Monday, 26 September 2011

Home Loan v/s Investment

Q. I have a question regarding Payment of Home Loan vs. Investment. Should a person start a SIP for his retirement or should he plan to prepay his Home Loan first. Say if a person is having a Home loan of 30L and paying EMI of 30K and having a SIP of 10K is good option or having EMI of 40K is a good option, or having a 10K of reoccurring deposit for one year and with this amount prepay his loan after each year.



Ans. -

Dear Sachin, in my view, Increase your EMI to 35K & invest 5K mly through SIPs for your retirement. The extra amount in EMI ‘ll help to close your loan early & the SIPs ‘ll give the power of compounding to your retirement portfolio.



Wednesday, 18 August 2010

ICICI Pru Life's Online Term Cover - I Protect

Dear friends, Earlier it was Aegon Religare's I- Term, the lone player in online Term cover Market but now it has a companion from the big daddy of private life insurers in India - ICICI PRU Life. The product is named as I-Protect. 

Product at a glance -

Minimum /Maximum Age at entry - 20 / 65 years

Policy Term - 10, 15, 20, 25, 30 years

Maximum age at policy expiry - 75 Years (Age completed Birthday)

Minimum Premium - 2000 Rs. (Excluding Service Tax & Education cess)

Accidental Death Benefit (Available with IProtectOption II only) - Equal to basic sum assured with maximum limit to 50L

Premium Payment term - Regular pay

Mode of Premimum Payment - Yearly only

Tax benefit - Prem. paid is eligible for Tax benefit under Section 80C of Indian Income Tax Act, 1961

Available Options - Option I Basic Life cover, Option II Basic Life Cover With Accident Death Benefit Rider

Death benefit - Option I - Basic Life Cover

Option II - Basic Life Cover + Accident Rider Sum  Assured equal to Basic Sum assured or 50L whichever is lower

Instant Life Cover - Policy 'll be issued immediately after realization of the prem. amount by the Ins. Co. for Non Medical Cases.

Maturity Benefit - Being a pure Vanilla Term Cover, there is no maturity benefit.

Offline Purchase - Yes allowed with a slightly higher prem. (To include the commission of Agent/Broker)

My take - I-Protect is a real competitor for Aegon Religare's I-Term. Actually it's better than I-Term. How here it goes - 

Max. Term - 30Y in I-Protect for 25Y in I- Term

Accident Rider - Yes for I-Protect no for I- Term

Offline Purchase - Yes for I-Protect no for I-Term

Maturity Age - 75Y for I-Protect  where as it's 65Y for I-Term

The major plus point with I-Protect, ICICI Pru Life has offices, agents, brokers, bankassurance channels in every nook & corner of India, Hence purchasing the cover online of offline is very easy as compare to Aegon Religare's limited presence.

In my view, if you are planning to purchase your first Term cover or want to increase one, go for this one.

For More info about the product click here.



Monday, 16 August 2010

How to clear name in CIBIL Report?

My name is Ritesh kumar and I requested for my CIBIL repot which I get and I found a “Written OFF” from Standard Charted Bank Credit Card for the amount of Rs 994/-.
From 2005 to 2006 I was using a SCB Manhattan Credit card then I stop using the Card around 2006 last Q, but I continually receiving statement from the bank and every time there are some charge add and till Feb. 2006 the amount where gone up to 3000/- then I write a mail to SCB customer care and get all the settlement (I have a mail from the bank). But my card was not officially close, but also, I never use that card again.
So can you please advice me what should I do now, I wanted to remove “Written OFF” from the CIBIL for me.
Please help

Ritesh Kumar

Dear Ritesh, You have following options.

1. Based upon your settlement of dues done in 2006, write to your Credit Card provider (SCB) & ask to remove your name for Written off from Cibil Report.

2. Wait for the 1 above to happen for at least 1 month or so. If nothing is happening, contact Banking Ombudsman in your area. Click here for more details on Banking ombudsman. 

3. Based upon your settlement of dues done in 2006, you may apply for loan (CAR, Home or Personal). With your application attach the copy of settlement documents. 



Life Cover may Got cheaper

Dear Friends, Please check the link below.



Monday, 12 July 2010

Income Tax saving - Infrastructure Bonds

CBDT has notified New infrastructure Bonds u/s 80CCF.An Individual or HUF can invest in these new infrastructure Bonds upto Rs 20000/- in a Financial years.Main features of this new section and new notification is given below
  1. New section can be availed by individual or HUF only.
  2. 20000/- rs can be invested in a Financial year to avail deduction under section 80CCF
  3. 20000/- Limit is in addition to 100000/- Limit of setion 80C,80CCC,80CCD
  4. Tenure of the Bonds will be 10 Years.
  5. However Lock in period is 5 years ,after 5 years investor can withdraw money from the bonds
  6. After lock in period ,Investor can take loan against these Bonds  
  7. Issuer of the Bonds is LIC,IFCI,IDFC and other NBFC classified as infrastructure company.
  8. Permanent account Number is must to apply these bonds.
  9. Yield of the bond – The yield of the bond shall not exceed the yield on government securities of corresponding residual maturity, as reported by the Fixed Income Money Market and Derivatives Association of India (FIMMDA), as on the last working day of the month immediately preceding the month of the issue of the bond.

Section 80CCF of the Income-tax Act, 1961 – Deduction – In respect of subscription to long-term infrastructure bonds – Notified long-term infrastructure bond

Notification No. 48/2010[F.No.149/84/2010-SO(TPL)], dated 9-7-2010

In exercise of the powers conferred by section 80CCF of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby specifies bonds, subject to the following conditions, as long-term infrastructure bonds for the purposes of the said section namely :-

(a) Name of the bond – The name of the bond shall be “Long-term Infrastructure Bond”.
(b) Issuer of the bond – The bond shall be issued by :-
(i) Industrial Finance Corporation of India;
(ii) Life Insurance Corporation of India;
(iii) Infrastructure Development Finance Company Limited;
(iv) a Non-Banking Finance Company classified as an Infrastructure Finance Company by the Reserve Bank of India;

(c) Limit on issuance – (i) The bond will be issued during financial year 2010-11;

(ii) the volume of issuance during the financial year shall be restricted to twenty-five per cent of the incremental infrastructure investments made by the issuer during the financial year 2009-10;

(iii) ‘Investment’ for the purposes of this limit include loans, bonds, other forms of debt, quasi-equity, preference equity and equity.

(d) Tenure of the bond. – (i) A minimum period of ten years:

(ii) the minimum lock-in period for an investor shall be five years:

(iii) after the lock in, the investor may exit either through the secondary market or through a buyback facility, specified by the issuer in the issue document at the time of issue;

(iv) the bond shall also be allowed as pledge or lien or hypothecation for obtaining loans from Scheduled Commercial Banks, after the said lock-in period;

(e) Permanent Account Number (PAN) to be furnished – It shall be mandatory for the subscribers to furnish there PAN to the issuer;

(f) Yield of the bond – The yield of the bond shall not exceed the yield on government securities of corresponding residual maturity, as reported by the Fixed Income Money Market and Derivatives Association of India (FIMMDA), as on the last working day of the month immediately preceding the month of the issue of the bond;

(g) End-use of proceeds and reporting or monitoring mechanism – (i) The proceeds shall be utilizes towards ‘ infrastructure lending’ as defined by the Reserve Bank of India in the Guidelines : issued by it ;

(ii) the end-use shall be duly reported in the Annual Reports and other reports submitted by the issuer to the Regulatory Authority concerned, and specifically certified by the Statutory Auditor of the issuer;

(iii) the issuer shall also file these along with term sheets to the Infrastructure Division, Department of Economic Affairs, Ministry of Finance within three months from the end of financial year.