Axis Bluechip Fund

Best SIP Funds to Invest Online 

After giving a lacklustre performance for the past several years, Axis Bluechip Fund has managed to reverse the trend and it is back in the reckoning. The scheme, which invests primarily in large caps, has beaten its peers in the past year by a wide margin. It has given close to 20% returns in a year, while its peers have generated returns in the range of 7-12%.

There are a few reasons why the scheme has done well. First, the scheme's fund manager Shreyash Devalkar, who joined the fund house in November 2016, focused on quality and growth companies which was in sync with the flavour of the markets. The factors he kept in mind while selecting companies included high return on equity (RoE), revenue and margin growth, and market penetration. Three sectors met these criteria: retail-focused banks, auto and auto-ancillaries, and consumption. Recently, Devalkar also enhanced exposure to quality companies such as Maruti Suzuki, Eicher Motors and Larsen & Toubro.

Besides, unlike his peers, Devalkar reduced the scheme's exposure to midcaps to 6% and took the share of large-sized companies to over 90%. Hence, in the past year, when mid-sized companies fell, Axis Bluechip's returns did not fall as much as its peers. This has helped in outperformance of the scheme. In the past three- and five-year periods, the scheme has delivered 11% and 15.6% returns, respectively, while its benchmark, Nifty50, has given 9% and 13% returns during the same periods. Therefore, investors may consider investing in the Axis Bluechip Fund.

SIPs are Best Investments as Stock Market s are move up and down. Volatile is your best friend in making Money and creating enormous Wealth, If you have patience and long term Investing orientation. Invest in Best SIP Mutual Funds and get good returns over a period of time. Know which are the Top SIP Funds to Invest Save Tax Get Rich - Best ELSS Funds

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Invest in SIPs and not in Endowment Plans

Most of you who read this column are now investing in the right way, using a systematic investment plan (SIP). But did you know that your dull, boring SIP is the result of more than 10 years of regulatory change? Most of you have also discarded the low-return endowment plans and now purchase a pure term plan to look after your life insurance needs. But did you know that you got to the right solution not because of regulatory change but despite it. I've been mapping the Indian personal finance industry for over 15 years and the behaviour of two regulators in industries that both manage household money has been fascinating. We now have the data to show the impact of regulatory change in the mutual fund and the life insurance industries on firms, sellers and households. I will relate the story through four tables.

Mutual funds have gone through a decade of regulatory action on costs and where they are placed. I find that the mutual fund industry made and sold products with the highest costs. Table 1 shows how the industry kept moving to launch fund types that allowed them to charge more from investors. Till 2006-07 all mutual funds could charge 6% of a new fund collection to investors which lead to churning of investor money. Mutual funds would go on launching new schemes, drum up a lot of advertising to get investor interest, pay distributors large commissions and get investors to buy. Nothing wrong with that except, in a few months, another new fund offer would do the same and agents would 'churn' investors from the old to the new scheme with a view to harvest the commissions.

The Securities and Exchange Board of India (Sebi) banned the 6% NFO charges on open-ended funds initially. The industry began launching closed-end funds because they chould still charge the 6% on those funds. Sebi plugged that gap. But then the industry began to harvest the 2.25% front load (commission embedded in the price of the scheme) in the product. In 2009, Sebi banned upfront commissions totally. Mutual funds became a no-load product and sellers could now either get a trail commission or charge a fee. Mutual funds (some of them, not all) found a way out to compensate agents. They began launching series of closed-end funds and 'upfronted' the trail commissions for the next three or five years. The data shows the numbers of closed-end funds jumping clearly. By 2015, the 'upfronting' was capped at 1% of the investment. As a persistent regulator kept closing gaps, the industry began an extensive outreach and literacy programme, telling investors to use a systematic way to access equity markets. Table 2 shows the almost vertical rise in investor interest that looks unlinked to the state of the stock market, post the clean-up in the mutual fund industry. The SIP flows at over Rs 4,000 crore a month by May 2017 show that this is sensible stock-market investing. Note that net assets turn positive and then are rising post-2014. This means that retail investors are holding their equity funds for a longer period of time, or that churning is less than before. Data is showing that both industry and investors have done well as the regulator has set sensible rules of the game.

The life insurance industry saw a disruptive change in 2010 when the regulator introduced arbitrage within the industry. In 2010, the ministry of finance leaned on the insurance regulator to check the rampant mis-selling of unit-linked insurance plans (Ulips). Used to the guaranteed returns of traditional plans, investors were hit by a new product called Ulip that agents said would double their money in three years. The rising markets made the deal look good. Stories of sharp sales, fraud and fudged signatures on policy documents reached the ministry of finance, which then asked the regulator to clean up. The regulator did clean up, but just the Ulip product, leaving the traditional plan to continue with its high-cost and opaque product structure. Table 3 shows how the industry flipped the sales from Ulips to traditional insurance policies. The argument that investors burnt their hands in the market and therefore demanded traditional plans flies in the face of the insurance industry argument that very high upfront incentives are needed to sell life products because insurance is sold and not bought.

Did the regulatory change benefit investors? No, it did not, because the reform nudged the industry to move from a now transparent, lower cost and potentially higher return (Ulip) product to an opaque, higher-cost and poor return (traditional) one. One way to map investor behaviour in a long-term product is to look at persistency, or the number of policies that are funded in subsequent years. If a person is right-sold a push product, then she clearly knows that she needs to fund it for 15 to 20 years. Why would a person who is buying a long term product stop funding it after the first few premiums? You can argue that a few people may do this due to some circumstances, but for more than half the policies sold to die after the 5th year points to mis-selling. In the case of certain companies, more than 80% of the policies sold don't survive five years. Did the persistency numbers improve post the 2010 regulatory change? Table 4 compares persistency numbers before and after the 2010 regulation change. The data clearly shows that persistency has fallen post the switch from Ulips to traditional plans after the 2010 regulatory change. I've chosen the firms that represent more than 90% of the market. Investors are being sold insurance due to the high (and increasing) incentives allowed by the regulator, but the industry is a leaking bucket - it is unable to retain money even for five years. This is not good for investors because they get very little of their money back if they exit traditional plans within the first few years.

Clearly regulatory change impacts firm and investor behaviour. There is now evidence to show that the capital market regulator reform has given us a better market but insurance regulator has caused more harm than good to retail investors in India.

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Tax on PF Withdrawal

Taxation of EPF withdrawal

The EPF withdrawal will be taxed as income and you need to include it in your ITR under the head 'Income from Salary'

There is no TDS deduction on your wife's PF withdrawal as she has completed 5 years. The EPFO will deduct tax on source (TDS) only if an employee fits the following two criteria:

1. The EPF withdrawal amount is less than 50000
2. The employee has not completed total 5 years of continuous service and the EPF withdrawal amount is more than 50000.

Yes, the EPF withdrawal will be taxed as income and you need to include it in your ITR under the head 'Income from Salary'.

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PROTECT RETURNS FROM Declining Interest RATES

 





Banks are going to lower their deposit rates. But you can earn higher returns by choosing mutual funds instead

Interest rates are clearly on the way down. The State Bank of India has lowered the in terest rate on savings bank accounts to 3.5%.

Fixed deposit rates are still around 6.25% for most people but are surely headed lower. This is a reduction of about 25% of what investors were earning on their fixed deposits just a couple of years back. Don't be surprised if, in about a year or so, most banks are paying 3.5% on savings accounts and 5-5.5% on fixed deposits.

Since individuals park a big chunk of their money in these two types of savings, the fall in interest rates is a problem. Is there a solution? As it happens, there is. There are mutual fund products that fit the bill perfectly. They not only give you higher returns than these banking products, but also get taxed at a lower rate, making the effective return very attractive. The convenience is still not up to the level of a savings account, although it's pretty close.

The types of mutual funds that make a good substitute for bank accounts are liquid funds, ultra short term funds and short-term funds. These types of funds offer fairly predictable and stable returns and have negligible volatility. Over the past one year, liquid funds have given an average 6.62% returns, ultra-short term fund returns have been 7.45%, and short-term funds have given 8.62%. These are substantially higher than the bank products they can replace in your investment portfolio.

However, there's actually much more to the story. Firstly, most fund house allow you to invest in and redeem liquid funds through mobile apps.Using these mobile apps, you can invest instantly by transferring money from your bank account.More importantly, you can redeem your investment and the money gets transferred to your savings bank account within 5-10 minutes. I have personally tried this and the convenience is magical. To be able to earn interest which is more than one and a half times that of a savings account and yet suffer a liquidity compromise of only a few minutes is a real advance in the tech-enablement of Indian personal finance.

Now let's turn to replacing fixed deposits with ultra-short-term and short-term funds. The former are a good substitute for fixed deposits of up to a year and the latter for longer periods. In the case of these products, the investment can be done through an app or online. In exchange for higher returns, you do have to wait for two business days for redemption. However, the financial benefits are significant.

The benefits go much beyond just the headline return comparison, which is currently about 6.25% vs 8.6%. There's an even bigger difference in posttax returns. The tax difference arises from the fact that fixed deposit returns are classified as interest income while mutual fund returns are classified as capital gains. Tax rules say that you have to pay tax every year for the interest earned that year. If your total interest income from a bank (all accounts and deposits together) exceeds `10,000 in a year, then the bank also deducts 10% TDS.In fact, if the bank does not know your PAN, it will deduct 20%. This means that a part of your return is not available for compounding because it is paid as tax every year.This makes a difference to returns.

There is a further advantage to the mutual fund option if you stay invested for more than three years. If you redeem after three years, then the gains are classified as long-term capital gains and are taxed after indexation. Roughly speaking, you get taxed only on inflation adjusted returns. This advantage is not available to investors in fixed deposits. Applying all these factors, a three-year investment in a shortterm fund will leave you with almost twice the returns as a fixed deposit over the same period, and with excellent liquidity.

If you are willing to forego all chances of redemption for three years, then the type of fund to choose is the so-called fixed maturity plan (FMP). These are likely to give somewhat higher returns. However, since liquidity is generally one of the desirable feature of any investment, the previous three types of funds are a better choice. As interest rates fall, and fixed-income depositors get more and more worried, I would expect the more knowledgeable ones to shift from banking products to these types of mutual funds.

Invest Rs 1,50,000 and Save Tax up to Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds. Save Tax Get Rich

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Earning regular Income from Muutal Funds

Best SIP Funds to Invest Online 

Falling interest rates mean investors should be more open to recognising the advantages of using mutual funds rather than FDs for regular income

In recent times, after the collapse of interest rates on fixed deposits, there is a heightened interest in using equity based mutual funds as a source of regular income. This realisation that bank fixed deposits are a poor way of earning an income hasn't come a day too soon. On an inflation adjusted basis, fixed deposits (and other interest bearing assets) were always a bad bet. In reality, for deriving a regular living income, specially for long periods as in retirement, equity mutual funds or balanced funds are by far the best option.

There are three reasons for this: One, a lower tax rate. Two, taxation only on withdrawal. And three, higher returns. Taken together, this effectively closes the argument. Let's see how.

Let's examine FDs first. Suppose you have Rs 1 crore as savings from which you need a regular income. In a bank FD, a year later, it will come up to Rs 1.07 crore. So you have earned Rs 7 lakh, effectively Rs 58,000 a month, right? Only in theory. Assuming an inflation rate of 5 per cent, if you want to preserve the real value of your Rs 1 crore and continue earning for years, you must leave Rs 1.05 crore in the bank. That leaves Rs 2 lakh that you can spend, which is just a paltry Rs 16,666 a month! This means that if you need Rs 50,000 a month, you need to have Rs 3 crore. Of course, at that level, income tax also kicks in and about Rs 30,000 a year will have to be paid. It's actually even worse, because the tax has to be paid whether you realise the returns or not.

The situation is very different when, instead of receiving interest, you are withdrawing from an investment in a hybrid (balanced) mutual fund. Unlike deposits, these are high earning but volatile. In any given year, the returns could be high or low, but over five to seven years or more, they comfortably exceed inflation by six to seven per cent or even more. For example, over the last five years, a majority of equity funds have returns of 12 to 14 per cent annually or more, some as high as 20 per cent. The returns may have fluctuated in individual years, and that's something that the saver has to put up with, but this is the way to defeat the threat of old age poverty.

In such funds, one can withdraw four per cent a year and still have a comfortable safety margin. On top of that, the tax is much lower. Instead of being added to your income, as with interest income, you have to pay capital gains tax on withdrawal. As long as the period of investment is greater than one year, returns from equity funds are taxed at 10 per cent. So for a monthly income of Rs 50,000 a month, Rs 1.5 crore will suffice instead of Rs 3 crore in case of FDs. And no matter how high your savings and expenditure is, it's still taxed at 10 per cent.

However, the tax advantage has yet another hidden factor. Let's say you invest Rs 10 lakh in a mutual fund. A year later, the value of the investment has increased to Rs 10.80 lakh. Now, you want to withdraw the Rs 80,000 you have gained. In your holding, 7.4 per cent is the gain and the rest (92.6 per cent) is the original amount you invested. When you withdraw any money, the withdrawal shall be considered (for tax purposes) to consist of the gains and the principal in this same proportion. Therefore, of that Rs 80,000, only Rs 5,926 will be considered gains and will be added to your taxable income. Obviously, this makes a big difference in the tax you pay.

The bottom line is clear: in every possible way, it is better to draw your earnings as regular withdrawals from an equity mutual fund, rather than as interest income. The SWP (Systematic Withdrawal Plan) facility is available for regular withdrawals from every open-ended fund. In fact, we are seeing specific schemes that facilitate this.

SIPs are Best Investments when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich - Best ELSS Funds

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How to Check EPF Balance Online

Best SIP Funds to Invest Online 

Check Online EPF Balance, ePassbook

EPFO or Employees' Provident Fund Organisation, which manages employee provident fund or EPF money of about 6 crore subscribers, has been coming up with new initiatives for the benefit of subscribers. Today, an EPFO subscriber can check his or her EPF balance and passbook online or through the government's UMANG app.

The link to e-Passbook can be found at the top right corner of EPFO's website. Click on the e-passbook link.

Then you need to key in your UAN id and password. UAN is a unique number assigned to an employee. Enter the UAN and password.

Then you need to click on the member-id to view the e-passbook to know your EPF balance and other details.

EPF balance check through mobile app UMANG

An EPFO subscriber can check his or her EPF balance by accessing the UMANG app, which provides a unified platform where multiple government services can be accessed. Register yourself with UMANG if you are a new user. Thereafter, select EPFO's services and then Employee Centric Services.

SIPs are Best Investments when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich - Best ELSS Funds

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Switch from gold ETFs to gold bonds

Start Saving for Tax 2018 by Investing in ELSS Funds Online

Gold is unlikely to give high returns in 2018 and one needs to invest in it only for diversification. Investors opt for gold ETFs over physical gold— coins or bars—because it removes the problems associated with physical gold, such as purity concerns, storage, etc. However, gold ETFs have started losing their lustre now and are seeing investors exit in large numbers. Gold's lacklustre performance in the last few years is the key reason why ETFs have lost investors' confidence.

While returns on gold ETFs have been diminishing, there are other assets which have fared remarkably well, drawing investors away from gold. 

Gold bonds are available at a discount 
The bonds will generate 3.5% more returns than gold ETFs. 

^Last traded price. *Gold price given out by IBJA on (Rs 2,906) used for calculating discount. Source: NSE. Data as on 26 Dec 2017. 

Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds

Top 10 Tax Saver Mutual Funds for 2018

Best 10 ELSS Mutual Funds to invest in India for 2018

1. DSP BlackRock Tax Saver Fund

2. Invesco India Tax Plan

3. Tata India Tax Savings Fund

4. ICICI Prudential Long Term Equity Fund

5. Birla Sun Life Tax Relief 96

6. Franklin India TaxShield 

7. Reliance Tax Saver (ELSS) Fund

8. BNP Paribas Long Term Equity Fund

9. Axis Tax Saver Fund

10. Birla Sun Life Tax Plan

Invest in Best Performing 2018 Tax Saver Mutual Funds Online

Invest Best Tax Saver Mutual Funds Online

Download Top Tax Saver Mutual Funds Application Forms

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