Money saving tips i found on Google are a great way to help spenders like me
1. Go to the shopping center with your belly full, this way you wont buy too many things since you are not too hungry.
2. Remove unnecessary load from your car. less load can improve the fuel efficiency.
3. If you have an impulse to buy something you should wait for 48 hours and then see if its still there.
4. Always turn off the lights once you leave the room.
5. Technology gets cheaper every three months. So when ever a new product is launched and you think you really want it wait for some time and then see it might be available cheaper.
6. Reuse Paper, this can be ecofriendly and save money.
7. Utilize the Online bill pay facility at your bank, this way you save trip to the billing counter and also save on paper.
8. Get organized and avoid missed payments of the bills and credit cards.
9. If you are living in a rented accommodation try living nearer to the office, this way you can save cost of commuting and all the hassle that comes with it.
10. Eat Out less. Yes that does save money.
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About New Pension Scheme
This is continuation with my last post regarding the new pension scheme...
ACTIVE CHOICE
Under the Active Choice, you can make a decision on how your money will be invested. There are basically three choices and how each choice you make invests your money is explained below.
AUTO CHOICE
Also known as the Life Cycle Choice fund, basically for people who do not want to be make the decision on how the money is invested and would rather let a system handle the same. Under this Choice it basically divides your investment under the three asset classes shown above based on your age bracket. The details are shown below….
Charges for investment are detailed below….
So go ahead and make and save for your retirement.
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Defining Salary Structure - Last Part
Explaining The New Pension Scheme
The new Pension Scheme started by the government of India’s PFRDA is a boon for all those working in the Private Sector and the unorganized sectors. It is a voluntary scheme to take care of us all in the Old age. The PFRDA has defined the Following objectives for the scheme
· To provide Old age Income
· Reasonable market based returns over long term
· Extend old age security coverage to all citizens
You basically have to apply for PRAN (Permanent Retirement account number), which is yours for life and is accessible from across India. The PRAN basically provides you access to two types of account
Tax Benefit – The Tax benefit for this account is like any other pension plan and as per the income tax act.
The Contributions to this scheme are as per below
Minimum amount per Contribution – Rs. 500/-
Minimum Contribution per year – Rs. 6000/-
Minimum no. of Contributions – 04
There are basically two approaches to invest in your account
1. Active Choice - Individual Choices (E, C &G type accounts)
2. Auto Choice – Life Cycle Fund
To be contd....
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What do You do with Surplus Money
· To provide Old age Income
· Reasonable market based returns over long term
· Extend old age security coverage to all citizens
You basically have to apply for PRAN (Permanent Retirement account number), which is yours for life and is accessible from across India. The PRAN basically provides you access to two types of account
Tax Benefit – The Tax benefit for this account is like any other pension plan and as per the income tax act.The Contributions to this scheme are as per below
Minimum amount per Contribution – Rs. 500/-
Minimum Contribution per year – Rs. 6000/-
Minimum no. of Contributions – 04
There are basically two approaches to invest in your account
1. Active Choice - Individual Choices (E, C &G type accounts)
2. Auto Choice – Life Cycle Fund
To be contd....
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Defining Salary Structure - Part 1
Defining Salary Structure - Part 2
Defining Salary Structure - Last Part
What do You do with Surplus Money
What is an NAV
Net Asset Value is the value of each unit in the portfolio. For Mutual funds, it is the price at which investors buy shares from mutual fund company and sell them. There is formula for calculating the NAV
NAV = Total Asset Value - Total Liabilities
----------------------------------
Total no. of units
NAV is usually used by the media like newspapers etc to designate the price per share for any particular Mutual fund. Ofcourse one thing should always be kept in mind that low NAV does not
mean that you are getting a good fund cheaper and it is no indication of performance of Mutual funds. The performance of any Mutual fund should be measured in terms of returns they have given over a period of time.
NAV = Total Asset Value - Total Liabilities
----------------------------------
Total no. of units
NAV is usually used by the media like newspapers etc to designate the price per share for any particular Mutual fund. Ofcourse one thing should always be kept in mind that low NAV does not
mean that you are getting a good fund cheaper and it is no indication of performance of Mutual funds. The performance of any Mutual fund should be measured in terms of returns they have given over a period of time.
Tips for Cutting Costs
Here i would like to give a few tips for cutting costs on personal expenditures and saving some money. This way you will save more and become financially secure faster.
1. Always pay by Cash or Debit Cards.
Potential saving - Saves interest on credit cards and also helps you budget better since cash will limit your expenditure
2. Always Pay credit card payment in the full at the end of every payment cycle.
Potential Saving - Saves interest on credit cards which can actually go upto 40% anually with some banks.
3. Always save small amounts every month for Diwali/Christmas/other festival shopping.
Potential Saving - This way you can avoid going it to shopping spree with a credit card and unlimited expenditure and end up paying heavy interest.
4. Always use internet / phone banking
Potential Saving - Saves fuel traveling to the bank, saves time, saves bank fees in some cases
5. Always take your own Lunch to Office
Potential Saving - If you are spending Rs. 50/day on lunch, in a month you can end up saving Rs 1300/month and Rs.15600/year.
6. Always start saving early for your next car and buy a lower model.
Potential Saving - A larger down payment can result in lower cost and lower interest payments for the loan.
7. Always use pre-paid cards for Children 's mobiles.
Potential Saving - If they talk too much on mobiles and end up finishing there balance early, ask them to top it up with their own pocket money, this way they will know learn the value of money faster.
8. Always stay in a self service hotel when going out on vacation
Potential Saving - Saves a lot on restaurant bill when out of town a lot of money since they are usually cheaper. i recently heard that the TATA group has opened a chain of such hotels.
Well that all i could think of right now, if you have any other items you can think of do let me know.
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1. Always pay by Cash or Debit Cards.
Potential saving - Saves interest on credit cards and also helps you budget better since cash will limit your expenditure
2. Always Pay credit card payment in the full at the end of every payment cycle.
Potential Saving - Saves interest on credit cards which can actually go upto 40% anually with some banks.
3. Always save small amounts every month for Diwali/Christmas/other festival shopping.
Potential Saving - This way you can avoid going it to shopping spree with a credit card and unlimited expenditure and end up paying heavy interest.
4. Always use internet / phone banking
Potential Saving - Saves fuel traveling to the bank, saves time, saves bank fees in some cases
5. Always take your own Lunch to Office
Potential Saving - If you are spending Rs. 50/day on lunch, in a month you can end up saving Rs 1300/month and Rs.15600/year.
6. Always start saving early for your next car and buy a lower model.
Potential Saving - A larger down payment can result in lower cost and lower interest payments for the loan.
7. Always use pre-paid cards for Children 's mobiles.
Potential Saving - If they talk too much on mobiles and end up finishing there balance early, ask them to top it up with their own pocket money, this way they will know learn the value of money faster.
8. Always stay in a self service hotel when going out on vacation
Potential Saving - Saves a lot on restaurant bill when out of town a lot of money since they are usually cheaper. i recently heard that the TATA group has opened a chain of such hotels.
Well that all i could think of right now, if you have any other items you can think of do let me know.
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Negotiate your Salary
Now why would i be talking about salary negotiation in a personal finance blog, well because salary is one of the primary source of income to over 90% of the people reading this blog and hence if you were to negotiate your salary well and get a good salary, you would have more money to spend and invest. I found this cartoon on one of those job portals that i would really like to share with you, its says a lot..
Well any HR professional will tell you that the first thing on his mind during any interview is the salary and how much he thinks the candidate is worth and how much is he willing to negotiate. While some candidates i know, who are desperate for a stable job in these times of recession are thinking "Lets just get in once no matter what they pay right now, i will get a good raise later". This thinking is not practical, since what ever raise that you get after this point will completely depend on the base salary fixed at this time.
There are some things that should be kept in mind while negotiating a salary...
1. Always be ready - Ready with all the data about your current Cost to Company along with any data like your retirement benefits or retention benefits that your company may have provided to you. Research your net worth and what salaries are your peer groups getting in different companies. Know your worth.
2. Dont push too much - Always remember that you are negotiating with the people you have to work with, dont let your negotaition skill tarnish your image. But then there is a very thin line between too much negotaition and too little. Even for the employer, if they really want you cost will always be taking the back seat but still you need to puch in your point as gently as you can.
3. Do not start a salary discussion - Never intiate a salary discussion, it shows you are desperate. Let the employer intiate even if it means going into next round.
4. Do not be hasty - Do not be hasty in rejecting or accepting any proposal put forward your way. Give it time to settle down and think over it very carefully before replying.
5. Freshers careful - If you are fresh out of college remember most companies have policies they like to stick to and might not like to negotiate but you have every right to ask if the salary is negotiable. So ask and if it is let them know your expectation. Do not under or over estimate your worth.
6. Time for silence - Remaining silent for a few seconds to think over a matter or let the emplyer get some breathing space to be able to evaluate what you might have just said. Silence is considered a very key negotiation skill.
7. No politics - Dont let the discussion get into a political mode, these discussions dont go anywhere and you might be left high and dry. So keep the discussion focussed.
8. Dont use the telephone - Never negotiate the salary over telephone, it may always end by you not getting what you asked for. It is very imporatant to study the body langauge of an individual. Including letting the employer study your body language.
9. Do not lie - Never lie about your past salary or about your packages, you dont know where it could lead you and if you are caught even at a later date your job may always be at risk. Some companies do reference checks of there prospective employee and it may create a bad note between yourself and the company.
10. End on a positive note - Always end the discussion in a positive note, even if you dont get the job at the end. Even when rejecting an offer always be polite and remember that you never know when you might be applying again to the company.
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What do you do with surplus money.
Well any HR professional will tell you that the first thing on his mind during any interview is the salary and how much he thinks the candidate is worth and how much is he willing to negotiate. While some candidates i know, who are desperate for a stable job in these times of recession are thinking "Lets just get in once no matter what they pay right now, i will get a good raise later". This thinking is not practical, since what ever raise that you get after this point will completely depend on the base salary fixed at this time.
There are some things that should be kept in mind while negotiating a salary...
1. Always be ready - Ready with all the data about your current Cost to Company along with any data like your retirement benefits or retention benefits that your company may have provided to you. Research your net worth and what salaries are your peer groups getting in different companies. Know your worth.
2. Dont push too much - Always remember that you are negotiating with the people you have to work with, dont let your negotaition skill tarnish your image. But then there is a very thin line between too much negotaition and too little. Even for the employer, if they really want you cost will always be taking the back seat but still you need to puch in your point as gently as you can.
3. Do not start a salary discussion - Never intiate a salary discussion, it shows you are desperate. Let the employer intiate even if it means going into next round.
4. Do not be hasty - Do not be hasty in rejecting or accepting any proposal put forward your way. Give it time to settle down and think over it very carefully before replying.
5. Freshers careful - If you are fresh out of college remember most companies have policies they like to stick to and might not like to negotiate but you have every right to ask if the salary is negotiable. So ask and if it is let them know your expectation. Do not under or over estimate your worth.
6. Time for silence - Remaining silent for a few seconds to think over a matter or let the emplyer get some breathing space to be able to evaluate what you might have just said. Silence is considered a very key negotiation skill.
7. No politics - Dont let the discussion get into a political mode, these discussions dont go anywhere and you might be left high and dry. So keep the discussion focussed.
8. Dont use the telephone - Never negotiate the salary over telephone, it may always end by you not getting what you asked for. It is very imporatant to study the body langauge of an individual. Including letting the employer study your body language.
9. Do not lie - Never lie about your past salary or about your packages, you dont know where it could lead you and if you are caught even at a later date your job may always be at risk. Some companies do reference checks of there prospective employee and it may create a bad note between yourself and the company.
10. End on a positive note - Always end the discussion in a positive note, even if you dont get the job at the end. Even when rejecting an offer always be polite and remember that you never know when you might be applying again to the company.
Related Posts
Defining Salary Structure - Part 1
Defining Salary Structure - Part 2
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What do you do with surplus money.
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.
Related Posts
How to select a Tax saving fund?
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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.
Related Posts
How to select a Tax saving fund?
Money Saving tips
Tax Saving in figures
Investment Opportunities
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