Category Archives: Personal Finance

22/04/2009
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Personal Finance

The first step – Financial Planning

April is the first month of the new financial year. It is better we start planning regarding our finances now rather than at the end of the financial year. It is a good sign to move ahead with our finances in a planned way rather than haphazard way.

Financial planning is a process of managing our finances in order to achieve the financial goals. Before you start planning you should have financial goals. It is very important. We should know what the goals are, once that is clear the rest all are easy. Examples for financial goals are buying a property, buying a home, going on a vacation, visiting a relative in a foreign locale and so on. Let the goal be very specific, if the goal is very specific then I am sure the path that leads to it also can be easily figured out. Once the goal is set the planning becomes the next step. Continue reading →

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10/03/2009
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Personal Finance

Evergreen Loan

A loan that does not require the principal amount to be paid off within a specified period of time. These loans are usually in the form of a short-term line of credit that is routinely renewed leaving the principal remaining outstanding for a long term. This kind of loan is very beneficial for the banks and other financial institutions. Continue reading →

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09/03/2009
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Personal Finance

GOLD – The precious Metal

History of gold prices (in rupees):

1930: 180 per 10 gram
1940: 360 per 10 gram
1950: 1000 per 10 gram
1960: 1110 per 10 gram
1970: 1840 per 10 gram
1975: 5,400 per 10 gram
2000: 3,000 per 10 gram
2006: 5,400 per 10 gram
2009: 15,700 per 10 gram.

Gold surprisingly gave 300% returns from 1970 to 1975 when world suffered worst ever recession after great Depression. Will the history repeat? That is the reason behind current “Mad Gold rush”. But if you invested in the Gold in 1975, your investment gave negative returns for the next 25 years. Continue reading →

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19/02/2009
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Personal Finance

How banks pay interest on your savings account balance – Part 2

Read Part I before reading this article.

Basically it implies that the bank gets to use your money for 51 days free of cost. Therefore, the banks have the option of leveraging these zero-cost funds and lend them at higher rates of interest. This is one of the most important sources of their profits.
At the same time a sharp cookie will deposit Rs 100,000 on April 10th instead of April 11th and remove the money on May 1st. The minimum between April 10th and April 30th now is Rs 100,000 and hence he gets 3.5 per cent a year for just keeping the money for 20 days. Continue reading →

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18/02/2009
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Personal Finance

How banks pay interest on your savings account balance – Part 1

How many of us have actually checked our savings account to see how much interest gets credited into our account for the deposits we make? A lot of people might know the answer to this one.
Now let’s change the question to “How many of us know the way interest is calculated and credited into our account?” Not too many. The answer to this one will surprise many depositors and a bigger surprise is that crores of rupees are lost through millions of savings accounts in our country. The numbers as you will see are staggering. Continue reading →

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