Category: Personal Finance

RBI revises calendar for auction of treasury bills

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Reserve Bank of India (RBI) on Friday (May 17) revised the calendar for the auction of Government of India treasury bills.

“The Reserve Bank of India, in consultation with the Government of India, will have the flexibility to modify the notified amount and timing for auction of Treasury Bills depending upon the requirements of the Government of India, evolving market conditions and other relevant factors, after giving due notice to the market,” the RBI said.

Also Read: RBI bars Kotak Bank from onboarding new online customers, issuing new credit cards

Further, it said, “Thus, the calendar is subject to change, if circumstances so warrant, including for reasons such as intervening holidays. Such changes, if any, will be communicated through press releases.”

What are treasury bills?

T-bills are short-term debt instruments issued by the Government of India to meet its short-term borrowing needs. These bills are highly liquid and considered a safe investment since they are backed by the government. T-Bills are issued with three different maturity periods: 91 days, 182 days, and 364 days.

They are issued at a discount to their face value, meaning they are sold at a price lower than their nominal value. The difference between the purchase price and the face value represents the investor’s return.

Also Read: RBI tells NBFCs to ‘strictly adhere’ to cash disbursal limits as per IT rules

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Financial planning trends in urban India

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Every year, Max Life Insurance partners with Kantar, a world leader in market research, to conduct the India Protection Quotient (IPQ) Survey. This extensive survey captures the financial planning habits of over 4,700 people across 25 Indian cities, piercing through varied cohorts, including Generation-Z, Women and Millennials, and devotedly carrying forward the belief of ‘Protection for All’.

Changing times and a challenging economy have increased the need for financial planning amongst urban Indians. Unforeseen circumstances such as unexpected medical bills, job loss, or property damage can cause significant financial strain on a household. In such times, having adequate life insurance, an emergency fund, and strong financial planning can act as a safety net, ensuring these challenges don’t lead to financial ruin.

Safeguarding your financial future

The pursuit of a higher standard of living has underlined numerous costs such as rent, leisure spends, entertainment, etc. On the other hand, volatile job markets and unpredictable economic conditions have necessitated better financial management so that individuals can maintain their desired lifestyles without compromising on long-term goals like retirement or higher education.

The burden of rising medical expenses has emerged as the top concern among urban Indians, leading to an increased interest in insurance awareness for the future security of themselves and their loved ones.

Urban India has made huge strides in awareness about life insurance over the past six years, with the knowledge Index increasing from 39 in IPQ 1.0 to 61 as per the IPQ 6.0 study.

Financial preparedness for retirement

Urban India’s retirement index has significantly risen from 44 to 47 over three editions of IRIS, with an improvement across all three—health, finance and emotion—indices. Urban women blazed the trail for financial preparedness, with men following closely. East India surpassed all other regions with a financial preparedness index of 53, while Tier II towns fared better than Tier I towns. Significant improvement as compared to previous editions “signals the country’s stronger economic resilience”, as quoted by Prashant Tripathy, Managing Director & CEO, Max Life Insurance .

Challenges and opportunities in financial preparedness

The findings of IPQ 6.0 reveal how safeguarding against the untimely death of the breadwinner holds lower importance amongst respondents, leading to a challenging gap between ownership and awareness of term insurance products. A shift in priorities regarding savings and insurance has led to a negligible growth in term insurance ownership, which stands at 31% in IPQ 6.0, an increase from 30% in IPQ 5.0. The challenge is bigger regarding the disparity in insurance awareness and ownership between metro and Tier-II cities.

It is interesting to note that modern marketing and communication solutions have not trickled down to smaller urban centers. While Tier I cities have secured 45 points on the Protection Quotient, Tier II regions are trailing behind at 36 points. The need of the hour is targeted interventions and information programs that address Tier-II audiences via more accessible media and making the acquisition of life insurance products simpler online.

Shifting trends in financial behavior

Interesting trends have come to fore in IPQ 6.0; although medical concerns have led to increased anxiety among the youth, saving for retirement has taken a back seat as urban Indians prioritize other savings goals like children’s education and marriage.

Digital transformation as a generational shift

While millennials are nearing parity with non-millennials in terms of financial readiness, Generation Z trails slightly behind. IPQ 6.0 highlights a notable gap in life insurance ownership levels, with Generation Z at 69 compared to non-millennials at 79. Self-employed urban Indians are making strides in financially preparing for an uncertain tomorrow, with IPQ scores significantly rising from 42 to 46 in this edition.

The Protection Quotient of digitally savvy urban Indians is 9 points higher than their non-digital counterparts, highlighting a digital divide. People who are comfortable with technology have a higher Protection Quotient compared to those who are not. There’s a shift towards online insurance options, reflecting the growing preference for convenience and accessibility.

Max Life Insurance: Your partner in financial security

Life throws curveballs, so being proactive about financial protection is a wise decision. By establishing a well-defined financial plan and exploring instruments like insurance and emergency funds, individuals can safeguard their future and the well-being of their loved ones.

Max Life Insurance offers a variety of life insurance solutions for both protection and long-term savings. They provide a multi-channel approach, including agents and online options. With over two decades of experience, Max Life Insurance focuses on a needs-based sales process, exceptional customer service, and a team of well-trained professionals.

Get Started Today!

Visit Max Life Insurance’s website for a free, no-obligation financial consultation with an expert who can help craft a personalized plan or call us to schedule your consultation.

(Note: This is a partnered post)

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Fifteen years of NPS: How to generate ₹1 lakh monthly pension by investing in it

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The National Pension System (NPS), India’s flagship pension scheme, celebrates its 15th anniversary this month. Initially launched for government employees in 2004, NPS opened its doors to the broader Indian populace in 2009.

NPS provides subscribers with the flexibility to allocate their investments across different asset classes.

There are two primary NPS accounts — Tier 1 and Tier 2.

While Tier 1 is strictly a pension account, Tier 2 is a voluntary savings account associated with the Pension Regulatory Authority of India (PFRDA).

In an earlier conversation with CNBC-TV18.com, Kurian Jose, CEO of Tata Pension Management, stressed the advantages of NPS for long-term retirement planning.

“NPS leverages the power of compounding over the long term. As contributions grow and generate returns, this compounding effect significantly boosts the retirement corpus,” he shared with CNBC-TV18.com.

Generating a monthly pension of ₹1 lakh with NPS

Jose provides a detailed example to illustrate how individuals can secure a substantial monthly pension using NPS.

Consider a 30-year-old who starts investing ₹5,000 per month with a balanced allocation of 50% in equities and 50% in government and corporate bonds.

Assuming a 6% annual increase in contributions and a 10% return on investment, the corpus grows to approximately ₹1.85 crore by the time the investor turns 60.

Opting for a 100% annuity can provide a monthly pension of ₹1,05,292 for life.

In the event of the subscriber’s demise, the pension would continue for the spouse, and the principal corpus would be available to the nominee.

For those looking to secure a monthly pension of ₹50,000, the calculations can be adjusted.

By investing ₹2,500 per month from the age of 30, with similar assumptions, the corpus would grow to about ₹92.5 lakh, providing a monthly pension close to ₹50,000.

NPS offers various calculators, including those from Tata Pension Management, to help investors visualise their retirement corpus and potential pension.

For instance, a 40-year-old starting with ₹5,000 per month and increasing the annual contribution by 20% can achieve a corpus of nearly ₹2 crore, yielding a monthly pension of around ₹1,13,730, assuming a 6.5% annuity rate.

While these examples provide a general guideline, individuals should consider their financial situation and goals before investing.

NPS’s flexibility, tax benefits, and potential for high returns make it a compelling choice for retirement planning.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Guide for Gen Z investors: An expert tells us five best suited mutual funds

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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As the younger generation steps into the world of investing, navigating through various options and strategies becomes crucial. One of the fundamental steps in financial planning is defining short-term and long-term goals.

Gen Z investors should take the time to reflect on their aspirations, whether it’s purchasing a home, starting a business, or saving for retirement.

Common goals for this demographic include higher education, marriage, loan repayments, and retirement planning.

Budgeting

Creating a budget that incorporates regular expenses like housing, transportation, food, and loan repayments is vital, said Shweta Rajani, Sr VP & Head, Mutual Funds of Anand Rathi Wealth.

“Setting an income-to-expenditure ratio and an EMI-to-investment ratio can provide clarity in financial planning,” she said.

Start investing early

Investing early and wisely is key to growing wealth over time.

Seeking professional guidance or using reputable investment platforms can aid Gen Z investors.

As per Rajani, options like lump-sum or SIP investments can be chosen based on fund availability and income stability.

Yearly stepping up of SIPs can expedite goal achievement.

Choose asset classes wisely

Opting for asset classes with low correlation and a calculated risk via the right asset allocation is crucial.

For example, an 80:20 asset allocation (equity:debt) can be suitable for long-term goals with an expected return of 12%.

Gen Z investors might prefer digital gold, but it’s advisable to limit gold investments to 5% of the portfolio.

Sovereign Gold Bonds (SGBs) offer additional interest, making them a superior option compared to physical gold and gold funds.

Initial portfolio for Gen Z:

For individuals just starting their careers, allocating at least 20% of monthly income to disciplined SIP investments in mutual funds is recommended.

Diversifying across different categories like large, mid, and small-cap funds can balance risk and returns effectively.

While speaking to CNBC-TV18’s Sonal Bhutra, Rajani suggested these five mutual funds suited for Gen Z investors:

Conclusion

For Gen Z investors, starting early, embracing technology, diversifying investments, and staying informed are keys to building a strong financial future.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Vested Finance integrates ClearTax to simplify US investment tax filings

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Investment platform Vested Finance has announced the integration of ClearTax on its platform. With this, over 2.5 lakh investors with Vested accounts can leverage the ClearTax platform to include their US investments in their income tax return (ITR) filings, Vested Finance said.

An investor has to log in to Vested Finance platform, visit the ‘Tax Documents’ section, select ‘File with ClearTax,’ login / sign up on ClearTax, and then all the tax documents generated by Vested, including capital gains, schedule of Foreign Assets, schedule of Foreign Income will be auto captured on the ClearTax portal in INR as per income tax regulations.

The investor has to then provide additional details of their income tax return, such as personal details, other income sources, capital gains from different sources, etc., and then file their ITR within a few clicks.

ClearTax offers DIY and expert-assisted plans that investors can choose from based on their preferences.

Step by step process:

Step 1: On the Vested tax documents screen, the you can click on ‘File with ClearTax’.

Step 2: On the ClearTax window that opens up, sign up or log in if you have an existing ClearTax account.

Step 3: Once you log in or sign up, all your tax information will be auto-imported from Vested, and a summary will be shown. Voila!

Step 4: You can review or edit the tax information imported in the capital gains dashboard on ClearTax

Viram Shah, CEO, Vested, said, “Investing in global stocks, primarily via the US markets, is an increasingly popular diversification option for Indian investors. Our tax documents are one of the most favorite features of our customers. What started as providing simplified tax documents has now evolved into a reporting and filing journey with our ClearTax partnership.”

Vested is featured as one of their partner brokers on the Capital Gains dashboard on the ClearTax platform.

“With this collaboration, Vested’s users are well-positioned to leverage this opportunity as a pmoment in their financial journey and further equip themselves with the tools and resources they need to achieve their financial and compliance goals efficiently.” said Avinash Polepally, Senior Director (Consumer Business Head) at ClearTax.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India’s largest MF house launches Automotive Opportunities Fund: Is it good bang for your buck?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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SBI Mutual Fund, India’s largest mutual fund house, has launched Automotive Opportunities Fund. This is an open-ended equity scheme following automotive and allied business activities theme.

The new fund offer (NFO) of the scheme will be available till May 31.

Investment objective and fund details

The investment objective is to generate long-term capital appreciation to unit holders from a portfolio that is invested in equity and equity related instruments of companies engaged in automotive & allied business activities theme from the domestic as well as global universe.

However, there can be no assurance that the investment objective of the scheme will be realised, SBI Mutual Fund said.

The fund will be benchmarked to the Nifty Auto TRI.

The fund managers for the SBI Automotive Opportunities Fund will be Tanmaya Desai and Pradeep Kesavan (dedicated fund manager for overseas securities).

Asset allocation

The fund will invest i.e., 80%-100% of its assets in equity and equity-related instruments of companies engaged in automotive and allied business activities theme (including equity derivatives), with the balance assets as per the following allocation:

Investment considerations

According to Shamsher Singh, Managing Director & Chief Executive Officer, SBI Funds Management, the Indian Automotive sector presents an attractive opportunity as domestic demand and auto exports have been drivers of growth.

“Electric mobility and rise of logistics & passenger transportation provide inflection points for the industry. The SBI Automotive Opportunities Fund is a wonderful opportunity for investors who would like to benefit from the growth of the entire automotive ecosystem as this sector is poised to take India to new places.” he said.

Seconding his views, D P Singh, Deputy MD & Joint CEO, SBI Funds Management said, “The Indian Automotive Industry is running in top gear as our country is a force to be reckoned in terms of production of vehicles and auto exports while our burgeoning domestic market, demands safer and premium vehicles. In addition, manufacturing of auto parts and ancillaries contribute to almost 30% of the manufacturing ecosystem providing wealth creation opportunities for investors in the long-term.”

He added that policy reforms and a defined roadmap with the industry will provide momentum and an opportunity for investors to benefit from India’s growing automotive ecosystem.

Conclusion

The SBI Automotive Opportunities Fund represents a targeted investment vehicle for those looking to gain exposure to the promising automotive sector.

With its structured asset allocation and expert management, it offers a unique opportunity to participate in India’s automotive growth story.

However, investors should consider it within the framework of their broader asset allocation strategy to ensure a balanced and diversified investment portfolio.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Zerodha Kite launches ‘Notes’ feature to help investors track stocks: How to use it?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Nithin Kamath-led Zerodha has introduced a new feature called ‘Notes’ on its Kite platform. This is aimed at helping users keep track of why they are monitoring specific stocks.

This feature allows clients to add personalised notes for each instrument they add to their marketwatch.

On the social media platform X, previously known as Twitter, Zerodha said, “You can easily add a quick note about why you are interested in a stock right in your marketwatch.”

Introducing notes on Kite web.

At any given point in time, you may be tracking multiple stocks for different reasons. Even if you add the stocks on your marketwatch, it’s hard to remember all the reasons why you added them. Now, you can easily add a quick note about why you are… pic.twitter.com/Su7AKm34Ip

— Zerodha (@zerodhaonline) May 14, 2024

The ‘Notes’ feature is currently available on the Kite website and will soon be rolled out to the Kite app.

This tool will enable users to write specific reasons for tracking each stock, such as “Check after lunch” for State Bank of India, directly in their marketwatch.

These notes can be revisited later, providing context and aiding in decision-making.

Nithin Kamath also highlighted the utility of this new feature in a tweet: “Have you checked out the notes feature on Kite Web?”

Have you checked out the notes feature on Kite Web? pic.twitter.com/4gTcGJN4vX

— Nithin Kamath (@Nithin0dha) May 14, 2024

He emphasised that the feature will help users by allowing them to remember the specific reasons for adding instruments to their marketwatch.

How to use the Notes feature on Kite:

Adding a Note:

Step 1: Click on the ⋯ (more options) next to the instrument.

Step 2: Select ‘Notes.’

Step 3: Type out the reason for adding the instrument.

Step 4: Click on ✓ to save the note.

Hiding Notes:

Step 1: Go to ‘Settings.’

Step 2: Unselect ‘Show notes.’

Users can save notes by pressing Ctrl + Enter and can close them with the ✖ or Esc key without saving changes.

However, if an instrument is removed from the marketwatch, the corresponding notes will also be deleted and will not reappear even if the instrument is added again.

Each note can contain up to 512 characters.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Kotak Mahindra Life Insurance declares 20% higher bonus for over 7 lakh policyholders

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Kotak Mahindra Life Insurance has announced a bonus of ₹1,007 crore for more than 7 lakh eligible policyholders for FY 2023-24. This is the 23rd consecutive year that Kotak Life has declared a bonus on participating products.

The bonus declared is 20% higher than the bonus amount of FY2022-23.

Participating plans provide policyholders with profit-sharing benefits in the form of bonuses.

This announcement follows a recent trend among major life insurance companies in India declaring substantial bonuses.

Just days earlier, on May 15, HDFC Life announced its highest-ever bonus of ₹3,722 crore, benefiting over 22.23 lakh policyholders.

Last month, Bajaj Allianz Life declared its all-time high bonus of ₹1,383 crore for over 11.66 lakh policyholders for FY 2023-24.

Understanding life insurance bonuses

Life insurance bonuses are additional amounts declared by life insurance companies on participating policies.

These bonuses are essentially a share of the profits made by the insurer, distributed among policyholders.

They come in various forms, such as reversionary bonuses, which are added to the policy’s sum assured, and terminal bonuses, which are paid out at the end of the policy term or on the death of the policyholder.

Who benefits?

Policyholders with participating plans benefit from these bonuses.

These plans allow them to share in the company’s profits, thereby enhancing the value of their insurance cover over time.

The declared bonuses increase the policy’s maturity or death benefit.

This profit-sharing aspect makes participating plans a popular choice for those looking for both protection and a steady accumulation of wealth.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

How to navigate market volatility in an election year: Expert weighs in

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

As investors frequently worry about protecting their investments from market volatility during an election year, CNBC-TV18 spoke with A Balasubramanian, Managing Director and CEO of Aditya Birla Sun Life AMC, to discuss strategies for navigating these uncertain markets.

Long-term investors shouldn’t be overly concerned with factors like volatility or election outcomes, says Balasubramanian. Instead, they should focus on the outlook for the next five to ten years.

Balasubramanian noted that the current market volatility is relatively less intense compared to previous election cycles.

Read Here | Foreign investors to stay wary of Indian market until election: Richard Harris

He believes India’s market has the potential to become one of the world’s largest markets in the next decade and some dips during such volatile phases could be a good opportunity for investors to plan for the long term.

Balasubramanian advocated for the simplicity and discipline of Systematic Investment Plans (SIPs) offered by mutual funds.

SIPs involve investing fixed amounts regularly, which, while straightforward, demand unwavering discipline.

“The best way to invest in mutual fund is SIP way of investing is as simple as that, Though it’s simple but the discipline that one has to bring on continue to keep your investment in SIP is the key to the success. Let the market be volatile or have its own predictions, it doesn’t matter.”

Watch this video for more.

Also Read | Mark Mobius reveals how markets will react if NDA wins 400+ Lok Sabha seats

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow