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Information provided on this newsletter has been independently obtained from sources believed to be reliable. However, such information may include inaccuracies, errors or omissions. lifelineexpert.com and its affiliates, information providers or content providers, shall have no liability to you or third parties for the accuracy, completeness, timeliness or correct sequencing of information available on this newsletter, or for any decision made or action taken by you in reliance upon such information, or for the delay or interruption of such information. lifelineexpert.com, its affiliates, information providers and content providers shall have no liability for investment decisions or other actions taken or made by you based on the information provided on this newsletter.
A child insurance plan provides the dual benefits of insurance and investment. Parents can buy such a plan when the child is as young as 14 days. The policy matures when the child attains adulthood. However, there are child insurance policies where in policyholders are allowed to make periodic or occasional withdrawals before maturity of the plan.

Buying child insurance means there is investment planning involved for large number of years, which is why it is a superb tool when planning for the future. Mentioned below are some long-term advantages of child insurance plans.

1.Funding Children's Education– Major chunk of the parents' savings goes into paying for their child's education. Studying in a decent school means shelling out a lot of money. Higher education in abroad or MBA from well known B-school would mean exhaustion of the limited savings. All of that could be afforded by buying a child investment plan as the sum obtained on the maturity of the plan would help lessen this financial burden to quite an extent.

2. Critical Illness/ Medical Emergency Aid– In case there is a family history of critical illness, it is advisable to purchase children insurance when he/she is young and fit. If due to a medical emergency, the child has to be hospitalized, a child plan would help by offering financial support. You are allowed to withdraw a lump sum from the about-to-mature policy to make sure that your child gets the necessary medical treatment.

3. Unexpected Demise of a Parent– Death is never anticipated, especially when one is young. In the event of the demise of a parent during the term of a child insurance policy, the insurance company provides a premium waiver. Thus, the beneficiary gets a lump sum amount and is no longer obligated to pay any premium on the policy.

4. Well Thought Of Investment– Prior to buying child insurance, Be sure of what you are planning for, whether higher education for your child, marriage, or even a mortgage on a house. While performing calculations, take inflation into account. Prices fluctuate largely in less than a decade. Once you have decided on an amount, buy a suitable child insurance policy. You will soon get into the habit of making regular premium payments and as a result you will be successfully earmarking money for your child's future.

5. Income Security for Your Child– This is an important benefit for children who are actors, singers and others who earn great incomes at a young age. Their money tends to heighten at a higher rate over a longer period when put in investment plans for children.

6. Could Be Used To Take Secured Loan– A child insurance plan is also largely accepted as security by banks and other lenders when processing education loans or other personal loans. 

Source:policybazaar.com

You are a responsible youth and hence, completely understand the significance of retirement and its consequences on one’s life. That’s why you have started saving diligently for your retirement because, obviously, you don’t want your sunset years to be boring and dull. In fact, you want them to be filled with love, laughter and lots & lots of travel! In short, you want to fulfil every dream of yours that you weren’t able to, due to your hectic work schedule.

However, if you are not clear enough on how and how much to save to lead a comfortable life after your retirement, it might lead to an inadequate or unrealistic plan that will not help you achieve your post retirement goals. You have to take several factors into consideration for a successful retirement plan. Rate of inflation is one such factor, as it will keep on messing with the value of your money every year, which means you will not be able to lead a lavish lifestyle to the extent that you always dream of.

We have enlisted few of the most important golden rules that will help you ensure that you can shape up your finances in a more fruitful way:

Set aside 10% of your salary for investments
This is one of the easiest, yet most rewarding steps towards successful retirement planning. It doesn’t matter how small the amount is, the compounding of even the smallest of contribution can make it a big lump sum in future. The sooner you start your investment, the better it will be for your savings.

Keep on increasing your investment as your income increase
Perhaps you are already saving diligently for your retirement, but have you ever considered the fact that you should also increase your investment every time your salary gets a hike? It’s quite a natural instinct for us to put things off and, especially if they demand sacrifice on our part to secure a good future. However, it’s very important to match your investments with the gradual increase in your income, as not doing so can really undermine the value of your retirement corpus.

Don't take out money from your retirement corpus before the right time
Most of us don’t hesitate to withdraw our PF amount every time we switch jobs. It might be due to any reason, be it need of some extra cash, medical emergencies, etc. However, dipping into your retirement fund before the right time can severely affect the compounding rate of your savings. You would have never guessed but a person with even a meagre salary of Rs 25,000 can easily accumulate an amount of Rs 1.65 crores in her / his PF account over the years (assuming that s/he starts savings at the age of 25 years and retires at the age of 60 years and gets a salary hike by 10% every year). Hence, you should never underestimate the power of compounding and try to avoid interrupting the flow of money in your retirement corpus - be it your PF account or your personal savings. You never know, how much of a gargantuan retirement corpus you can generate in the upcoming years.

Play safe and plan a systematic withdrawal to avoid unexpected costs
An increase in life expectancy and the ever-rising cost of living (not to mention, the inflation rate) hugely affect the savings of tomorrow’s retirees. It’s important to understand that even with a minimal inflation rate of 6%, the value your Rs 1 crore accumulated over the years will be reduced to Rs 29 lakhs. Besides this, Indians now have a much better life expectancy rate than before – owing to better medical conditions. Hence, it’s essential for the retirees to understand the importance of a lesser draw-down figure in the beginning of her / his retirement phase which can be increased with the passing years. It will ensure that the retiree won’t have to worry about outliving their savings and face any financial issues in the coming future. Save 20 times more than your current annual expenses. Last but not the least, make sure to create a retirement corpus accounting your current expenses and the amount you are going to need after 20 or 30 years (depending upon your current age). Although, there are a lot of expenses such as clothing and entertainment that are supposed to go down (depending upon the individual’s hobby and preferences), there would be certain expenses like medical & insurance, transportation, etc. that will go up. Try to add up all your expenses with the help of a retirement calculator and then multiply the result by 240, to get an idea of the approximate amount that you need to save for your retirement corpus. This way, you will be able to tackle any unforeseen expenses in future.

Source:policybazaar.com

If you have recently joined the working class of the country and have no clue about how the whole taxing system works, there are a few things that you must know. If you are getting paid above Rs.2,50,000 per annum, you will be taxed on your income. And like every newbie, it will take you time to completely understand where you have to invest to claim for deductions and save on tax. Read on to know the last minute tax saving instruments that you can invest in. The following instruments can be used by those who are lazy to plan their investment through the year as well.

80C Investments
80C investments are the most common deductions. The maximum limit under this deduction is Rs.1,50,000 per annum. The instruments that let you avail 80C deductions are as follows:

PPF:
It is a fixed income security plan offered by the government. You get 8.8% interest on the savings. The lock in period is 15 years and the maximum amount that can be invested is Rs.1,50,000.

Life Insurance Premiums:
If you are paying premium for yourself and your dependents, you will get deduction under Section 80C for the premium paid.

NSC:
This scheme is designed especially for the IT Assessees. There is no maximum limit for the investment. The tax is also not deducted at source. NSC can also be kept as a collateral to get loans from banks. The rate of interest offered is 8.50%.

5 Year Tax Savings FD:
The lock period for this FD is 5 years and you cannot make any premature withdrawals. The rate of interest varies from bank to bank.

ELSS:
ELSS offers market linked returns. The lock in period is 3 years and the dividends earned are tax free.

Pension Plans:
The premiums paid for pension plans are eligible for deductions under Section 80CCC. The maximum limit for deduction under Section 80C and 80CCC is Rs.1,50,000.

Senior citizen Savings Scheme:
The current rate of interest for SCSS is 9.20% per annum. The interest is paid quarterly. But the interest is chargeable by tax.

Home Loan Repayment:
If you have taken a home loan and are paying EMIs, the EMI amount qualifies for deduction under this section.

Tuition Fees Paid:
Tuition fees that are being paid for your children is also eligible for deduction under this section.

80D Investments- Medical Insurance policy
Up to Rs.15,000 deduction is available for the medical insurance taken. If your spouse or you are over 60 years, then the deduction available is Rs.20,000. Additional deductions of Rs.15,000 is available if you are paying the medical insurance for your parents if they are below 60 years of age. If your parents are above 60 years, then you can get deduction up to Rs.20,000. The maximum deduction available under this section is Rs.40,000.

80DDB Investment – Medical treatment of certain illness
Deduction up to Rs.40,000 is available if the assessee is getting treated for a specified disease. The deduction is available if the dependant of the assessee is getting treatment for specified diseases. Senior citizen can claim up to Rs.60,000 and it is Rs.80,000 for very senior citizens.

80E Deductions– Interest paid on Education loan
If you are paying interest on higher education loan taken for yourself, spouse and children or for a child that you are a legal guardian, then you can claim deduction under this section.

80EE Deductions – Interest paid for home loan
If you are a first time home owner and the value of the first house is Rs.40 lakh and the loan taken is less than Rs.25 lakh, then you can get deduction of up to Rs.1 lakh under this section.

80TTA Investment – Savings account
Interest earned on savings account of up to Rs.10,000 is deductible under this section.

80G Investment – Donations made to charitable institutions
Various donation made towards social causes are eligible for deduction. The deduction can be either 100% or 50%. If the donations are above Rs.10,000 in cash, the deduction will not be applicable.

80GG Deduction – House rent paid
The deduction available for a house rent paid is the least of rent minus 10% the total income, house rent allowance offered or 25% of the total income.

80DD Deduction – Rehabilitation of handicapped dependent relative
If you are taking care of a handicapped relative, you can get Rs.75,000 deduction if the disability is 40% or more but less than 80%. If the disability is more than 80%, you get a fixed deduction of Rs.1,25,000.

80U Deduction – Person suffering from physical disability
If you are suffering from physical disability, then you get a deduction of Rs.75,000. If the disability is severe, you get a deduction of Rs.1,25,000.

80GGB Deductions – Contributions given by companies to political parties.
If an Indian company contributes to a political party or an electoral trust, deductions are allowed under this section.

80GGC Deductions – Contributions made by an individual to a political party
If an assessee contributes to a political party or an electoral trust, deductions are allowed under this section.

80RRB Deductions – Deduction for income by way of Royalty of a Patent
If the assessee is receiving royalty for a patent that he or she has registered, deduction available is up to Rs.3 lakh or the income received. The assessee must be an individual resident who is the patentee.

Source: bankbazaar.com
The basic objective of a life insurance plan is to provide a replacement of your income in your absence.

You may think that life insurance is not important for you and that your savings and investments alone will take care of your family's future requirements. But just consider this: if you fill up Eden Gardens stadium with 60,000 people, around 420 of them will die in this year alone. Of this, some 130 people would be in the age group of 15-60 years. Now, what will happen if you are one of those unlucky ones? Who would take care of your aged parents or your spouse and children in your absence?

This is where life insurance comes in. The basic objective of a life insurance plan is to provide a replacement of your income in your absence. Life insurance plans are perhaps one of the most important financial products you must buy. Add to it, they are simple and cheap.

Now that you understand the importance of a life cover, the question arises: How much life cover should you buy? Generally, your life cover should be large enough to act as a substitute of your monthly income. So, suppose you are earning Rs 50,000 per month, your life insurance plan should provide anything that covers Rs 50,000 per month plus a little extra to take care of the inflation.

A good thumb rule on life insurance cover is that it should be at least 15 times of your annual income. So, if your monthly income is Rs 50,000 per month or Rs 6 lakh per annum, your life cover should be bare minimum Rs 90 lakh. You should also include your existing debt obligations, such as your car loan or home loan in your life cover. Also include your child's educational or wedding expenses while calculating your life cover.

In the event of your death, the payout can either be a lump sum amount or a staggered payout option, which will be a combination of lump sum and monthly payout. Staggered payout option is particularly suitable for people whose survivors lack financial awareness. They would not have to worry about how to invest the death benefit. Nowadays, most life insurance companies offer the staggered payout option.

Now, there is another segment of customers who prefer to get returns from their insurance policy. To cater to such customers, life insurers have come up with term return of premium (TROP) plans. Unlike the standard term policies, in TROP, insurers will pay you back the premiums if you survive the term.

You can also consider Unit-Linked Insurance Plan (ULIP) schemes if you want your insurance policy to take care of your investments too. Depending on your risk appetite, you may opt for ULIPs investing in equity and/or debt instruments. Equity ULIPs would allow you to beat inflation, something that debt ULIPs or bank deposits often fail to do. Do you know an item worth Rs 1,000 in November 1995 would have cost Rs 3,854 in September 2015?

The decrease in the purchasing power of rupee is due to inflation. Contrary to this, Rs 1,000 invested in NSE Nifty on 3 November 1995 would have amounted to Rs 7,949 on 30 September 2015. Note how equities beat inflation by a huge margin over the long term.

Now, what if you develop some critical health issue, such as cancer or paralysis? To take care of treatment costs and possible loss of income arising due to the illness, many life insurance plans also come with riders for critical illnesses.

If you are diagnosed with a critical illness listed in the rider, then the insurer will pay you a lump sum amount, irrespective of whether you opt for treatment. You can add additional coverage to your life insurance policy by opting for such riders as waiver of premium, accidental disability and accidental death.

However, all your premiums, riders and financial planning will come to naught if you are dishonest with your insurer. Always be frank with your insurer regarding your health and lifestyle issues. While withholding important facts such as smoking or tobacco consumption or any present physical ailment may reduce your premium outgo at present, it may also leave your family without any protection when they will need it most.

By Yashish Dahiya, Co-Founder and CEO,

Source: Policybazaar.com
Please do not reply back to this mail. This is sent from an unattended mail box. Please mark all your queries / responses to webmaster@sanjaysinghal.co.in.
Information provided on this newsletter has been independently obtained from sources believed to be reliable. However, such information may include inaccuracies, errors or omissions. lifelineexpert.com and its affiliates, information providers or content providers, shall have no liability to you or third parties for the accuracy, completeness, timeliness or correct sequencing of information available on this newsletter, or for any decision made or action taken by you in reliance upon such information, or for the delay or interruption of such information. lifelineexpert.com, its affiliates, information providers and content providers shall have no liability for investment decisions or other actions taken or made by you based on the information provided on this newsletter.