Ways to Cut Taxes and Save money

With the start of the new Financial year and the last one long gone, most of us just like to forget the taxes and money saving ideas we had last year. Even the resolutions made last year are forgotten, but its always best to start investing in the start of the year itself and save money and also cut taxes. This way we dont have to do last minute purchases of tax saving instruments so lets start doing them right now, although i have talked about them a lot of times but i would really like to point them out right now in the start of this FY...

1. Systematic Investment Plans(SIP) - We should just get out there and buy one of those so many advertised Equity Linked Savings scheme SIP 's. Always buy one which can directly debit your account

2. Equities - Its getting more easier to invest in Equities with the DEMAT accounts. With a lot of banks offering share trading options online, you could just sit on office, do a little research, visit this site very often and just buy equities. Although you dont get tax deductions, there is always a exemption from capital gains tax if you stay invested for over 12 months. (also read - How to invest in a stock market)

3. Public Provident Fund(PPF) - I have given a lot of details about PPF in my previous posts but here i would just like to point out that insted of making one large deposit at the end of the year, maybe we can make small investments of equal amount over a period of one year.

4. Insurance - We dont need to wait for the end of the year to complete the premium payments, just try to pay all of them up by December. This way you dont have to wait for March and them make a dash in March for all those premium recipts and collect them to be sent to the office. (also read - What is Endownment Policy)

5. Home Loan - Well this is a great avenue for building up an asset and also helps cut down on the tax liabitlity as well. Even if you already do have your house try buying out a new one, maybe just as an investment or just to rent out.

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4 comments:

Stew said...

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