Wednesday, December 5, 2012

Prajna Capital

Prajna Capital

How to Avoid Falling Into a Debt Trap

Posted: 05 Dec 2012 04:04 AM PST

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Call 0 94 8300 8300 (India) 

Here are some ways in which you can ward off the temptations that play havoc with your finances


   CRAWLING out of a debt trap isn't always an easy task. Talk to any survivor and he or she will tell you it means a lot of wasted time and opportunities.


   The prices were down, interest rates were down… I always feel like that I missed a big opportunity. This is a routine refrain among those who have burnt their fingers with multiple credit cards, personal loans, consumer loans and so on. We all talk about getting out of a debt trap, but we don't tell people how not to fall into the trap. The trouble is once you are neck deep in it, then it takes a lot of time and effort to clear the debt.

Swipe Carefully:

True. Why do you land in a tight spot in the first place when you know it sucks out a few years of your life? "Most people unknowingly accumulate huge debt. One of the easiest ways to fall into the trap is to accumulate credit via a credit card

 

Most people don't understand a credit card statement. They wrongly interpret the minimum amount due and think that they just have to pay the 5% of the due amount. They don't realise that the company charges exorbitant interest on the remaining amount. That is why Sajag Sanghvi, a certified financial planner, advises clients to use credit cards wisely. It is fine if you are travelling and using your credit card, but you should be careful to clear off the amount on the due date. But the trouble is people use multiple credit cards and they use the revolving credit facility and slowly end up in debt.

Go Easy On Purchases:

Personal loans and consumer loans come next on the list. According to financial experts, thanks to the easy availability of credit, people are shopping as if life is one big sale. It is no more a taboo to opt for a loan. These days the mindset is if you can't afford something, opt for a loan and buy it immediately. Earlier, people used to think hard before opting for a loan, that is not the case anymore. In fact, we are amazed to find huge EMIs on very young people who have just about started their career.


   Most experts share the wealth manager's aversion towards borrowing. Borrow only if it is absolutely necessary. Also, borrowing is fine only if you are creating an asset that would fetch you money. This is the advice that financial wizards have for impulsive shoppers. The trouble is that when people opt for personal loans to buy things which are really not necessary, chances are that they might default on repayment. The trouble with easy loans, is that people don't understand that they come with an interest rate of around 20%. Needless to say, piling on innumerable loans is a sure-shot way of landing yourself in a debt trap.

Restrict Your EMIs:

An EMI for a housing loan, another for a car and one more for that LED TV… the list is endless. In fact, according to experts, many unfortunate individuals actually discovered the list of EMIs when they faced a salary cut during the slowdown in the economy. When people don't think twice before opting for a loan to buy something, it is bound to happen. They confuse the cash flow with permanent income. They don't understand any setback on the career front can upset their calculations.

Budget Your Purchases:

Want to buy an LED or an expensive music system? Well, prepare a financial plan to buy it. Financial planning is not restricted to saving for your daughter's education or retirement. It is a useful tool to achieve your short-term goals like expensive purchases. Do you remember how your parents' generation used to save up for every major purchase? Why should one plan only for major goals like retirement? One should have plans for one, two or three years also. This will ensure that at least you will partly fund your acquisitions, making large contributions will make sure that you are better off even if there is a steep increase in the interest rates.

Don't Borrow At All:

This may not go well with many people, but experts are of the view that one should try to avoid accumulating debt at any cost. Why should you buy things for pure consumption on credit? You should ask yourself whether you can wait a little longer to fund the purchase. Most experts feel that one shouldn't borrow at all. The only exception they makes is for housing, which they consider is a must. However, he adds that it is very difficult to convince clients to wait for the purchases. When something is easily available why would wait more. Sure, this may be bit hard to practice. But try as much possible to stick to the adage as impulsive purchases are often identified as a the main reason behind debt traps.

Do A Health Check:

Normally looks for some signs (or ratios if you will) to find out whether the person has a problem with spending. There are two ratios which tells you the financial aspect of the person. One, how much is his EMI to his income. Two, what is the ratio of his total liability to assets. If these ratios are on the higher side, he then subjects them to further queries like why the person is borrowing, what is the repayment schedule and so on.


   If the borrowing is for a genuine need like critical illness or the repayment schedule is for a year or two, it is fine. Otherwise, it is a serious problem. In a decade, there will be at least two business cycles, where there could be job loss, salary cuts and so on. If a person is servicing a debt for five or six years, he can really run into trouble during this period.

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

 

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver Mutual  Funds  Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

 

 



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Section 54EC Capital Gain Bonds from REC and NHAI

Posted: 05 Dec 2012 02:52 AM PST

Buy Gold Mutual Funds

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Download Tax Saving Mutual Fund Application Forms

Call 0 94 8300 8300 (India)

Capital Gain Bonds are instruments offering you tax exemption for transferring gains of long term capital assets. As per provisions of Income Tax Act, 1961, any long term capital gains arising from transfer of any capital asset would be exempt from tax under Section 54 EC of the Act if ;

· The entire capital gain relized is invested within 6 months of the date of transfer in eligible bonds

· Such Investment is held for 3 years

· To avail of capital gain exemption, the bonds so acquired cannot be transferred converted into money or any loan or advance can be on security of such bond with 3 years from date of acquisition else, the benefit would be withdrawn

· If the amount invested in bonds is less than the capital gains realized, only proportionate capital gains would be exempt from tax.

· Capital Gain Bond limit 50 lakh.

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

1.      ICICI Prudential Tax Plan  Invest Online

2.      HDFC TaxSaver   Invest Online

3.      DSP BlackRock Tax Saver Fund   Invest Online

4.      Birla Sun Life Tax Relief '96 Invest Online

5.      Reliance Tax Saver (ELSS) Fund   Invest Online

6.      IDFC Tax Advantage (ELSS) Fund  Invest Online

7.      SBI Magnum Tax Gain Scheme 1993   Invest Online

8.      Sundaram Tax Saver   Invest Online

Details about REC & NHAI issue Capital Gain Bonds 2012-13

REC

NHAI

Face Value

10000

Issue Price

10000

Minimum Application Size

One Bond of Rs. 10000

Maximum Application size

500 Bond or 50 lakh

Mode of subscription

100% on application

Deemed Date of Allotment

Last day of each month for appl.money cleared & credit in REC collection a/c

Last day of each month for appl.money cleared & credit in NHAI collection a/c

Coupon Rate

6%

Payment of Interest

Payble annually on 30th June

Tenor

3 years

Maturity

3 years from Deemed Date of allotment ,

Date of Closure

Upto 31 Mar 13 . The corporation would have right to close the issue any time by giving prior notice

Rating

AAA CRISIL

AAA CRISIL

TDS

Non TDS from domestic Investor

Who can apply?


Individuals, HUF , Partnership Firm, other eligible firms

Document to be provided by all investor

1. Self attested copy of PAN Card (In case of joint application, self attested PAN copy of all applicants)
2. Address Proof
3. Cancelled Cheque

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

 

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver Mutual  Funds  Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund



Invest in Tax Saving Mutual Funds Download Any Application Forms
Buy Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now

Principal Index Fund - Change in Fund Manager

Posted: 05 Dec 2012 01:41 AM PST

Principal Mutual fund has announced a change in the fund management responsibilities of Principal Index with effect from October 22, 2012.

 

Now, the fund is managed by Ms. Rupali Pandit and prior to the change Mr. Rajat Jain was managing the same.



Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

  1. ICICI Prudential Tax PlanInvest Online
  2. HDFC TaxSaver Invest Online
  3. DSP BlackRock Tax Saver Fund Invest Online
  4. Reliance Tax Saver (ELSS) Fund Invest Online
  5. Birla Sun Life Tax Relief '96 Invest Online
  6. IDFC Tax Advantage (ELSS) Fund Invest Online
  7. SBI Magnum Tax Gain Scheme 1993 Invest Online
  8. Sundaram Tax Saver Invest Online
  9. Edelweiss ELSS Invest Online
    ----------------------------------------

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap FundsInvest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap FundsInvest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap FundsInvest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap FundsInvest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector FundsInvest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Gold Mutual Funds Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund


Invest in Tax Saving Mutual Funds Download Any Application Forms
Buy Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now

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