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Ways to save money for your client IMS Proschool http://proschool.imsindia.com

Ways To Save Money

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Page 1: Ways To Save Money

Ways to save money for your client

IMS Proschool

http://proschool.imsindia.com

Page 2: Ways To Save Money

Saving money on Home Loans

• Your client can opt to pay EMI at the beginning of the month rather than at the end of month–Case Rs 30 Lakh Loan, Tenure 20 years,

Interest rate. Find out how much savings can accrue by paying the EMI at the beginning of the month

–What happens if the small amount thus saved is invested in Equity Mutual fund as SIP for 20 years at 15% return ?

–Caluclate the savings that you can generate for your client

Page 3: Ways To Save Money

Opting for Max PF Deductions

• Companies normally deduct min amout i.e Rs 780 p.m as deductions towards PF. An equal amount is contributed by the employor. This amount of Rs 780 deposited is tax free.

– Is it possible to increase this Tax Free income. Employees can choose to opt for Maximum PF deduction i,e 12% of Basic. Equal amount can be contributed by employer. Suppose if 50,000 is basic then Rs 6000/= is deducted from employee and 6000/= is paid by employeer. Rs 6000/= for 12 months paid by employer amounts to Rs 72,000/= Employees can opt out for deduction of this component from other taxable income. If the employee falls under 30% bracket. The tax saved on this Rs 72,000/= is close Rs 24,000 per annum

Page 4: Ways To Save Money

Saving Taxes by Residential Status criteria

• If your client travels outside the country for work, he need not pay taxes if the travel date is before Sep 29 (and he stays there for remaining part of the financial year)

• If he travels after Sep 30, he will end up paying tax both in India and abroad–Little planning can help huge amount of

savings

Page 5: Ways To Save Money

Loss from House Property

• If your client has bought house on borrowed capital and the property is let out you can use Income from house property clause to save money for your client

Page 6: Ways To Save Money

Treating Insurance as an expense

• If we change our perception from Insurance as an investment or tax planning tool to Insurance as an expense, lot more money can be saved

Page 7: Ways To Save Money

Helping Clients to make rational Financial Decisons

• Most financial decisions taken by us are emotional rather than rational–Replacing old Car/TV/Mobile frequently–Shoping & Entertainment expenses–Eating out–Buying products including financial products

(We buy insurance products mostly guided by emotional aspect)

– If we can question each financial decision and try to see the rational..

Page 8: Ways To Save Money

Most importantly

• Making a Budget and sticking to the budget–How many of your clients have monthly

budgets–Even if they have one, how many of them

stick to it ?