How much will your car loan payments be?

A car loan is a type of personal loan that allows the borrower to purchase the vehicle of his choice. The loan is then cleared through monthly payments at a particular interest rate and tenure. Many banks offer great auto loans at attractive interest rates today, making it more convenient for individuals to own their dream car!

But before opting for an auto loan, consider the loan amount and plan a budget accordingly.

A number of factors determine the final amount that needs to be paid when purchasing a car. Similarly, these factors determine the auto loan amount that one needs to apply for.

The best way to calculate the loan payments in order to purchase a car is through a car loan calculator. One can effectively use this calculation tool to accurately calculate the nature of his payments during the term of the car loan. 

The three major factors upon which the payment of a car loan depends are-

1. The price that one pays for the car after including all trade-ins
2. Rebates
3. The down payment

Once, the borrower is aware of the above three numbers, he can calculate the EMI that he needs to pay after including the interest rate on the car loan.

How to calculate car loan payments?

Any car loan calculator will ask for the below mentioned basic information. This includes-

• Price of the vehicle
• Trade-in-Value
• The amount of down payment
• Interest rate
• Tenure of loan

Car loan calculators that offer greater detail, may also ask for sales tax paid on the car. Using a car loan calculator is fairly simple and will allow one to plan his auto budget accordingly. One can get access to a car loan calculator online on various websites.

While car loans are easily available in the market, one should be extremely careful when applying for this type of a loan. Dealers are offering long term auto loans to make expensive cars more affordable for customers. There was a time when the tenure of a car loan was maximum 60 months, but today dealerships also offer a tenure of 6-7 years on car loans.

The longer the loan, more is the interest that has to be cleared. Thus, in the long run the loan turns out to be more expensive than the car purchase. Discuss all the aspects of the loan with the dealer first.

Before opting for a long term car loan, use a car loan calculator to ensure if it is feasible to pay back such a loan amount.

How to use your savings account to meet your millennial goals

While most people opt for fixed deposits and recurring deposits in order to maximise their goals, the same can be done with a savings account as well. Especially, in case of millennials who do not have a large amount of cash to invest in a fix deposit, using a savings account smartly will take one a long way!

A wide variety of different types of savings accounts are available, which help to build up cash to meet future goals. They are-

Savings accounts offering high interest- A number of savings accounts offer high interest on the money one saves. In fact, a few also come with the feature of a high introductory rate of interest that is offered for a particular period of time.

Savings accounts that offer incentives and bonuses- Investing in such a type of savings account is a great way to earn fast money. In case a customer meets particular conditions, such as limited withdrawals, a bonus is added to his account.

Savings accounts online- In case one is too busy to regularly visit their local bank branch, open a savings account online. Online savings accounts offer better interest rates and lower overhead charges.

In order to choose the savings account that best suits one’s needs, consider all the different options and decide how you would like to manage the account. In case one opts for an introductory rate, ensure that a competitive interest rate is offered in order to maximise returns. Also find out the frequency at which the interest is calculated. The more frequently it is compounded the higher will be the returns.

Most importantly, carefully consider all the terms and conditions the bank is offering before opening a savings bank account. Go through all the fees, requirements of deposits and withdrawals, overhead charges as well as any restrictions that are mentioned in the agreement, before accepting it.

Another effective way of optimizing the use of a savings account is opening more than one. This is especially beneficial for those individuals who are looking forward to accomplish multiple goals. So if one has 2 goals to meet in about 5 years, he can set up 2 savings bank accounts and segregate his savings separately. This does help prioritise and effectively plan a budget as well. In this way one knows exactly how much he needs to meet each specific goal, and money can be saved at a faster rate.

Start small by opening two or more savings bank accounts, but achieve big money goals this way!

Reduce your chances of defaulting on your business loan with these tips

One may default a business loan for a number of reasons. In case of some individuals it is merely carless miscalculation, for many others a default may be the result of bad sales, sudden financial emergency or other related factors.

A business loan default should be avoided as much as possible, because it negatively effects one’s credit score and history. Moreover, a default also adds more debt pressure and puts one’s assets at great risk.

Some amount of grace is given by banks to a borrower, generally about 2 weeks, before he is tagged a defaulter, but this is absolutely on the lender’s discretion. Here are a few helpful tips that one should keep in mind in order to avoid defaulting-

In case of delay, inform the lender

If you have taken a business loan and are going through a difficult time, it is best to contact the lender and inform him why there may be a delay in payment of the EMI. One should inform the lender that he needs some time to get things together and that repayment will be done soon.

Refinance

A common problem that many businesses face is the pressure of clearing small loans that have been taken for a short period of time. In this case, one should weigh their options and consider refinancing. Debt consolidation comes handy during this time. But the present situation should be carefully evaluated before taking another huge loan to pay current short loans.

Prioritize payment of debts

In case one has a number of short term debts, it is best to prioritize their payment. Keep in mind the payments that need to be made at the end of the month and ensure that they are promptly cleared. Do not delay small payments as they will keep piling up.

Ensure that the credit card that has a high rate of interest is cleared first. In this case one pays less interest on the whole.

Take legal help

Seek the advice of a lawyer in order to find a solution to any such problem.

Try cutting costs

In case the business is new, ensure that some cost cuts are practiced. A stringent budget should be organised and re-evaluation of the expenses should be undertaken from time to time. This will allow one to plan his debt repayment more efficiently and prevent any defaults of business loan.

In order to successfully pay back a business loan, one should carefully consider if he really needs the money and has the capacity to repay, at the time of loan application.

Demat Account: How holding this account will benefit you

Dematerialization first began in 1966 and the concept of demat, which is short for ‘dematerialization of share’ has been silently growing in the country.  It functions similarly to a bank, just as accounts can be opened in banks to save money, customers are given a passbook and online access to make transactions and check balance, the same is done in case of dematerialization. In this case, the data is kept in depositories and backed up as well depending on its importance. This service has made the trade and ownership of shares more secure and simple.

To open Demat account, first conduct a thorough research and compare which bank is offering the best Demat account features and benefits. Once the decision is made send in the application along with the necessary documents. Once the documents and application are approved and processed, the Demat account is opened at the cost of a small maintenance fee. The documents that need to be provided include identity proof and address proof. Submitting a copy of the PAN card is best. One also has to submit their photograph at the same time.

To open Demat account, a minimum balance is not essential. Although it is best to make sure that the documents provided are correct to avoid any delay. Here are a few advantages of holding a Demat account-

• Dealing with shares via a Demat account is not only convenient but extremely easy as well.
• Because all the data is securely stored, one does not have to worry about lost investment certificates or for that matter even fake certificates.
• It is quite simple to transfer securities via a Demat account.
• As compared to the cost incurred via physical purchase and sale of securities, costs incurred are much lower when such transactions are made through a Demat account.
• Bonus shares as well as share splits are stored in the account automatically.
• The banks offering the best demat account features, also manage bonds for customers. Thus, one can manage majority of their investments through a single account.
• Through a Demat account single shares can now be transacted as well. Earlier, this was not possible and shares could only be transacted when in lots.
• Thefts, faulty deliveries and the risk related to false shares will be completely eliminated for those who hold a Demat account. It also involves less paperwork and timely delivery.

One can effectively trade through a demat account, but deal with a bank that is reliable and offers the best features in share sale and purchase.

How to deal with ATM card frauds

While an ATM card or a Debit card come extremely handy on a day to day basis, one has to be careful when using them. ATM frauds are very common and one may fall prey to such a theft when they least expect it. Thus, it is best to be alert when using an ATM card or a Debit card.

To avoid falling prey to an ATM card theft, one needs to first know the various means through which such fraud is committed-

1. Cash trapping through a ruler device- In this case the thief installs a ruler device that holds onto cash in the ATM machine. When cash is withdrawn it does not come out, and while the customer seeks help the thief withdraws the money and escapes.
2. Distraction and attack- In this case, the customer is distracted by one gang member just after he has authorized the transaction via an ATM machine. The distraction may be in the form of some emergency assistance. While the customer is helping out, another gang member removes the money from the machine.
3. Very often fake pin pads are also installed in order to get hold of transaction PINs. 
4. Card skimmers may also be used to commit ATM card fraud. This device basically records the data from the ATM card’s magnetic strip. While this means of fraud is more common in case of credit cards, it is also sometimes used to commit ATM card frauds.

Here is how one can deal with ATM card frauds-

• Once you have entered the ATM room, stay alert and carefully observe the place.
• Hide the ATM keypad while typing the PIN as well as the amount.
• In case the machine does not work efficiently, inform the authorities immediately. Make sure to cancel any transaction first.
• While making the transaction do not take help of any strangers, especially those who look suspicious.
• After the transaction is complete and the money has come out of the machine leave the ATM room but ensure that you are not followed. If one feels suspicious head right towards a local police station and make a complaint. 
• If one has fallen prey to a debit card fraud or witnessed it make sure to get in touch with the authorities immediately. This way prompt action can be taken and the criminal or gang may be located and put behind bars.

All types of crime and thefts can be prevented by the spread of awareness. Thus, one should be aware about such crimes in order to stay alert and vigilant.

Why do you need internet banking today?

Internet banking is convenient and is gaining much popularity these days. While many may still prefer the traditional way of banking, that is, making transactions through checks and bank drafts, there are others who have adopted the modern system of banking- Internet banking!

Very soon most individuals will prefer this modern form of banking over the traditional means of making transactions, and rightly so!

With the advent of the internet, lifestyle these days has become superfast. No one has the time to make frequent bank visits in order to make transactions. Thus, internet banking is the perfect solution for instant transactions from the comfort of the office or home. It is fast, easy and reliable!

Here are a few reasons why Internet banking is great and a must these days-

• Pay bills with just a few clicks

Online banking allows one to clear their bills without the hassle of standing in long lines. Bills can be cleared anytime from anywhere. While many complain that relevant information has to be first put in about the payees, which takes considerable time, this is merely a onetime thing. Once this step is completed, bills can be paid anytime by just choosing the payee profile and authorizing the payment.

• Easy view of list of transactions

One can get access to their transactions and account balance anytime, anywhere. There is no need to constantly update passbooks in order to keep a tab of the account history anymore. Thus, one can easily keep a tab on any pending transactions or other issues related to the account. Any errors that occur can also be immediately detected and resolved.

• Access to mobile banking facility

Internet banking has just become more advanced with the recent introduction of mobile banking applications and facilities. Thus, one can now do bank transactions and payments through apps on their smart phones. One only has to download the app and boot in relevant information to log in. Once this process is done transactions and bill payments are just a touch away.

• Easy access to bank information

Internet banking also allows one easy access to information about loans and various investment options that the bank offers.

While Internet banking has made life easier and is quite secure, one should be vary of cyber-crime and ensure that their account is well protected. Account passwords should be changed often and always log out after every session. It is also best to avoid sharing account passwords with anyone or logging on to the bank account on an open Wi-Fi.

Know how your interest is taxed with your recurring deposit

A recurring deposit is very similar to a fixed deposit, except one does not have to lock in the entire sum at one go. In case of a recurring deposit a fixed amount of cash has to be transferred to the account on a monthly basis for a certain period of time.

To open a recurring deposit account, one has to first open a savings bank account. Each month, money will be automatically deducted from the savings account and transferred to the recurring deposit account. If one opts for a recurring deposit of 5 years, the rate of interest that he may get is about 8.4% annually.

How is interest taxed in case of a recurring deposit?

While before the year 2015, there were no taxes charged on interest earned from recurring deposit investments, the government came up with a new rule during the financial budget of 2015-2016, that TDS (Tax Deducted at Source) would apply henceforth and 10% would be deducted from the interest that is earned on recurring deposit.

But TDS is only deducted if the interest earned is above Rs10, 000. In case one fails to submit their PAN card information to the bank, they are charged 20% on the interest earned.

In case one has a recurring deposit account and their income falls below the non-taxable income category, form 15G still needs to be submitted in case of fixed deposits as well as recurring deposits.

How can you opt for tax exemption on a recurring deposit?

In order to reduce tax payment it is best to opt for tax saving recurring deposit accounts. One simple way of saving tax payment on recurring deposit is by opening an account with the Post Office. Tax exemption is only applicable if the account has tenure of about 5 years.

The income tax is generally cleared at the end of every financial year or after the recurring deposit matures. The same applies for fixed deposit accounts. The choice is generally made by the tax payer. But, once the time of tax payment is chosen it cannot be changed.

Are taxes liable for a minor holding a recurring deposit account?

In case a recurring deposit account is held by a minor, the parents are entitled to pay the tax on the earnings.

Calculation of income on recurring deposit
For the most accurate results it is best that one uses a recurring deposit calculator, which is available on a number of bank websites. A RD calculator is simple to use and saves time.