MUTUAL FUND INVESTMENTS

IN THIS POST WE SHALL TALK ABOUT INVESTMENTS IN MUTUAL FUNS,WHICH ARE VERY POPULAR WITH INVESTORS because MUTUAL FUND INVESTMENTS ELIMINATE THE RISK OF DIRECT SHARE MARKET INVESTMENTS BY INDIVIDUAL INVESTORS AND THE INVESTMENT DECISIONS ARE MANAGED BY EXPERTS ON BEHALF OF THE INVESTORS.MOREOVER POOLING OF RESOURCES OF MANY SMALL INVESTORS IS POSSIBLE IN MUTUAL FUNDS ONLY. THE MUTUAL FUND MANAGERS INVEST THESE COLLECTIVE RESOURCES IN EQUITIES.DEBT FUNDS,SECURITIES/SECTOR FUNDS AND GENERATE RETURNS FOR THE INVESTORS THROUGH BETTER MANAGEMENT .
THE NAV OR NETASSET VALUE OF OPEN FUNDS ARE DECLARED ALMOST DAILY AND ARE TRADED LIKE SHARES OR CAN ALSO BE REDEEMED AT THE PREVAILING NAV.
IN CASE OF CLOSED ENDED FUNDS ,THERE IS A LOCK IN PERIOD RANGING FROM 3 TO 10 YEARS .ONLY THEN THESE UNITS IN CLOSED ENDED MUTUAL. FUNDS ARE TRADED OR REDEEMED .
SIP OR SYSTEMATIC INVESTMENT PLAN IS A BETTER ALTERNATIVE WHILE INVESTING IN MUTUAL FUNDS AS THIS RESULTS IN RUPEE COST AVERAGING AND IT DOES NOT MATTER VEERY MUCH WHETHER THE MARKET IS IN UPTREND OR DOWN TREND.
BASICALLY MUTUAL FUNDS INVEST IN EQUITIES OR DEBT SECURITIES OR SECTORS LIKE POWER SECTOR OR BANKING SECTOR ETC....
ONE HAS A CHOICE OF INVESTING IN ANY TYPE OUT OF THE ABOVE 3 CATEGORIES,OR PARTLY IN EQUITY AND PARTLY IN DEBT SECURITIES CALLED BALANCED FUNDS .A SWITCH OVER AMONG THESE TYPES OF FUNDS IS ALSO ALLOWED SUBJECT TO APPLICABLE RULES.
IN INDIA,RELIANCE MUTUAL FUND HAS STARTED SIP AMOUNT AS LOW AS RS 100 P.M.
MUTUAL FUNDS OFFER LIQUIDITY, FAIR RETURNS ON INVESTMENTS AND ALSO SECURITY COMPARED TO DIRECT STOCK MARKET INVESTMENTS BY INVESTORS.

RBI BONDS AS AN INCOME OPTION

EARLIER WE HAVE SEEN POST OFFICE AND BANKS SAVINGS SCHEMES.
NOW LET US SEE RBI BONDS AS AN INCOME OPTION. THESE BONDS OFFER 8%INTEREST P.A(TAXABLE)PAYABLE HALF YEARLY IN FEB AND AUGUST EVERY YEAR.THISINTEREST IS TAXABLE. SO ONE HAS TO SUBMIT FORM 15 G OR 15H(IN CASE OF SENIOR CITI ZEN) TO AVOID TAX DEDUCTION AT SOURCE.THERE IS NO UPPER LIMIT ON INVESTMENT.SO HUGE AMOUNTS CAN BE INVESTED.
IN THE NEXT POSTINGS WE SHALL SEE ABOUT MUTUAL FUNDS,SHARES AND REAL ESTATE AS INVESTMENT AVENUES.

RALLABANDI VENKATA RAO

various saving schemes

as of now in india, we have several savings schemes like nsc,kvp,post office monthly interest scheme,senior citizen savings scheme.,post office time deposits,.post office savings bank account, post office recurring deposits. All these schemes offer annual interest varying between 3.5% to 9% p.a.all interest income from above schemes is taxable.
FOR the above schemes there is no TDS except in senior citizen savings schemes for which one may submit form 15H TO AVOID TDS.
banks now a days offer better rate of interest thanks to rising inflation and RBI steps to reduce inflation.For bank deposits tds is applicable if interest per annum exceeds Rs 10000/.ONE MAY SUBMIT FORM 15G/FORM 15 H to avoid tds by banks.
some companies also accept fixed deposits and pay interestranging between 6 to 10.5%p.adepending on period of deposit and frequency of interest payment like monthly,qrtrly,halfyearly/annually.
better opt for TRIPLE-AAARATING COMPANY DEPOSITS.remember to submit form 15G/15H to avoid tds

save money with a few help tips

ONE OUGHT TO KEEP FIT AT ANY AGE.OTHERWISE ILLHEALTH LEADS TO LOSS OF PEACE OF MIND AND ALSO LOSS OF MONEY.
I MAKE IT A POINT TO DO TREAD MILL FOR ATLEAST 20 TO 30 MINUTES A DAY,FOLLOWED BY STRECHING OF BODY AND MUSCLES AND BONES IN DIFFERENT DIRECTIONS.
I NEVER EVER TAKE TO LIFT.MUST GO BY STEPS ALWAYS UNLESS YOU NEED TO REACH MORE THAN THE 6TH OR 7 T FLOOR.
WALKING IS THE SIMPLEST EXERCISE AT ANY TIME AT ANY AGE.DEEP BREATHING EXERCISES ALSO HELP IN GOOD HEALTH.
ONE CANNOT BE MENTALLY ACTIVE OR ALERT UNLESS ONE IS PHYSICALLY FIT.

tips to avoid income tax

whenever one makes a fixed deposit in bank or elsewhere , pl.remember to submit form 15G if you ARE NOT A SENIOR CITIZEN.
If you are a senoior citizen,remember to sumbmit form 15H.
THESE FORMS need to be submitted in duplicate once at the time of making a deposit and again in every year April to be on safe side.
on submission of these forms income tax will not be deducted from the interest income.otherwise one stands to lose interest income through income tax.
in case income tax is deducted by banks /others from the interest income for whatever reason ,one has to file income tax return and claim the refund by submitting the TDS certificate provided by the deductor of income tax.

make savings regular habit

in cricket consistency of making runs in each innings is more important than making a ton or none .This applies to all of us in the sense we must make it a habit to save regularly out of the income streams by which we regularly get money like salary/business income /windfall income/pocket money received by students etc...Never ever think that we shall save on getting a hefty money packet

save big money if any received to create financial/economic security

occasions do come in life when a man or woman receives a certain amount of unexpected big money like arrears of salary,promotion hikes,recovery of past debts etc...On such occasions it makes sense to create financial/ecocomic security by keeping such money in fixed deposits or post office monthly income or open a recurring deposit in bank or post office etc.The bank deposits if made can be made either for monthly interest or for interst on maturity