Skip to main content

Education Loans offer Tax benefits and Home loan offer Interest rate benefits

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

 

Going to a financial planner for the first time? Be ready for this question — How much have you borrowed? But a financial planner won't consider all loans as bad. If there is a big amount on the credit card, he will ask you to pay it immediately. If you are short of cash and the bill is too high, he may even advise you to take a personal loan. After all, a personal loan comes at 15- 20 per cent whereas credit card companies charge over 40 per cent annually. But some loans like an education loan have actually created an opportunity for the generation to fund themselves even before they are his goals achievable. It boosts his capacity to acquire assets. It gives an individual confidence to fulfil his materialistic aspirations.

Provides tax advantage

There are two loans that immensely help an individual by getting her some tax relief. These are home loan and education loan. Any time any individual takes a home loan from an HFC ( housing finance corporation) the interest that he pays and the principal payback up to ₹ 1 lakh gets exempted from tax liability every financial year during the lifetime of a loan account. The interest amount is capped at ₹ 1.5 lakh if it is for a self- occupied house and if it is for a let- out property, there is no cap on the interest amount exempted An education loan creates a culture encouraging youngsters to pursue their academic dreams and not feel paralysed due to unavailability of funds at their personal level. This deduction u/ s 80( E) is allowed only if the education loan is taken from any financial institution or approved charitable institution. Education loans from relatives and friends do not qualify. Also, the exemption u/ s 80E is allowed to be claimed in the year in which the individual starts paying the interest on the education loan and in seven succeeding years.

Building credit history/ score

Any loan taken from a financial institution puts the borrower's PAN under observation throughout the loan period. The Cibil ( Credit information transaction details of every borrower from the financial institution that lends the money to the borrower. Since the records are centralised with Cibil, every bank before processing anew application checks the applicant's PAN with Cibil to check if the borrower has had any defaults on his part on previous loans. The credit score plays a critical role in the loan approval process. An individual's Cibil credit score provides a credit institution with an indication of the probability of default of the individual based on his/ her credit history that is, the past pattern of credit usage and loan repayment behaviour. Credit history is an important part of financial record. And loans play an important role in building one's credit history.

Inculcating a sense of financial discipline

When an individual is taking a loan he is giving a commitment to the lending institution to pay equated monthly instalments for the lifetime of the loan. He is ensuring that his accounts have sufficient balance to pay an instalment every month for the loan he has taken. This builds a sense of financial discipline in the person. The person also understands that if he defaults, he would be ruining his credit record with Cibil which will make his/ her new loan applications in future difficult to get approved.

Financial independence

Gone are the days when you would turn to family and friends for financial help. With the loan eligibility an individual can always borrow money from a lending institution and set out on the path of financial independence. The only favour you would need from your close relatives and friends is to ask them to be your guarantor and assure them of your repayment capability through EMIs. Loans have helped people become responsible and mature in their financial transactions. On a softer side it has benefited individuals become confident and competent in managing their financial life. When should loans be avoided? Watch out for the following when deciding to take a loan.

Is a loan being taken for an appreciating asset or depreciating asset? Any loan taken on an appreciating asset like a house or education loan that builds human capital value, creates financial leverage i. e. the borrowed money creates more money than it costs. Tax exemptions, capital value appreciation and increase in human capital value drive leverage. Loans on depreciating assets like electronics and cars must be avoided unless you don't have the lump sum to make 100 per cent down payment. Is this loan an unsecured one? Home loans and auto loans ( commonly known as secured loans) are likely to be better than unsecured loans because secured loans are cheaper and secured loans impact one's credit score favourably. Credit card loans and personal loans are two prime examples of unsecured loans that must always be avoided. Is a loan being offered at a competitive rate? Understanding the cost of borrowed money is very important. If the loan product is not competitively priced, it must be avoided.

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

Popular posts from this blog

ICICI Pru Mutual Fund Dividend

ICICI Prudential Mutual Fund has announced dividend under the following schemes: Scheme Dividend ( Rs /unit) ICICI Pru Capital Protection Oriented Ser V Plan B-D 0.03611325 ICICI Pru Capital Protection Oriented Ser V Plan B Direct-D 0.03611325 ICICI Pru Balanced Advantage Direct-DM 0.06 The record date has been fixed as February 08, 2017. ------------------------------ ------ Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds Top 4 Tax Saver Mutual Funds for 2017 - 2018 Best 4 ELSS Mutual Funds to invest in India for 2017 1. DSP BlackRock Tax Saver Fund 2. Invesco India Tax Plan 3. Tata India Tax Savings Fund 4. BNP Paribas Long Term Equity Fund Invest in Best Performing 2017 Tax Saver Mutual Funds Online Invest Best Tax Saver Mutual Funds Online Download Top Tax Saver Mutual Funds  Application Forms For further information contact  SaveTaxGetRich on 94 8300 8300 ------------------------------ ------ Leave y...
Read more

What is Financial Freedom?

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India)     There were many things common between our Freedom fighters. All had the Single vision (Free India), common goal (independence) and had a disciplined and focused approach. They were ready to do anything and everything and had made so many sacrifices to see India free . But the road to freedom was not easy .They had faced lot many hardships, went to jail so many times and even confronted physical and mental torture from the British. There was one more thing which proved to be an advantage to our fighters that most of them were professional lawyers. The knowledge of legal issues and its impact on our country at large has helped them counter various bills and proposed new laws by the then government. It is due to their continuous effort that we are able to achieve the goal of Independent Indi...
Read more

Hidden Bank Fees

  What Banks Hide From Customers Imagine after a peaceful and exciting holiday you receive your bank statement with steep charges. You then rush to your bank and start confronting staff members and to your dismay, you come to know that the high end debit card was charged very heavily. Wouldn't this cause damage to your finances? So remember, the world outside is full of deceptive and double cheating people. Unethical practices are always used by company sales person in order to meet the target. Credit card companies, mutual funds and bank institutions always play dirty tricks to lure customers and the practices are rampant. So here's how you should be careful while dealing with your banks: High End Debit Card Charges While opening an account with a bank you opt for a debit card with minimal charges. But later on when you upgrade your card and opt for high end debit card the annual charge rise by a good amount. Though such a card has slew of features but it all comes at a high ...
Read more

Partial withdrawal from PPF

  Public Provident Fund (PPF) account has a lock in period   If you opened a PPF account to meet your retirement needs,, think twice about withdrawing from this fund before retirement. But provided it's an emergency here are the rules. Public Provident Fund (PPF) account has a lock in period before which you cannot withdraw your money.   The partial withdrawal is allowed after the completion of 6 financial years . This means that you will be allowed a partial withdrawal from 1 April 2017. The maximum partial withdrawal allowed is the least of the following: 50 percent of the account balance at the end of fourth financial year, 31 March 15 50 percent of the account balance of the end of previous financial year, 31 March 17.   There's a loan option available on your PPF account between the fourth and the sixth financial year. You can obtain a loan of up to 25 per cent of the balance in your account. However, this will attract interest of 2 percent more than the prevailing ...
Read more

Updating a minor PAN card upon becoming adults

  Updating a minor's PAN card once they become adults A PAN card issued in the name of a minor does not contain the minor's photograph or signature, and therefore, cannot be used as a valid proof of identity. Once a minor PAN card holder turns 18, the relevant changes must be made in the PAN records. A new card is then issued bearing a photograph and signature. Application The applicant is required to fill up the "Request for new PAN card andor changes or correction in PAN data" form. The form can be filled up online by accessing NSDL's Tax Information Network website and clicking on the online PAN application tab. Information The applicant must mention the existing PAN number in the application and check the `photo mismatch' and `signature mismatch' boxes, and submit the online form. The form must also be printed out, signed by the applicant, and submitted along with two photographs. Documents Identity and address proof in the form of a copy of the app...
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