Skip to main content

How to manage your Bank Savings account efficiently?

Invest In Tax Saving Mutual Funds Online

Call 0 94 8300 8300 (India)

 

 

Gone are the days when we used to stand in serpentine queues to withdraw money from our local savings bank accounts. Even though the procedure was cumbersome, it ensured that we estimated or budgeted the monthly cash requirement before we filled in the withdrawal slip so we could avoid the trouble of again standing in the queue. Today with the help of automated teller machines (ATM's) we can conveniently withdraw our monies from several locations. The ATM technology has definitely made our lives a lot easier but if not used in the right manner, it can also leave you high and dry.

Take the case of Mr. Aditya, 36 who work for an MNC firm in the senior managerial category and earns a net income of Rs. 75000 per month. His family comprises of his homemaker wife Sarita, 34 and Son-Arnav-5 and they stay in their self owned flat in one of the suburbs of Mumbai. Their monthly expenses including a home loan EMI ( Rs. 31300 for a 30lakh loan) and other living expenses comes to Rs. 60000 per month. Another Rs. 5000 goes towards an SIP in an equity diversified fund bringing the total outflow per month to Rs. 65000 thereby leaving a surplus of Rs. 10000 per month.

From the day the salary is credited which is usually on the 1st of the month, the ATM cum debit card is put to maximum use for initial cash withdrawals, Grocery purchases and a few additional purchases at malls with family in the weekends. Aditya has no track as to what his exact monthly expenses are but takes care to maintain sufficient balance for his home loan EMI debit. No fixed pattern is applied for cash withdrawals. The withdrawals range in various amounts of Rs. 15000 to 20000 initially in the beginning of the month and then small withdrawals ranging from Rs. 2000 to Rs. 5000 in the latter part of the month and at times he is not even left with minimum balance.

Following this pattern of unplanned withdrawals and expenditure, will never let Aditya realize if he is overspending or making impulsive purchases on things which he doesn't need. Secondly not maintaining funds for contingency can prove to be fatal if faced with an emergency situation such as a sudden medical expense.

Here are a few guidelines which can be followed to ensure that your savings account is maintained in the most prudent manner.

  1. Prepare a family budget: Maintain a simple budget book in which you can jot down the monthly income and expenditure. This exercise needs to be done in consultation with your spouse as there are a host of family related expenses such as grocery, utility bills, etc which the home maker or working women would be managing directly. Joint consultation helps in including all the possible expenses that the family has to cater to every month and enables near accurate results. Don't forget to include periodic or annual expenses such as Insurance premiums, Vacation, etc which can be one time or spread over different months. For those who don't know what their exact monthly expenditure is, can begin with writing down their daily expenses for a month or two and monitor the same which should be good enough to give you a fair idea of what your expenses are going to be. Doing this exercise over several months will enable you to reach near accurate levels.

 

  1. Control your ATM withdrawals: Once you have prepared your budget the next step is to withdraw the amount required for the whole month. Take care to see that you don't withdraw cash for expenses such as insurance premiums, society maintenance etc. You can keep provision for those payments by maintaining the required amount in the bank and issuing cheques towards those expenses. For eg. If your monthly expenditure on groceries, consumables, utilities, etc is Rs. 20000, while insurance premium and society maintenance is Rs. 10000 and Rs, 3000 respectively then withdraw only Rs. 20000 and maintain upwards of Rs. 13000 to be paid vide cheque. The budget based expenses will avoid excess withdrawals way beyond your requirements and prevent several trips to your ATM's.

 

  1. Maintain a separate record of your bank transactions. How many times do you visit the ATM to check the balance in your savings account or to take a mini statement? Others take recourse through their online banking platform. These routine visits can be eliminated if you maintain a small record of your income and various transactions in a separate book or in an excel sheet of your PC.

 

 

  1. Maintain a contingency fund: There could be events such as a medical emergency which may require urgent or immediate funding. Try and maintain a contingency fund of minimum of 3 times of your monthly expenditure in your savings account. The contingency fund may vary across different families and depend on various factors such as job stability, dependent parents, etc and can be decided in consultation with your financial planner.

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 in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

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. 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

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

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 MutualFunds 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

Popular posts from this blog

Tata Mutual Fund

Being a part of the Tata group, the fund has the backing of a very trusted brand name with strong retail connect. While the current CEO has done an excellent job in leveraging the Tata brand name to AMC's advantage, it is ironic that this was just not capitalised on at the start. Incorporated in 1995, Tata Mutual Fund remained an 'also-ran' fund house for around eight years. Till March 2003, it had a little over Rs 1,000 crore in assets and 19 AMCs were ahead of it. But soon after that the equation changed. It was the fastest growing fund house in 2004 and 2005. During these two years, it aggressively launched six equity funds, two debt funds and one MIP. The fund house as of now stands at No. 8 in terms of asset size. This fund house has a lot to offer by way of choice. And, it also has a number of well performing schemes. Tata Pure Equity, Tata Equity PE and Tata Infrastructure are all good funds. It also has quite a few good debt funds. The funds of Tata AMC are known to...
Read more

UTI Mutual Fund

Even though only a few of UTI’s funds are great performers, this public sector fund house has many advantages that its rivals do not. It has a huge base of retail equity investors and a vast distribution network. As a business, it looks stronger than ever, especially in the aftermath of credit crunch. UTI is, by a large margin, the most profitable fund company in the country. This is not surprising, since managing equity funds is more profitable than debt. Its conservative approach and stable parentage is likely to make it look more attractive to investors in times to come. UTI’s big problem is the dragging performance that many of its equity funds suffer from. In recent times, the management has made a concerted effort to improve performance. However, these moves have coincided with a disastrous phase in the stock markets and that has made it impossible to judge whether the overhaul will eventually be a success. UTI’s top performers are a few index funds, some hybrid funds and its inf...
Read more

Salary planning Article

1. The salary (basic + DA) should be low. The rest should come by way of such allowances on which the employer pays FBT and you don't pay any tax thereon. 2. 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 commercial or rented house. 3. 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 of Sec. 80C. 4. 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 per cent 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 per cent of the salary. 5. A chauffeur driven motor car provided by the employer has no perk value. True, the company would...
Read more

8 Investing Strategy

The stock market ‘meltdown’ witnessed since the start of 2005 (notwithstanding the recent marginal recovery) has once again brought to the forefront an inherent weakness existent in our markets. This is the fact that FIIs, indisputably and almost entirely, dominate the Indian stock market sentiments and consequently the market movements. In this article, we make an attempt to list down a few points that would aid an investor in mitigating the risks and curtailing the losses during times of volatility as large investors (read FIIs) enter and exit stocks. Read on Manage greed/fear: This is an important point, which every investor must keep in mind owing to its great influencing ability in equity investment decisions. This point simply means that in a bull run - control the greed factor, which could entice you, the investor, to compromise with your investment principles. By this we mean that while an investor could get lured into investing in penny and small-cap stocks owing to their eye-...
Read more

Debt Funds - Check The Expiry Date

This time we give you an insight into something that most debt fund investors would be unaware of, the Average Portfolio Maturity. As we all know, debt funds invest in bonds and securities. These instruments mature over a certain period of time, which is called maturity. The maturity is the length of time till the principal amount is returned to the security-holder or bond-holder. A debt fund invests in a number of such instruments and each of these instruments would be having different maturity times. Hence, the fund calculates a weighted average maturity, which would give a fair idea of the fund's maturity period. For example, if a fund owns three bonds of 2-year (Rs 30,000), 3-year (Rs 10,000) and 5-year (Rs 20,000) maturities, its weighted average maturity would be 3.17 years. What is the big deal about average maturity then, you may ask. Well, knowing a fund's average maturity is important because it tells you how sensitive a fund is to the change in interest rates. It is ...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now