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Friday, October 31, 2014

Gold Loans

Gold Loans

 

 





As gold loans offer flexible repayment options, these can help those facing a temporary cash crunch.

 

As an asset, gold is almost as liquid as cash. You can unlock the value of your holding with a loan whenever you are in need.

In fact, gold loan companies promise that you can bring your gold and walk out with cash in a matter of minutes. While it may not be as simple as that, a loan against gold does not have too many hurdles.

Almost all forms of gold can be pledged, including bars, coins and ornaments. The lender will get the gold tested for purity and, accordingly, extend up to 75% of the gold value as loan. Experts say it is not a good idea to take the maximum 75% as loan. The interest rate on any loan is determined by the risk associated with it. So, a lower loan amount (say, 50-60% of the gold value) reduces the risk for the lender and could lead to a lower rate of interest.

As the borrower is giving a collateral (a highly liquid one), gold loans are cheaper than unsecured personal loans. The interest rate on a personal loan can be as high as 2024%, while a one-year gold loan will charge only 11-15%. In cases where the tenure of the loan is very long, say 4-5 years, the interest rate is higher at 18-20% (see table).

Repayment options

There are several repayment options for borrowers. Traditional moneylenders take a lump sum along with interest at the end of the tenure. This is not cost-effective for the borrower since the interest rate can be as high as 24-30% per annum.

The other option is to pay a simple interest on the loan every month. At 1.2-1.85% a month, the interest is not low. The annualised rate comes to 14-18%. However, this mode works well for borrowers who are faced with a temporary cash crunch and are likely to be able to repay the entire amount after a few months.

The EMI option suits borrowers who will not be able to repay the amount as a lump sum. For them, monthly repayment is a better option. The interest rate is also lower in this option because the risk for the lender comes down with every EMI payment.

What to watch out for

Like any other loan, gold loan requires disciplined servicing of repayment. If you fail to pay by due date, the lender might slap a 2-3% penalty. This may not sound too bad, but if you skip more than three payments, it can turn ugly. Go through the terms and conditions of the loan agreement. Most of them have a clause saying that the lender can sell your gold to recover his dues after a grace period of 90 days. This can be devastating if the pledged gold was an heirloom or something of great sentimental value.

Also, watch out for the other clauses that lenders slip into the terms and conditions. Avoid those who charge a very high processing fee or levy a stiff penalty on prepayment. The processing fee should be in the range of 0.5% to 2% of the loan amount, while the penalty should not exceed 2%. Some lenders also charge 0.25% for valuation.

Gold loans are cheaper than personal loans and credit card advances, but one can also consider loans against securities and insurance policies. These loans are comparatively cheaper and have more customer friendly terms and conditions

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

Leave a missed Call on 94 8300 8300

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

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any 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. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. 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
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
      2. Franklin India Smaller Companies

E. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. Birla Sun Life Gold

H. International funds Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF

Insurance Policy Term

Insurance Policy Term

The period of coverage provided by an insurance policy.

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

Leave a missed Call on 94 8300 8300

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

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any 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. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. 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
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
      2. Franklin India Smaller Companies

E. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. Birla Sun Life Gold

H. International funds Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF

Life insurance versus Mutual Fund:

Download Tax Saving Mutual Fund Application Forms

Invest In Tax Saving Mutual Funds Online

Buy Gold Mutual Funds

Leave a missed Call on

94 8300 8300

 

Life insurance versus Mutual Funds

-- Investment in MF is made either in debt or equity and only in one fund. In life insurance, the investment is made in a bouquet of funds.

-- Just like PPF and FD, MFs don't offer the benefits of life cover and protection. Life insurance offers protection while at the same time also works as an investment tool. It all depends on the type of policy you select.

-- As compared to life insurance policies, mutual funds are considered to be short-term investment avenues.



 

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

Leave a missed Call on 94 8300 8300

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

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any 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. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. 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
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
      2. Franklin India Smaller Companies

E. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. Birla Sun Life Gold

H. International funds Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF

Types of Life Insurance

Download Tax Saving Mutual Fund Application Forms

Invest In Tax Saving Mutual Funds Online

Buy Gold Mutual Funds

Leave a missed Call on

94 8300 8300

 

Types of Life Insurance

Life insurance should be an important part of your financial plan. It offers security to your family members should anything untoward happen to you. Let's look at the different types of life insurance policies that are available in the market today:

Term Plan

A term plan is the simplest type of insurance in which you buy in an insurance cover for a specific number of years and at a certain premium. This type of insurance plan does have any other investment component. In case, the policyholder dies during the term of the policy, the sum assured is given to the beneficiary.

Whole life insurance plan

A whole life plan covers you for the 'Whole of your life' that is as long as you survive. A slight variation of whole life plan could be a whole life endowment plan, which will practically cover your whole life and will have the provision for maturity benefit too after a considerably long interval say at 100 years of age. The premium that you pay for this type of policy remains the same throughout the policy life. In case of the death of the policyholder, the sum assured is given to the nominee.

Endowment Plan

An endowment plan is a life insurance plan designed to pay a lump sum after a specified term (on its 'maturity') or on death. Endowments can be cashed in early (or surrendered) and the holder then receives the surrender value which is determined by the insurance company depending on how long the policy has been running and how much has been paid into it.

Money Back Plan

In a moneyback insurance plan, the policyholder gets a percentage of the sum assured at regular intervals, rather than getting the whole amount as lump sum. It is essentially a type of endowment plan with benefits of liquidity. One of the best features of this type of plan is – in the event of death of the policyholder during the policy term, the claim amount comprises the full sum assured. Also, there are no deductions made to the survival benefit amount that has already been paid.

ULIPs

ULIPs or Unit Linked Insurance Plans are investments made with risks associated to the capital markets. As this investment risk is borne by the policy holder, one needs to be discerning enough. Before buying a ULIP, it will be wise to consider your risk appetite and your requirements beforehand. There are several unit liked insurance products that are specially designed to suit your goals – be it for your health, marriage, retirement planning or for your child's education.

Retirement Plan

The main objective of retirement plan should be to create a corpus sufficiently large enough to take care of the regular stream of income post retirement. It is a type of retirement solution that can help you with regular flow of income to maintain your existing lifestyle. While planning for a retirement solution, one should take a look into vesting provisions as set out under such plans like – minimum vesting amount, open market option, i.e., flexibility to choose annuity from any of the annuity providers in the market, types of annuity being offered, etc.



 

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

Leave a missed Call on 94 8300 8300

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

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any 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. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. 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
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
      2. Franklin India Smaller Companies

E. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. Birla Sun Life Gold

H. International funds Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF

Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now
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Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now