Savings for future is important to have a secured future | Six savings plans for a secured future
Most of the people remember about savings only at the time of submitting income tax to have some tax benefits. But the financial status can be bettered by thinking twice before spending money. Financial status can be bettered by reducing unnecessary expenditure and increasing savings.
Investments in Share Market for high profits:
Those who wants high profits even though having high risk should enter into share market. The investor can choose from the index shares of BSE, and NIFTY to shares of big companies. The midcap shares should be chosen only after having thorough knowledge on the business of respective companies.
Mutual funds are better for those having very little knowledge on stock market. In these funds amount can be invested in equities and deft plans based on our financial status. SIP plans can be chosen to invest regularly.
Share market gives up to 30% profit on investing long times. Hence this should be chosen in case the investor is young, have the ability to face risk, and those who invests for longer periods.
Investment on properties is a wiser option:
Investments on properties may cause some difficulty for some time but it is the best choice for future. So lands, houses and plots should be bought whenever possible. Because the value of property grows with time and may get some amount in the form of rents every month. Some large amounts are required to buy lands or houses. So loans may be taken from banks for this purpose. New employees will have the capacity to earn and will have time to return the loan.
Fixed deposits can be used for trusted income:
Fixed deposits gives about double the amount of interest than normal savings accounts in bank. Currently these deposits are paying about 8% and more as interest. If we are interested in more profits then may invest in fixed deposits in private banks and finance companies. But the private banks and companies are linked to high financial risk, so trusted companies should only be chosen.
Fixed deposits should be chosen because these gives security for the actual sum and also for some amount of interest. Banks are providing auto renewal facility to the account holders to give an opportunity to earn more interest. The total amount along with interest will be paid on completion of the window period of the fixed deposit. Tax may be deducted from this amount. These plans gives the investor the feasibility add some more amount to the fixed sum intermediately and take over drafts on the deposits. Thus fixed deposits gives security for emergency needs. But some amount of interest may be lost in case of withdrawing before the completion of the period.
Postal Deposits for Monthly income:
To invest in the monthly income plan in post office, one person may open account in his name Â or two, three persons can open joint account. There is no rule that the persons opening joint account to be couples. In the personnel account, amount can be invested from Rs. 15Â to Rs. 4.5lakhs in multiples of 1500. In the joint accounts, amount can be invested up to Rs. 9lakhs. The maturity period of the plan is 6 years. Annual interest of 8% will be paid monthly. And after completion of the maturity period 5% bonus will be sanctioned. If the monthly interest is not required for regular needs, it can be deposited in any savings or R&D accounts. There is no tax benefits applicable for the actual sum and interest amount. These accounts can be opened in the post office itself.
This plan is very useful for those wanting to pay some amount to their family every month. The account can be cancelled after three years and no fees will be deducted from the sum.
Tax Benefit plans:
The National Savings plans will be issued by Indian Government which will be available in post offices. These plans give 8% interest for 6 years of maturity period. The profits afforded by the investments in these plans will have tax benefits.
The interest on these policies can be claimed for tax benefits every year. These doesnâ€™t have the feasibility to withdraw amount before the maturity period, hence can be sold to others in case of emergency. These can also be transferred on some otherâ€™s name by paying some particular amount.
PPF for double benefits:
The policy to be invested to get both savings benefit and tax benefit is PPF. About Rs. 70,000 can be invested in this plan. The current interest rate in this plan is 8%. The maturity period for this plan is 15 years, so the total sum can be assured in the 16th year.
The investments in this plan will give interest on interest. The interest will be calculated for every six months. And tax benefit is also applicable for the interest gained in this plan.