What is the Right Age to Apply for a Loan?

Although legally you will not be allowed a loan until you are over the age of eighteen years, there are no other legal restrictions as to when you can borrow money. However, there are advantages and disadvantages to borrowing money at different stages of your life. If you can delay your borrowing, then it might be wise to do so in some cases or do it as soon as possible in other, depending on your age and your life situation.

Age is not really relevant here when it comes to people looking to apply for a loan, but more the stage of life that you are at, which can tend to follow a general pattern with regards to age, but not everyone fits the mould. Therefore it is better to look at the important factors to consider at different stages of your life.

Salary/job security – if you are taking on a loan, particularly a substantial one, then you need to be confident that you will be able to repay it. You will need to not only be paid enough to cover the cost of those repayments but you will need to be confident that you will have this income available to you for the duration of the loan. As we get older and more experienced, we will often have a higher salary and so be able to take on higher value debt. We may also find that our job gets more secure as we become more knowledgeable and therefore more valuable to the company that we work for.

Marriage/partner – When we meet someone and settle down together it means that we then have two incomes. This means that we are far more able to afford loans. Therefore it could be a good time to take them out and pay for things that we need such as a home, furniture and cars. It is best to try to repay the loans as soon as possible, particularly if they have high interest as this will make them a lot cheaper.

Children – once we have children things start getting expensive. It may be that only one parent is working, one is working full-time and the other part-time or both are working part-time. This will put pressure on the finances as the income is going to go down. Even if both parents continue to work there will be the expense of child care on top of the costs of a child. Preparing for a new baby can be quite expensive but children tend to get more expensive as they get older and eat more, grow and need more clothing and want more things to entertain them. So if you have children it is worth calculating really carefully whether it is the right time for a loan and assume that your expenses will go up.

Savings – it is easy to think that having savings is a good indicator that we are ready to take on a loan. We have some money to fall back on and therefore will be able to manage those repayments. While this is perfectly true, it is far wiser to spend those savings on the item that you are getting the loan to pay for, if you can afford it. This will save a lot of money. This is because the loan costs money and you will be saving all of this money by not getting one. You will be losing out on any interest that you were getting on the savings but this will normally be a lot lower than what you would pay out for a loan. You can compare the interest rates to get a quick idea, although loans will tend to have additional costs as well as the interest rate. So put aside each month the amount that you would pay on loan repayments and you will soon have enough money accumulated to take out a loan. Obviously, if you are buying a house you will need a loan as saving up that much would take a very long time but for smaller loans, this idea can work very well.

Caring for parents/relatives – as our parents get older it may fall on us to care for them or for other people who cannot manage on their own. This can mean that we have to give up work or that we do not have time to do extra work such as overtime and therefore it could possibly cause a reduction in income. If someone is being paid to care for them, it may be that you will need to pay them if your parent or relative does not have the money to. It is hard to think of older relatives needing to be cared for, but these days it is really important to factor in that expense.

Retiring – once we retire then we usually see a reduction in our income. Even if we have paid into a pension scheme we usually have a smaller income. This means that we need to be very careful about what we are spending and therefore taking out a loan, where will need to make repayments, may not be a good idea. You may also find that that lenders will be reluctant to allow a retired person to have a loan because they will be concerned that they will have enough income to pay it.

Conclusion

So as you can see choosing when to take out a loan is not easy. There are things at many life stages which could mean that the time is not right. You will also need to think about the future and whether you will be able to afford the loan repayments for the necessary amount of time. Although we should not be scared of debt and it can be very useful for us, it is something that we do need to consider very carefully. It is wise to spend time calculating whether your current financial situation will be able to cope and thinking about how well it will cope in the future as well and this should help you to be able to make the right decision for you.

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How to Repay Your Loans

How to Repay Your Loans

If you have loans, then you may feel that you will have them for a long time. This can be the case with some loans, but it can be relatively easy to pay some off quickly and get rid of them. Wiping out a loan can be a great relieve as it not only removes stress but will mean that you will have more money to spend. You may feel a loan gives you the freedom of having extra money. However, when that money has been spent, you have to repay the loan and the fees that go with it and this can make it difficult for you to manage. There are ways that you can repay your loans, which should be fairly easy and will allow you to have more money in the future.

Find out what you owe

You will need to start by working out exactly what you owe and who to. Understandably this might be something that you are reluctant to do, but it is important. It isn’t nice knowing exactly how much debt you have, but until you know, then it will harder to start to repay it. Include all loans, overdrafts, credit cards, store cards and money you owe to friends and family.

Calculate the costs of each loan

It is worth calculating how much each loan costs you. This is normally done by looking at the interest rate, although some loans may have charges as well. It is good to see which is the most expensive as if you pay this one off first you will save the most money and therefore get out of debt more quickly.

Choose which to repay

You may think that there is a different loan you would rather repay before the dearest. It could that you owe money to a friend or family member and feel they deserve to be repaid first. You might feel that one loan makes you feel more stressed than the others so you want to pick that one.

Be careful that you do not pick an overdraft or credit card because you want to pay it back so that you can spend on it again. You need be wary of getting loans again as they are expensive. It is best to try to avoid most types of loans in the future so that you do not get into uncontrollable debt again.

So think about the reasons for picking one loan over another to repay first. If you have no reasons, then pick the dearest to repay first.

Pay extra off the selected loan by spending less and earning more

In order to start paying back the loan more quickly, you will need to make overpayments. It is wise to find out whether there is a charge from your lender for doing this. If there is a charge then you will need to work out whether it is worth paying that charge or if you think that you should opt for a different loan to repay first.

In order to make these extra payments you will need some spare money. If you have money in a savings account, then it can be wise to use that. It can be hard to use this money but if it is earning less interest on it than you are paying on the loan then it is better to spend it on repaying the loan as you will save money and soon be able to replenish the savings. You will need to check the interest rate though and make sure that you are better off repaying the loan.

If your savings are not enough to repay your loans then you will need to find the money elsewhere. By spending less money, you will have extra left to make bigger repayments. It can be good to think about whether there are areas that you can temporarily reduce your spending so that you can repay the loans. These areas will vary depending on the person but cutting down spending on luxuries such as vacations, clothing, jewellery, alcohol, evenings out, eating out, subscriptions and take away food can really help. Also checking process and making sure that you are not overspending on things can help as well. You could also see whether there are any ways that you can earn more money. As well as your conventional job, where you could see if you can do extra hours, you could get a second job, do some work online from home, sell things that you own, set up a business or something else. There are many opportunities to earn out there – you just have to find one to suit you and your lifestyle.

Once first loan paid off, start on second

Once you have paid off the first loan, then you will need to choose the next one to pay off, working through them one by one until they are all paid off. It can be a great feeling every time one of them is paid off in full and knowing that you are closer to your goal of paying them all off.

Stay motivated

The hardest thing can be to stay motivated. It can feel like you are punishing yourself because you are earning more, spending less but not seeing any of the extra money. However, it will be worth it when you have paid off all of your loans and no longer have to worry about them or pay out interest on them.

You may find that you need to keep reminding yourself of this. One way to do this is to write yourself a small note, with your goal of being debt free written on it and a reminder of why you want to repay the loans. It could just the freedom of not having any, the fact that you will no longer be paying interest payments to the lender, the fact that you will have more money available or something else. Keep a note of that as well so that you can keep remembering why you are doing this. It can be also be good to keep imagining how good it will feel to be free of debt.

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Understanding Social Media and How It Will Work for Your Business

Understanding Social Media and How It Will Work for Your Business

If you have not yet connected with social media or are wondering whether you should expand your social media presence as a business then it is important to understand what the main social media channels are and how they work so that you can choose between them.

Facebook

This is really easy to set up and can be used on mobile devices as well as PCs. You can be contacted privately as well as publically which allows for easy communication and you can sell through it. It can be difficult to get your information shown to all of your followers though. Facebook will not show messages that you post to everyone which means that you may be forced to pay for advertising if you want more exposure. However you may find that the adverts are shown to people that already follow you and shown to them multiple times so you end up paying for adverts which are not being viewed by lots of people.

Instagram

Instagram is really for photos and is really growing. It is great if you want to show lots of pictures of your products and it also links easily with Facebook. You can sell things directly from it as well but you cannot put in active links (although you can post URLs but they have to be cut and pasted into browsers).

YouTube

If you want to use videos to draw attention to your business then this is a great way to do it. They are indexed in search engines so easy for people to find and can be viewed by anyone even if they are not following you. It can take a lot of time and effort to make a good video though and it will not be good for your reputation if the one that you make is not up to scratch.

Twitter

Limits on how many characters you can put in a message can be limiting but also mean that you have to get to the point quickly. It is not so good for pictures as some other platforms but it is easy to use and tweets will show in Google search results. It can also be used to sell things.

Pinterest

This is used to showcase images and so good if what you are selling has lots of relevant images. You will need to produce really good images though and they will be hyperlinked to their original sources which means that you can link them to your website if you have one.

Google+

This is easy to use particularly with other Google products and shows on Google searches, It is similar to Facebook though but has a much smaller audience. It is also against the rules to run promotions and competitions, so if this is something you were thinking of doing this may not be the right place for you.

LinkedIn

This is really for business to business networking and so will be relevant if this is what your company needs to do. You can post blog length articles which could be useful. It is not so good at targeting adverts though, so if you do decide to use it then you need to be aware that you may get irrelevant content due to this.

It is wise to think about what you are expecting from social media and then you will be able to choose the right one for you. You may be tempted to try several or all of them. Beware that you will need to put time and effort into whichever you choose and so if you pick too many you may end up spreading yourself too thinly and not doing enough on each to give yourself the best chance of making an impact.

Of course you have to also make sure that you are making money by using these platforms. Creating brand awareness is one thing but you need people to buy from you and generate some income. This means that you need to think about how they will do this. Some will provide a sales platform for you which can be great, but if you do not want to use those specific social media sites then you will need something else. Obviously posting about what you sell and linking to a site where items can be bought can be helpful. However, if it is all too salesy then this can put some people off. They will not follow you if they think you are just trying to get them to buy your product.

You therefore have to do this in a more subtle way or intertwine posts about your products with other posts. With all good advertising it is finding a way to make people feel that you are helping them by selling them a product rather than the other way around. Putting details of special offers or new products on social media first could help keep people engaged and interested in following you which in turn could lead to sales. It can be worth looking at what other similar companies do to find out whether you can do something similar. Try to see which types of posts are working best for them by the amount of engagement they are getting through comments and likes. You could also try hiring a PPC agency to divert some paid traffic at your content.

It is worth giving a lot of thought to what you are hoping to achieve form social media, how you expect to achieve it and therefore which social media platform will suit that the best. It can still be daunting as there is a lot of choice out there and sometimes it is just not clear which site will be the best and how you can use it in the best ways to make more money for your business. If you are still feeling confused or just not quite decided on this then do get in touch with us as we will be able to help. We can provide guidance for you to let you know what you should be doing, which social media sites will suit you the best and how best to use them to generate income for your business.

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Does My Sip Investment Qualify for Tax Deduction?

Does My Sip Investment Qualify for Tax Deduction?

Which part of the SIP investments qualify for tax benefits?

Not all of your SIP investments are deducted on the basis of tax but the SIP investments that are made into certain instruments and markets have tax deductions under the Income Tax Act in India. There are some aspects of the systematic investment plans that are exempted from being taxed. The 2 aspects are as follows:

– Tax Saving Mutual Fund Schemes
– ELSSs – Equity Linked Saving Schemes

ELSSs – Equity Linked Saving Schemes

The ELSSs – Equity Linked Saving Scheme mutual funds are allowed for a tax deduction under the Section 80 C of the Income Tax Act. The investor can avail a tax exemption of Rs. 1.5 lakhs if they have invested money into the ELSS scheme. The Equity Linked Saving Schemes are a equity mutual fund schemes which are diversified. They have a minimum lock – in period of about 3 years before which the investor cannot withdraw any returns. How the ELSS funds work is that the money is invested into equity related markets and equities but the majority of investments are made into equities. A longer SIP investment period into the ELSS fund scheme will get you a higher return on investments. The investor also does not have to pay any taxes when if they have got any LTCGs – long term capital gains through the ELSS as they are also exempted from being taxed under the Income Tax Act in India.

Tax Saving Mutual Fund Schemes

The systematic investment plans also have funds that are specially known for tax benefits; they are the Tax Saving Mutual Funds. If an investor invests into the Tax Saving Mutual Funds, then they are subjected to getting tax exemptions under the Section 80 C of the Income Tax Act.

To avail SIP tax benefits, you can start with SIP investments in the following way:

KYC to provide your information to the company

To be able to invest into a SIP account, the first step that the investor has to take is to complete the KYC process. KYC is Know Your Customer and this process has to be completed so that the fund company has certain important details about you which are necessary for opening the systematic investment plan account. It is very basic information that the KYC asks like the potential investor’s name, address, date of birth, mobile phone number and other details necessary for the SIP. KYC registration websites and KYC agencies are there to help you complete the process. There is another easy way to complete the KYC; it is through linking your Aadhar card with it. The KYC website will get all the information they need from UIDAI – Unique Identification Authority of India. This eliminates the hassle of you filling in every detail. The process of linking it with your Aadhar card also saves a lot of time.

Verification of documents

The next thing that has to be done to start up your SIP is to upload your documents on the website so that they can be verified. You are to scan each document and upload it onto the website in the correct blanks. The document that has to be uploaded for the purpose of verification is the PAN card – permanent account number.

Inter personal verification

Now, the next step is that you need to set a date and time for your IPV and be prepared for it. The process of verification is very important to check if the person logging into your account is you or a hacker. So, it is done to eliminate the possibilities of that and be sure about the personal identification. Keep your PAN card and address proof handy as the insurer might ask for you to show it to them to verify. The investor has to pick a date and set a time with which they are comfortable to attend the verification. The intern personal verification is done through a video call. The investor needs to make sure that their webcam is functioning properly and that they have a strong internet connection so that the video call can process easily.

Make a SIP investment account

After the completion of the verification, the investor has to complete the account. The investor has to go to the website and make an account by clicking on the registration link.

Enter information and details

Now, the investor has to enter their details about their information on the bank that they have an account with so that the online SIP investment can be started with. Enter all the details correctly to avoid any problems.

Verification through OTP

After you, as an investor, enter your details, you will receive an OTP which is the one time password that you have to enter into while making the account to verify you contact. The OTP is received either through SMS on your cell phone or through an email on your email ID. Enter the OTP correctly and within the time threshold after which it will expire.

Log – in into your account

You can, now, log into your SIP investment account as it has been created.

You can start SIP investments

After starting up the account, the investor has to make certain selections regarding the SIP investment pan so that the plan can start. The selections are like the date of the SIP and the mutual fund that the investor wants to invest into are to be chosen in the last step.

Invest into SIP funds through ELSSs – Equity Linked Saving Scheme mutual funds or Tax Saving Mutual Funds to get great tax benefits, deduction or exemptions and save more money. Systematic investment plans allow you to save a lot of money and saving money on taxes just adds to the huge amount that you will be accruing through the investments that you make as they invest to save money through a systematic approach.

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Ways to Reduce Your Grocery Bill

Ways to Reduce Your Grocery Bill

Groceries are something that we all have to buy to feed ourselves and our families. However, it can seem that our trips to the grocery store get more and more expensive, even though we are buying the same items. It can therefore be wise to consider whether there are some ways that you can reduce how much you spend.

Coupons

There are often coupons printed in papers and magazines and these can be a great way to save some money on your groceries. Even if you only save a few dollars it can all add up. We do need to be careful with coupons though. They look like a great deal and that they are saving us money but this only applies of you would have bought that item anyway. If they are for an item you would not normally buy, then you could be buying an extra item and this will mean you are spending more money; not less. However, if it is an item you normally buy or it will be replacing an item that you normally but which is dearer, then it is worthwhile.

Deals

The above also applies to deals in the store. Only buy things that are reduced if you would normally buy them or you are buying them in place of something dearer. Often the items that are reduced are junk food which we can do without or they are expensive brands which we would be better off avoiding. So make sure that what you are seeing really is a good deal. As you could be being lead to think that something is a good deal when it is actually costing you more money or you are buying more items than you actually need.

Compare prices

Comparing prices is a good way to see whether you can save money. You will find that for many items that you buy, there are different options available to you, perhaps different brands, different sizes or different packaging. These will be priced differently. You need to compare the prices carefully though. Look at the size of the containers as well as the price and see which is cheaper but be careful of how you do it. If you are buying potato chips, for example, comparing price by weight, so per 100g will allow to see which is cheapest overall. However, if each pack is a serving and one is larger you may think that it will be better to buy it as you are getting more for money. However, you will eat one serving sized pack, whatever the size of it and so it could make sense to buy the smaller, cheaper one, as you will save money even if the larger one offers better for money because the price per chip is less.

Compare stores

As well as comparing prices within the store, it makes sense to also compare prices between the different stores. Often you will find that a store might be cheaper for some items but not others, although some will be cheaper overall than others. It could be cheaper to shop across several stores to find the best prices, but you will have to pay to travel there which could outweigh the savings made. You will also have to spend more time grocery shopping, which you may not be keen on. Therefore when you compare prices think about which store you would most like to go to or whether you would be happy to change to a different store or go to several.

Change what you buy

Sometimes changing the types of groceries that we buy can change the cost of our shopping bill. Thinking about the types of foods we buy may help. For example certain cuts of meat are cheaper than others. Food that has been prepared, such as chopped carrots are dearer than whole ones and so swapping to whole carrots will save money. Pre-prepared meals, such as sandwiches and microwave meals can be more expensive than buying separate ingredients too. It may take time to prepare food or to learn how to cook different types of food, but it could make a big difference to your grocery bill if you do.

Take a list

It is always wise to take a list with you when going to the grocery store. This means that you remember to buy the things that you need, which saves you a second trip or having to stock up at a local store which could be dearer and it also allows you know what not to buy as you do not need it. Buying things you do not need will not only mean you spend more money. It could lead to you eating more as more food is available or it could mean that you have too much food to eat and some goes off so you have to throw it away and waste it. It will hopefully reduce the amount of impulse buys that you make.

Check use by/best before dates

It is wise to look at the date son food to make sure that it will lost as long as you need it to. If you stock up on a lot of things and then find that you have too much to eat quickly, then it may be that some of it will go off before you eat it. Although dates can sometimes only be a guideline, it is wise to shop with them in mind as then you have less chance of the food being inedible before you get a chance to eat it.

Never Shop When Hungry

If you go to the grocery store when you are hungry or thirsty then you can end up buying much more than you need. You will be picking up items that you would like to eat or drink right away and you may also buy more than you need or really want. So try to make sure that you shop after a meal, when you have just had a drink or just at a time when you are not hungry or thirsty.

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