Archive for the ‘mothly income’ Category

Set Up New Financial Plans After A Divorce !!

Set Up A New Financial Plans After A Divorce

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You need to do long term financial planning when you are going through a divorce.

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Itโ€™s important that you recover from the split by assessing your situation as singles and setting up new financial plans with a focus on longevity.

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Here are five simple steps for building your financial future after a divorce:

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1. Start with a plan.

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Take a look at your finances before the divorce and then subtract what youโ€™ve lost to give you a good perspective on your fiscal situation.

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Be realistic with yourself and set a budget that you can easily manage with your new single status.

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2. Check your credit.

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Maintaining your credit is an important step in walking away from a divorce financially intact.

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Examine your credit reports and ensure that any name changes or card closures are accurate and taken care of.

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3. Ensure your retirement.

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Confirm that all of your retirement arrangements are intact and that any assets or funds you are entitled to have been taken care of.

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Division of savings and accounts should be paramount in your review.

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4. Obtain the necessary insurance.

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Examine your insurance policies and make sure that you and your property are still covered.

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5. Review your taxes.

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Understanding the tax ramifications of your divorce is a key part of planning for your financial future.

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Confirm that all tax responsibilities between you and your spouse are coordinated appropriately.

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RBIโ€™s Monetary Policy – Analyst View

Hello Friends, last month we witnessed loads of action with the RBIโ€™s monetary policy being laid down.

Just an extension of our previous blog โ€œRBIโ€™s Monetary Policy Stance โ€“ Part 3โ€.

 

 

Analyst View RBI policy

RBI Monetary Policies and Projections Part 4

 


In this Blog we would read the Analyst views with respect to the monetary point of view.

Analysis from the Analyst from monetary point of view:

Though there is a hike in SLR to 25 % but we think it will not have much more impact because the total investment book of commercial banks is already at 30.4% of total NDTL.

Although key rates of CRR, reverse repo and repo rates have been left unchanged, special repo facilities have been withdrawn.

Real estate loans provisioning are set to become more expensive.

NPA norms for banks have been tightened while liabilities of scheduled banks arising from transactions in CBLO with Clearing Corporation of India Ltd. (CCIL) will be subject to maintenance of CRR.

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The RBI is thus attempting to withdraw liquidity from areas where excess liquidity had reached a point it was more than comfortable with, while also targeting better quality management of credit.

Another point is that in the policy stance, RBI has given first priority to keep a vigil on trends in inflation and to be prepared to respond swiftly and effectively through policy adjustments to stabilize inflation expectations.

Second, it will monitor the liquidity situation closely and manage it actively to ensure that credit demands of productive sectors are adequately met while also securing price stability and financial stability.

Lastly, RBI will maintain a monetary and interest rate regime consistent with price stability and financial stability, and supportive of the growth process.

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In conclusion, it bears emphasis that the Reserve Bank is mindful of its fundamental commitment to price stability.

It will continue to monitor the price situation in its entirety and will take measures as warranted by the evolving macroeconomic conditions swiftly and effectively.

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To conclude all the factors it seems that with the withdrawal of special liquidity measures together with an imposition of CRR in borrowing in CBLO market, RBI has taken a first to step towards controlling liquidity.

 

With prioritizing inflation it is expected that the next step of RBI could hike in CRR as it has also reduced the indicative growth of Broad money to 17% from 18%.

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Investor’s Dilemma : Are ULIPs just another Mutual Fund??

ulips

At almost every investor mind a question is generally cropped up: โ€œWhat is the difference between a ULIP and a Mutual Fund?โ€

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The reason, perhaps for the wide extent of confusion, lies largely in the way ULIPs have been sold by agents. As just another mutual fund.

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Unit Linked Insurance Policies (ULIPs) as an investment avenue are closest to mutual funds in terms of their structure and functioning.

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As is the case with mutual funds, investors in ULIPs is allotted units by the insurance company and a net asset value (NAV) is declared for the same on a daily basis.

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Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few.

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Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component.

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Mutual Fund is a body corporate that pools the money from individual/corporate investors and invests the same on behalf of the investors /unit holders, in various investment avenues like equity shares, Government securities, Bonds, Call money markets etc., as per the pre-specified objective and distributes the profits earned from such investment.

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In India, Mutual Funds are registered with the Securities and Exchange Board of India (SEBI).


ULIPs vs Mutual Funds

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ULIPs are a mix of investment and insurance. ๐Ÿ™‚

But very long term investment, not even medium term.

Insurance companies themselves admit, that if your investment horizon is anything less than 7 years, donโ€™t even consider a ULIP.

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Charge structure in a ULIP is vastly different from a mutual fund.

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ULIP investors also have the flexibility to alter the premium amounts during the policyโ€™s tenure.

The freedom to modify premium payments at oneโ€™s convenience clearly gives ULIP investors an edge over their mutual fund counterparts.

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In mutual fund investments, expenses charged for various activities like fund management, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board of India.

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Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority.

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ULIPs also allow you to switch from debt to equity within the same scheme, at no extra charge.

So if you want to get the benefits of long term investment and risk cover in one single product, ULIP is the product for you.

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So it is not an issue, of whether a mutual fund is better or a ULIP. It is about your need.

Both can co-exist in your basket of needs. ๐Ÿ™‚

So identify your needs with a financial planner and then pick the product suitable for you.

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ULIPs are a mix of investment and insurance. But very long term investment, not even medium term.

Insurance companies themselves admit, that if your investment horizon is anything less than 7 years, donโ€™t even consider a ULIP.

Charge structure in a ULIP is vastly different from a mutual fund.

ULIP investors also have the flexibility to alter the premium amounts during the policyโ€™s tenure.

The freedom to modify premium payments at oneโ€™s convenience clearly gives ULIP investors an edge over their mutual fund counterparts.

In mutual fund investments, expenses charged for various activities like fund management, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board of India. Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority.

ULIPs also allow you to switch from debt to equity within the same scheme, at no extra charge. So if you want to get the benefits of long term investment and risk cover in one single product, ULIP is the product for you.

So it is not an issue, of whether a mutual fund is better or a ULIP. It is about your need.

Both can co-exist in your basket of needs.

So identify your needs with a financial planner and then pick the product suitable for you.

Indian Stocks Rise; Bharti, Telecom Companies Lead Advance

Bull & Bears

Indian stocks rose for the seventh day, driving the benchmark index to its highest monthly gain in more than a year. Telecom shares led gains after the government said it aims to auction high-speed mobile phone service permits.

Bharti Airtel Ltd., the largest mobile operator, jumped to a three-month high on news that so-called 3G licenses will be auctioned off at a starting price of 35 billion rupees ($716 million).

The Bombay Stock Exchangeโ€™s Sensitive Index, or Sensex, added 108.66, or 0.7 percent, to 15,889.73, according to preliminary closing prices. The gauge gained 4.3 percent this week. The S&P CNX Nifty Index on the National Stock Exchange advanced 0.8 percent to 4,723.85. The BSE 200 Index rose 0.7 percent to 1,945.33.

To set 25 pct public equity float is tough task for India

equity

India faces an uphill task to reimpose a rule requiring listed companies to have at least a 25 percent public float, with resistance seen from controlling shareholders in private sector firms.

The finance ministry’s effort to bring in a uniform public float minimum comes after a similar push by the capital markets regulator was waylaid by the collapse in markets last year.

Market players say reimposing a minimum float is a good idea but would work only if it were rolled out gradually in order to prevent flooding the market with shares.

A total of 174 firms would need to offload stakes worth roughly 1.61 trillion rupees ($33 billion) if the minimum float rule was imposed, a study by deal tracking firm SMC Capitals showed. Of that, 28 state-run firms, primarily in energy, steel and banks, account for 83 percent.

By comparison, Indian firms have raised $10 billion in share sales so far this year, surpassing the $7.2 billion raised in all of 2008, according to Thomson Reuters data.

PROPOSAL TO HELP PLUG SHORTFALL

India, facing its highest fiscal deficit in 16 years, can use the sale of stakes in government companies to meet the shortfall. A minimum float rule would mean the sale of larger stakes in state firms than might otherwise be considered.

The mandatory share of huge blocks of stock could also be a boon to investment banks managing the sales.

Finance Minister Pranab Mukherjee noted in his July 6 budget speech that the average public float in Indian firms was less than 15 percent.

“Deep, non-manipulable markets require larger and diversified public shareholdings. This requirement should be uniformly applied to the private sector as well as public sector companies,” he said.

Recent media reports have said the finance minister has approved a minimum public float plan in phases from 2010/11.

There will be pulls and pressures especially from some private sector firms but this time the authorities are banking on pulling it off given the government finances,” said Arun Kejriwal, director at research firm KRIS.

However, several market insiders were sceptical of the plan’s success, given the huge amount of stock the market would need to absorb, as well as the reluctance of controlling shareholders to trim their stakes.

“It is just impractical from an execution point of view. India just does not have the capacity,” said a top executive at a foreign investment bank. He did not want to be named given the sensitivity of the matter.

The Securities and Exchange Board of India tried implementing the 25 percent rule in phases from 2006 on firms with a market value of under 10 billion rupees ($204 million).

Consumer Confidence In India?? Excellent & On Upswing ;)

Indian COnsumers Most Confident

Despite below average monsoon, INDIA has emerged as the second most optimistic nation across the world in terms of consumer confidence level.

Majority of people have expressed their positive opinion about job prospects, personal finances and their willingness to spend in the next 12 months. ๐Ÿ™‚

A survey conducted by global consultancy firm Nielsen throws light in this regard.

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According to the survey, consumer confidence in India is on upswing, registering a 13-point rise to 112 index points in the second quarter, second only to Indonesia (113 points).

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โ€œThe recent elections in India have had a positive effect on Indiansโ€™ sentiments towards its economy.

With the UPA government back in power for the second-term, consumers are more confident that political and policy continuity will help recover the Indian economy,โ€™โ€™

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The consumer confidence in India witnessed an uptrend on three parametersโ€”

Job Prospects,

Personal Finances and

Willingness to Spend.

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In terms of job prospects, Over half of Indian consumers are optimistic that job prospects will either be excellent (13%) or good (55%) in the next 12 months.

India ranked second after Indonesia in this regard. ๐Ÿ™‚

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When it comes to spending habit, about 4% Indians think this is an excellent time to buy the things they want and need, and 39% think it is a good time to buy things.

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Regarding personal finances, Indians are the most optimistic globally as about 9% of Indians think their personal finances would be excellent in the next 12 months and 65% consider they would be good.

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“A stable economy has refurbished Indian outlook on the job market and their personal finances. Indians are relaxing their hold on money and are spending more than they were willing to spend in the last eight months,โ€™โ€™ an expert from Neilsen quoted.

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However, more or less consumer sentiments are positive all across the world, with the Global Consumer Confidence Index, rising to 82 points from 77 points in March.

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Despite below average monsoon, India has emerged as the second most optimistic nation across the world in terms consumer confidence level, with a majority of people having bullish opinion about job prospects, personal finances and their willingness to spend in the next 12 months, a survey conducted by global consultancy firm Nielsen, said on Tuesday.

According to the survey, consumer confidence in India is on upswing, registering a 13-point rise to 112 index points in the secondquarter, second only to Indonesia (113 points). โ€œThe recent elections in India have had a positive effect on Indiansโ€™ sentiments towards its economy. With the UPA government back in power for the second-term, consumers are more confident that political and policy continuity will help recover the Indian economy,โ€™โ€™ The Nielsen Company associate director (consumer research) Vatsala Pant said. The consumer confidence in India witnessed an uptrend on three parametersโ€”job prospects, personal finances and willingness to spend. In terms of job prospects, India ranked second after Indonesia. Over half of Indian consumers are optimistic that job prospects will either be excellent (13%) or good (55%) in the next 12 months.

Regarding personal finances, Indians are the most optimistic globally as about 9% of Indians think their personal finances would be excellent in the next 12 months and 65% consider they would be good.

โ€œA stable economy has refurbished Indian outlook on the job market and their personal finances. Indians are relaxing their hold on money and are spending more than they were willing to spend in the last eight months,โ€™โ€™ Pant said. When it comes to spending habit, about 4% Indians think this is an excellent time to buy the things they want and need, and 39% think it is a good time to buy things.

Globally consumer sentiments are positive, with the Global Consumer Confidence Index, rising to 82 points from 77 points in March.

FM Revised Direct Tax Collection Target, Increases Target by 8% !!

Direct Tax Collection

The Government on Tuesday revised its direct tax collection target for the current fiscal to Rs 4,00,000 crore, up by Rs 30,000 from the budget estimate.

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The upward revision has been made โ€˜โ€˜given the likely impact on government finances due to unanticipated drought,โ€™โ€™ finance minister Pranab Mukherjee said.

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Mukherjee exhorted top tax officials to make it possible given the โ€˜โ€˜extremely challengingโ€™โ€™ situation.

โ€˜โ€˜I know what I am asking you to achieve is an extremely challenging target given the current economic situation.

But it is equally true that if such a target has to be achieved, it can only be done by the direct tax,โ€™โ€™ the FM told a gathering of chief commissioners and directors-general of income tax in the Capital.

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As direct taxes have become a major source of central revenue, their role has, accordingly, increased in shaping the economic future of India, the FM said.

He also said the tax base in the country is still small and there is still substantial tax evasion or underpayment of taxes, he said.

The tax base needs to be further expanded, he added.

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Direct tax collections have grown at an average annual rate of 26.8 per cent in the last five years, and have more than trebled from Rs 1.05 lakh crore in the financial year 2003-04 to Rs 3.38 lakh crore in 2008-09, Mukherjee said.

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Direct taxes accounts for the bulk of tax revenues and slowed to 16.5 per cent in 2008-09 owing to the economic slowdown.

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FM Pranab Mukherjee will release the draft of the Direct Tax Code and a discussion paper on Wednesday to seek public opinion before finalising the relevant Bill for introduction in Parliament.

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The Direct Tax Code Bill, which is set to simplify the existing Act, will be uploaded on the finance ministry website alongwith a web-based interface for readers to send their suggestions. ๐Ÿ™‚

The Bill is likely to be introduced in the winter session.

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The government on Tuesday revised its direct tax collection target for the current fiscal to Rs 4,00,000 crore, up by Rs 30,000 from the budget estimate.

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The upward revision has been made โ€˜โ€˜given the likely impact on government finances due to unanticipated drought,โ€™โ€™ finance minister Pranab Mukherjee said.

Mukherjee exhorted top tax officials to make it possible given the โ€˜โ€˜extremely challengingโ€™โ€™ situation.

โ€˜โ€˜I know what I am asking you to achieve is an extremely challenging target given the current economic situation. But it is equally true that if such a target has to be achieved, it can only be done by the direct tax,โ€™โ€™ the FM told a gathering of chief commissioners and directors-general of income tax in the Capital.

However, As direct taxes have become a major source of central revenue, their role has, accordingly, increased in shaping the economic future of India, the FM said.

He also said the tax base in the country is still small and there is still substantial tax evasion or underpayment of taxes, he said. The tax base needs to be further expanded, he added.

Direct tax collections have grown at an average annual rate of 26.8 per cent in the last five years, and have more than trebled from Rs 1.05 lakh crore in the financial year 2003-04 to Rs 3.38 lakh crore in 2008-09, Mukherjee said.

Direct taxes accounts for the bulk of tax revenues and slowed to 16.5 per cent in 2008-09 owing to the economic slowdown.

FM Pranab Mukherjee will release the draft of the Direct Tax Code and a discussion paper on Wednesday to seek public opinion before finalising the relevant Bill for introduction in Parliament. The Bill is likely to be introduced in the winter session.