JAGOINVESTOR

No more sending ITR-V by post after income tax filing – Verification with aadhar card introduced

Posted on April 19, 2015July 23, 2019 by Jagoinvestor

There is a good news to taxpayers. CBDT recently announced that taxpayers who filed their income tax returns online will no longer have to send the ITR-V paper acknowledgement by post to CPC Bangalore, if they have aadhar card which can be used for verification purpose.

Instead of manual verification, a new Electronic Verification Code has been introduced to verify the e-returns. For that one will have to mention their aadhar card number in ITR form, and tax-payer will get an OTP number on their mobile for verification, which needs to be completed on the website of tax filing.

Below is a snapshot of the new ITR form where aadhar card number is asked in case you have it.

aadhar card section in ITR form

Issues with the old system

Earlier the process was like this. Once you e-filed your tax returns, you then had to send the acknowledgement copy within 120 days to CPC Bangalore. Only those who had signatures could do verification online, but it was very rare, hence millions of tax-payers had to take the pain of manually sending the form.

However, the old system was not robust and a big number of people used to get messages that their acknowledgement has not reached tax department and other manual errors used to happen.

With the introduction of this new system, things will be simplified and even faster. Now the process will be as simple as filing the tax returns online and they will get a one time password for verification purpose on the registered mobile number, which has to be used for verification on the website of tax department. That would complete the process of verification.

efiling verification with aadhar card

But I don’t have Aadhaar Card ?

Don’t worry. You can always send the physical documents ITV-V to CPC, Bangalore like you did earlier. You can do that even if you have aadhar card. This new system of verification is just an alternative way for those who have aadhar card.

What do you think about this new system?

Write us your opinion on this in our comment section.

Attend Jagoinvestor Workshop in Mumbai on 17th May (Sunday)

Posted on April 16, 2015April 6, 2022 by Jagoinvestor

Last week (on 12th of April) we conducted investor workshop “Design your financial life” in Pune, it was a great learning experience for participants and for us. At the end of workshop it was amazing to see how each participant’s heart got filled right kind of commitment to walk on the path of financial freedom.

Here are is the message from one of the Pune workshop participants to investors community

Hi Manish and Nandish,

First of all let me thank you for sharing very important basic concepts about INVESTMENTS…(Not SAVINGS) during this workshop. Me and my wife both enjoyed this workshop very much and in future we would like to certainly attend another one.

Let me also congratulate both of you. Two of you compliment each other nicely and form a very good team.

The workshop was very simple yet an eye opener for many of us who attended it. We never realised that we were making such huge mistakes in buying certain financial products, life insurance policies etc. which drained our hard earned money so far. We were not giving proper logical thought.

YOU MADE US THINK ABOUT HOW TO DEVELOP RELATIONSHIP WITH MONEY. This is the most important concept which I liked In this workshop. The name JAGO INVESTOR perfectly suits.

I would like to mention here that our education system does not include syllabus on money related matters which is in fact most important matter once we become graduates and start earning. I sincerely appeal to all the parents and young children to attend this workshop once. I am sure this worshop will change their views about investing the money for ever. The more early you start the more better it is.

Thank you once again. It was worth taking the pain for coming all the way from Ahmedabad to Pune to attend this workshop.

KEEP SHARING & SPREADING THE KNOWLEDGE…

Regards.
Abhay

More comments from other participants

This is really great workshop for all age groups, especially for the young students who just started their career. I would say please do come for the workshop as our school system doesn’t teach us importance of financial planing, all they teach us is that “mitochondria is the power house of the cell”. 🙂 These guys are genuinely taking efforts to financially literate the people. The workshop worth more than its fee. – Vivek Ratnaparkhi

The program is really well designed to convey the crux of the personal financial planning. It really acts as eye opener for all participants. The program introduces to basic financial planning concepts in a very easy to understand way – Vijay Kumar

The program gave me a list of actions I need to take for my financial life. It stressed the importance of written goals. Financial freedom was the best take away – Rupali Desai

It enhanced my knowledge on finance. It was an eye-opener program for me. I can manage my finance more clearly now. A small amount of saving can become a large amount in long term. Only thing is we have to put “Effort” – Supriya Singh

It was really good and my knowledge was increased about financial planning. I used to avoid the discussions related to financial life, but now I know the importance of it and can contribute towards it – Rakhi Gulmire

Here are some of the pictures from Pune Workshop

Jagoinvestor Investor pune workshop

Video Testimonials of Pune workshop Participants

Opportunity to participate in Mumbai

We invite you to block 17th of May (just one Sunday) so that you can participate in our Mumbai workshop. We are inviting you, because our workshop will add a lot of value to your existing financial life. So far, we have seen and observed that our workshop helps investors to add new and different dimensions to their financial world. In the whole process, you will learn to slow down so that you can examine what’s going on in your financial world. With our help and support, you will be able to define and adopt new set of actions and strategies to create an amazing financial life.

Why we conduct these workshops?

We do offline workshops so that we can connect with some of our readers at a deeper level, round the year we write articles, reply to thousands of comments and work with a few hundred investors one on one and in that process we learn, grow and expand as professionals. Our Workshop gives us an opportunity to share outrageously all the knowledge and experiences that we acquire round the year. The program is an opportunity to get our readers more and more action oriented.

Why you should come for this workshop?

You will learn how to improve your financial life with your current set of resources and income.
You will learn how to plan for your financial life goals
You will interact and learn from other’s people’s financial life
You will dedicate one full day to get better with money management
You will learn to add new dimensions to your financial life
To understand that personal finance can also be fun
To give a whole new direction to your financial life

Register for the Workshop in Mumbai

Single Ticket

Rs 3,800

Buy Single Ticket

Couple Ticket
(Discount of Rs 500)

Rs 7,000

Buy Couple Ticket

Venue and Timing Details9 am – 6 pm (17th May, 2015)
BEST WESTERN HOTEL SAHIL
292,Bellasis Road, Mumbai Central
Opp City Centre Mall

The hotel is walking Distance from Mumbai Central Station
Lunch and Breakfast is included in the program fees

What you get as a participant?

You get a FREE Financial Health check-up Report worth Rs 499/-
One day workshop with some personal finance tools like budget sheet, Mutual fund tracker etc
Invitation to join our inner circle

It’s time at add jagoinvestor workshop to your financial journey

It has been a few years now conducting “Design your financial life” workshop and the experience has been amazing. It is a wonderful space to be in, in which the group learns and starts to fall in love with the overall process of wealth creation. We do not teach tricks and tips to build wealth in fact we help you to discover your own personal process of wealth creation.

This time we want more and more couples to participate so that they can get on same page when it comes to personal finance. It is extremely important that husband and wife both take equal interest when it comes to money management. We are offering special discount to those who want to come with their partner. (You can even come with your parents, siblings or friends and can claim the discount)

The workshop we conduct are highly interactive, it has lots of activities and fun exercises which helps you to discover your relationship with money. The sessions are interactive and very easy to grasp for any kind of investor, beginner or advanced. In short there is something for everyone in this workshop

Listen to workshop Participants who attended in Past

Invitation to join and participate

From the bottom of our heart, we invite you to join and participate in pune workshop. Come alone or with your spouse or parents, siblings or friends but see that you do not miss this opportunity. Do not let time and money to get in your way and book your seat at the earliest because we will be taking only 35 participants this time and registration will close after some days.

This workshop is strictly for investors and not for advisors or finance professionals. If you have never participated in any personal finance workshop let this be your first workshop. If you have already participated in our past workshop we invite you to share the event brochure with your loved ones. If you have any questions you can write in the comments section.

You can also visit our Workshop Page to Register and Get more details

3 incredible money lessons – I would like to pass on to my Kids

Posted on April 7, 2015July 23, 2019 by Jagoinvestor

We have worked with more than 500 investors till date one on one and we have decent understanding of how financial lives take shape over the years.

Today I am going to share few observations out of working with clients for so many years and will share some mistakes which you should avoid in your financial life. I really wish if each parent could pass it on to their kids or their siblings when they start earning money.

Mistake #1 – Don’t go with the flow

It’s often said that in life – “Go with the flow and don’t worry”. While that’s a good advice for your life in general, but I think it’s not a good advice for your financial life.

Most of the times, if you just go with the flow, you might not get desired results. It’s a shortcut which you are always tempted to take in your financial life, but often that leads to a clumsy and bad financial life.

There is another saying that – “Only dead fish goes with the flow”.

I am sure you don’t want to be a dead fish 🙂

dont go with the flow

I have observed that most of the people, who today are having a very bad financial life, have just gone with the flow and never planning out things. Nothing in their financial life happens due to their careful planning or conscious effort. Whatever comes in front of them, they take it.

Tax season arrives and they buy the policy because they have to submit the investment proof.
They take loan because its a “Interest Free loan” and not because they needed it
They want to buy a house soon, but then the next moment they upgrade their car !!
They sign the documents where the agent asks them too and complain they were cheated

I just want to make a point. You can either choose to move with the flow and let things happen to your financial life OR take charge and make things happen in your financial life as per your plan. The biggest issue today is not just less income, but how managing the money in proper manner.

Mistake #2 – Don’t get attached with past and harm your future

Almost all the investors face this. One bad experience in some area and they carry it with them all their future.

When recently, I recommended a mutual fund from ICICI Prudential to one of our client. He was taken aback and very strongly told me that he does not want any ICICI prudential mutual fund because he has had a very bad experience with them.

On further enquiry, I realised that he was sold a ULIP by an ICICI Prudential Life Insurance agent, which he was not happy with and from that day he took a vow that never in his life, he will deal with ICICI products.

dont let past harm your future

In the above example, did you see that the person had just labeled ICICI = FRAUD. There are so many good things which ICICI has to offer (and it’s true for every company) and just labeling things will only hurt your own future because you then cut down your own options.

Good and bad experience are part of life

Good and bad experience’s are part of life and it happens with everyone. You need to learn from it and move on. Take some learning’s from the incident and see how you can make your own self more strong to deal with a situation.

Like in the above example, the person could have said that – “I will now onwards read the documents and understand where I am putting my money” or “I will not buy something, which I truly don’t understand”. But instead he chose to take the extreme step.

I will give you another example

I see many people who bought a stock or mutual fund and it didn’t perform well and gave them bad returns. Now they are so scared to try out equity in their portfolio all their life, because they equate EQUITY = MONEY LOST

Note that in today’s times of high inflation and high taxes, having a good portion in equity class is not an option, but a necessity. You can’t build enough wealth without investing in equity based financial products for long term.

So coming to the conclusion, all I want to say is that don’t make mistakes of carrying a bad experience throughout your life and avoid the opportunities which exists, this is not a money lesson, but a good life lesson – which applies in all the areas of life.

If you buy a book on personal finance, and you don’t like it, it does not mean that good books on money does not exist. Or if you had a bad experience with a financial planner, it does not mean that all financial planners are bad.

Mistake #3 – Don’t just focus on earning money, but also your networth

Do you know one big difference between RICH and Middle class ? Here it is …

“Rich talk the language of Networth and middle-class talks the language of pay-package”

What have you heard your parents ask you – “Go get a good paying job?” OR “Go and build a great networth?”

Over the years, the income level has risen many folds and today its not uncommon to see income levels of 10/15/20 lacs per annum and the society label them as “doing well”. But the ground reality is very different many a times. The net worth of these high earners is still not upto the mark.

When we do workshops in various cities, we often see people who are earning 10-20 lacs per year who have spend years in their job, but they don’t have enough to show off as their networth. Many of them are empty pots whose size if big enough.

Its because they have focused and worked on their income’s, but never focused properly on building networth. Just because you earn good, does not mean you will have a lot wealth, because that needs conscious effort and mindset to build wealth. It needs actions, adoption of structures in your life which many don’t act upon.

income vs networth

Good Income is very Important

Don’t get me wrong. I am not saying don’t try for good income. In fact, if you focus on good income, you can build wealth more easily and faster, because more income generally leads to good wealth. But often its not true and it can happen only if you choose to consciously work on it.

It might happen that a person earning less than you build;s higher networth then you because he was fanatically working towards it.

We once came across a couple in Mumbai who was collectively earning around 35-40 lacs each year. I know the moment you read this, you must have thought – “Wow .. that’s a lot of money. I want to get there”

But reality is different

But their lifestyle never allowed them to save enough. Their expenses list was so huge that I was almost numb, when I saw their datasheet.

Here was a couple who was doing extremely well from “society standards”, but still their networth was pathetic compared to their income because they just focused on consumption and only consumption. Their were so many leakages in their financial life, that money never stayed in their financial life.

They could not even arrange for 10 lacs cash in emergency situation. So poor was their allocation and planning, that it was a height of mismanagement. We then worked with them for few months and redesigned their overall financial life which they approved.

We set their financial goals, helped them to define things and systematically save for each of them and suggested them how they can improve. We put right structures in their financial life, which forced then to save first and only then spend. They are doing better now.

I know this is an extreme example, but many people can relate to it at some level.

As an investor your main focus has to be on your networth and a good income is a tool for it. A higher income which does not lead to a good networth is only a short term success story.

What I have seen in last 7 yrs ?

Today’s generation is into a deep financial depression. You meet a guy, he is going to a swanky office, his package is bloody 16 lacs per annum, you envy him and you hear this guy has just bought a house (on loan). You feel you want to be like him, what an awesome feat he has achieved.

But the reality is very different. While this all looks great from a distance, deep down a big number of investors are facing a very tough situation, which is only known to them.

They are hell scared of future. Even though they are doing well today, they are still not sure what future has for them, they are depressed and fearful of expenses lined up for future. It has destroyed their peace of mind. They have good money coming into their bank accounts, but peace of mind is missing.

I am sure many readers who are reading this can relate it to their lives. What kind of suggestion would you like to give to a new investor who has just started their financial life?

How to pay Income tax online in 5 min ? Use Challan 280

Posted on March 22, 2015July 23, 2019 by Jagoinvestor

Today I will show you, how you can pay your income tax online using challan number 280 on the income tax website. Most of the people rely on their CA and other service providers to paying income tax. Salaried class mostly don’t need to pay additional income tax most of the times at the end of the year because anyway their employers pay it on their behalf.

how to pay income tax online in 5 min with the use of challan 280?

However, one might come across a situation where they have to pay their income tax themselves in following situations like.

If TDS deducted is less than the actual tax liability?
If you have got a notice for balance tax to be paid
If one has any other income apart from salary

What is Challan 280?

Challan 280 is the form which is required to be filled when you want to pay your income taxes. This can be done offline at the bank, or you can also pay it online. We will see both of them

How to pay income tax offline at the bank?

One can physically go to the bank and submit the filled challan 280 form along with the money. You can download the challan 280 from Income Tax website.

How to pay income tax online?

Another way to pay the taxes is by filling up challan 280 online and making the payment through your net banking facility. I have included the steps one needs to take below. Also, you can see the video below to learn the steps.

Step 1#: Choose the option “Challan 280” from income tax website

The first step is to visit this link and click on the option “Challan 280”.

challan 280

Step 2#: Fill details on the Challan 280 form

Once you click on the challan 280 link, you will be directed to the page which will ask you various details.

How to fill challan 280

Choose (0021)INCOME-TAX (OTHER THAN COMPANIES), which is to be chosen by individuals
Choose an assessment year, which is next year for which you are paying income tax. So if you are paying income tax for the year 2013-2014, the assessment year will be 2014-2015
Enter your PAN Number, address, Email, Phone etc
For Type of Payment, you can choose “(300) SELF ASSESSMENT TAX” if you are paying the final income tax for the year, or “(100)ADVANCE TAX” if you are paying the advance tax.
Choose the bank name from where you are going to make the payment and finally click on the “Proceed” button which will take you to the next page for confirmation of all the details entered by you

Step 3#: Verify Details and proceed for payment

On the next page, you will be asked to verify all the details you had filled. It’s important to check that the name mentioned on this page is for the same person for whom the income tax is to be paid. It should match with the PAN card holder name, also match the assessment year, email and phone number and other details.

confirm details before paying income tax online

Step 4#: Enter your login details for the bank

On the next page, you need to enter your bank username and password, so that you can make the payment finally.

make payment income tax online
Step 5#: Fill the Income-tax payable and make payment

The next step is to enter the income tax amount and other details as applicable and then finally hit the payment button.

income tax online payment

Step 6#: Download the PDF receipt and also get it in your email

Once you make the payment, it will give you an option to download the challan receipt in PDF format. You can save it on your computer. Also, you will get the email containing the challan copy anyways.

Challan 280 Reciept

I hope you got a good idea of how to pay income tax online. In case you have any questions, please ask in the comments section below.

4 important things to complete when you Close your Home Loan

Posted on March 16, 2015July 23, 2019 by Jagoinvestor

It’s a dream of most of the homeowners to own a house without any loan on their head. It’s a great moment in their life, when they pay the final EMI of their home loan or pre-pay the full outstanding balance and clear the home loan fully. It’s a moment of pride and happiness. It’s a great relief for someone who was paying the EMI from so many years continuously.

However in that excitement, a lot of people do not take all the required actions and later suffer because of small things they didn’t complete after closing their home loans. In this article, I want to share few things every home owner should complete, when they are closing their loan.

While I am focusing totally on home loan closure in this article, but whatever I am going to share also applies when one closes a car loan, education loan, personal loan or any other kind of loan.

Point #1 – Take back your original Documents from Lender

This is a no-brainer.

Make sure that whenever you close a home loan, you take back all the important document you had submitted at the time of taking the loan. Original documents are really important to collect, because in future if you want to sell the house or want to take loan against property, that time you would require all the documents. Some of the documents we are talking aboout are …

Original Sale Deed
Original Conveyance deed
Power of Attorney
Possession Letter
Your Payment Receipts
Any Cancelled Cheque’s given

Some lenders even give you a copy of letter, mentioning what all documents were submitted by you to the lender at the time of taking the loan. Below is a sample list of documents mentioned by HDFC LTD to one it’s loan takers. It clearly mentions exactly which documents were taken by the bank at the time of giving the home loan. This really helps, because there is no confusion later and lender is also accountable towards the customer.

Make sure you personally go to the branch and collect all the documents yourself. Do not ask the lender to send the documents via courier or speed post. There are tons of cases where the documents were misplaced and investors had to run from pillar to post to get them back.

After getting the documents, you should also check if they are in good condition and no pages are missing from between. Also – If you can’t collect the documents yourself for some reason (like when you are out of country) then you can give an authorization letter to someone trusted, who can collect the documents on your behalf or ask bank to wait till you come back yourself and then take the documents.

Point #2 – Take NOC from the lender

NOC or No Dues certificate is a legal document provided by the lender, which certifies that you have repaid the full loan and no outstanding balance exists. The document will have the lender stamp of the lender. It’s extremely important document, which you should collect from the lender. Below you can check out the experience of one investor who had no proof of closing the loan and how he faced issue due to that.

Usually, NOC/NDC is dispatched by the lender after the loan is fully paid. But if you do not get it by default, then you should talk to your lender. I have already written in details about the NOC and its importance

Point #3 – Remove Lien from Registrar Office, if any

Let’s first understand what is the meaning of “Lien”?

Lien means “a right to keep possession of property belonging to another person until a debt owed by that person is discharged.”

What is means in simple language is that, the lender will keep the right to sell the property themselves, if the loan taker is not able to pay back the loan. These days banks do not put a lien on property, because they anyways check the background of the customer properly and keep the original documents in their custody. But at times, it can happen that due to customer background or on a slight suspicion, lender wants to put a lien on property, which is done in registrar office.

So you should surely check with your lender, if they have put lien on your property or not?

And, If they have – then you should ask them to help you to remove the lien and overall process. Some people will ask – “What happens if I do not remove the lien?”

If you do not remove the lien from your house, then you will face difficulty at the time of selling the house in future, and at that time you have to visit the lender again anyways. So please make sure you complete this part as soon as your home loan is closed.

Once you clear the lien from your property, you can verify it back by applying for a new encumbrance certificate, which should mention that there is no encumbrance with the property, means no one has any legal rights in the property. You should see that its mentioned in the certificate. I was able to find a sample certificate on the internet which you can see.

Even if you are planning to not sell your house in future, still make sure you don’t skip this step, Its always a good idea to make sure 100% process is followed.

Point #4 – Make sure your CIBIL report is updated with CLOSED entry

CIBIL report is one document which records each of your loan entry and all your actions of payment. Each lender checks this CIBIL report before giving any kind of loan to you (even when they give you a credit card).

Once your home loan is closed, your bank should update CIBIL, that you have closed your home loan and an entry called “DATE CLOSED” should appear on your report with the date of closure.

But many a times, banks delay this small action or completely ignore it for months and years. Your CIBIL report might not have that updated entry. So you should double check with your bank at the time of closure of loan that they will update the CIBIL very soon.

So when should you check your CIBIL report again? A good practice is to check it after 60 days of closing the loan and verify if there is an entry of “DATE CLOSED” with a date on it.

Make your Home loan closure 100% full proof

I have tried to make sure that you take all the last mile steps after closing your homeloan. Even if you prepay your home loan early, still you need to take all these steps, otherwise your home loan closure will not be 100% full proof.

Let me know if you want to add some other point in this list and I would be happy to add it.

Jagoinvestor Workshop in Pune – 12th April (Sunday)

Posted on March 10, 2015July 23, 2019 by Jagoinvestor

We are back with our offline workshop. This time it will be held in the city of Pune.

We invite you to block 12th of April (just one Sunday) (mark 12th of April on your calendar) so that you can participate in our one day workshop. We are inviting you because our workshop will add a lot of value to your existing financial life. So far we have seen and observed that our workshop helps investors to add new and different dimensions to their financial world. In the whole process they learn to slow down so that they can examine what’s going on in their financial world. With our help and support they also define and adopt new set of actions and strategies to create an amazing financial life.

jagoinvestor workshop

Why we conduct these workshops?

Why you should come for this workshop?

You will learn how to improve your financial life with your current set of resources and income.
You will learn how to plan for your financial life goals
You will interact and learn from other’s people’s financial life
You will dedicate one full day to get better with money management
You will learn to add new dimensions to your financial life
To understand that personal finance can also be fun
To give a whole new direction to your financial life

It’s time at add jagoinvestor workshop to your financial journey

It has been a few years now conducting “Design your financial life” workshop and the experience has been amazing. It is a wonderful space to be in, in which the group learns and starts to fall in love with the process of wealth creation. We do not teach tricks and tips to build wealth in fact we help you to discover your own personal process of creating wealth.

Listen to workshop Participants who attended in Past

Register for the Workshop in Pune

Single Ticket		SOLD OUT
Couple Ticket (Discount of Rs 500)		SOLD OUT

What you get as a participant?

You get a FREE Financial Health check-up Report worth Rs 499/-
One day workshop with some personal finance tools like budget sheet, Mutual fund tracker etc
Invitation to join our inner circle

Invitation to join and participate

You can also visit our Workshop Page to Register and Get more details

Sukanya Samriddhi Account with 80C benefits – Special scheme for girl child

Posted on January 29, 2015July 23, 2019 by Jagoinvestor

You must have heard about “Beti Bachao Beti Padhao” initiative recently on television advertisements. As part of it, the government has recently announced a scheme called “SUKANYA SAMRIDDHI ACCOUNT”, which is mainly for saving money for the girl child.

This is a welcome move because a lot of investors will get some extra incentive to save in the name of their girl child once they are born from a long-term perspective. You can see the exact PDF containing all information.

Sukanya Samriddhi Account

Let me share with you all the benefits and features of this scheme in details.

What is Sukanya Samriddhi Account?

Sukanya Samriddhi Account (SSA) is an investment scheme which can be opened for a girl child. The scheme is specially designed for girls higher education or marriage needs and should be opened by her parents or legal guardian(in case parents are missing).

One can deposit a maximum of Rs 1,50,000 per financial year (Apr-Mar) and the yearly interest rate in this account is 9.1% compounded on a yearly basis. Note that this interest rate is not fixed and will be notified on a yearly basis or from time to time whenever applicable, very much like PPF.

The best part is that the investment in this account is exempted from income tax under sec 80C.

Amount of Deposit and Frequency

The minimum amount one has to deposit per year is Rs 1,000 and the maximum amount is Rs 1,50,000. There is no limit of the number of transactions in a year. When you open the account for the first time, you have to deposit a minimum of Rs 1,000 and above that any multiple of Rs 100 (like Rs 1200 or Rs 1400, but not Rs 1,450).

You also need to make sure that you do not skip your payments each year, otherwise a penalty of Rs. 50 will be levied for each year of non-contribution. At this point in time, it’s not clear if NRI can invest in these schemes or not. I don’t see any wording in the official document published by govt. If someone has clarity on that, please share it in the comments section.

This account can be opened before the girl attains 10 yr of age. So the moment the girl child is born, you can open this account in her name or wait for some years and open it later, but once the age of 10 is reached, one can’t open a new account for the girl child.

You can deposit the money in the account only for the 14 yr period, from the date of opening, so the best thing is to open the account early itself so that you get the maximum window of 14 yr to accumulate the money.

You will need following documents to open this Sukanya Samriddhi account.

Birth certificate of the girl child
Address proof
Identity proof

One can open only maximum of 1 account per girl child and in total only 2 accounts can be opened by parents for 2 girls (one for each), but in case the second birth has resulted in twins, then 3 accounts are allowed. You can’t open multiple accounts for the same child as you do in saving bank account.

Where can you open this account?

As per the notification, this account can be opened either in a Post Office or any public sector bank. You will get a passbook under this scheme which will have details of the account holder (daughter name) along with other information like date of opening etc like it happens in the case of PPF account. Also, the account can be transferred to any city in India later if you wish.

As this has been recently announced, I believe the banks and post office must be in the implementation mode right now and must be training their staff on this.

So if you immediately visit them to open an account, you might face problems as the staff might not be 100% clear of rules. So I suggest to wait for 2-3 months and let the whole thing settle down.

Maturity and Premature Withdrawal

Sukanya Samriddhi Account will get matured after 21 yrs from the date of opening the account or before the marriage of the girl, whichever is earlier. The good part is that if parents want to close the account before 21 years for marriage purpose, they have to give an affidavit that the girl has reached at least 18 yr of age so that one can’t use it for child marriage (before 18 yr).

One can also partially withdraw 50% of the balance amount after the girl reaches 18 years of age, for the educational purpose and rest has to be left in the account so that it can be used for the marriage purpose.

Sukanya Samriddhi account Rules

Also in the worst case, if there is the death of the girl child, the account will have to be closed and the money will be paid to the legal heirs (mostly parents). Apart from that, the account can still be closed much before in cases of extreme compassionate grounds such as medical support in life threatening diseases. death, etc.

There is no loan facility under this scheme.

How can you deposit the money under this scheme?

You can make the payment by Cash, Cheque or demand draft by going to the post office or the bank where you have opened the account.

Unlike PPF or Saving bank account, you can’t deposit the money online as of now, which will really discourage those investors who are too much into online transactions. However, I am sure this is not a cause of concern for people from smaller cities and villages who are the main target for this scheme.

Tax applicable on the money deposited and earned and maturity amount?

As of now, the taxation status of this scheme is ETE (Exempt, taxed, Exempt), which means money deposited is exempted from tax, interest earned is taxable, but the maturity amount is again exempted from tax.

This is exactly how tax-saving fixed deposits work, they also have ETE status. Some people will compare with PPF which is EEE (Exempt, Exempt, Exempt) and there is no tax to be paid in any case.

How much corpus you can accumulate by investing in Sukanya Samriddhi Account?

So how much money you can accumulate in this scheme if you try to get the maximum benefit from this scheme. Assuming you open the account the moment your girl child is born, you will have complete 21 yrs in hand, and if you invest the maximum permissible amount Rs.1,50,000 per year for 14 yrs (tenure allowed for investment).

It can accumulate to the approx amount of Rs 72 lacs after 21 yrs tenure. You will have approx 55 lacs, by the time the girl turns 18 years. So in a way this account can be meet your girl’s education and marriage expenses.

You can withdraw 45-50 lacs for education purpose and also have 25-30 lacs for marriage expenses (try to focus more on education expenses rather than marriage).

The below graph gives an approximate idea of how your corpus will grow in this scheme.

Should you open Sukanya Samriddhi Account for your daughter or not?

If you look at the features of this scheme, then you will realize that it’s very much close to PPF features, the lock-in period, interest rate, passbook facility, partial withdrawal, and taxation status.

So the real question is if it is better than PPF? Or Recurring deposit? In my opinion, overall it’s a good initiative by the government, the intention is pure and something very much required, but it still does not beat PPF as the product. I personally didn’t find any reason why I would prefer this scheme and not PPF?

However, when you look at this scheme, it’s much better than the traditional child policies and child plans (non-equity) from insurance companies. I would recommend this one over them.

How to open Sukanya Samriddhi Account – Real Experience

Thanks to Dr Dinesh Rohilla for sharing his real life experience of opening the SSA account. I am sharing his exact words and experience below

Quite surprised by the updated knowledge of post office staff in a small town like Pataudi regarding this scheme while the commercial banks in the area didn’t have any instructions regarding SSA neither there customer care helpline.

Anyway following is the procedure adapted by me :-

1) Downloaded form from internet along with gazette notification
2) Fill the form and deposit it along with –

Date of Birth Certificate of my daughter

My identity proof

Latest electricity bill for residence proof

Note:- I had pasted photo on form on which it is written that photo is optional but at post office they told me to give them two more photos. So be prepared.

3) Please check whether they had correctly written in pass book the name of the account holder (girl child) and the depositor (parent/guardian).

In my case they had written just depositor name ( girl child which is not correct way) and after bringing it to their notice they promptly corrected and said they write this way on all pass books but will be happy to know the correct method.

4) Please deposit original birth certificate .Postal staff told me that there is no need to deposit original certificate and photocopy will be sufficient. Being a Birth and Death registrar earlier I know that wherever required Birth/Death certificate should be original. You can take as many as certificates as you wish from authorities by paying fee .

5) On the day of opening account you cannot do other transaction as per staff but can open account with any amount.

Overall experience was very pleasant and efficient working of staff really made me happy .
Thanks India post.

S.K Morthy also confirms that many people have started opening this account in the head post office in Chennai .. See his message below

opening of Sukanya Samriddhi Account

Given the long-term nature of girls education and marriage goal, it’s important to beat the inflation and some part should be invested in equity component too. I would suggest SIP in mutual funds for some amount at least if not full.

For someone who is not willing to take any risk, this scheme is a good choice. Also, note that it’s a good idea to open this account if you are already exhausting your PPF limit and cant invest more on girls child name. Even though you will not be getting tax benefits, but you can still invest more money with help of this account.

Sukanya Samriddhi Scheme vs Other investment options

Also, one good point of this scheme is very much focused on girl’s education and marriage expenses and their future, so mentally it’s easy for investors to relate to it and keep their investment separate.

Below there is a comparison between Sukanya Samriddhi Account and PPF account (SSA vs PPF), along with recurring deposit – because you can open all 3 accounts for long-term and invest on a regular basis like on a per-month basis.

Sukanya Samriddhi Scheme comparision

I hope you are the best person to judge if this is better than other alternatives or not.

Please share your thoughts on this initiative and comment back.

21 tips you should follow to secure your banking transactions

Posted on December 26, 2014July 23, 2019 by Jagoinvestor

The world of banking has evolved too much in last 10 yrs and the way banking happens now is totally different from past. Millions of people across the world still do not take simple precautions while they should ideally take or they are too casual about things and later regret when they lose money in some kind of fraud.

Today I want to talk about simple tips and precautions which you should take in your banking and while transacting with debit and credit cards online. It’s up to you to see which of the suggestions and tips suggested applies to you and how deeper you want to be secured. Here are those tips

1. Scratch your CVV number

It’s one of the most common mistakes almost every credit card and debit card holder does. On the back of your card, there is a 3 digit CVV number, which is very critical information and only you should be aware about it. The first thing you should do after getting the card is that you should memorize and write it down somewhere and then scratch it, so that someone else can’t have a look at it. Note that this step will secure your CVV, but then you have to remember it, you can’t retrieve it back if you forget it yourself!

2. Make sure your internet banking password is very strong

Your password for internet banking is probably the most important thing you have to take care of. Make sure you keep it very strong. Do not use your date of birth, name, etc in password, so that one can’t guess it and it’s only known to you. Make sure you have Capital Letters, Numbers, special characters in the password (anyway it’s mandatory in most of the banks portals).

And if possible keep a long password, which makes it tougher to crack and even if someone is watching your fingers typing movement, it becomes extremely tough for them to remember. It’s a good idea to check your password strength on this password strength calculator

3. Make sure have sms alerts enabled for any amount

Make sure you have SMS alerts for all the debit and credit transactions. A lot of online frauds are series of transactions like buying 10 times on a similar site or couple of recharges to various mobile phones. If you get notifications on your phone even for small amounts, it will help you identify the start of a fraudulent activity.

4. Make sure you buy insurance for your wallet and its contents

Companies like OneAssist and CPPIndia have products like wallet insurance, which will cover you from theft and other frauds which are possible in day to day life. Not just that, they have much more than just insuring your credit and debit cards.

If you have ICICI bank Account, you can upgrade your debit card to RubyX and you will get One Assist complimentary benefits for your wallet insurance. Read more on this topic here

5. Do not save your banking passwords in Phone or Email in plain English

It’s a human tendency to take the shortcut route all the times, but when there is your money involved, it’s better not to ! . Do not store your banking passwords etc (I would say any password) in plain English in your emails or drafts or phone. Always make sure it’s in some format which only you understand, like interchange the alphabets one after another (e.g. – 12A47* becomes 214A*7) , so that you know what is the password, but even if someone gets access to it, has to spend some time to crack it. If you can avoid that also, it’s much better.

The other thing you can do is, you can just store start, middle and end 1-2 characters, because most of the times, we just need the start (most of us have multiple passwords). So if your password is MANISH987_FAKEpassw0rd , then you can store it as MA…98…FA…rd , and that’s all . You will most probably be able to recall it considering you are using it from long time, but someone else will not.

6. Never share your CVV / Expiry date to anyone on Telephone or email ever

Being financial literacy at low levels, millions of people are not aware which information is critical and which is not when it comes to credit cards, debit cards and online banking. Things like CVV , your Expiry dates etc are never ever asked by any bank customer care. They ask things like card number, start date, date of birth etc for verification purpose. But there are scams going on internationally where scamsters pose as actual customer care and in name of verification call, they ask for CVV number and Expiry Date, which is extremely confidential information and no one other than the cardholder should know.

7. Don’t let others punch your PIN at restaurants or Petrol Pump

I have seen tons of people who share their debit card CVV number at hotels while dining or even at petrol pumps just because its shortcut, and in 99% cases, nothing happens too and you are safe. But that 1% case is dangerous where someone looks at your expiry and CVV number, and then do the online transaction without requiring your OTP password (6 digit) on international websites (that last level authentication is just applicable for Indian websites)

I personally think you should punch your PIN yourself and not share it with others. Most of the time some restaurants even carry the EDC machine and bring it to you. If you are sharing your PIN with others and handing over cards at hotels, don’t be surprised if someday you get a sms saying – “You just purchased …. worth $340 at amazon.com” , it happens and very much can happen with you too! . Read the incident below

Four unauthorized transactions happened to my ICICI credit card on 27 Jan 2014 in USA in a Grocery Shop amount $1200 (Rs 70000) approx. The Credit card was with me all the times at Bangalore and I never shared my credit card or personal info to anyone. I was using the ICICI credit card from last 6 years. The transactions happened in night and in the morning I show the sms alerts and called customer care about that. (Source)

8. Have the customer care numbers in your mobile for emergency purpose

You should make sure that you have your credit card company customer care stored in your mobile to inform them as soon as possible in case there is some fraud transaction with your account or card. At times, we come to know about the fraud and we feel that we will inform the customer care as soon we reach home/office. But that can actually turn against you because of delay.

9. While using your ATM card, make sure you block the view of others

Looks are deceptive . You never know who is watching you and your activity and what’s their plan? It’s always a good idea to cover your hand while punching the PIN and make sure no one is looking at you. If its ATM, make sure no one is around you. I know many must be thinking that they should probably skip this point, but only when some fraud happens, you realize how important it is.

It’s like people start wearing helmets only after an accident and buy health insurance only when someone in relatives had paid a big bill at hospital.

10. Avoid ATM transactions very late at night or at lonely places

If possible, it’s better to avoid ATM transactions at lonely places or at nighttime especially after 10-11 pm . If you are using ATM’s at remote locations, you have to be extra cautious. There are numerous cases where someone entered the ATM while someone was using it and they at gunpoint looted them or because it was lonely and dark, someone tried to rob someone coming out of ATM.

11. If you don’t swipe your cards regularly, keep it at home

I do this myself. I generally use only credit card when I am transacting offline, and use credit card only for online transactions, so I don’t not carry my credit card at all (haven’t seen it from last one year actually). So if you do not use it on a very regular basis or only in some pre-know situations , then it’s better to carry them only when you require them. Else just keep it at home.

I know this does not apply for many people, but you can still learn from this point .

12. Do not put much info on Social Media

I have seen numerous cases of people sharing their bank account details, phone number, email id, PAN and even date of birth online one various portals online (even on this blog) especially on consumer complaint websites. Note that you can write your entire story without your critical details too. Never share your personal details with anyone stranger or on public forum

13. Enable Two Factor Authentication for your transactions

Enabling two factor authentications means that you will be asked to enter your transaction password and then either an OTP (which comes on SMS) or your card grid values. So there is security at two levels.
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Most of the banks now have this by default, but if your bank has a choice of it, then you should enable it and if your email accounts are too precious, then even they have two factor authentications now (Gmail)

14. Never click on links on email to go to sites

You should never click on the links which come on your email and visit the website of a bank or credit card company. That might be a fraud email, which is taking you to a similar looking website. As far as possible, always make sure you only open the website either by clicking on a pre-stored web address or book marked one by you or type it yourself and always make sure it starts with https://

Below is an example of one such email which was sent by a fraudster on the name of Axis Bank Security update, which was taking the person to some other website on clicking the link mentioned in the email.

Image Source (read the full story on this link) 15. Never access your internet banking passwords and accounts from cyber cafe and someone else PC

You should make sure you do not access your internet banking (and even your important mail accounts) from a public computer or unsecured networks. Places like cyber cafes are a NO NO .. I would even make sure that I do not operate my internet banking from someone else computer too. You never know what kind of softwares are stored on someone computer. There are programs called “Key loggers” which record your which keys are you typing and it keeps a note of it and can later be retrieved.

Even some viruses and Trojans might be stealing your important information on real time and you might be at risk

16. Make sure your computer firewall is turned on and are running antivirus software

A lot of people turn off their firewall to increase the speed of internet . Make sure you avoid keeping it off. The firewall of your computer is extremely important to protect you. Also, make sure you have a good antivirus installed in your computer and keep cleaning it from time to time. You never know what bad thing got installed while you were downloading something over the net (especially when you use torrents)

17. Use Mobile Antivirus in case you access banking from your phone

If you use your mobile frequently to access banking, then it’s a good idea to have even mobile antivirus installed . Most of the troubles come from the least expected people and place.

18. Do not choose to save your passwords in browser when it asks for it

When you login to any website with username and password, browsers often ask you if you want to save the password, so that you it auto populates it next time.

19. Keep your computer OS and browser up-to-date

Its highly recommended that you have an up-to-date browser and Operating system (I hope no one has Windows XP or Vista or old version of IE/Mozilla/Chrome) . There are several security updates which keep coming and many loopholes are detected and fixed from time to time. Almost all the banks suggest it clearly that users should keep their OS and Browsers updated. ICICI bank also mentions it on their security tips webpage ..

20. Use Virtual Keyboard if possible

You must have seen a keyboard kind of interface which can be used while typing password and username, you can use it to make sure you are safe. As I explained before, there are programs like ‘Spy Ware’, which can detect which keys are you hitting and can steal that data. But when you use the virtual keyboard, it can only record which keys you pressed because it’s not happening on your computer, but one the bank server (experts on this topic, please correct me if I am wrong)

You should read more on this topic here

21. Use a separate browser for banking purpose

I think it’s a great idea to use a separate browser itself for banking purpose. Like if you are using Chrome for your other browsing, you can keep Firefox reserved for the banking related activities. I know this might sound like it’s going to extreme level of security, but then it depends on how paranoid you are about this security thing. It’s a personal choice of yours. If you do this, you can choose to disable the cache at all and not save anything in browser at all by default, no plugins , no add ons .. just pure minimal level of browser.

Secure your Banking NOW!

I know that most of the people might be following a lot of things mentioned here. Now it’s time for you to follow the other things mentioned here. Banking is one of the core element of your financial life, which can be considered the central element I would say. It’s extremely important to take care of it with highest level of security.

I would love to hear your comments and any new tips if you want to give from your side?

Jagoinvestor Android App Launched – Read articles on your Mobile

Posted on December 18, 2014July 23, 2019 by Jagoinvestor

I am happy to share that finally we have launched an android app for the blog and an iOS app is in making and will be launched very soon.

You can do various things on the mobile app like reading the latest articles, checking your portfolio (for clients only), do your mutual funds investments and redemptions. You can also visit our knowledge section and check out some education material or use financial calculators on the app.

Here is the Android app link

jagoinvestor mobile android app

I hope this will make life easy for many people. You can download the app on any mobile or tablet which is on android platform. Give give your suggestions and comments on this.

Everything you wanted to know about Advance Tax and Penalties under it

Posted on December 12, 2014July 23, 2019 by Jagoinvestor

Are you paying your income tax only at the end of the financial year ? If your answer is YES, then understand that you are doing it in wrong manner. Today we will learn about Advance Tax which is not widely understood and its quite important thing to know. I know that majority of the people don’t follow this process and pay the income tax at the end of the year only (infact on the last minute many times), But today you should understand if advance tax is applicable in case your case or not.

You can either view the youtube video below to learn about it, or skip it and read the article below.

What is Advance Tax ?

As the name suggests, Advance Tax is part payment of your income tax liability in advance. So instead of paying everything at the end of the year, you pay it 3 times in a year in parts. The concept of Advance tax exists because govt wants you to pay income tax as you earn month after month and not at the end of the year. Advance tax is to be paid when your annual tax liability exceeds Rs 10,000 overall .

However important point is that Advance tax is applicable on your Income from sources other than your Salary like

Interest on FDs or Savings bank deposits exceeding Rs. 10,000/-
Rental income on House Property/properties
Capital Gains on sale of Mutual Funds or Shares
Income from any other sources not mentioned as above.

Which means that if you are a salaried employee who does not have any other income source and if your employer deducts TDS regularly, then Advance Tax is not applicable in your case. You dont need to worry about it.

On which date you have to pay Advance Tax ?

You have to pay advance tax 3 times in a year, which is 15th Sept , 15th Dec and 15th Mar and you should be paying not less than 30% , 60% and 100% of your income tax liability before these dates. Below picture makes it clear for you.

advance tax payment

Which means that if your income tax liability for a year is Rs 1,00,000 , then you should pay advance tax of Rs 30,000 by 15th Sept, another Rs 30,000 by 15th Dec and rest Rs 40,000 by the end of 15th Mar

What if I don’t pay Advance Tax on time ?

If Advance Tax is applicable in your case, then you should be paying it on time, but if you don’t pay it on time, then you can pay it on the next due date along with the interest. So those who have not paid the first installment (i.e. September 15) of Advance Tax (if applicable to you), then you can pay it together with second installment (on of before 15th Dec), but with interest on the first instalment for deferment of the same by three month and if you are not paying it even on Dec 15th , then you can pay it by the end of the year along with the interest.

You will be charged with penalty under Sec 234B and 234C incase you ddon’tpay your advance tax on time. Let me quickly share what is sec 234C and sec 234B

Understanding Penalty under Section 234C

Lets first understand sec 234C. Under this section, if you don’t pay your installments of advance tax on time, then you are charged 1% of simple interest for next 3 months on the amount of shortfall. So this is the penalty to be paid because of DELAY!

Understanding Penalty under Section 234B

If your total advance tax paid by last due date (15th Mar) is less than 90% of your advance tax liability, then you will have to pay 1% interest on the balance amount each month until you complete the payment. which means that suppose your income tax liability is Rs 1,00,000 in total and if you have not paid anything upto 15th Mar, then you will be charged 1% on the outstanding balance (Rs 1 lac in this case) each month, unless you pay it, so if you pay in June , then you will be charged for 3 months penalty and it would be Rs 3,000 in total other than penalty under sec 234C.

Lets understand sec 234B and 234C with help of case studies. Lets assume that your total Income Tax payment for the year would be Rs 50,000, then as per rules of Advance tax, you should be paying

Rs 15,000 by 15th Sept
Another Rs 15,000 by 15th Dec
And Rest 20,000 by 15th Mar

Now imagine you don’t pay any advance tax , then how much penalty you will pay under sec 234B and 234C under various situations ? Below I have explained 4 situations where you pay your full income tax on different dates. Check out how much penalty you will have to pay under these situations !

advance tax payment example

How to pay Advance Tax ?

Now comes the final question, that how can you pay your advance tax ? Most of the people are worried on this, as they feel that paying advance tax would be very tough or involves lots of hassles, but thats not correct. You can make payment of your advance tax in less than 5 min.

There are mainly two ways of payment advance tax.

1. Offline option

Almost all the banks have tie up with govt for accepting the advance tax from the taxpayers, you can go to the banks which have the tie up and fill up the challan number 280 and pay your advance tax to them.

1. Online Payment of Advance Tax

The other faster way to make payment online. Here is how it works

Step 1: Go to https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp

challan 280 for advance tax payment

2. Choose Advance Tax option and other details and make payment

When come to the next page, you will have to choose various details here. Make sure you choose your

PAN Number (of utmost importance)
Advance Tax (under Type of Payment)
Email, Phone and Address details
Assessment year (to know more about this, click here)

Once you choose these details, you can then click on “proceed” and it will connect you to the Bank which you had selected, It will show you your NAME on the next page, so that you can confirm there was no mistake from you end, then you can make the payment online, and you will be able to print the receipt online (you will also get it on email)

Online Payment of Advance Tax

Are you paying your Advance Tax

I guess, you are now clear about the advance tax and how its calculated . Its a good practice to pay your advance tax on time and do not delay it because it can mean a penalty of few thousand rupees in most of the cases. I know its tempting to delay the headache and complete the payment once in a year, a lot of people might be ok with paying some penalty, but then you also invite related problems with it. Pick your choice.