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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. samirkotak.in 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. samirkotak.in, 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.
What are Child Plans?
Child Plans are insurance plans that help parents save for their child’s future expenses. A Child Plan also offers Life Insurance cover on the parent’s life and ensures the financial security of the child in case of the parent’s demise.

How does a Child Plan work?
In a Child Plan, the parent is the insured person and the child is the beneficiary.

The idea behind a Child Plan
The idea behind a Child Plan is to protect the child’s future in case something were to happen to the parent. A Child Plan also helps the parents save for their child’s higher education and future expenses. Begin early and enjoy the benefits of compounding.

Is it an insurance plan or an investment plan?  
A Child Plan comes with a life cover and a Sum Assured amount is payable at maturity.

ULIP Child Plans
If you are looking for higher returns in order to take care of the rapidly mounting costs of higher education, you should think of opting for ULIP Child Plans.

In a ULIP Child Plan, the parent gets a life cover and the premiums are invested in funds that the parent chooses.

Plans that have no upfront premium distribution charges are also popular. Here, the total premium is invested in chosen funds and the scope for long-term returns is maximum.

More Flexibility
With child plans, you get added flexibility because you can withdraw funds through partial withdrawals. This allows the parent to access saved funds to cater to the child’s educational needs.

Death Benefit
In case of the parent’s demise before the maturity of the policy, a Child Plan offers a guaranteed lump sum amount that is paid to the child, with a fixed annual income for the remaining duration of the policy.

Additional Reading: Child Insurance Plans

Flexible Tenure and Tax Benefits
The parent can choose the tenure of the Child Plans and enjoy tax benefit up to a specific amount.

Waiver of premium option  
You can opt for a waiver of premium add-on which means that if the parent is no longer around, any future premium would be paid by the insurance company. Your Child Plan would be unaffected and a lump sum will be paid to your child on the maturity of the policy. Life is uncertain. Don’t wait any longer. Secure your child’s future today.

Source:blog.bankbazaar.com

A husband and wife are supposed to share everything. Why not a life insurance policy?

Especially if sharing can lead to lower costs and better benefits, it becomes even more necessary to take such wise decisions. To help a couple save some costs without hurting their risk coverage, few life insurance companies have launched joint life term plans.

To be eligible for these plans, both the partners have to undergo medical tests and give proof of their income along with all the necessary documents required to buy a term plan in India. Catering to individual needs and requirements, the insurers have come up with various plans and products with different features. To make it easier for you to understand, the following are the two main kinds of plans:

1) In the first scenario, if either of the insured passes away during the term of the policy, the sum assured will be paid to the survivor spouse and the policy will lapse. These are also called Single Payout Policies and usually, attract extremely low premiums.

2) In the second scenario, the insurance company will pay the death benefits to the surviving spouse, and the policy will remain active. The surviving spouse will be able to continue with the policy for the same sum assured or reduced cover and premium depending on the type of plan they have bought.

These were the basic types of plans. Now let’s see how different features make various plans work in a variety of ways:

1) In case the couple bought a joint life term plan in India for an amount of Rs. 1 crore, at the death of husband, the wife will be paid out the sum assured as a death benefit. After that, the policy will cease. However, in some other policies, the insurer may waive off, the future premiums while reducing the sum assured on the wife to 50% of the total value. In some cases, the insurer might pay 50% of the sum assured to the surviving spouse and pay the rest of the amount as monthly income over a period of time. Therefore, go through the various terms and conditions of different policies to buy the best term insurance plan.
2) In the unfortunate event of both husband and wife die at the same time in an accident or some other causes, the entire sum assured will be paid to the children, who automatically become nominees in this case. The policy will cease to exist after this.
3) Finally, if both husband and wife survive the term of the plan, they will not get any maturity benefits and the policy will be terminated. The life insurance companies will not be liable to pay them any money.
Based on the above-mentioned information, the benefits of buying a joint life term policy are:

1) You can save on premium. Compared to individual term plans, a joint plan is more economical.
2) Managing the policy and keeping a track record is easier compared to various separate individual policies.
3) A few policies do consider the average age of the policyholder at the time of calculating premium that can work in your favor. However, for the final terms, refer to the policy documents.

4) There are certain below mentioned disadvantages as well:
5) If both the spouses pass away together, the nominee (kids) will receive the sum assured on the policy, but if both had separate individual plans, that might have resulted in double the payout regarding sum assured.
6) When there is a single payout policy, the survivor’s policy cover lapses and buying a new policy might prove to be costly and cumbersome.
7) In the case of a divorce, it is not possible to delete one of the insured and carry on with the plan. The only option is to continue with the policy or discontinue it totally letting go of all the premium paid earlier. It is in your best interest to study the terms and conditions of various plans in great detail before finalizing your decision. The best term insurance plan will be the one that provides the couple adequate cover even after the death of one of the spouses and that too at a minimal cost. Make your decision wisely!

Source:www.suggestinsurance.com/blogs

Life is uncertain and no matter how steady you feel you are, a financial crisis can leave a big impact on your personal finances and throw your future plans off gear. While this is not to say that you should have a pessimistic outlook towards life, being prepared for a financial crisis can indeed help in more ways than one. In fact, if you have your feet planted firmly on the ground, as far as your finances are concerned you can weather any storm! Here are some tips that you can use to plan for a financial crisis.

Begin with a budget
The first step towards getting a hold over your finances is making a budget. If you do not have a budget to live by chances are you are overspending and have even taken on excessive debt. For instance, you may have taken a personal loan to purchase one or more gadgets, just because you were taken in by attractive personal interest rates. While a budget cannot things magically, it is a useful tool to determine where you stand financially. It will also be an indicator of where your funds are being directed.

While you have to fulfill existing debt obligations including your personal loan like the one mentioned above, there are indeed other places where you can cut corners. For instance, if you have a subscription for a magazine that your hardly read or going out with friends almost every weekend, you know for certain that these are surplus expenses that you can do without. Making these small changes in your daily financial habits can make a big difference to your finances and even ensure that you do not find a place in the loan defaulter list of a bank.

Create an emergency fund
Once you have a hold over your finances with a budget, it is time to create a contingency fund to last you at least 6 months to a year in case of any financial crisis. These funds should be enough to help you meet all your regular expenses for the above mentioned time frame. Instead of leaving these funds idle in a savings account, you can consider investing in a liquid fund that provides a higher rate of interest and also provides you the required liquidity to withdraw funds in the face of a crisis. The greatest advantage of creating and replenishing your emergency fund periodically is that you will not have to worry about fulfilling your debt obligations even in the face of crisis and live in fear of ending up on the loan defaulter list.

Maintain a good credit score
Your credit score is a barometer of your financial health. If you have a good credit score, you not only feel in better control of your finances, you also enhance your chances of obtaining a line of credit when you are in most need of it. There are instances in life, where despite your best attempts to remain prepared you are faced with a sudden financial crunch. At times such as these, a quick loan at attractive personal loan interest rates will come handy if you maintain a good credit profile. You can maintain a good credit score, by simply making it a point to make timely repayments on your existing lines of credit and maintaining a good balance between secured and unsecured credit. Too many unsecured lines of credit such as personal loans and credit cards may be detrimental to your credit health.

Look for an extra stream of income

Lastly, but not the least, if you have a talent or a knack that you know you are not making the most of, use it to earn an extra income. For instance, you can take up work are a freelance graphic designer or website developer if you are really good at it for making that extra bit of income that you can use to beef up your emergency fund. With the explosion of social networks and the expanding need for digital content for professionals procuring these extra jobs is a tad easier in this day and age.

Source: www.creditsudhaarfinance.com/articles
Direct tax collections are one of the easiest and safest ways of collecting revenues by the Government. In spite of our greatest reluctance, all of us are in the tax net and contribute a sizable portion of the revenue of the exchequer. The law provides for levying of taxes at different stages and forms of income. On the contrary, it provides the impetus for efficiency savings out of the income generated by us through which we can reduce our tax liability. Such investments provide a dual purpose for both the assessee and for the Government. On the one hand, it reduces tax liabilities in our hand and on the other hand it provides sizable funds in the hands of the Government. Tips to save Income tax for Salaried Person

Our main aim in tax planning is to pay minimum taxes by abiding by the legal statute and maximizing return on our investments by investing in the correct instruments at the correct time of our life. Tax Planning- Save tax through your family

I endeavor, in brief, some of the important aspects in this respect:

Some people have a wrong notion that tax planning is useful only once you reach an advanced stage of life or are well settled in a business or profession. That is not true. In fact, the best time to start tax planning is right from day one when you start having any income in your name. The sooner you enter the wonderland of tax planning, the better it will be for you in the long run. The benefits of tax planning adopted in the initial years of life will come in very handy when you are planning your retirement. The longer the duration of your tax planning, the better results it will yield to you in years to come. Thus, the right time to begin tax planning is when a person becomes a major. And, it should be continued in right earnest, year after year. Here is how …

Tax Planning upon Becoming a Major
1) Take your first lesson of tax planning when you attain the age of 18
2) Document all the amounts you receive
3) Small cash presents you receive on various ceremonial occasions should be put into the bank
4) Separate income tax files for each individual so that one’s income is not added with that of other family members.

Tax Planning Once You Start Earning

1) Systematically maintain your withdrawals, banks deposits, etc.
2) Save as much as you can because being single you have fewer financial commitments
3) Open a PPF account and put money in the account as much as you can. This investment is tax free and also remains blocked for a minimum period of 15 years.
4) Stop luxurious spending as this is not the age for that.
5) Go for some insurance policy with a long period of maturity.

Tax Planning When You Get Married

1) Avoid gifts to your spouse after marriage as the income arising from the same will be clubbed with your income. Best planning would be to make a gift to your prospective spouse just a few months before your marriage.
2) If your spouse is not a working woman, do not withdraw from household expenses from her account. Utilize that fund for tax saving investments.
3) Start some pension plan investment which will be beneficial when you retire.
4) Start saving for a house of your own if you don’t have one
5) If yours is a joint family open a HUF account and maintain the separate file for the same.
6) Tax Planning after a Decade of Your Marriage
7) Start investments in the name of your children
8) In the case of a fund, constraints take some small but long-term insurance policies in the children name for their education and marriage.
9) Invest the maturity value of your certain early age investments into long-term risk-free investments.

Tax Planning after the Marriage of Your Children

1) Income in the group is distributed amongst yourself your spouse and your son, daughter in law
2) Prepare your will and adopt tax planning relating to your will to secure tax saving for the family members.

Tax Planning for Senior Citizens

1) Open joint bank accounts and put all your maturity value in the same.
2) Invest in safe instruments and in joint names.

Conclusion

Intelligent tax planning calls for changes in approach every few years. It is, therefore, recommended that you must review your investment and tax planning perspective at least every decade and reorient it depending on the facts and circumstances of the situation.

Source: www.taxguru.in
Please do not reply back to this mail. This is sent from an unattended mail box. Please mark all your queries / responses to webmaster@samirkotak.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. samirkotak.in 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. samirkotak.in, 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.