Saturday, September 6, 2014

Best NRI Savings Account India - YES Bank vs HDFC vs Kotak

Recently I was doing some research to open a NRI Savings account in India, and given there are so many banks, both public and private sector are providing NRI services, I thought to do some quick checks about the best NRI savings account I can get this moment. One of my friend suggested me to open your NRI Savings account in HDFC bank, other suggested that he has account in Kotak Mahindra and very happy with their services especially rather offered on their remittance service click2Remit. My third friend suggested me to go for YES bank, a relatively new bank but with better services and more importantly better interest rate. Seems YES bank is offering highest interest rate on NRI Savings account, they are offering rate of @ 7% p.a.* for balance more than Rs. 1 lakh & 6% p.a. for balance up to Rs. 1 lakh, compared to 4% per annum from both Kotak and HDFC. Good thing is that interest for all rupee savings accounts will be calculated on the daily closing balances maintained in the account, and this is true for all three banks. So by chance if you keep more than 1 lakh in your NRI savings account, YES Bank is the best one for you. You can get much higher interest rate compared to Kotak Mahindra or HDFC. Apart from this deciding factor, let's see couple of other unique features provided by NRI savings account of these three Major bank.

Saturday, August 30, 2014

Why Should You Invest Some Money on Equities, Stock or MutualFund

Many people ask me whether they should invest money in stocks or mutual fund or not? I say, you should invest at-least some part of your money into equities, because it is the only investment which can beat inflation in long term. It's not that investing in equities will guarantee superb returns, because there are periods and even extending upto 5, 10, 15, 20 and even 25 years where equities has delivered negative, no returns or very poor returns. For examples in Japan, Equities has not really been the best performing asset class in last twenty years. Nikki, index of Tokyo stock exchange was around 39K on December 1989 and where it is now, around 15K, after touching lows like 7K and 8K during 2001 and 2009. What this mean, if you have invested in Index you would have one third of your money by now, forget about getting any interest. This may look you really contrasting from the title of this article, but it's true that there is no guarantee on stock market and even with mutual fund. You need to accept that fact to better organize your investment. The most important thing is that stock market is actually a proxy of the countries economy and so is inflation. Inflation will only rise if there is money to spend, and people will only earn money if there is job to do. More jobs means more production and consumption, which means growing economy. This is the key, if you feel an economy is in the start or mid of growing cycle, then investing in Equities is the best idea. 

Saturday, August 16, 2014

10 Points on Public Provident Fund (PPF) Accounts in India

If you are an Indian, I am sure you must have heard about Public Provident Fund or PPF, one of the most popular long term saving scheme backed by government of India. If not about PPF, then definitely about EPF, Employee Provident Fund, it's big brother. Since EPF is sort of mandatory and your employer deduct some portion of your salary apart form his contribution, it's not something you worry about. By the way, if you want to check your EPF account balance, you can see it here. PPF investment is similar product for any citizen of India, though NRI can not open PPF account in India, it's only for residents of India. PPF allows you to save some money, reduce your taxable income and grow your investment with safety guarantee from government on India. It also gives you decent interest rate of 8.7% per annum, compounded annually. Though interest rate is subject to change and decided every year in month of April, you can be sure that you will get a decent rate from next 15 years given grown potential India has. Ironically, many people in India doesn't know much about public provident fund or PPF, they know little bit about it but never bother to go beyond that and open a PPF account, forget about investing money regularly. Only salaried employee make that effort to save money and plan for future. By the way time is changing, and we are living in high inflation era where cost of living, education are gone up multiple times in last 10 years. This huge cost increase forces people to plan about big ticket items like children's eduction, daughter's marriage, and their own retirement plan. PPF is a investment product which can be used to full fill any of above goal. After last article about choosing between PPF and Fixed deposit, I got lot of emails asking question like I am self employed can I invest in PPF, Can I open a PPF account in my daughter's name, how can I invest more than 1 lakh in public provident fund account etc. This prompted me to list down some important details of PPF account in India. In this article, you will know some details of this excellent long term investment option available only to resident Indian.

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