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Old 11th October 2012, 11:27   #316
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Default Re: Income Tax savings, Investments and Insurance

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Originally Posted by mobike008 View Post
Oh, shucks! So to see good results you say 10 years is minimum in mutual funds?
Normally, five should be Ok, but these are extraordinary times. You can reduce the risk (and also gains) by choosing a balanced fund like the HDFC Prudence.

Last edited by sgiitk : 11th October 2012 at 11:29.
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Old 11th October 2012, 15:34   #317
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Thanks for the wonderful insights.

Any advice where to invest a chunk of cash? I am not comfortable with mutual funds at all.

Cash isnt that big that I can buy an apartment so what's the next best?
So you don't want to invest in PPF, Insurance or MF's and don't have enough to invest in property.

May I suggest managing your funds directly?

What I mean is perhaps you might have the risk appetite to invest in Equity directly. And I say this, because you have also explored the idea of buying gold at 30k+ levels.

Way this works:

You want to invest 1lac per annum over the next 5 years, and wish to redeem it after 10 years, yet would like to have the option to exit early in case of an emergency.

So, you might want to identify some sectors which you feel are going to do well and within those sectors some companies that are leaders.

For instance in banking, you might want to look at HDFC bank, SBI, Yes Bank
In Telecom: Idea Cellular, Tata Teleservices
In Pharmaceuticals: Lupin, Dr.Reddy's etc.

Based on your expertise (or lack thereof) in stock markets, focus only on Largecaps and market leaders, stay away from smallcaps.

Also the fact that you're investing 1lac per annum over a 5 year period, allows you to average out your investments similar to a SIP, thereby reducing volatility.

The only risk is market risk, but again that risk is reduced since you have a 10 year time horizon.

Hope this helps.
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Old 12th October 2012, 12:00   #318
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Default Re: Income Tax savings, Investments and Insurance

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Originally Posted by Vasuki View Post
The best way to invest into gold is buying it in NSE spot exchange. Once you have a demat account linked to a commodity trading account, you can buy the gold i.e; e-gold with minimum unit as 1gm. You get the 99.9% pure gold, with lowest additional charges(brokerage) at current SPOT rate. When need arises you can sell the gold then and there or can convert the same into physical quantity to take delivery.

NSE spot exchange link : National Spot Exchange Limited
This is very good information. But are you sure, we can convert to physical gold. I could not find that written anywhere on NSEL website.

Edit: Found information about this. There are some charges. I can't find the charges related information anywhere.

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The normal demat account we have for trading in shares can't be used for spot trading. For that a new one, NSE (spot exchange) demat account has to be opened. This may or may not be with the same service provider.
Unfortunately, I did not realize this when I opened up equity account with FundsIndia.com. They do NOT support commodity trading, neither do they have any plans to introduce this in the future.

Sharekhan is more complete in that sense (but more expensive as well).

There are two brokers in Pune who are listed in the NSEL website.
However, I am not sure how safe it is to invest through them.

What are the risks in this platform?

Last edited by S_U_N : 12th October 2012 at 12:15.
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Old 12th October 2012, 15:32   #319
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Default Re: Income Tax savings, Investments and Insurance

Thank all, I have decided to either

fixed deposit entire amount in a bank at 10.25% per annum with minimum lock-in period of 365 days and this can be automatically continue if i dont wish to withdraw

OR

Buy a 250 Sq.yard plot just outside city limits in a beautiful army locality which is roughly just 17kms from my home which i can probably use to construct a house in future.
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Old 12th October 2012, 15:46   #320
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Thank all, I have decided to either

fixed deposit entire amount in a bank at 10.25% per annum with minimum lock-in period of 365 days and this can be automatically continue if i dont wish to withdraw
Hmm, Its probably not the most efficent way from a Tax perspective. May I suggest that you either deposit atleast half your money in a PPF/VPF account so that the returns are higher, or consider a debt mutual fund. They are giving returns in the range of 8-10% post tax.

A 10.25% Bank FD is about 7.25% (actually a lil lower) post tax, if you are in the highest tax slab.

Just in case you're focussed only on FD's, then consider Yes Bank, which has a FD for senior citizens at 10.6% for 15-16 months.

Either way, so good to see someone saving the money, rather than blowing it on a new car or some new gadgets. Envy you. All the best!!!
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Old 12th October 2012, 16:28   #321
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Originally Posted by Lalvaz View Post
A 10.25% Bank FD is about 7.25% (actually a lil lower) post tax, if you are in the highest tax slab.
He is investing it in the name of a senior citizen who is having probably no source of income.
So, ideally, he would not be paying any tax at all.
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Old 12th October 2012, 16:29   #322
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Default Re: Income Tax savings, Investments and Insurance

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Either way, so good to see someone saving the money, rather than blowing it on a new car or some new gadgets. Envy you. All the best!!!
Thanks. I guess will stick to my mom's regular bank and wont switch over for 0.35% more interest.

Yeah, even i am glad to have accidentally hit the "Sanity Wall" after splurging on buying 6 brand new cars and 2 bikes in last 11 years

@SUN, your right. My mom is a retired State Government Employee

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Old 12th October 2012, 16:51   #323
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Buy a 250 Sq.yard plot just outside city limits in a beautiful army locality which is roughly just 17kms from my home which i can probably use to construct a house in future.
I would suggest this option as land is becoming a precious commodities in cities like H'bad.

Also this piece of land can be used by Hydi BHPians for T-BHP meets till the time the house is not constructed (and may be after constructed also)
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Old 12th October 2012, 17:28   #324
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Default Re: Income Tax savings, Investments and Insurance

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I would suggest this option as land is becoming a precious commodities in cities like H'bad.
You bet. Actually, the plot that I identified his connected to the bunglow of my cousin and is nearer than my current driving distance to my office.


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Also this piece of land can be used by Hydi BHPians for T-BHP meets till the time the house is not constructed (and may be after constructed also)
So your aware about the hydeez penchant for meets and good food

Actually, we already had many dinner meets at a BHPians home just little distance from that plot and I spent many weekends at my cousins place and its a peaceful green heaven that grew phenomenally over the last 3-4 years

P.S: Sorry for going OT. Let's return to the discussion of the thread.Thank you all again
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Old 14th October 2012, 06:54   #325
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Default Re: Income Tax savings, Investments and Insurance

Any thoughts on investing in Fixed Deposits of Manufacturing Companies/Infrastructure companies. at the moment. How is the industry doing as a whole ?
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Old 15th October 2012, 00:01   #326
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Default Re: Income Tax savings, Investments and Insurance

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Any thoughts on investing in Fixed Deposits of Manufacturing Companies/Infrastructure companies. at the moment. How is the industry doing as a whole ?
Alter.e.go
Hi.
Todays blue chips could turn dud over the years.Can give you umpteen names which went under like Calico mills,Tata Svadeshi,Nirlon etc.
Dont know who to trust after 3 or more years.Personally I stick to bank FD.Last month invested in debt funds.
The rest is up to you.
Regards
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Old 15th October 2012, 08:57   #327
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Any thoughts on investing in Fixed Deposits of Manufacturing Companies/Infrastructure companies. at the moment. How is the industry doing as a whole ?
You can think of investing in company FD's provided that the investment scheme of the company has been rated AAA and above by a reputed rating agency like CRISIL etc. Only care which needs tio be taken is go for Cumulative option and for a smaller period say 1 to 3 years max. Pls do read the Premature withdrawals rules too.
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Old 15th October 2012, 09:10   #328
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Default Re: Income Tax savings, Investments and Insurance

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Only care which needs tio be taken is go for Cumulative option and for a smaller period say 1 to 3 years max.
Why only 'cumulative option'?
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Old 15th October 2012, 09:15   #329
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Why only 'cumulative option'?
In comparison to the Regular income option, the Cumulative option allows you to reinvest the interest earned again at the same coupon rate giving better returns and a lumpsum amount upon maturity.

Check this link.
http://www.moneycontrol.com/glossary...heme_3960.html
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Old 15th October 2012, 09:46   #330
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Default Re: Income Tax savings, Investments and Insurance

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In comparison to the Regular income option, the Cumulative option allows you to reinvest the interest earned again at the same coupon rate giving better returns and a lumpsum amount upon maturity.
This reason I know - I thought you had some reason specific to Manufacturing Companies FD.
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