Saturday, 29 April 2017

“Health cover is the best healthcare financing tool for women‘

Women should take the lead in buying health insurance policies early on in life and can then choose to add their spouse once they get married.

How important is to for women to have adequate health insurance cover?

Women face a number of unique risks such as gender-related illnesses, care giving responsibilities, ageing (longevity), greater healthcare costs etc. Women bear higher risk of cervical and breast cancer. While medical advancements have made these illnesses less severe, the financial drain of fighting these diseases is sufficient to wipe out a lifetime of savings of entire family. Hence it is advisable that women pay special attention to their health at all times, and proactively invest in healthcare financing instruments. Health insurance is undeniably the best healthcare financing tool. 

A survey conducted by Apollo Munich Health Insurance in collaboration with Nielsen India Pvt. Ltd. In 19 cities found that despite a rise in health insurance claims filed by women, few women are coming forward to buy health insurance. Given the low awareness for the need of a health cover, the number of women opting for products that are tailored for them, has significantly gone down.

The need of the hour today is to increase penetration of health insurance among women and provide specialized incentives for them to purchase policies to cover their healthcare needs specifically. While some insurers are offering specialized covers, women should consider taking up at least a basic individual sum insured health insurance policy of Rs 5 lakhs to cover the gender neutral ailments such as diabetes, obesity, cancer, cardiac conditions, etc

Do health insurance needs for women change in different life-stages? 
Women should take the lead in buying health insurance policies early on in life and can then choose to add their spouse once they get married. If one’s husband already owns an individual plan, a woman can choose to continue with her own plan, in order to enjoy continuous benefits.

For example, women in their 20s should purchase a basic indemnity health insurance policy that covers oneself, when she starts her career. For women in their 30s, individual policies are ideal, and in cases where she has children younger than 12 years, a policy of Rs 5 -7.5 lakhs is ideal to ensure coverage for all medical expenses. Women in their 40s and 50s must consider buying a critical illness policy if she is genetically susceptible to ailments such as diabetes and heart conditions. A critical illness policy is a good add-on policy to one’s indemnity health insurance policy, as it provides a lump-sum amount for treatment of pre-determined ailments/diseases.

What are the things women should keep in mind while buying health cover?
While buying health insurance policies, women must comprehend the features, benefits and exclusions and determine which policy is most suitable for them. 

Women should consider opting for additional covers such as critical illness that are now offered along with standard health insurance plans, as these riders offer additional coverage for heart attacks, cancer, diabetes, kidney failure, organ transplant or paralysis. In case any of these ailments are genetic, then a woman can benefit from these riders over and above her existing health insurance policy.

With the rising number of Indians being diagnosed with lifestyle diseases, women are most susceptible to ailments such as diabetes, obesity, cardiac conditions, long-term gynecological conditions, cancer, etc. Hence it is essential that a woman choose a personal health insurance policy for herself, as an add-on cover to what her spouse may already have from his employer.

While there are women-specific policies in the marketplace, the ailments/diseases that require health insurance coverage are not always gender-specific and are covered by most health insurance policies. Hence, women must focus their decision on what kind of health insurance policy they need, rather than paying for medical expenses through personal means.

Lifestyle ailments that are prevalent today, are largely gender neutral, and hence it is imperative that women seek health insurance coverage for themselves. With more women becoming economically independent today and leading longer lives, women should consider individual health insurance policies and critical illness riders, etc., and not depend only on the spouse’s cover to mitigate their healthcare expenses.

Friday, 5 August 2016

Hello Our Avid Reader, 

This time I am sharing the article based on relationship with money & how one generation can teach or make the younger generation how to Value Wealth & how to retain .In this context real time example of Mr Savji Dholakia - 54, chairman of the diamond company, Hari Krishna Exports Pvt. Ltd. A big time Diamond Trader from Surat - Gujarat having a turnover more than 6,00,000/-, Who sent away his son Mr Dravya Dholakia, 21 to Kerala to gain a hands on life experience to earn & live in Kerala without using his father influence nor use any money.


A father ensures impeccable life lessons for the 21-year-old heir to his Rs 6,000-crore diamond empire.

This is a story wholly about money, starting with the name of the protagonist, Dravya Dholakia, 21, the son of one of India's leading diamond merchants. In Hindi, dravya means liquidity, and the word is often used to signify cash.

Last week the Times of India reported the story of how Suratbased Savji Dholakia, 54, chairman of the diamond company, Hari Krishna Exports Pvt. Ltd., sent his son and heir Dravya on a unique life hack: Dholakia senior wanted his son, raised with a diamondencrusted golden spoon, to understand and appreciate the value of every single rupee. Towards this end, he challenged his son to go to far-flung Kochi (where he was bound to encounter language difficulties) for a month and earn his keep doing odd jobs.
On June 21, Dravya, who studies as a second year student of Bachelor of Business Administration at Pace University, New York, set off for Kochi with three sets of clothing and Rs 7,000 that was to be used only in case of an emergency.

What follows is an account of how that eventful month unfolded and how it has indelibly changed his life.

Dravya grew up in a beautifully appointed 11-storied home on the banks of river Tapi in Surat, and which he shares with his extended family comprising uncles, cousins, aunts, several nephews and nieces. Save for one month in Kochi, when he had to take the bus, he has only ever driven around in Bentleys and Lamborghinis when in India. The family's diamond business has its footprint across 71 countries and at last count the business was worth Rs 6,000 crore.
His father, not just a canny businessman but also someone with an astute understanding of life, had previously sent four of his nephews too to different parts of India on a similar challenge. Now it was the turn of his young son, who was often in the habit of demanding and getting all the fripperies that a luxurious life offers.

Savji Dholakia chose Kochi for his son to go and earn his daily bread because he had had an unpleasant time when he had gone there and he knew that problems with language would up the difficulty levels in this game that he was devising for Dravya.

For starters, upon his arrival in Kochi, when he began to look for odd jobs, Dravya encountered Kochi's 'No Malayalam, No Job' rule.

For the first two days he had no luck with a job but had to shell out Rs 250 a night from his emergency fund to rent a room in a lodge. Unlike back home in Gujarat, where homeless people are often allowed to sleep in a temple premises, Kochi temples offered no such haven.

Dravya decided he would tell prospective employers that he was a farmer's son from Gujarat, keen on making a living in Kerala. Having never had to earn his money, the first hurdle Dravya faced was to "ask" for a job. So even if he learnt of a vacancy in a shop, he would just go and stand outside the place, agonising for hours. "I just could not bring myself to walk in and ask for a job and more so, because I was shy. But I soon realised that if I did not want to starve I would have to overcome my hesitation."

On the fifth day in Kochi he got hired as an assistant by the bakery at Arya's restaurant. His job was to weigh and sell bakery items and for which he was offered Rs 9,000 a month, for an 11-hour shift per day. Soon, he moved out of the lodge and into an 8X8ft cubbyhole — far smaller than the size of his personal bathroom back home — with five of his co-workers. There were two toilets in that building, which were shared by over 25 people. There were no mattresses and no one cleaned the room that also had a clothesline running from one end to the other. He bathed and washed his clothes out in the open, like his roommates did. "I was given Rs 3,200 for my 14-day stint with Arya's. They should have paid me more, but they chose to keep a part of the salary with them, to ensure I continued working there." He left the bakery as his father had stipulated he should work at multiple places before his month was up.
Kicked out of second job

The hunt for the second job lasted two days. He approached an Adidas showroom for a job and was almost rejected, but their regional manager intervened. "He realised that I was badly in need of a job and asked me to join the next day, which was a Sunday. I turned up, but as I was terribly stressed I was a bit glum-faced. This irked the store manager who asked me to leave. Can you believe it?  I lost that job within two days all because I did not smile?

He next tried his hand at a BPO job and cracked the interview within minutes owing to his fluency in English. His work profile entailed making 800 calls in eight hours to sell a solar campaign to US clients. "I was doing well and they did not want me to leave. I requested them to pay me on a daily basis. They paid me Rs 250 on my fourth day at the BPO and Rs 500 on the seventh day. Thanks to this job, I got to use a public bus for my daily commute; this was an experience I had never had in India."

Of the 23 days Dravya was employed in Kochi, 14 were spent as a shop assistant at three different branches of Arya Restaurant's bakery section, two at an Adidas showroom, and a week at a call centre. He also got employed at a McDonald's, but by this time his father's assistants came down to document his experiences.

In the time he was in Kochi, Dravya was not allowed to speak to his mother or his three sisters. If something urgent arose he could give his father a "missed call" from someone's number and the call would be promptly returned. "Most of his concerns related to the dilemma of trusting people. I would patiently listen to his stories. I was there to lend an ear, but he had to find his way out," recalls Savji Dholakia.

Some of Savji's fortitude comes from his own modest beginnings. A first generation entrepreneur, Savji had come from Amreli to Surat to work as a diamond polisher for which he earned Rs 170 a month before going on to achieve his phenomenal success. The idea of sending the new generation of Dholakia boys on these tough missions came from a family trip to London eleven years ago, recalls Savjibhai. "We had gone for an Indian meal to a restaurant and were shocked out of our wits when we received a hefty bill. A single papad cost 4 pounds, then approximately Rs 250. I decided then and there that when our children grow up, they must be taught a way to understand the value of each and every rupee."

Dravya reveals with pride that not only did he earn a precious Rs 3,950 from the various jobs he undertook, he also saved Rs 55o from the emergency cash his father had given him at the start of the trip. When his stint at Kochi came to an end, Dravya went back to all the places he had worked at and showered his co-workers with gifts. Those he had shared a room with, he gifted them a bed, offered cash to a watchman, who without knowing him had offered to help him. A photocopier, who had photostated his CV for free, was also given gifts. He gave gift vouchers to his colleagues at the BPO, as he also did to the Adidas store manager who had sacked him for teaching him a valuable life lesson.


1 KNOW YOUR MONEY'S WORTH: I was in Ahmedabad recently for a retreat when I suddenly felt thirsty. I could have bought myself a 500 ml bottle from the nearest pizza shop for Rs 40, but I waited until I found a small shop that charged only Rs 10 for a bottle. This, I feel, is what has changed the most about me. Having worked 12 hours a day for just Rs 300, I know where to put my money.

2 VALUE WHAT YOU HAVE: I think I was foolish to have toyed with the idea of buying a luxury watch worth Rs 45,000 six months ago. I have always received expensive stuff from my parents without asking for it. Still, I used to crib a lot. I did not value what I already had. I would complain about the food being too spicy, or too sweet. But in Kochi, when I lived on two subzis, sambhaar and rice every day, I began to value the meal my mum prepared for me. In Kochi, I had to check out 30 shops to zero in on the one that offered me food within my daily budget of Rs 40. Besides, I used to be conscious of my health and avoid maida. But in Kochi, I preferred food with maida in it as it requires a lot of time to get digested. That meant fewer hunger pangs and less spending on food. I learnt that you eat to survive; it is not the other way round.

3 BE HUMBLE: There were people who treated me like their servant. They would not address me by my name. It would always be, 'aaee, idhar aa (hey you, come here)'. But when they learned who I was, they were suddenly all nice and polite to me. 'Tu' was replaced with 'aap'. I really don't get this: do we respect money or the human being? I have learnt to respect everyone, irrespective of their social status.

4 BE HUMAN: My shoe-store experience in Kochi taught me to be more considerate towards others. Unlike my employer who sacked me, I am not going to fire somebody only because he did not smile. I will try and understand the reason behind his unhappiness and try to address his problem. Also, I will utilise a person's skills to the maximum, irrespective of whether he smiles or frowns. Employers need to learn to be civil and more understanding.

5 LEARN TO ADJUST: I learnt how to deal with people and circumstances. On the first two days in Kochi, I was in tears because I did not know how to approach people or handle a particular situation. I was put up in lodge with a dingy room and a dirty toilet. Now, this situation is something I had never imagined I would be in. Now, whenever I feel uncomfortable about something, I close my eyes and think of the Kochi days. It just takes a minute for me to be at peace with the present. Instead of complaining, I cherish each moment now. I am grateful for every meal and the time spent with my family.
6 BE COMPASSIONATE: People put their faith in me and helped me when I had no job, no money. They were not going to benefit from this gesture, but they still decided to help me. I must now pay this forward

Thursday, 21 July 2016

As this is Income Tax filing July month this is more relevant to salaried taxpayers, especially the new taxpayers, have the lot of questions about interpreting Form 16, Its uses and how it can be referred during the preparation of Income Tax Return.
Here is the list of 15 questions & answers that will help you understand Form 16 and its impact on tax filing.
15 queries about Form 16 answered and its impact on tax filing
1. What is Form 16 and how it is different from Salary Certificate?
Form 16 is a certificate which is issued by the employers to their employees. It is a Tax Deduction at Source (TDS) certificate which shows the salary details and the tax deduction with various components.
The employer will provide Form 16 or TDS certificate if your salary paid is more than the maximum exemption limit. For example, if the maximum exemption limit for tax on salary is Rs 250,000, while the salary paid is Rs 200,000, the employer will issue a salary certificate. If the salary paid is Rs 300,000, the employer will issue Form 16 (TDS certificate).
2. Should I avail Form 16 and Salary Certificate both?
If you have received Form 16, you do not require a Salary certificate. You will receive Form 16 only when your employer deducts TDS on your Salary.
3. What is the significance of Form 16? 
Form 16 contains various information such as tax calculation, the amount eligible for tax deductions, TAN, PAN of the Deductor etc. It also provides details of Tax Deducted at Source (TDS) by your Employer. 
4. What is PART A in Form 16? 
Part A of Form 16 contains employee and employer details. It provides information such as TAN, PAN of the employer, details of the amount paid/credited and the Tax Deducted at Source by the employer.
5. What is PART B in Form 16? 
Part B of form 16 contains salary details, information about income from various sources that collectively form your gross total income, various tax benefits, total income, tax on it, etc. 
6. Is Form 16 the only document that I need for e-filing? Is it a complete document? 
No, Form 16 is not the only document that is needed for filing your income Tax Returns. It is a form of income certificate and it is referred for computing the total Salary.
For computing other income and deductions, refer to other related documents such as bank statements, interest certificates etc. Form 16 can serve as a complete document only if you are sure that you have reported all other income from various sources and investments to your Employer without hiding any other details. 
7. I have invested Rs 10,000 in Tax Saving FDRs. But, I forgot to declare it to my employer. Hence, my Form 16 is not showing it. What should I do?
You do not need to worry if you have not declared about your investment to your employer. You can claim the amount invested in tax-saving FDRs under section 80C by declaring the details in the relevant column in ITR while filing your Income Tax Return. 
8. I invested Rs 80,000 on LIC premium and paid Rs 30,000 as my child’s tuition fees. I declared it to my employer but I was given the tax credit of Rs 80,000 for LIC premium only. Am I not considered to get deduction Rs 30,000 for tuition fees? 
Yes, you can get the full deduction of Rs. 110000 for LIC premium and tuition fees paid under section 80 C. If your Employer has not given you the tax benefit of tuition fees, you can still claim both the deductions while filing your Income Tax Return. 
9. I worked for two employers and hence I have two Form 16 documents. Do I need to file a separate return for each Form 16? 
No, you require filing only one Income Tax Return irrespective of how many Form 16s you receive. The Income Tax Return Form provides an option for reporting the salary from multiple employers while filing the Income Tax Return. You can also claim the deductions for which you are entitled. 
10.  My employer has not provided Form 16, how will I file my return?
If your employer has not provided you Form 16, there is nothing to worry about. You can still file your return in the following ways: Collect your salary slips or pay slips to compute your total salary. View your Form 26AS or tax credit statement to match the TDS calculation. Gather all the requisite documents related to your investments and claim your deductions accordingly.
Please note that for Provident Fund, you can claim only the amount contributed by you but not by your employer.
Collect the rent receipts from your landlord to get the deduction for House Rent Allowance (HRA). If you have income from other sources such as interest from the fixed deposit, house property, etc. Do not forget to include the details in your Income Tax Return.
Mention tax amount and the amount of TDS as shown in Form 26AS in your ITR. Log on to Income Tax Website or E-Filing Private Websites to prepare your ITR with the above details and e-file your Income Tax Return.
11.  During the financial year 2015-2016, I paid Rs. 15000 per month as rent to the landlord. But, the landlord neither provided PAN nor any sort of declaration. As a result, my employer did not provide HRA benefit in Form 16. Can I still claim it? 
Yes, you can claim it, if you have enough evidence to prove that you have actually paid the rent. You will be required to present the evidence to the Income Tax Department claiming that the rent has been paid. You can present your bank statements if you have made payments by cheque.
If you have paid rent by cash, you can ask the landlord to provide the duly signed acknowledgment receipt as a proof of payment. Despite all evidence, it is completely dependent on the discretion of the Income Tax Department whether they get convinced by the evidence and accordingly they may provide tax benefit on HRA. 
12.  My Form 16 is not displaying complete TDS. How can I claim it? 
If your Form 16 is not displaying complete TDS, you must verify the Form 26AS. If TDS is reflected in Form 26AS, you must immediately inform your employer and request to issue the revised Form 16.
If TDS is not reflected in your Form 26AS, your details are not properly updated and the reasons could be incorrect PAN, incomplete form, mistakes while filing the TDS return by your employer, etc. In such cases, you must inform your employer and request to take necessary action. 
13.  What are the important factors to consider in Form 16?
When you receive Form 16, you must check the following: Name, PAN, Employer’s TAN, Cross check the Salary (mathematical) numbers from your pay slips.
14.  My Employer has miscalculated my HRA exemption as Rs. 145,239, whereas it is Rs. 185,239. Will I get a claim for the remaining amount?
When an employer by miscalculates the HRA exemption, the employee can still get the tax benefit of HRA while filing the Income Tax Return. Remember, all deductions which were omitted while generating Form 16 can be claimed while filing the Income Tax Return, provided that you are eligible as per the Income Tax Laws.
So, if you have enough evidence to prove the genuineness of the exempted HRA amount, you can claim Rs. 185,239 while filing your return instead of Rs. 145,239 as given in Form 16. 
15.  My Form 16 is showing incorrect PAN. What should I do? 
It may happen that your employer has mentioned an incorrect PAN in your Form 16. This is a very serious issue due to which you may not be able to claim your TDS amount and so necessary actions are required to be taken as soon as possible.
In such case, you need to inform your employer of the said error and ask him to correct it on his end. He will have to file a revised TDS return correcting your PAN so that the tax deducted from your income gets displayed against your PAN.
Moreover, after the revised return has been filed download your Form 26AS to check that the TDS has been correctly reflected in your tax credit statement.  


Tuesday, 19 April 2016

Systematic Transfer Plan

1. What is a Systematic Transfer Plan (STP)?

Under STP, you invest a lump sum amount in one scheme and regularly transfer a pre-defined amount into another scheme, on a specified date. The mutual fund will reduce the number of units equal to the amount you have specified from the scheme you intend to transfer money. At the same time, the amount that is transferred will be utilized to buy the units of the scheme you intend to transfer money into, at the applicable net asset value (NAV). You can get into a weekly, monthly or a quarterly transfer plan, as per your needs.

2. How does an STP work for you?

STP is a useful tool to take exposure into equities in a staggered manner or to reduce exposure over a period of time. Say you have Rs.1 lakh to invest in equity over a period of time. You could put this amount in the liquid fund of a mutual fund. This gives an opportunity to earn higher than you would in your savings bank account. Once the money is there in the liquid fund, you can start an STP where every month a pre-determined amount will be invested into an equity fund. This helps in deploying funds at regular intervals in equities with minimum timing risk.

3. When is it effective?

An STP from debt to equity will work when markets are volatile and an investor does not want to take risk in a short span of time. If you invest through STP in equities and if markets fall or are volatile, then this situation will be better than the one-time investment option.

4. When will it not work?

In a scenario where equity markets are at the end of a bear market and markets can get into an up move anytime, in that case, one-time investment is a good choice and an STP may lose out. However, it is very difficult to predict this. Given that a retail investor does not have the time and tools to research the markets on his own, it makes sense for them to stagger their investment over a period of time and get better risk adjusted return.