Are you aware of these tips before borrowing for car loans?

For plenty of individuals, getting a loan to finance the purchase of a car can be tempting and easy. All you need is a steady employment and sufficient income to cover your loan payments, and before long, you will be enjoying a brand new car in no time.

No doubt, with plenty of options for car loans, you will be spoilt for choice. Additionally, you will need to consider the risks and downsides that come along with taking any of these auto loans. So, how can you take advantage of the car loan you will be borrowing? Here are a few tips you can consider before borrowing:

Terms of the loans: The rate of the car loans, like any other loans,are determined by several factors namely, your income and your ability to repay the loan amongst many others. In order to get the best car loan in India, you first need to see what all is offered by the lender, and what all can you afford. Consider your own job situation. Are you steady enough to hold a loan for a few months or a few years? Is your job volatile, that you can afford to hold a loan, let alone along with other debts? You also need to contemplate the fact that the value of cars typically depreciate faster than long-term loans are paid off. In this situation, you may not be able to break even, even if you have to sell off your car to finance the loan and added interest.

Maintenance and insurance costs: If you purchase a new car, you would be under warranty for several years. However, if you are purchasing a used car or even car loans that outlast than the warranty period, you need to take into consideration possible maintenance, repair and insurance costs. Your monthly loan payment will definitely be low, but to get a good idea; you will need to take in all the other expenses into account. Additionally, you will need to consider other options in the event that your car breaks down.

Commitment: The decision to purchase a car will go back to your current life situation and how dedicated you are to your current job and location. Even if the car payment is lower than the leasing of a car, getting out of a car loan will be a costly affair. So if you see yourself in a stable job, with no plans to relocate or switch jobs, you can shop around for a car loan in India that suits your needs. An exception to this situation will be sufficient cash payment. If you have sufficient physical cash, you can easily pay off the purchase without any hassle.

All You Need to Know About What is Demat Account

A Demat account is an indispensable thing to have if you want to trade in the stock market. This kind of an account is meant to store your shares, bonds, mutual funds, government securities and more. Demat or dematerialisation has simplified the whole stock market trade experience by eliminating physical share certificates and replacing them with electronic form of securities. Here is more on what is Demat account and how it works.

- Central Depository: The two depositories in India are – the National Securities Depository Services Limited and the Central Depository Services Limited. The central depository keeps all your shareholding information on your behalf in a similar way that the banks do.
- Depository Participants: An investor can have access to their central depository with the help of their depository participants (DPs). The DPs can be a financial institution like a bank or brokers or organisations that provide Demat services.
- Unique ID: Every Demat account gets a unique number for identification. This number can be used to carry out transactions and for companies to identify you in order to credit shares to your account.
- Hold Portfolio: Since the Demat account keeps a record of all your securities and investments, you can take a look at your portfolio at one go. Every time you conduct a transaction, whether buying or selling shares, your list is automatically updated.

How to Open a Demat Account:

- The first step is to fill out a form for opening the Demat account. Submit it with the required documents like PAN card and residential address and a passport-sized photograph.
- Next, you will be given a copy of the list of the rules and regulations, various terms and the charges that you will need to pay.
- During this process, a member of the Depository Participant (bank person or broker) will contact you in order to cross-check the details you have provided for opening the account.
- As the application process progresses, you will be provided with a client ID or account number that can be used to access the details of your new account.
- Once the account starts functioning, the account holder may have to pay a certain fee to maintain the account or while converting physical shares to electronic form. Different DPs charge different fees as per their norms.
- When you open a Demat account, you absolutely have no worries about keeping a minimum amount of shares. You can open an account with no shares in it.

So if you were wondering what is Demat account, this should answer your question. You can now open an account with confidence and carry out your stock and other investments smoothly.

How a Prepaid Forex Card is Helpful During Your Travel

The holiday season is here and many of you must be packing your bags for a foreign tour with your loved ones. With changing times our banking needs have upgraded to another level. With almost every country going cashless, having a prepaid forex card is a blessing. This card is the best way to buy foreign currency while travelling abroad. Here are some of the benefits that make this cashless option so favourable for everybody who is planning a vacation.

- Accepted Everywhere: This card is accepted almost everywhere and you will never have any trouble finding a counter that takes this card for foreign currency. It is a feasible option if you have set out on a Euro trip, as you will save a lot of cross country currency exchange cost. Who would want to pay extra while travelling from one country to another?

- Reasonable over Credit/Debit Card: The prepaid forex card is a much cheaper option than a credit/debit card. If you decide to use your credit or debit card in a foreign country, you will be charged with a cross-currency mark-up for every transaction, which can range from 3-5%. Whereas, the forex card already carries foreign currency and it saves on all those extra mark-up costs.

- Safe and Secure: A card is always easier to carry than bundles of cash. And various companies also provide a secondary card along with the original forex card, which can be activated by placing a request on a toll free number when you lose the original one. The forex card can also be hot listed when lost just like your credit or debit card.

- Why Buy Currency: Why should one buy currency when it is more cost effective to buy a prepaid card. One should always opt for a prepaid forex card rather than buying cash and tediously carrying it along.

- Shielded from Currency Fluctuations: The prepaid card is always unaffected by any kind of currency fluctuations. It is because the amount loaded in the card is valued on the exchange rate of the day of the transaction, which remains unchanged.It is a win-win situation for you as no amount of currency hike or fall will affect the money already stocked on your prepaid card.

These are some of the benefits of the prepaid card while travelling abroad. You can plan your trip ease when you have the forex card handy. It is absolutely hassle-free and loaded with advantages. There are several banks like HDFC, ICICI, Axis, SBI and more offers a variety of prepaid cards to make your international trip a joyful one.

Several Advantages of Online Mobile Recharge

With changing times we as a race have made progress in all the areas of our lives. From banking to shopping and paying bills, everything has been digitalised. Things have become much more convenient and simple with technology spreading its branches to all the aspects of our lifestyle. Gone are the days when people would stand in line for hours just to get their mobile phones recharged. With digital options stepping, the same can be done at the comfort of your home or office. There are several benefits of online mobile recharge, following are some of them.

- Convenience: The recharge process has become absolutely hassle-free as you can make payments while relaxing on your couch. The services are available 24 x 7 and there are no restrictions whatsoever. This is the best way one can save time and energy.

- Easy Payment: One can recharge their pre-paid numbers or pay their post-paid ones using a Debit, Credit or ATM card. One can also use net banking accounts or Paytm accounts for online mobile recharge.

- Variety: There is a wide variety of recharge options for SMS, data packs, talk time, ISD services and more, which can be recharged via an online mode. There is no need to visit store after store to find the exact recharge you are looking for. There are various online portals that are a one-stop-solution for all your online mobile recharge needs.

- All-in-one:There are various online applications like Freecharge, Mobikwik, Paytm and more that provide recharge options for all major mobile service providers. You can get any account recharged with the help of these convenient mobile apps.

- Cash Back: Some of the recharge apps and portals also offer a certain percent of cash back amount along with other benefits like free coupons for various food and entertainment outlets. This is a great advantage for all mobile users as none of the physical recharge stores would offer such exciting offers for recharging your mobile.

- Easy Procedure: The process of recharging your phone is quite simple. All you got to do is download the app or visit the portal, login with your details, sync your bank details like credit/debit card number, password, related mobile number, and a few more banking details. Once this is done, you can recharge your phone any time you need to without any complication.

These are some of the benefits of online mobile recharge that makes it such a favourable option during these fast-paced, digitalised times. If you still haven’t tried this, you need to try it for yourself and get ready to be a total fan of this digital wonder.

How to avoid traps when applying for a credit card this festive season

With the festive time approaching, it may not come as a surprise that you will be caught up in the sudden festivities. Soon you will find yourself amidst the chaos of choosing gifts and shopping for attires.

But to make your financial expenditure more flexible and convenient during this time, surely you would think a credit card would make a great tool to help finance your purchase. No doubt, you will rack reward points or even cash back offers with the amount of shopping you will do with the card. After all, the bill at the end would justify the means of saving in the long run. But is it?

Not many are aware, that excessive expenditure on your credit card can lead to plenty of financial traps in the future. And this future can also be long term. So if you are thinking to apply for a credit card here are a few things you need to keep in mind, before you begin the application process.

• Limit your application to one credit card: It may seem easy when you are considering a credit card to apply for, especially when it comes to multiple credit cards. But you should actually restrict your application to one card. This will go a long way to set what you spend, especially since the limit on the card will prevent any extensive expenditures. Additionally, one card will make it easier to set a regular pattern of purchases and repayment, which goes a long way to establishing a good credit history.

• Understand all the terms and conditions: Before even beginning the process to apply for a credit card, you first need to consider the terms associated with this banking card. What is the interest fee, what are the annual fees attached to it? Are there different rates for cash advances? You will need stringent answers to these questions before you consider a credit card to apply for.

• Set a budget: Setting a budget is critical when you begin to shop with the credit card. No doubt, the limit on the card will prevent you from over expenditure, but a budget will deter you from even reaching that limit in the first place. It also helps prevent any unnecessary expenditures and reduce your overall credit bill. 

• Set a time limit on big purchases: You may have to spend big bucks on items that are a bit expensive. Before making this purchase, you will need to consider the necessity and feasibility of your repayment on such purchases along with your other smaller purchases. To be on the safer side, establish a waiting period of several days before you buy.

• Ensure that you avoid paying a bare minimum: While you shop, you can also take steps to repay the borrowed funds as soon as possible.Your minimum repayments can be as low at 1.5% of the outstanding amount. But by paying the minimum amount, you don’t cover your interest payments. In the end, you will pay more interest overall, thus making it longer to pay off your debt.

What are the factors you need to consider when applying for a car loan?

In today’s day and time, owning a car is not only an imperative but also a part of one’s lifestyle. There are also plenty of options a potential car owner can consider, based on the different features of the car. However, it is these features that set the price of the car, which in turn, influences the car owner’s choice of financing the purchase. In other words, if you are looking to purchase a car, you may need to consider your financial borrowing options.

Amongst the various financial options, the car loan is one option that is the most favourable option to finance this purchase. But before you can opt for the best car loan, that can suit your needs; there are certain factors you will need to consider. These factors will go a long way to determining the loan type that will suit your need, but also ensure that you have a convenient means to repay back the borrowed funds. They include the following:

Amount to put down: The amount to put down, also known as the down payment, is one factor that not many car owners are aware of. However, it is one of the most important factors that you should consider, as in turn, it will affect the principal amount you are liable for. It also determines how much of interest you will need to pay for the principal amount. Additionally, since the value of the car depreciates the moment you sign up for it, the down payment will determine how much you owe the car, especially in terms of insurance.

Length of the tenure: Like any other loan, you would be required to pay a loan amount during a fixed tenure for the car loan. The normal duration is not more than 15 years. While a longer tenure will lead to lower monthly payments, it will also increase the interest rate. Opt a tenure that does not outlive the car itself.

Interest rates: The interest rates for the car loan may vary, but the ideal way to get the best car loan interest rates is to compare lenders. You can keep in mind that loan rates are typically high on long loans, therefore try to opt for a shorter one.

Cost of deferred payments: Plenty of lenders may be offering a ‘payment free’ limited months as a part of their offer. While this may imply that you don’t have to pay for your car during that time, chances are, you will still have to pay the interest. In other words, in addition to the principal amount along with the added interest, you will also need to pay interest for those ‘free months.'

Financial lenders dealer: When opting for loan options, you can either approach a financial institution or through a car dealer. While it may be convenient to have a dealer arrange the financing, you should be aware they will offer a mark – up on their offerings, so as to increase the overall cost of the loan. Don’t settle for such offers, until you have independent loan offers to compare them with

Why should you open a recurring deposit for your child right from birth?

In today’s day and age, you may be feeling the pinch of the financial demand. No matter what you do, or how much of an additional income you earn, you may seem to never have enough. But what if you could plan your financial future, right from the time of birth, in order to have a sufficient financial cushioning by the time of earning on one’s own two feet?

While the chance may have gone by for you, your children, on the other hand, have the perfect opportunity. But with all the financial products available in the market, how can you choose the right one? The recurring deposit is one such option that you can consider. Through this termed deposit, you only need to put in a few funds, on the designated date, on a monthly basis until the deposit has matured. On maturity, you have the choice to reconvert the initial investment amount along or along with the added interest. Here are some of the few benefits your child can earn financial with the recurring deposit.

Start small, increase later: One of the main benefits of the recurring deposit is the flexibility in the amount that can be invested. As mentioned above, you would be required to invest a small amount, on a monthly basis until the tenure is met. This amount will vary from lender to lender. For some lenders, the amount will be as small as Rs 100 to 1000. The upper limit can also be Rs. 49,000. While it may go beyond your financial limit to invest the upper limit, in this investment, you can start with the smallest amount for the first few initial years. You can then increase the investment amount, as per your financial flexibility.

Create long tenures: The recurring deposit comes with fixed tenures. These tenures can last anywhere between 6 months to 10 years. You can opt for a comfortable tenure that offers you a flexible yet optimum return on your investment. Additionally, when considering this factor, you should also remember that the interest rate will be tied to the tenure of the deposit. Therefore, the longer the tenure, the higher will be the interest rate.

Opt for compounding interest: As mentioned previously, the termed deposit comes with an interest rate. However, it also comes with two different types, namely, the simple and the compounding interest rate. The simple interest rate is calculated on the initial amount that is invested, at a fixed interest rate. With the compounding interest, the deposited interest is added to the principal amount, thus increasing the value of the principal amount, at a fixed interest rate.

Create multiple deposits: While one termed deposit may not satisfy all the financial requirements your child may require in the future, you can compensate for it, by creating multiple deposits with different tenures. In this way, you can time the maturity at the time where you can use it, or reinvest it for a higher interest rate.