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As investment instruments, <keyword id="76579" type="CITY" weightage="20" keywordseo="PPF">PPF</keyword> (Public Provident Fund) and <keyword id="45027" type="ORGANIZATION" weightage="20" keywordseo="EPF">EPF</keyword> (Employees' Provident Fund) have a lot of things uncommon between them. Basically speaking, the decision to invest in a PPF scheme rests with the investors while EPF is automatically deducted from the salary of the salaried class of people. Both these investment options enable the investors cave on taxes. Section 80 C of the Income Tax Act of 1961 makes both <keyword id="8113458" type="UNKNOWN" weightage="20" keywordseo="PPF-and-EPF">PPF and EPF</keyword> investments eligible for a range of income tax benefits. Overview of EPF and PPF In India, two types of provident funds are popularly known namely Employees’ Provident Fund or EPF and Public Provident Fund or PPF. Under the existing regulations, EPF is automatically deducted from the salary of the salaried class individuals by their employees and paid into their respective EPF accounts maintained with the EPF department under the auspices of the Government of India. The choice to invest in a PPF scheme solely rests with the investor. This means that if you are a salaried individual, you do not have a choice not to subscribe to the EPF scheme. Hence, the deductions will be invariably made from your salary to be invested into your EPF account. But, whether you wish to invest in a PPF scheme is purely optional. EPFO or Employees Provident Fund Organization is a retirement fund body that governs the EPF scheme. PPF scheme is offered by the Government of India through banks and post offices. How do these schemes compare Interest rates The government decides the interest rate of PPF year on year depending on several factors related to the country’s economy. Over the past several years, the interest rate of EPF contributions had never come down below 8.5 percent. The government decides the interest rates of PPF during every quarter. For the quarter ending in June 2018, the interest rate for PPF investments was fixed at 7.6% for example. Since the PPF investments come under the Exempt, Exempt, Exempt category, the returns are completely exempt from taxes. The principal amount, the maturity amount and the benefits earned on the investment are all qualified for tax exemption. How the EPF and PPF schemes operate If an individual works with a company that has more than 20 people on its rolls, EPF deduction is compulsory. The salaried employee contributes about 12 percent from their monthly salary towards EPF. The employer has to contribute an equal share of 12 percent which will be deposited in the employee’s account along with the employee’s contribution. Any citizen who is a resident of India can open a PPF account. To open a PPF account it is not necessary that the individual must be a salaried person. Members of Hindu Undivided Families (HUF) cannot open a PPF account. The tenure of investment in case of a PPF account is 15 years. Once this period expires, the investment can be extended for another 5 years. From the third financial year of opening the account, the investor can take a loan from the PPF account. From the seventh financial year, the investor can make partial withdrawals from this account.

What is the difference between PPF and EPF

<keyword id="7723175" type="General" weightage="20" keywordseo="what-is-provident-fund" source="Orion">What is Provident fund</keyword>? PF or Provident Fund or as it is commonly known as, Employee Provident fund(EPF) is a government backed savings scheme which allows a salaried employee to invest a certain amount every month on which a fixed amount of interest is paid by the government. It is a retirement savings scheme and is amninistered by a statutory body, EPFO, Employee Provident Fund Organisation under the Ministry of Labor and Employment. <cmsannotation type="cmsannotation" annotationid="You can check your PF balance in four different ways." comment="subhead" text="You can check your PF balance in four different ways.">You can check your PF balance in four different ways.</cmsannotation> <cmsannotation type="cmsannotation" annotationid="Check PF balance through EPFO Portal" comment="subhead" text="1. Check PF balance through EPFO Portal">1. Check PF balance through EPFO Portal</cmsannotation> To check your PF balance, the employer must have activated your Universal Account Number (UAN). This number is allotted by the EPF organization. Irrespective of the companies you change, this number will remain the same throughout your life. Step 1: Log on to the EPFO portal. Go to ‘Our Services’ and choose ‘for Employees’. Choose the option ‘Member Passbook’ under ‘Services’. Step 3: In the Login page, enter your UAN Number and Password after activating them. Now you can access your EPF account. <cmsannotation type="cmsannotation" annotationid="Check PF balance via SMS" comment="subhead" text="2. Check PF balance via SMS">2. Check PF balance via SMS</cmsannotation> If you have linked your UAN number with your KYC details like Aadhaar number or PAN number, you can access your PF balance via SMS. If this is done, you can send SMS message “EPFOHO UAN ENG” to the number 7738299899. This will send the details in English. Alternative SMS codes are available if you wish to know your PF balance in other languages like Hindi, Punjabi, Gujarati, Marathi, Kannada, Telugu, Tamil, Malayalam, and Bengali. 3. <cmsannotation type="cmsannotation" annotationid="Check PF balance via Missed call" comment="subhead" text="Check PF balance via Missed call">Check PF balance via Missed call</cmsannotation> If you have linked your Aadhaar card or PAN number with your PF account, you can use this method to know your PF balance. Give a missed call to 011-22901406 from your registered mobile number and you will instantly get a message stating your PF balance. 4. <cmsannotation type="cmsannotation" annotationid="Check PF balance using EPFO app" comment="subhead" text="Check PF balance using EPFO app">Check PF balance using EPFO app</cmsannotation> Download the “m-sewa app of EPFO” from Google Play Store. Open the app and click on ‘Member’ and go to ‘Balance/Passbook’. The page will ask for your UAN number and registered mobile number. If the details you give match with their records, your PF balance will be displayed. <div type="Article" hostid="261" msid="88278188" title="Here’s how you can create Universal Account Number (UAN) on the EPFO portal" mstype="2" mssubtype="0"></div>

How to check Pf (Provident Fund) balance in India

The taxation laws in India contain a number of provisions to let the tax payers save on taxes. By taking some informed decisions on how you spend and account, you can save on taxes in a legitimate way. Here we discuss some important deductions under the Income Tax Act 1961. Tips to save on income tax Make the right use of Rs.1.5 lakhs limit allowed under Section 80C Investing up to a limit of Rs. 1.5 lakh in schemes like Tax-Saver FDs, PPF (Public Provident Fund), ELSS Funds, NSC (National Saving Certificate), Life Insurance Premiums, National Pension System (NPS), Home Loan Repayment, Payment of tuition fees of your children, EPF, Senior Citizens Savings Scheme, and Sukanya Samriddhi Yojana can enable you for appropriate tax deductions depending on the case. National Pension System This deduction facilitated by Section 80CCD (1B) allows up to Rs 50,000 for contributing to the National Pension Scheme. The NPS makes it possible to invest in equity and debt pension funds for building a corpus for the retirement life. This can be withdrawn at 60 years of age. Health Insurance Premiums Paying for health insurance premiums can let you qualify for a deduction up to Rs 25,000 under Section 80D. This is permitted on top of all the deductions listed above. In case of senior citizens, this limit is up to Rs. 50,000. The taxpayer contributing towards health insurance premiums for himself as well as for a senior citizen can claim a combined deduction of up to Rs. 75,000 per annum. Deduction on your rent If you are getting HRA, it is possible to claim tax deduction on your House Rent. Though there is no upper limit specified for this, there are some rules that place a cap on the maximum deduction. If you do not get HRA but pay towards rent, a maximum claim of up to Rs. 60,000 per annum is allowed under Section 80GG. Deduction on the home loan interest When you have a home loan running, the interest you pay towards the home loan is tax deductible under Section 24 of the Income tax Act. The maximum limit that you can claim in this regard is Rs. 2 lakh. If the house is rented out, there is no upper limit. Money in your savings account The easiest way to save money on income tax is to keep some money in your savings account. Up to a limit of Rs. 10,000 per year, the interest on savings accounts is tax free under the Section 80TTA. In case of senior citizens, this limit is up to Rs 50,000 applicable in cases of both FD and savings account interest. Give for charity Donations made towards charity enable you for tax deductions. Though there is no upper limit for this, there are different rules that restrict the amount deductible on the contributions towards charities. Across a majority types of donations to the NGOs, this limit is fixed at 50% of the donated amount and up to 10% of the total income that is adjusted. If you want to claim this deduction, the NGOs to which you contribute must have 80 G certificate.

How to save Income Tax in India Schemes to Invest in 2019

No more getting hassled over reclaiming your dormant provident fund for WhiteInc has come to the rescue. Financial advisory firm WhiteInc is developing an app by which one can do so through one’s smartphone. It is compatible to both Android and <keyword id="75489" type="ORGANIZATION" weightage="100" keywordseo="IOS">iOS</keyword> platforms. Last month, minister of state for labour, <keyword id="115762" type="PERSON" weightage="80" keywordseo="Bandaru-Dattatreya">Bandaru Dattatreya</keyword> had said that about Rs 27,000 crore is lying unclaimed in the Employees Provident Fund. "We are in the trial stage for the application and it should be available in the next two to three months. The idea is to reach out to young professionals who do not have the time and expertise to their provident fund or other financial <keyword id="6362476" type="ORGANIZATION" weightage="80" keywordseo="investments">investments</keyword>," said <keyword id="2898274" type="UNKNOWN" weightage="80" keywordseo="Abhay-Chandalia">Abhay Chandalia</keyword>, founder of <keyword id="2897805" type="UNKNOWN" weightage="100" keywordseo="WhiteInc-Group">WhiteInc Group</keyword>. 

	All the user need to do is download the app and fill in the required details which from there on will be tracked by the financial advisory firm, who will charge a fee for offering this service based on the amount to be claimed.
 "We already have a website which provides this service, but it is mostly focused on shares and <keyword id="6357979" type="ORGANIZATION" weightage="100" keywordseo="mutual-funds">mutual funds</keyword>," said Chandalia. In his budget speech, finance minister <keyword id="42575" type="PERSON" weightage="100" keywordseo="Arun-Jaitley">Arun Jaitley</keyword> had proposed to use the unclaimed deposits of around Rs 3,000 crore in <keyword id="114852" type="ORGANIZATION" weightage="100" keywordseo="Public-Provident-Fund">Public Provident Fund</keyword> (PPF) and around Rs 6,000 crore in Employees Provident Fund (EPF) corpus to create a Senior Citizen Welfare Fund. The fund is expected to be used for subsidising the premium of vulnerable groups such as old-age pensioners, below-the-poverty line card holders, and small and marginal farmers. The firm plans to expand its services to other unclaimed investments in shares, <keyword id="35450" type="COMPANY" weightage="100" keywordseo="insurance">insurance</keyword> and mutual funds as well. 
	 
	(image credits: relakhs.com)

Now use your smartphone to reclaim your PF

March is not called the craziest month of the year for nothing; after all those tax-saving and tax-filing processes, tax-payers finally breathe a sigh of relief as it gets over. However, soon into the new financial year, investors and taxpayers should look forward to completing a few pending tasks, which don't take too much time or effort, but help a lot in making your finances controlled. 
 
Here are six ways in which you can plan your next financial year. 
 
Don’t Wait For Yearend To Start <keyword id="136807" type="ORGANIZATION" weightage="100" keywordseo="tax-planning">Tax Planning</keyword> 
Even though the tax-planning season has just ended, this is still the best time to start tax planning, say experts. Investing in equity-linked saving schemes (ELSS) is best done when SIPs are started in April itself. 
As per an ET research, investors who took the SIP route earned more than those who waited till March to invest in ELSS schemes. When your investments are spread across 12 months, you get a cushion against volatility, and it also lightens the burden at the end of the FY. 
 
Get Your Tax Papers Ready 
start collecting whatever documents and information you need for tax filing from the beginning itself, to save yourself the collective efforts at the time of filing. Foreign assets or foreign income earned during the year calls for the collection of these documents right away, as obtaining tax credit receipts, income certificates and other documents from foreign countries might take time and should not be kept for later. 
Organise Investment Portfolio 
Make a detailed portfolio of all your asset allocations and investments. For this you can start using a portfolio tracker via Value Research, by uploading the consolidated mutual fund statement and NPS details, which would incorporate all transactions into the portfolio. 
 
Raise Quantum Of Investments 
As the appraisals are just around the corner, your investments need to be increased in the same proportion. Out of these, some investments like Employee Provident Fund contribution would automatically increase, while for others, you can either increase the existing SIP amount or start fresh SIPs in other funds. 
 
Ask your employers for VPFs 
Small savings schemes have smaller interest rate, which could further fall. However, the interest earned on EPF might not be affected much, which is why you can go for VPF contribution instead of PPF. These are eligible for tax deduction under Sec 80C and are tax free on withdrawal. 
 
Avoid TDS by submitting forms 15G &amp; 15H 
To avoid TDS on interest, this is the right time to file forms 15G or 15H. While form 15G can be filed by investors below 60 years of age having total income from interest less than the basic exemption of Rs 2.5 lakh and don’t have any tax liability, form 15H is for individuals above 60 who don’t have to pay any tax on total income. 
 
<a href="http://intraweb.stockton.edu/eyos/hshs/content/images/2013%20Pics/finance.jpg">Image source</a>

Here’s how you can make the best out of this financial year

Tax saving is something that all of us typically think about only in the last quarter of a financial year. As we enter January, we get an email from our company’s HR department to submit our tax-saving details for the year. This email makes us realise that we haven’t made any tax-saving investment yet. We rush to invest to save taxes and end up making hurried investment decisions. Sure, even this way, we do end up saving tax. But that shouldn’t be the sole purpose of tax-saving <keyword id="6362476" type="ORGANIZATION" weightage="20" keywordseo="investments">investments</keyword>. When planned and executed properly, tax-saving investments can help you build wealth over the long-term as well. By their nature, tax-saving investments are long-term and can be used for goals like child’s education or marriage and your own retirement. Under Section 80C, a taxpayer can invest up to Rs 1.5 lakh in a year to save tax. This is a decent amount to build a corpus of wealth as well. But these investments should not be done in the last few months with little time and after little thought. These investments should be planned and started in the beginning of the financial year itself. Here is how you can plan your tax-saving investments for FY2017-18 to make maximum gains. Figure out the tax-saving expenses that you can claim Under Section 80C, there are a number of expenses that qualify as tax-saving deductions. This includes the life insurance premium you pay, school tuition fees for two children, repayment of your home loan, etc. These are expenses that you make anyway and they should be used to save taxes. Figure out how much will be the amount of these expenses. This will help you understand how much of the Rs 1.5 lakh 80C limit you need to invest. Build a portfolio of tax-saving investments Once you know how much you will need to invest to fulfil the 80C limit, you should think about where you want to invest that money. There are a number of investment options available, like ELSS funds, PPF, NPS, SukanyaSamriddhi, fixed deposits, NSC, etc. Choose the kind of investment that you are comfortable with, which matches your risk profile and start investing in them right away. It is easier to invest a small amount every month through the year than a big amount in one go at the end of the year. Make good use of ELSS funds ELSS funds are equity <keyword id="6357979" type="ORGANIZATION" weightage="20" keywordseo="mutual-funds">mutual funds</keyword> that come with a lock-in period of 3 years. They are considered to be the best tax-saving investment because of the flexibility they come with and the ability to earn inflation-beating returns. Everyone should invest some amount of their 80C limit in these funds. The equity-related risks get mitigated over the long-term and the returns earned by these funds also become tax-free after a year. Ideally, the younger you are, the more you should invest in ELSS funds. Link investments to goals It is always good to have investment goals. With a target in mind, it would become easier for you to choose a tax-saving investment. For example, for a goal like retirement, you can rely on your investments in EPF or PFF. But for a goal that is just 5-7 years away, you can put money in tax-saving fixed deposits or ELSS funds. This way, investments with different lock-in periods can be used to achieve different short-term and long-term goals. Don’t invest and forget This is a mistake that many investors do, especially with ELSS funds. It is of no use to check a fund’s performance every single day, but you should at least once in 6 months or a year. You can stop your SIPs in an underperforming ELSS fund any time you want and start SIPs in another ELSS fund to avail the same tax benefit. This flexible nature of ELSS funds should be used to earn optimum returns. Think beyond 80C Tax-saving doesn’t end with Section 80C investments and expenses. There are other ways to save taxes that should also be utilized by taxpayers. Medical insurance is tax-deductible under Section 80G. An additional ₹50,000 can be invested in NPS under Section 80CCD. Taxes can also be saved by making certain donations under Section 80G. You should find out about these tax-saving deductions and avail as much benefit as you can. These are some things that the common taxpayer can do to get the most out of saving taxes this year. But the most important thing is to not procrastinate. Plan your investments and start early. (The article is authored by Archit Gupta, Founder &amp; CEO, ClearTax.com)

Here’s how you can plan your investments to gain maximum savings

A first job is both exciting and memorable. With it comes the thrill of a first pay check and some responsibility too. Now that you have become an earner, you are likely to be a taxpayer as well. 
 
Here are some tips help kick start your tax return filing– 
 
What is the good in filing tax returns? 
Tax filing is compulsory if your total income in a financial year exceeds the minimum income which is exempt from tax i.e. Rs 2.5lakhs. Even if your taxes have been paid in full, you should still file a tax return if your income is above this threshold. Those who are seeking a refund, can get it by filing a return. Having a proper trail of filing also helps in securing loans and visas. 
 
What is assessment year? 
Most of us know financial year is the 12 month period that begins on 1st April and ends on 31st March. Your taxes are calculated for this period. Say if you started working in June 2015, your financial year is 2015-16 which ends on 31st March 2016. Assessment year is the year in which tax return is filed for a financial year. The assessment year is 2016-17 for financial year 2015-16. It is the year in which your income details are submitted to the tax department. While preparing your return, you must make sure you select the assessment year correctly. 
 
How should I prepare my tax return? 
If you always saw your parents do a paper return, those days are long gone. E-filing of your tax return is compulsory if your annual income exceeds Rs 5 lakhs. 
 
If you are salaried, some e-filers allow you to upload your Form 16 and your return is automatically populated. Form 16 takes care of your income from salaries. But your income tax return should include every income earned by you. Do you have any interest income from a fixed deposit or a savings account? Include that in your tax return under ‘income from other sources’. If there is any income from a prize or internship or rental income that should be included too. 
 
From your gross total income ‘deductions’ can be claimed. These deductions reduce your total taxable income and you end up paying lower tax. Make sure you make the most of them. The most popular deductions are section 80C and section 80D. You can claim it, if you are enrolled for EPF, deposited in PPF or invested in ELSS during the financial year. Under section 80D, deduction is allowed for medical insurance. 
 
What should I do about <keyword id="17506" type="ORGANIZATION" weightage="60" keywordseo="TDS">TDS</keyword>? 
Your employer deducts TDS from the salary you are paid. The bank cuts some TDS on your interest income. Anybody who pays you cuts some tax on the payment. This helps the government get its share of taxes as you get your payment. This tax deducted on your income is called TDS. TDS is linked with your PAN. You can locate all the TDS deducted from your income in one document called the Form 26AS. At the time of filing your tax returns, <a href="http://www.businessinsider.in/searchresult.cms?query=TDS&amp;sortorder=effectivedate">TDS</a> that appears in your Form 26AS is adjusted against your tax dues. If higher TDS is deducted, you are eligible for a refund. Or your return will show a tax due if TDS was short. You must pay any dues before submitting your return. 
 
Anything else I should keep in mind? 
1. Remember to verify your return after submitting it. After your return is submitted, an acknowledgement is received from the tax department. You should now verify your return. This can be done easily via <a href="http://www.businessinsider.in/searchresult.cms?query=netbanking&amp;sortorder=effectivedate">netbanking</a> through your bank account or via aadhaar OTP. Verification is a critical step to return filing. A return which is not verified is not considered filed. 
 
2. Remember to disclose stocks of your employer which are already vested, if they are listed on a stock exchange outside India. It is mandatory to include these foreign assets in your tax return. 
 
3. Make sure you mention your personal email id in your return and keep track of all communication received from the tax department. 
 
(This article has been authored by Mr <a href="http://www.businessinsider.in/searchresult.cms?query=Archit+Gupta&amp;sortorder=effectivedate">Archit Gupta</a>, Founder &amp; CEO <a href="http://www.businessinsider.in/searchresult.cms?query=ClearTax&amp;sortorder=effectivedate">ClearTax</a>.com) 
 
<a href="http://extras.mnginteractive.com/live/media/site568/2012/1228/20121228_100803_ipadclifftax_500.jpg">Image Source</a>

First time in a job? Get a kick start on
your tax filing

With <keyword id="35050" type="CITY" weightage="20" keywordseo="gdp">GDP</keyword> growth of 7.3%, in 2014-15, India’s economy is firmly on the path of economic revival. India is the brightest spot on the global map, with GDP Growth expected to rise to 7.9% in 2017-18. India is well positioned to withstand near-term global headwinds and the high volatility in global financial markets due to reduced external vulnerabilities, a strengthening domestic business and investment cycle, and a supportive policy environment. Most recently, even the IMF has maintained its GDP growth projection of 7.3% in 2015-16 and 7.5% in 2016-17, even as it cut projections for overall global output. 
	 The transition from a state of crisis of confidence in 2013 to a bright spot in 2015 is not by chance but by design. The past few months in particular, have seen even renewed energy from the Government to enforce key reforms, and revive industrial sentiment. Going forward, the upcoming Budget Session of <keyword id="6354721" type="ORGANIZATION" weightage="20" keywordseo="parliament">Parliament</keyword> will be very important in the current scheme of things, to create short &amp; medium term wins. 
	 
	Boosting Savings in India 
	 
	Most importantly, there is a need to boost savings in the economy to enhance the inherent economic strength of the financial sector. It will be worthwhile to adopt of the structural GEAR (Growth, Efficiency, Attractiveness, Reach) approach, as elaborated below, to augment the savings rate in the economy: 
	 
	Enhance economic growth to increase per capita incomes: Towards this end, it will be important to increase disposable incomes by relaxing personal income tax slabs to INR 5 lakh from the current level of INR 2.5 lakh – this could be a one-time correction and this could thereafter be linked to inflation and reviewed every three years. This will provide an immediate thrust to household incomes, part of which will be diverted to financial savings. 
	 
	Focus on efficiency in financial transactions: Use of plastic currency and e-transactions (via internet/mobile) will not only improve ease of transactions but also enhance saving propensity among citizens. Every 1% reduction in currency in circulation is likely to add 0.4% to the savings rate. More importantly, this could also help in curbing the flow of black money. 
	 
	Make financial savings attractive: Financial savings must be promoted by improving tax incentives. One of the enabling measures for this will be to enhance 80C limits to INR 3,00,000 from current level of INR 1,50,000 – this will also deepen the mutual fund and equity markets. Secondly there is a need to increase inflation adjusted post tax returns for bank deposits, by reducing lock in period eligible for tax rebate to 1 year from 5 years; and enhancing the threshold for mandatory TDS on interest income to INR 50,000 a year from the current level of INR 10,000. It will also be useful to roll back TDS on Recurring Deposits to encourage wider adoption, as this is a product that promotes the habit of regular saving. Further, pension products like EPF and PPF continue to enjoy ‘EEE’ tax status whereas the National Pension Scheme (NPS) are subject to ‘EET’, which involves tax obligation at the withdrawal stage. To create a level playing field and prevent cannibalization, NPS needs to get ‘EEE’ tax status to make it more attractive. 
	 
	Expand financial reach: The Government could consider converting India Post into Postal Bank of India, a full-fledged Payments and SAVINGS bank, to leverage its rural penetration for greater financial inclusion. Internationally, there are a few countries which have tapped the postal institution for extending financial inclusion. 
	 
	Next Generation of Reforms 
	 
	For 2016, I believe India’s top priorities should include passage of GST, rationalizing direct taxes further, tax sops for Start Ups and introducing key structural reforms in terms of real estate, labor and MSMEs. The farm sector too needs significant focus on irrigation and technological support. 
	 
	With the global economy expected to remain mired in volatility in 2016, strengthening the domestic economy will also help to ring-fence India against global headwinds. While micro measures will help, the Banking &amp; Finance sector also needs the next generation of reforms. I am hopeful that economic clairvoyance will triumph over political myopia in 2016 and GST will see the light of the day. The Bankruptcy Bill will also turn out to be a game changer for spurring economic activity and confidence. This Budget presents a Golden Chance to usher in Fiscal Measures to make 2016 India’s Year. 
	 
	The article has been authored by Rana Kapoor, managing director and CEO of YES Bank and chairman of YES Institute.

Here’s what one of the largest private bank, YES Bank has to say about Budget 2016

For <keyword id="159074" type="ORGANIZATION" weightage="100" keywordseo="RETIREMENT-PLANNING">retirement planning</keyword>, determining your <keyword id="775334" type="UNKNOWN" weightage="100" keywordseo="retirement-corpus">retirement corpus</keyword> amount is only half the work done. Any plan not backed by action can fall flat. So, you need to start investing for retirement once you have figured how much you need. 
 
Here’s how you should work towards accumulating your retirement corpus: 
 
1. Start investing early 
 
Take advantage of the power of compounding to amplify your investments. If you need to save Rs 5 crores for retirement in 35 years, then you need to invest Rs 13,060 per month for 35 years (at 10% p.a.). If you delay this by another 5 years, you will need to invest Rs 21,926 per month for 30 years. And with a further 10 year delay you will need to set aside Rs 37,370 per month. Thus, you can see the benefit of starting early; the monthly burden is lessened, when you have more time in hand. Don’t wait till your late thirties or early forties to start planning for your retirement. 
 
2. Do not play too safe 
 
Higher return is usually associated with higher investment risk. Our parents saved for their retirement by investing in safe products such as fixed deposits, EPF, PPF and traditional insurance plans which may not help you beat inflation when the returns are adjusted for tax. 
 
Using the same example, when returns are 8% p.a. you need to invest Rs 21,652 per month for 35 years, whereas you invest Rs 13,060 when returns are 10% p.a. If you settle an instrument that is safer but gives you 8% instead of 10%, you need to invest one and a half times the amount. 
 
3. Investment discipline is paramount 
 
It is easy to compromise on a financial goal that is still many years away. You might feel tempted to make a down-payment for a new car from your retirement corpus, because you’ve got time for retirement. In fact retirement savings are the first to get compromised in case of a short term cash flow crisis. 
 
It is essential to maintain investment discipline, set up SIPs and auto-debit instructions for investments in mutual funds, recurring deposits etc. 
 
4. Diversify your assets 
 
Although you need to invest in equity mutual funds, it does not mean you must invest exclusively in equity investments for retirement. Do not ignore other asset classes, having a 100% equity portfolio for retirement at the age of 58 is as or even more foolish than having a 100% debt portfolio, when you’re 25. 
 
An equity heavy portfolio near retirement, when the equity markets are in the bear period can lead to a lifetime of financial misery. Diversification across asset classes is important; start with an equity heavy portfolio and shift to debt instruments as you move closer to retirement. 
 
5. Review and rebalance your portfolio 
 
Review your portfolio regularly to see how your investments are doing and use this opportunity to eliminate underperformers. If your portfolio has underperformed, you may need to increase the investment amount. A bull or a bear run can skew the asset allocation, so you must review and rebalance your retirement portfolio at regular intervals. 
 
Based on your investment horizon and risk tolerance, you must keep 60% in equities and 40% in debt. If required, sell some equity investments to invest in debt products during a bull run and vice versa during a bear phase. 
 
6. Don’t have irrational expectations 
 
Don’t fool yourself! If you have 30 years to accumulate Rs 5 crores, you need to invest Rs 21,936 per month, at 10% p.a. and only Rs 2,140 per month at 20% p.a. But to expect 20% p.a. return for 35 years is a recipe for disaster. 
 
 
7. Purchase adequate insurance 
 
You do not just need comfortable retirement for yourself but for your spouse too. Purchase adequate life cover to ensure comfortable retirement for your spouse. You should also purchase adequate health cover to avoid a dent in your retirement savings due to prolonged hospitalization or illness. 
Additionally, also set up a medical emergency fund to cover medical expenses not covered under your health insurance plan. You can also maintain an emergency corpus of funds to tide over short term cash flow crisis. 
 
8. Let your children share some responsibility 
 
Parents would do anything to keep their kids happy. However, don’t go overboard. If you don’t want to depend on your children during retirement, let them share some responsibility. For instance, if you fall short of their higher education corpus or the amount required is more than you expected, ask them to take a loan to cover the shortfall. Don’t sacrifice your retirement savings! 
 
<a href="http://blogs-images.forbes.com/rbcwealthmanagement/files/2015/11/Retirement-Risks-1200x802.jpg">Image source</a>

8 Steps to plan your investments for retirement

10 best tax-saving investments

The relationship between income and affordability for various income groups follows a nonlinear trend. Owning a house means investing a substantial amount of money – probably the single largest investment made by any person aspiring to purchase a house. It is obvious that many people may not have the means to buy a house and may have to look out for possible <keyword id="6357455" type="EVENT" weightage="40" keywordseo="Funding">funding</keyword> resources. Availing loans from banks or other financial institutions in the form of home loans or mortgages is one of the ways to fullfil your dream if you have a regular source of income. 
 Earlier the gap between middle-class income and cost of houses was huge, which made buying a house near to impossible. But during the last decade, the gap between the income level and the housing cost has come down significantly and more people are now interested in acquiring properties. That’s why there is increasing demand for middle-income housing. Moreover, <keyword id="6371181" type="UNKNOWN" weightage="40" keywordseo="interest-rates">interest rates</keyword> have also come down significantly, compared to what they were a few years ago. 
 
1) Avoid incurring more debts that you can handle. Since a mortgage loan involves a huge sum and a longer repayment period, it is crucial to take your repayment obligation seriously. Always remember that your home – your most important property – is at stake. Avoid applying for other loans that can be an additional burden. Keep your credit card spending in check. Whenever possible, try to pay more for your mortgage. The sooner you can complete your payments, the better. 
 
2) Arrange a fixed <keyword id="37018" type="UNKNOWN" weightage="40" keywordseo="interest-rate">interest rate</keyword> on your <keyword id="6354730" type="UNKNOWN" weightage="40" keywordseo="Home-loan">home loan</keyword>. It is recommended to choose a home loan with a fixed interest rate. Although a fixed-rate loan may start out with a higher rate, compared to a variable-rate loan, you can be assured that your monthly payment won’t change, regardless of the increased prime rate in the market. 
 
3) Consider getting a debt consolidation loan. If you are managing two or more types of loans, consider consolidating your debts for easier repayment. Consolidating or ‘merging’ your debts into a single loan can significantly lower the interest rate you are paying. 
 
4) Consider refinancing your loan. If you are in <keyword id="1009187" type="UNKNOWN" weightage="40" keywordseo="the-middle">the middle</keyword> of repayment, consider refinancing your current mortgage to lower your rate. Refinancing a loan is recommended, especially if you notice a considerable improvement in your credit score. 
 
5) Make a lump sum payment. If your finances allow you to pay your mortgage completely, do so. This way, you can be secure about your investment. 
 
6) Put in a large payment on your loan whenever possible. Instead of paying just the minimum due, try to pay more of your mortgage to cut down your balance more quickly. 
 
7) Don’t go for a loan just because it offers a very low rate. Do not sign up for a home loan just because it is offering a low interest rate. Keep in mind that a variable-rate loan is bound to change at any time during your repayment term. Half-way through your loan term, you may find that you are stuck with balloon payments, which can make repayment very difficult. 
 
8) Obtain a loan that gives you more options and flexibility. Look for a mortgage lender that offers flexible repayment options. Make sure that modification of your loan’s term is possible just in case anything unexpected takes place (for example, <keyword id="6358907" type="ORGANIZATION" weightage="40" keywordseo="unemployment">unemployment</keyword> or sickness). 
 
9) Go for a long-term mortgage. A home loan with a fixed interest rate and a reasonable repayment period will be less of a burden than a short-term loan with variable interest. 
 
10) Save for down payment. Submitting a higher down payment can reduce your loan interest rate by 20-25%. Therefore, prepare your down payment prior to acquiring a mortgage loan. 
 
11) List of savings/investments. Make a list of all the loans and savings/investments that you have made. Do you find instances where the savings/investments are giving lesser returns than the loan rates? This can typically be seen in endowment <keyword id="35450" type="COMPANY" weightage="40" keywordseo="insurance">insurance</keyword> plan, EPF and PPF, postal deposit and even ULIP. Why should you <keyword id="47916" type="UNKNOWN" weightage="40" keywordseo="invest">invest</keyword> in something when you are paying higher interest to somebody else? It is better to close all or most of these lesser returns savings/investments and divert the funds to close the home loan. 
 
12) There are ways to come out of the EMIs and make your loan tenure shorter. These include: 
1. Partial pre-payment 
2. Switching to a lower rate 3. Increasing the <keyword id="6357050" type="COMPANY" weightage="40" keywordseo="EMI">EMI</keyword> 
 
Now let us look at these options in more detail. The best part is – these options do not, in any way, add to your existing budget. 
 
13) Partial pre-payment. This is the easiest way to close a housing loan faster. The method is to make use of any one-time income such as bonus, salary arrears, gifts from friends/relatives, any windfall from the <keyword id="6357040" type="UNKNOWN" weightage="40" keywordseo="Share-Market">share market</keyword>, money from a property sold, deposits closed, tax-saving <keyword id="6362476" type="ORGANIZATION" weightage="40" keywordseo="investments">investments</keyword> maturing, closure of <keyword id="25450" type="UNKNOWN" weightage="40" keywordseo="savings">savings</keyword> that are giving you lesser returns than the housing loan, etc., to partially close the housing loan. 
 
These one-time payments help reduce the principal balance in the loan. And when the EMIs continue, they have to cover less principal. 
 
So the same EMIs require less time to close the loan. The earlier and more frequently these partial pre-payments happen, the faster you can close the loans. 
 
The author Brijesh Parnami is the CEO, Distribution at Destimoney.

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