ranks as the most conventional investment avenue for domestic investors. More importantly, given its offering, it makes an apt choice for risk-averse investors. In this article, we present 5 things investors must look at in an FD.

1. Credit profile
The FD's credit profile is an indicator of the degree of risk associated with it in terms of timely repayment of the principal and interest payment. For example, an 'AAA/FAAA' rating is indicative of the highest level of safety. Typically, an FD with a higher rating would offer lower returns vis-a-vis an FD with a lower rating. The additional return in a lower rated FD is in effect a compensation for the higher risk borne. Investors would do well to decide on the quantum of risk they are willing to bear and then select an FD.

2. Rate of return
Rate of return or interest rate indicates the return that the FD investor will clock. At any point in time, it is not uncommon to find various entities like banks, small savings schemes and corporates offering differential returns on similar rated FDs. Investors on their part would do well to scout various options and select the FD that offers them the best return at a rating that suits them.

3. Interest payout options
Investors can generally choose between various interest payout options like monthly, quarterly, annually or on maturity. Ideally, the investor's need for liquidity should be used to determine which interest payout option is chosen. Selecting the interest payout 'on maturity' option can help investors benefit from the compounding effect and clock a higher return.

4. Tenure
The FD's tenure is the period over which the investor stays invested. By and large, a longer tenure translates into a higher rate of return. Investors must match their investment tenure with their needs/objectives. For example, if the investor has an expense to meet 3 years hence, he can invest an appropriate amount in a 3-Yr FD to ensure that the maturity proceeds match his future obligation. On the same lines, if there is a 5-Yr investment tenure, then investments can be considered in tax-saving FDs; this will help the investor simultaneously benefit from tax sops under Section 80C.

5. Premature withdrawal
An often-ignored aspect of FD investing is the premature withdrawal clause. Investors opting for a premature withdrawal can be penalised by either being given a lower rate of return or zero interest depending on the terms and conditions of the FD. Investors would do well to acquaint themselves with the implications of a premature withdrawal before making an investment

Credit Card- Watch out for the Common Mistakes

2008-01-19T07:04:00.000+05:30

Good Credit card management is not everyone’s cup of tea. But, while using this plastic money, care and caution hold utmost importance. Wise handling of monetary matters always acts a good opportunity for credit card holders, but one needs to be wary of certain specific points. Let’s see what these vital points are.

Your Limit is only As much as you SHOULD spend
Generally credit card companies today have been lavish in giving credit limits to its customers. However, as a customer, you need to keep in mind that Credit Card spending is after all a loan which you need to repay on a later date. So, spend only as much as you can repay. Do not be trapped in this spending mania due to higher credit card limits. It is better to set a limit per month for one’s own expenses.

The Myth of “Cash Limits” As we all know, the credit cards have a cash withdrawal limit attached, where a person can withdraw the amount. But, one needs to be very watchful on this as the interest rate is much higher than the normal bank loans. Beware and use this limit only and only if it is extremely necessary.

The Trap of “Minimum Payments”
This is something which creates highest problems. A layman would be misguided by this term as actually this “Minimum Payment” is meant only for not freezing the card from further usage. However, the reality is hard. If you pay only the minimum amount, you would be heavily charged on the amount of the bill unpaid on the due date. The failure to make full payment results in mounting debt. It is advisable to avail a direct debit facility for the minimum payment every month and pay the additional amount due via a cheque or online balance transfer of funds.

Late Payment – The Way to Catastrophe
Direct Debit arrangements these days have given people a relief from the disaster of late payments. One can face real problems due to forgetfulness or busy schedule. Late fees or late payment charges are too high for anyone to bear. And it is better not to bring a situation where one needs to bear this. Pay additional attention to the payment dates and try not to linger on the payment till the last payment date. Try paying as soon as the funds are available with you.

Keep your receipts
Judicious use of credit cards is necessary. It is vital to keep the credit card slips safely to tally them with credit card statements. Don’t be careless with such receipts as these have details of your card which could bring additional risk to you, if it goes in wrong hands.All these and much more, when you are on the way to enjoying additional funds available through credit card!

• Check your statements timely and report any discrepancy as soon as possible.
• Do not hastily select the associated products with credit cards which normally carry the “free or discounted” tag as the reality may be different.
• Be extra alert about the security of the PIN numbers.
One who can handle funds judiciously has full right to use this plastic money. So, be wary and enjoy the advantages.

Ways to Make Your Credit Cards Work for You

2008-01-19T06:53:00.000+05:30

Is financial management too difficult practically? Not really, if you take little care of your transactions. We keep watching and listening to news informing how credit card debts have ruined the credibility and financial discipline of people. But, do not fret! We could solve this problem for you, if you keep some points in mind. Managing credit card does not need a degree in finance. It’s all about a few important steps, so that credit cards can actually prove to be your asset.

Let us have a justified view of what could be the plusses and the minuses of various actions that relate to credit card transactions.

Case Where Credit Card Transactions Can Work Against You & Ways to Avoid Them

1) When you overspend

Research proves that credit card owners spend more compared to when cash transactions take place. But, make sure that this does not result in some negativity for you. A non judicious spending results in expenses to such an extent that you are unable to bear the amount when the bill payment time comes. Do not get carried away by this easy swipe money as this can go against you.

How to avoid

Fix up a limit for your expenses through credit card.

2) When you think of paying only minimum due amount

The minimum due amount is a real trap. Credit card companies normally calculate and mention such amount. However in reality, these are not meant for your benefit, but theirs. By paying only the minimum due amount, you land yourselves in trouble as the unpaid amount of the bill generates attracts interest, service tax as well as late payment fees. The charges are huge. Remember, minimum due amount is only meant to keep your card running.

How to avoid

Pay full amount of the bill generated before the due date.
Pay minimum due amount only in the months when you do not have enough funds.

3) When you use department store credit cards

One thing definitely works as a disadvantage in case of department store cards i.e. the soaring rate of interest. What you can see apparently is the discount rate that is offered to you on your departmental store purchases, but actually such cards do not work best for you in spite of the discounts. However, a sound strategy may help you have an edge sometimes. Find out how, below.

How to avoid

Use of these at home improvement stores including Lowe’s and Home Depot, which offer interest free purchases on these cards for a year or half.
Make use of the ordinary credit card rather than the department one to have a better deal
If you use any department store card, pay off the full balance due to avoid the mounting interest pressure.

The key to making Credit Cards work for you

If you properly adhere to the avoiding tips mentioned above, life can work easy for you financially. However, it is always good to be clear about the basics for making the credit card transactions beneficial in an ultimate sense. Make your life easy with a correct usage of credit card and take care a few below mentioned points:

Always pay the full balance generated each month.
Keep credit cards of business transactions separate from those of personal transactions
Use balance transfers to save your interest expenditure

PPF vs NSC: What's the difference?

2008-01-19T04:24:00.000+05:30

This is what we attempt to do here. Explain the difference between the Public Provident Fund and the National Savings Certificate.
The NSC is a post-office savings scheme while the PPF was established by the central government in 1968. But both are very safe since they are backed by the government.

How much goes in?
The minimum amount you have to put into your PPF account in a year is Rs 500. The maximum you can put is Rs 70,000 per year.
With NSC, the minimum amount is Rs 100. Here, is no upper limit on investment.
However, NSC is sold in denominations of Rs 100, Rs 500, Rs 1,000, Rs 5,000 and Rs 10,000. So, if you want to invest Rs 30,000, you will have to buy three certificates of Rs 10,000 each.
What do I get?
On the face of it, both give an identical rate of interest: 8% per annum. Or so it seems.
The only difference is in the way it is computed. PPF is compounded annually. NSC is compounded half-yearly (twice a year).
Let's say on April 1, 2006, you invested Rs 30,000 in PPF and the same amount in NSC.
On April 1, 2007, your PPF account will have Rs 32,400 while your NSC will have Rs 32,448.
What's the tax impact?
The most important issue!
Both these investments fall under Section 80C. That means the investments made under this section are eligible for an income deduction upto a maximum Rs 1,00,000.
This is as far as your principal investment goes.
Let's look at the interest earned.
With PPF, you pay no tax on the interest you earn.
What about NSC?Till FY 2004-'05, an individual could avail of a deduction under Section 80L of the Income Tax Act. This limit was Rs 12,000 of interest income received during the financial year. This deduction has been done away with from FY 2005-'06. Now, all interest income is taxable at the respective slab rate of the individual.
The interest accrued on NSC is taxable. But, it is also eligible for a deduction under Section 80C.
Generally, it is advisable to declare accrued interest on NSC on a yearly basis. So, over the period of six years, you could declare the interest income for each year. In such a case, it does not amount to a huge sum.
If you do not declare the interest on accrual basis, then the entire interest earned (difference between the amount deposited and the maturity value) would accumulate in the year of maturity. You could then claim it under Section 80C but it would be a huge amount and would be taxable at the current applicable tax rate.
How long do I hold it?
PPF is for 15 years, but you can extend it for a block of five years. Let's say you open a PPF account when you are 21 years old. It matures when you are in your late 30s, when you may be earning well and may not need the money. In that case, you can continue with the account.
Of course, you do have the option of withdrawing the entire balance on maturity, that is, after 15 years of the close of the financial year in which you opened the account.
So, if you opened it in FY 2006-07 (this financial year), you will be able to withdraw it 15 years later, starting March 31, 2007 (end of this financial year). That is April 1, 2022.
If you extend it for five years after that, you continue to earn the rate of interest and can also make fresh deposits and get the tax benefit.
NSC is for a much shorter duration -- just six years from the date of investment.
How many can I have?
Once you open an NSC, you can't keep adding to it. You will have to buy another. Let's say you buy a NSC of Rs 30,000. In a year's time, you want to add another Rs 30,000. You cannot add it to this amount. You will have to buy another NSC.
With PPF, you can have just one account. But this does not matter because you have to make annual additions. Every year, you keep adding to it.
However, if you like the safety of the investment and a guaranteed return of 8% per annum, you can open one in your child's name. So you can have one account for yourself and one for your child. But this does not mean the tax benefit is doubled. The limit is the same -- Rs 70,000, irrespective if it all goes in your account or in your account and your child's.
Let's say you open an account for your minor child. You can deposit Rs 70,000 in your account and Rs 70,000 in your child's account. But you will only get the tax benefit on Rs 70,000.
How is it held?
The PPF account cannot be held jointly. You can nominate someone but it cannot be jointly held with someone else. With NSC, you can hold it jointly or you can hold it singly and nominate someone.
Where can I open it?
To open a PPF account, you can drop by a State Bank of India branch. No, you do not have to have an account with them.
You can also ask your nationalised bank where you have an account if they are authorised to open PPF accounts. You can also approach the head post office in your area. If that is inconvenient, ask your local post office (selection grade sub post offices are allowed to do so).
To buy an NSC, just approach our office.

Insurance Basics

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Even though new age financial planners scoff at the idea that Insurance can be an investment, here's a revealing figure. The total fund manged by LIC is more than Rs 5 lakh crore while the total funds managed by the entire Mutual Fund industry is Rs 2.31 lakh crore only!

Even though Mutual Funds may and should catch up with Insurance, let's take a look at the Insurance concept. Life insurance is universally acknowledged to be an institution which eliminates risk, substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner.

Life insurance

Life insurance is concerned with two hazards that stand across the life-path of every person:That of dying prematurely leaving a dependent family to fend for itself and that of living till old age without visible means of support.
In India, Life insurance is popular because Savings through life insurance guarantee full protection against risk of death of the saver. Life insurance encourages 'thrift'. It allows long-term savings since payments can be made effortlessly because of the 'easy instalment' facility built into the scheme. It is also easy to acquire loans on the sole security of any policy that has acquired loan value. Life Insurance is the best way to enjoy tax deductions on income tax and wealth tax.

Need

A policy that has a suitable insurance plan or a combination of different plans can be effectively used to meet certain monetary needs that may arise from time-to-time. Children's education, start-in-life or marriage provision or even periodical needs for cash over a stretch of time can be less stressful with the help of these policies. Alternatively, policy money can be made available at the time of one's retirement from service and used for any specific purpose, such as, purchase of a house or for other investments. Also, loans are granted to policyholders for house building or for purchase of flats
With the insurance industry showing robust growth, it's time to become more aware of your insurance needs. And which is actually evaluating your human life value and then deciding your insurance.

Steps to Insurance?

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Life insurance is a potent tool that not only offers the ability to plan for unforseen events that can affect the family's financial situation adversely, but is also looked up to as an important tax saving cum investment tool. (Source: The Money Times.com)
Though the importance of buying an insurance cover is well known, one needs to do a certain amount of spade work before purchasing a policy, to ensure the best possible coverage at the right price.
Here are some helpful tips to get you started:
Explore
As premiums vary widely from company to company and cover to cover, it’s important to look around. One can try internet sites to get instant quotes.
Plot your value
The key to purchasing the right amount of life insurance is to have just enough coverage to meet your needs. If you have more life insurance than you need, you'll be paying unnecessarily for higher premiums. On the other hand, it's important not to have too little coverage, resulting in you being underinsured.
Health matters the most
Healthy people get better rates on life insurance. Higher premiums are quoted for anything that poses a risk for longer life expectancy (smoking, on regular medication, etc).
Sooner the better
As premium rise with increasing age, the younger you are when you purchase life insurance, the lower premiums you will be required to pay.
Review your cover periodically
Any life change indicates the need for an overall review of the financial plans. Make sure you have enough cover for all important events of life.
Check out for no-commission deals
One of the reasons for higher premiums is that most life insurance policies pay commissions to the agent/broker. However, you may be able to purchase a no-load policy through an insurer that sells no-load policies directly to consumers.
Focus on annual installments
You may not realize it, but you may be paying more for your life insurance if you pay your premium in monthly installments. Many insurance companies charge extra fees if you make monthly premium payments instead of paying the annual premium.
Ensure to be adequately insured
Many employers offer their employees group life insurance. But this amount of coverage is usually not enough to adequately meet the life insurance needs. Also, as group life insurance policies are not portable, you’ll be left uninsured when you leave the job.
Never conceal facts
Though, age and negative health related conditions attract higher premium, don’t think about lying on the insurance application. If your insurance company gets the knowledge of concealed facts they can terminate the cover.
Buying more is sometimes cheaper
As the amount of sum assured goes up, the premium amount also rises, but at a decreasing pace. If the numbers work out, you may be able to pay a lower premium while increasing your coverage.

Insurance Cover, Do we need

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A Person who has Insurance cover. He is a 32 year old guy and has a cover of Rs 7 lacs and pays a premium of approx. Rs 50000. When I told him that I'm covered for Rs 35 lacs with only Rs 20000 premium, he did not beleive me at the first instance.

Human Value in Money
If you haven't started a family, an Insurance cover is the least of your priorities. But even though it's not that cool to be insured, it sure is smart when there are people who depend on you.A very simple way of looking at your economic value towards your family is as follows. Imagine a monthly income of Rs 20000 and the net income provided to the family is Rs 18000 after deducting Rs 2000 for personal expenses. Thus the annual income provided to yr family is Rs 226000. The amount of money which will earn Rs 226000 pa at 8% interest rate is Rs 28,25,000. This is only a representation of the value of HLV. It is not the exact way of calculating yr HLV.

Right now you can go to this page to calculate your HLV, Page to calculate yr HLV or this link Insurance. The future income growth, yr income generating assets, liabilities, spouse income, children'seducation, etc are also to be factored in.Ask your agents about the term assurance plans and he would definitely discourage you from taking one. After all there's little commission he's getting there since the premium is so low.The point is that Insurance is NOT Investment.

Why Us

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What We Deliver :

* You can find various tips and resources that will help you saving your hard earned money. There are lots of financial schemes available in India. Many of them provide you guaranteed returns, high interest rates and tax savings.

* These financial plans not only provide you money growth but also provide you with financial security at various steps in your life. It depends on your needs which product suits you best.

* Novices, who are lured into the markets with expectation of high returns, often burn their fingers. Volatility is an integral part of investments that also promise good returns. Investing early helps you in gradual wealth creation.

* Minimize your tax outgo, Maximize what you keep.

FAQ:

# How many years we are in this profession?
We are from last 8 years in this profession and serving in Shivajinagar, Kotharud, Pimpri, Wakad, Aundh, Deaccan and many more.

# Choose the right LIC agent
PRIVATE INSURERS don’t pose much of a problem, as their numbers are small. Moreover, most private companies assign an official to contact you after you give us a call. However, that’s not quite the case with LIC. There are around 6,00,000 LIC agents across the country.
Here are a few anwers in ensuring you end up in safe company:

# Are we a ‘real’ LIC agent?
we are a professional agent – in other words, a full-time agent. There are a whole lot of rank amateurs, part-timers, dummies who have signed up with LIC, many with less than a year’s experience. It is in your interest to buy insurance not from one of them, but a professional agent.

# Which branch do we work for?

Aundh
Deccan Gymkhana
Kotharud
Sangvi
Shivajinagar
Pimpri
Wakad

# Who are our clients?

* Clients are from Goverment offices, Schools, Clinics & Colleges and Private Orgnisations.

* Employees from Company like:

Atlas Copco
BMC software,
Calsoft,
EDS,
Infosys,
John Deere,
Kanbay,
nvidia,
Patni,
Satyam,
Symphony,
Synechron
T Systems,
TATA
Wipro,
and many more

# Do you have experience in dealing with claim settlement?
Claim is your final settlement. It can be maturity claim (when you survive the term) or death claim. LIC strives to discharge maturity claim on time. For timely payment, We not only just keep track of it and also make a few queries about it at the branch. Especially in early claims.

We Specialize Inn:

* Asset Insurance- Home, Auto, Shop Showroom, Shopkeeper.
* Health Insurance- Personal, Family, Medical, Critical Illness.
* Life Insurance- Money Back, Children, Whole Life Plans.
* Postal Saving- Time Deposit, Fixed Deposit, Recurring Deposit, Monthly Income Scheme, NSC, KVP, PPF and other Deposit schemes.
* LIC- Insurance, Pension, Unit Plan, Special & Joint Life Plans.

We just don’t sell “We customize as per your requirement”

Contact us at:

Invest-Inn
21, Mann Hsg. S#18/4
Pune, Maharashtra, 411017.
Agency code: 4429934

Ph: 94-2353-2005
Mail: money_insurance@yahoo.com
http://investinn.tripod.com
http://investinn.blogspot.com

LIC Life Insurance Corporation- LIC Plans

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LIC Products

1.Insurance Plan
As individuals it is inherent to differ. Each individual's insurance needs and requirements are different from that of the others. LIC's Insurance Plans are policies that talk to you individually and give you the most suitable options that can fit your requirement.

Jeevan Anurag
Jeevan Kishore
Komal Jeevan
Jeevan Chhaya
Jeevan Aadhar

2.Pension Plans

Pension Plansare Individual Plans that gaze into your future and foresee financial stability during your old age. These policies are most suited for senior citizens and those planning a secure future, so that you never give up on the best things in life.

Jeevan Nidhi
Jeevan Akshay-V
New Jeevan Dhara-I

3. Unit plans
Unit plans are investment plans for those who realise the worth of hard-earned money. These plans help you see your savings yield rich benefits and help you save tax even if you don't have consistent income.

Market Plus
Profit Plus
Fortune Plus

4. LIC’s Special Plans
LIC’s Special Plans are not plans but opportunities that knock on your door once in a lifetime. These plans are a perfect blend of insurance, investment and a lifetime of happiness!

New Bima Gold
Jeevan Saral
Jeevan Madhur

5. Joint Life Plan
This is an Endowment Assurance Plan issued on the lives of husband and wife. The plan provides financial protection against death of both the lives. It pays the maturity amount on survival of one or both the lives to the end of the policy term

Jeevan Saathi

Benefits

Benefits differ from policy to policy but General benefits of LIC are:

Maturity Benefit
Auto-cover facility
Death Benefit
Bonuses
Assured Benefit
Tax Benefits
Surrender Value
Accidental Death And Disability Benefit
Guaranteed Surrender Value
Paid Up Value

Invest-Inn, Pune MH

LIC,Postal, Insurance.

Auto Insurance

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Types of Auto Insurance

Policy A
Act only policy, commonly referred to as third party insurance as it covers damage or harm caused to third parties other than the insured. It is compulsory to take this cover.

Scope of Cover :
Under this policy the company covers the legal liability of the insured as per the Motor Vehicle Act,1988 in the following cases:

Death of or bodily injury to any person (unlimited liability)
Damage to property other than belonging to the insured or held in trust or in the custody or control of the insured. ( Upto Rs.6000 only)

There is a provision in the motor tariff by which on the payment of additional premium as detailed below, it is possible to take unlimited cover for damage to property also.

Goods carrying vehicles/passenger carrying vehicles/ Misc. and special types of vehicles : Rs.75 additional premium
Two wheeler/Private car/Taxi : Rs.50 additional premium

Policy B
Act only & Own Damage (loss or damage to the vehicle), is commonly referred to as comprehensive insurance.

Scope of Cover :
The company indemnifies the insured against the loss or damage to the motor vehicle and /or its accessories arising from:

Fire,explosion, self ignition or lightning;
Burglary,house breaking or theft;
Riot and strike;
Earthquake (fire and shock damage);
Flood, typhoon, hurricane, inundation, cyclone, hailstorm;
Accidental external means;
Malicious act;
Terrorism;

Whilst in transit by road, rail, inland waterways, lift elevator or air.

Note :
Charges for towing the vehicle after an accident to the repairer’s place upto a maximum of Rs.1500 for private cars & taxis, Rs.2500 for commercial vehicles and Rs.300 for two wheelers are reimbursed.
Exclusions to the Comprehensive Insurance Policy
The company shall not be liable to make any payment in respect of :

Consequential loss, depreciation, wear and tear, mechanical and electrical breakdown, failures or breakages;
Damage to tyres unless the motor vehicle is damaged at the same time when the liability of the company is limited to 50% of the cost of replacement;
Loss or damage to accessories by burglary, house breaking or theft unless the motor vehicle is stolen at the same time;
Any accidental loss or damage suffered whilst the insured or any person driving with the knowledge and consent of the insured is under the intoxicating influence of liquor and drugs.

General Benefits of Auto Insurance

1. Bodily Injury LiabilityCovers legal costs and personal injury claims filed against you should someone be killed or injured in your automobile and you are determined to be “at fault.”
2. Property Damage LiabilityCovers legal costs and damage claims filed against you should an accident involving your automobile result in damage to someone else’s property and you are determined to be “at fault.”
3. Medical Payments CoverageHelps pay for medical expenses you incur as a result of an automobile accident. Your Medical Payments coverage protects you even if you are injured in another person’s vehicle.
4. Uninsured or Underinsured Motorist CoverageProtects against expenses you incur as a result of an accident that is caused by another individual who is either uninsured, or who has inadequate insurance coverage.
5. Comprehensive CoverageCovers loss to an insured vehicle due to fire, theft, or glass breakage. 6. Collision CoverageCovers an insured vehicle for damages and expenses in the event you are involved in a collision. Six or twelve-month policy renewal periods.

Invest-Inn, Pune MH
LIC,PPF Postal, Auto insurance.
Contact us for more info at
Mail:money_insurance@yahoo.com

ASSESSMENT YEAR 2008-2009

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RELEVANT TO FINANCIAL YEAR 2007-2008

I TAX RATES FOR INDIVIDUALS OTHER THAN II & III
Upto 1,10,000 - Nil1,10,000 to 1,50,000 - 10% of the amount exceeding 1,10,0001,50,000 to 2,50,000 - Rs.4,000 + 20% of the amount exceeding 1,50,0002,50,000 & above - Rs.24,000 + 30% of the amount exceeding 2,50,000

II TAX RATES FOR RESIDENT WOMAN BELOW 65 YEARS
Upto 1,45,000 - Nil1,45,000 to 1,50,000 - 10% of the amount exceeding 1,45,0001,50,000 to 2,50,000 - Rs.500 + 20% of the amount exceeding 1,50,0002,50,000 & above - Rs.20,500 + 30% of the amount exceeding 2,50,000III TAX RATES FOR INDIVIDUAL RESIDENTS AGED 65 YRS AND ABOVE
Upto 1,95,000 - Nil1,95,000 to 2,50,000 - 20% of the amount exceeding 1,95,0002,50,000 & above - Rs.11,000 + 30% of the amount exceeding 2,50,000

SURCHARGE ON INCOMETAX
In the case of every Individual, Hindu undivided family, Association of person and body of individuals, Surcharge on income-tax is calculated @10% if the total taxable income exceeds Rs.10,00,000.

EDUCATION CESS
The amount of Income-tax and Surcharge shall be further increased by Education Cess of 3% on Income-tax plus Surcharge.

EXEMPTIONS/DEDUCTIONS FROM SALARY

1. VOLUNTARY RETIREMENT - 10(10C)Amount received or receivable (ie.,in instalments) by an employee on his voluntary retirement in accordance with any scheme of Voluntary Retirement is exempt to the extent of Rs.5,00,000, provided the VRS is in accordance with Rule 2BA of IT Rules.

2. HOUSE RENT ALLOWANCE EXEMPT U/S.10(13A)a) Actual HRA received : Rs.xxxxb) Rent paid in excess of 10% of Salary : Rs.xxxxc) 50% of Salary in Metro Cities or40% of Salary in other cities : Rs.xxxxLeast of a), b), c) is exempt.NOTE : Here Salary means Basic Salary as well as DA if the terms of employment so provide.

3. CONVEYANCE ALLOWANCE : Any allowance granted to meet the expenditure incurred wholly, necessarily and exclusively on conveyance in performance of the duties of office and so certified by the employer is exempt u/s.10(14).

4. TRANSPORT ALLOWANCE : Any allowance granted to an employee to meet the expenditure for the purpose of commuting between the place of his residence and the place of his duty to the extent upto Rs.800/- per month is exempt u/s.10(14).

5. MEDICAL REIMBURSEMENT : An amount of Rs.15,000 or the actual amount reimbursed by the employer whichever is less is exempt u/s.17(2).

6. PROFESSION TAX : Profession Tax levied by the State Government is allowable as a deduction from Gross Salary provided it has been paid.

STANDARD DEDUCTION U/S.16(1) IS NOT ALLOWABLE FOR A.Y.2006-07
DEDUCTIONS FROM HOUSE PROPERTY

1. DEDUCTION U/S.23(1) : For let out property, amount paid by the owner towards taxes levied by any local authority in respect of the property is deductible from Annual value(taxes pertaining to any previous years).

2. DEDUCTION U/S.24(a) : For let out property, deduction of 30% of the Net Annual Value is allowed. No separate deduction for Repairs, Collection Charges, Insurance Premium, Annual Charge and Ground Rent.

3. INTEREST ON BORROWED LOAN(U/S.24(b)):FOR SELF OCCUPIED PROPERTYa. If Property is acquired or constructed with loan taken after 01/04/99 and construction is completed within 3 years from the end of the financial year in which the capital was borrowed - Rs.1,50,000 or actual interest paid/payable whichever is less is deductible.b. If new housing loan is taken for repayment of old loan (old loan taken after 1/4/99) - Rs.1,50,000 or actual interest paid/payable whichever is less is allowed as deduction.c. If Property is acquired or constructed with loan taken before 01/04/99, Rs.30,000 or actual interest paid/payable whichever is less is allowed as deduction.d. If loan taken for Repairs, renewal, reconstruction of property, Rs.30,000 or actual interest paid/payable which ever is less is allowed as deduction.FOR LET OUT PROPERTY, actual interest paid/payable can be claimed as deduction.ONLY OWNER OF THE
HOUSE PROPERTY CAN AVAIL THE ABOVE DEDUCTIONS.

CAPITAL GAINS:
With effect from 01/10/2004, Long Term Capital Gains arising on sale of equity shares or unit of equity oriented fund through recognized stock exchange is exempt if such transaction is chargeable to Securities Transaction Tax (u/s.10(38)).
With effect from 01/10/2004, Short Term Capital Gains arising on sale of equity shares or unit of equity oriented fund through recognized stock exchange is subject to tax at the rate of 10% if such transaction is chargeable to Securities Transaction Tax.

EXEMPTION U/S.54EC:The Capital Gain arising out of sale of long term capital asset can be invested in National Highways Authority of India, Rural Electrification Corporation Limited, within six months from the date of sale. (Lock-in period is 3 years)For Cost Inflation Index, refer website.

STANDARD DEDUCTION FOR FAMILY PENSION U/S.57(iia): An amount of Rs.15,000 or 331/3% of family pension whichever is less is allowed as deduction. If an assessee receives arrears of family pension, then Relief u/s.89(1) can be claimed by him.Family Pension received by the widow or children or nominated heirs, as the case may be, of a member of the armed forces(including para-military forces) of the union, where the death of such member has occurred in the course of operation is exempt.

EXEMPTIONS - OTHER SOURCES
Any income by way of Dividends from company, Income received in respect of units from the Unit Trust of India, Income received in respect of the units of a mutual fund are exempt.
DEDUCTIONS FROM GROSS TOTAL INCOME (CHAPTER VIA):
http://incometaxindia.gov.in/publications/9_Income_Tax_For_NRI/Chapter005.asp

For NSC, PPF, LIC Contact: money_insurance@yahoo.com

FRINGE BENEFIT TAX (FBT)
Fringe Benefit Tax is a tax for the Fringe Benefits provided to the Employee by his Employer as defined u/s.115WB(1) and (2). It means any privilege, service, facility or amenity, directly or indirectly received by present & former Employees.

http://india.gov.in/outerwin.htm?id=http://www.taxmann.com/TaxmannDit/Displaypage/dpage1.aspx?md=2&typ=cn&yr=2006&chp=3960

Fringe Benefit Tax(FBT) is calculated @ 30%(+SC+EC) on the percentage value of Fringe Benefits.

TAX ON FRINGE BENEFITS:
The tax on fringe benefits provided by their employer to their employee as defined u/s.115WB(1) and (2) is payable by the EMPLOYER.PENALTY U/S.271F: If a person who is required to furnish a return of income as required under section 139(1) or by the proviso to sub-section, fails to furnish such return before the end of the relevant assessment year, shall be liable to pay by way of penalty a sum of Rs.5,000.

INTEREST U/S.234A: Where the return of Income of any assessment year u/s.139(1) or 139(4) or in response to a notice u/s.142(1), is furnished after the due date as specified in sub-section 1 of section 139, or is not furnished, the assessee shall be liable to pay simple interest at the rate of one percent for every month or part of a month comprised in the period commencing on the date immediately following the due date.
INTEREST U/S.234B: Where an assessee who is liable to pay advance tax under section 208 has failed to pay such tax or, where the advance tax paid by such assessee under the provisions of section 210 is less than 90% of the assessed tax, the assessee shall be liable to pay simple interest at the rate of one percent for every month or part of a month comprised in the period from the 1st day of April following the financial year.
INTEREST U/S.234C: Where an assessee other than a Company, who is liable to pay advance tax under section 208 has failed to pay such tax or,1) The advance tax paid by the assessee on his current income on or before the 15th day of September is less than 30% of the tax due on the returned income or the amount of such advance tax paid on or before the 15th day of December is less than 60% of the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of one percent per month for a period of three months on the amount of the shortfall from 30% or, as the case may be, 60% of the tax due on the returned income.2) The advance tax paid by the assessee on his current income on or before the 15th day of March is less than the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of one percent on the amount of the shortfall from the tax due on the returned income.

DUE DATES FOR FILING RETURN OF INCOME :
All Individuals/HUF/Firms deriving Income from Salary, House Property, Capital Gains, Business or Other Sources and not covered under section 44AB are required to file the Return of Income by 31st July. All Tax Audit Cases covered under section 44AB, Company returns are required to file the Return of Income by 31st October.

PERMANENT ACCOUNT NUMBER:
Every assessee is required to obtain 10 Alpha numeric Permanent Account Number (PAN) and quote the same in his returns, challans & correspondence. PAN can be obtained by applying in new Form No.49A at the designated Service Centres of UTITSL OR NSDL(Log on to our website). PAN is essential for processing the Return of Income and for giving credit for taxes paid. If a person who is required to quote his Permanent Account Number fails to do so or intimates false number, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum of Rs.10,000.

TAX PAYMENTS :
Advance tax payments and Self-assessment tax payments have to be made in Challan No.280. Please obtain counterfoil of challan containing Challan Identification Number (CIN) from the Bank and enclose copy of the same with the return and quote CIN in the return.
This brochure should not be construed as an exhaustive statement of law. In case of doubt, reference should always be made to the relevant provisions of Income Tax Act, Rules or Notifications.

Invest-Inn, Pune MH
LIC,PPF Postal, Auto insurance.
Contact us for more info at:money_insurance@yahoo.com