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5 Profitable Business Ideas In Demand For 2025

Entrepreneurs consistently seek out lucrative opportunities. As technology evolves, consumer preferences change, and global demands shift, the year 2025 offers a range of high-demand sectors that are well-suited for individuals prepared to launch or expand a business. These five business ideas are ideal for profitability: 1. Healthcare Services for Seniors The growing elderly population, coupled with the rising need for senior care, renders businesses that offer healthcare services for seniors not only lucrative but also vital. The global senior care sector is projected to experience significant growth as the baby boomer generation continues to age. There is a substantial demand for services including home healthcare, assisted living facilities, and specialized senior care centers. Why it's profitable: Numerous elderly individuals prefer to remain in their homes for as long as possible, which presents opportunities for home care services. By providing specialized care, such as dementia support, entrepreneurs can cater to a specific niche with unique requirements. How to get started: Establishing a home healthcare business can be achieved with minimal initial investment. While obtaining the necessary licenses is essential, the startup expenses can remain within reasonable limits if you begin with a small client base and gradually expand your team as your business develops. 2. Sustainable Products and Services Sustainability has become a crucial consideration for numerous consumers. Companies that prioritize eco-friendly products and services are expected to flourish by 2025. With innovations ranging from biodegradable packaging to renewable energy options and ethical fashion, sustainability is significantly influencing consumer preferences. Why it's profitable: Numerous elderly individuals prefer to remain in their homes for as long as possible, which presents opportunities for home care services. By providing specialized care, such as support for dementia patients, entrepreneurs can cater to a specific market with unique requirements. How to get started: Recognize the necessity for a sustainable alternative. For instance, substitute single-use plastic items with biodegradable materials. 3. Tech Consulting for AI Integration Artificial intelligence (AI) is revolutionizing businesses across industries, but not every company has the know-how to integrate AI effectively. Consulting firms that specialize in AI integration and automation are in high demand, helping businesses streamline operations, enhance customer experiences, and make data-driven decisions. Why it's profitable: AI has emerged as an essential component for contemporary business operations. Organizations that fail to embrace AI technology may find themselves at a competitive disadvantage, while technology consultants serve as the vital link between traditional practices and advanced automation. Enterprises are prepared to allocate resources towards consultants who can assist them in enhancing efficiency, minimizing mistakes, and boosting profitability through AI-enhanced solutions. How to get started: Individuals with a background in technology or experience in artificial intelligence can provide consulting services. It is advisable to concentrate on particular sectors, such as healthcare, finance, or retail, in order to establish expertise in AI solutions tailored to those markets. 4. Digital Marketing Agencies The need for efficient digital marketing is on the rise. Organizations require assistance with search engine optimization (SEO), pay-per-click (PPC) advertising, social media strategies, and content marketing to maintain their competitiveness in the saturated online market. Why it's profitable: The digital space is the primary avenue for customer acquisition today. Businesses are willing to invest in specialists who can increase their online presence, drive traffic, and convert leads into paying customers. Agencies that can demonstrate results through data-driven campaigns will find an eager market. How to get started: Establishing a digital marketing agency can be achieved with minimal initial costs by utilizing freelance professionals or adopting a remote work model. It is advisable to concentrate on developing a portfolio with a select number of clients while specializing in in-demand services like SEO or social media management to set your agency apart from competitors. 5. Pet Services and Products The surge in pet ownership has transformed the pet industry into a lucrative market. Enterprises focused on pet care are expanding swiftly, as pet owners demonstrate a growing readiness to invest in premium services and products for their beloved animals. Why it's profitable: Pet owners regard their pets as integral members of the family and are prepared to invest in high-quality products and services to guarantee their pets' well-being and happiness. The market for organic pet food, customized care, and upscale grooming presents substantial opportunities for considerable profit margins. How to get started: One can initiate a modest venture by establishing a mobile grooming service, a pet-sitting enterprise, or an e-commerce platform specializing in distinctive pet products. Emphasizing quality and outstanding customer service is essential to differentiate oneself in this competitive landscape. Ultimately, the most lucrative businesses are those that align with contemporary trends and address significant consumer needs. These concepts present avenues not only for generating profit but also for creating a meaningful impact. The crucial aspect is to proceed with a strategic approach, select a specific niche, and deliver exceptional value to your clientele. Read the full article

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6 common mistakes while taking a loan, and how to correct them

The availability of loans and credit has significantly enhanced the ability to achieve dreams and aspirations. Nevertheless, the ease of borrowing may also present concealed risks that, if not handled prudently, could result in substantial debt obligations. Recognizing these possible challenges is essential to guaranteeing that loans serve as a beneficial financial resource instead of leading to prolonged financial difficulties. The following outlines the prevalent challenges associated with excessive borrowing and strategies to mitigate them. Fixed, floating and APR (Annual Percentage Rate) It is crucial to understand the different types of interest rates—fixed and floating—when considering borrowing, as they significantly influence the total expense of the loan. A fixed interest rate stays the same for the entire duration of the loan, providing predictability, whereas a floating (or variable) rate varies according to market conditions, potentially resulting in changes to monthly payments. APR, or Annual Percentage Rate, serves as a holistic indicator that encompasses not only the interest rate but also various additional expenses linked to the loan, including processing fees and administrative costs. For example, a loan may present a low-interest rate; however, substantial processing fees can considerably elevate the overall APR, rendering the loan more costly than it initially seems. Grasping the concept of APR provides a more comprehensive understanding of the total borrowing costs and enables effective comparison of different loan offers. Incorrect cost estimation One of the most significant mistakes made by individuals who take out loans is failing to accurately assess the costs associated with their needs. Whether the funds are intended for education, purchasing a new home, or launching a business, an inaccurate or excessively cautious estimation of expenses can lead to a deficiency in financial resources at crucial moments. A lack of sufficient funds can jeopardize your capacity to cover essential expenses, such as daily costs or unforeseen emergencies. This situation can adversely affect your financial stability and overall well-being. Conversely, excessive borrowing may lead to monthly obligations that are unmanageable, placing undue pressure on your finances and increasing your stress levels. It is crucial to engage in careful planning and to borrow solely the amount that is genuinely necessary. Mismatch in loan sanction turnaround time Comprehending the duration from the initiation of the loan application to the disbursement of funds is essential. Delays in processing and associated costs can result in considerable challenges, including the risk of missing important payment deadlines or forfeiting time-sensitive opportunities. To mitigate this risk, it is advisable to commence the loan application process well in advance, prepare all required documentation, and establish open lines of communication with your lender. This proactive strategy guarantees that funds will be accessible when needed, thereby preventing last-minute rushes and the stress that accompanies them. Inflexible repayment schedules Selecting a repayment schedule that is overly ambitious may initially appear to be a financially prudent choice; however, it can result in significant financial challenges in the future. Unforeseen expenses during the early years of repayment can lead to missed payments, incurring late fees, and negatively impacting your credit score. Such consequences can compromise your financial stability and limit your ability to borrow in the future. It is advisable to choose a repayment plan that provides flexibility and is in harmony with your financial circumstances, taking into account your potential future earnings and any additional costs that may emerge. It is also important to examine the terms related to prepayment options, restrictions on foreclosure, and any substantial fees. For example, many lenders impose a 5 percent foreclosure fee, which can render prepayment an unfavorable choice. Not planning early Loans serve as a crucial means of financing; however, the amount of debt incurred can be minimized through proactive financial planning. For example, making small, consistent investments over time can lead to the accumulation of a significant fund, thereby decreasing the necessity to secure large loans. By engaging in early planning and maintaining a disciplined saving strategy, individuals can establish a financial buffer that facilitates expense management without a heavy reliance on borrowed money. This forward-thinking strategy can greatly lessen one's dependence on loans and improve overall financial stability. Not investing while repaying the loan A prudent approach to enhance the management of your loan is to begin investing an amount that corresponds to a specific percentage of your monthly repayment. For example, if you are dealing with a long-term loan, allocating a fraction of your monthly repayment towards investment can assist in establishing a supplementary financial resource. This investment can appreciate over time, potentially enabling you to settle the loan more swiftly, thereby reducing the total interest paid. Furthermore, this practice fosters a routine of saving and investing, which is advantageous for your overall financial well-being. The bottom line Utilizing borrowing as a financial instrument can prove beneficial when approached with responsibility. Nonetheless, it requires meticulous management to avoid possible financial pitfalls. By precisely assessing expenses, comprehending the terms of loans, initiating investment strategies early, and practicing disciplined financial behaviors, borrowers can reach their objectives without succumbing to debt. It is essential to adopt a careful and strategic mindset towards borrowing, as this can facilitate the realization of your ambitions while ensuring financial stability and tranquility. Borrow smart, not hard. Disclaimer: The opinions and investment recommendations provided by specialists on Moneycontrol reflect their personal views and do not represent those of the website or its administration. Moneycontrol encourages users to consult with certified professionals prior to making any investment choices. Read the full article

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Mutual fund investment: Flexicap funds or multicap funds - where can you get more returns? 

An efficient method to attain diversification is through the investment in multi-cap and flexi-cap funds, which allocate resources across different market capitalizations, encompassing large-cap, mid-cap, and small-cap equities. Engaging in financial market investments, whether via stocks or mutual funds, necessitates thorough research and assessment. Conventional wisdom highlights the significance of diversification, particularly in times of market peaks or troughs. A practical approach to attaining diversification is through the investment in multi-cap and flexi-cap funds, which allocate resources across different market capitalizations, encompassing large-cap, mid-cap, and small-cap equities. Multi-cap and flexi-cap funds represent two of the most prominent and favored categories of equity funds within the mutual fund sector. From January 2021 onwards, flexi-cap funds have garnered net investments totaling Rs 72,248 crore, whereas multi-cap funds have experienced net inflows amounting to Rs 88,856 crore during the same timeframe. What are Flexi cap funds? Flexicap funds are a type of equity mutual fund that possess the ability to invest across a range of market capitalizations, including large-cap, mid-cap, and small-cap stocks, without imposing strict constraints. This flexibility enables the fund manager to adjust the fund's asset allocation in response to prevailing market conditions, thereby seizing potential investment opportunities and assessing valuations effectively. According to Siddharth Alok, AVP Investments at Multi Ark Wealth-Epsilon Money, "Flexicap funds are designed to invest in companies of varying market capitalizations. Fund managers can adapt their allocations based on market dynamics and emerging opportunities. Currently, the average allocation consists of approximately 55% in large-cap stocks, 40% in small and mid-cap companies, with the remainder held in cash. This dynamic allocation approach positions these funds to potentially achieve strong returns over the medium to long term." Flexi-cap funds have become increasingly favored by individual investors, with a total of 39 schemes in this category amassing a collective Assets Under Management (AUM) of Rs 4.30 lakh crore. This positions flexi-cap funds as the second-largest category by asset size, following sectoral schemes. As of the end of August, the capital market features 39 flexi-cap funds, which collectively manage assets totaling Rs 4.29 lakh crore. In addition, there are 26 multi-cap funds with an aggregate AUM of Rs 1.73 lakh crore. Varun Goel, senior fund manager–equity at Mirae Asset Investment Managers (India), stated that increased diversification through the distribution of investments aids in balancing risk and reward for these funds. Historically, flexi-cap funds have demonstrated superior performance in volatile market conditions due to their ability to allocate investments across various sectors. Multicap funds Multicap equity funds offer investors the chance to invest in companies of varying sizes and across multiple sectors. This versatility allows fund managers to distribute investments among large, mid-cap, and small-cap companies in response to prevailing market conditions. These funds provide access to all major sectors driving the growth of the Indian economy, making them a suitable investment option for a period of five years or longer. By choosing multi-cap funds, investors can avoid the necessity of acquiring multiple funds to achieve a thorough market exposure. Regarding multi-cap funds, it is essential that they comply with a required allocation, designating at least 25% to each of the Large, Mid, and Small-cap categories. While these funds carry a higher risk profile, they also have the potential to perform well during bullish market conditions. Small-cap funds primarily target investments in companies that rank below the top 250 in terms of market capitalization. These firms are often in the early stages of development, presenting considerable growth opportunities, yet they also carry the risk of failure. Consequently, these funds exhibit high volatility and are more vulnerable to economic fluctuations and business cycles, as noted by Alok. Where should you invest? According to SEBI regulations, multi-cap funds are required to allocate a minimum of 50% of their portfolio to smaller-cap stocks, which include small-caps and mid-caps. Multi-cap funds have outperformed flexi-cap funds in terms of average returns. On a one-year basis, multi-cap funds have delivered returns of 43.88%, compared to 39.81% for flexi-cap funds. Over a three-year period, multi-cap funds have generated returns of 21.45%, while flexi-cap funds have returned an average of 18.04%. A multicap fund is ideally suited for investors who possess a long-term investment perspective and a high tolerance for risk. In selecting among these funds, it is essential for investors to evaluate their risk appetite, investment objectives, and time frame to identify the fund that most closely aligns with their financial goals, according to Alok. "Flexi-cap funds are increasingly favored due to their inherent adaptability, allowing them to navigate risk-averse sentiments or market volatility by varying the allocation among large, mid, and small-cap stocks," stated Meenakshi Dawar, fund manager for equity investments at Nippon India Mutual Fund. Read the full article

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The Most Important Difference Between Bitcoin And Crypto

Bitcoin stands as the inaugural and most widely recognized cryptocurrency, holding the largest market capitalization. Nevertheless, numerous proponents of Bitcoin emphasize a significant distinction between Bitcoin itself and the broader cryptocurrency landscape. Michael Saylor, the founder of MicroStrategy and a prominent advocate for Bitcoin, articulated this perspective during an appearance on CNBC's "Squawk on the Street." He remarked, "Speaking for all the bitcoiners, we feel trapped in a bad relationship with crypto, and we want out." What accounts for such a pronounced separation between terms that seem closely intertwined both in language and technology? It is important to note that all cryptocurrencies are constructed on blockchain technology, which facilitates the transfer of digital assets via a decentralized network that continuously maintains and updates the expanding ledger of transactions. The fundamental principle of "bitcoin, not crypto" is rooted in the idea of decentralization. To date, no other blockchain has been able to match Bitcoin in this regard. Nevertheless, it is possible to harmonize this viewpoint with the presence of alternative blockchains by acknowledging the distinct functions they fulfill. Decentralization Is A Spectrum Decentralization serves as a remedy for the shortcomings associated with central authorities. Bitcoin represents a groundbreaking advancement in establishing a genuinely decentralized system for value transfer, relying on cryptographic principles and economic incentives—specifically, the issuance of new bitcoins and transaction fees directed to miners. In exchange for their efforts, miners allocate resources towards specialized hardware and consume significant amounts of electricity. Their primary task involves solving proof-of-work for each block, thereby ensuring the security of the blockchain. Miners are driven by the imperative to maintain the safety, functionality, and, crucially, the censorship-resistance of Bitcoin. An alternative to Proof of Work (PoW) is Proof of Stake (PoS), which necessitates that validators stake the blockchain's currency to demonstrate their integrity. This consensus mechanism and its various adaptations have become increasingly favored among blockchains due to their capacity for enhanced scalability. Nevertheless, PoS has the potential to foster an oligarchic structure. The greater the number of coins staked, the more likely one is to successfully add a block and receive a reward. This accumulation of wealth enables further staking of additional coins. In contrast to Bitcoin miners, whose influence remains static after mining a block, PoS validators have the opportunity to expand their power. Moreover, concerns regarding centralization are not limited to the PoS consensus. Issues such as a limited number of nodes, liquid staking protocols that aggregate user funds, nodes operated by centralized entities, substantial hardware requirements, and centralization risks associated with maximal extractable value (MEV) practices represent significant challenges that many blockchains encounter. On the Ethereum network, which is recognized as one of the most decentralized blockchains aside from Bitcoin, approximately 35% of staked assets are attributed to the top three decentralized liquid staking services, as reported by Dune Analytics. An additional 20% is derived from the leading three centralized services. Furthermore, 69% of Ethereum nodes are managed by three centralized providers, while 90% of the blocks are organized by merely three builders specializing in MEV optimization. The Ethereum blockchain, with a size of 1.16 TB, is nearly double that of Bitcoin's 604 GB, complicating participation for average users. Indeed, many blockchains exhibit a significantly lower degree of decentralization and, consequently, reduced resistance to censorship compared to Bitcoin. Furthermore, in contrast to Bitcoin, which Satoshi Nakamoto entrusted to the community within two years of its inception, the majority of other blockchains remain closely associated with their original founders. This group of insiders, which includes early investors, frequently maintains substantial control, particularly through the possession of pre-minted coins, thereby further consolidating their wealth and influence. It would be premature to conclude that the entire cryptocurrency sector is without value. Decentralization exists on a continuum, and even platforms that are less decentralized provide users with greater freedom and control compared to conventional web services. This characteristic enables them to cater to a range of applications beyond mere financial transactions. Not All Cryptocurrencies Are Currencies Bitcoin's main objective is to establish and maintain a form of independent currency. As an increasing number of individuals trust bitcoin as a substitute for conventional currencies, its value rises correspondingly. Most other blockchains, such as Ethereum and Solana, were developed as versatile platforms for smart contracts. Their primary objective is to facilitate the creation of decentralized applications, commonly referred to as dapps. By leveraging these blockchains, the forthcoming phase of the internet, termed Web3, has the potential to introduce innovative applications across various sectors, including gaming, social media, finance, commerce, and more. From this viewpoint, ether, the native currency of Ethereum, should not be classified merely as a cryptocurrency. Although it can be traded or invested in, ether serves more as a utility asset within the Web3 ecosystem rather than as a general medium of exchange. Its main function is to support the Ethereum blockchain by acting as a payment method for transactions and providing incentives for validators. As the popularity of Ethereum-based dapps continues to rise, the demand for ether is expected to increase to accommodate transaction fees. Smart contract platforms are typically managed by founding teams that function similarly to conventional businesses. These teams address challenges such as securing funding, resolving technical issues, fostering community engagement, and promoting their offerings. The worth of the native coins associated with these blockchains is indicative of the quality of their efforts, which separates them from the concept of a truly independent currency. Within the Web3 ecosystem, many view such organizational structures as essential for driving innovation, a perspective that is difficult to contest. Nevertheless, prioritizing efficiency over decentralization contradicts the principles of the cypherpunk movement. This situation further exacerbates the distinction between Bitcoin and other cryptocurrencies. Blockchain-Based Tokens In addition to native cryptocurrencies such as Bitcoin and Ether, blockchains accommodate a diverse range of tokens, each serving distinct purposes and exhibiting varying degrees of decentralization. These tokens encompass stablecoins, memecoins, protocol tokens, and numerous other digital assets that can be readily generated through smart contracts. While these tokens coexist within the blockchain ecosystem alongside native coins, their value is contingent upon the specific project that created them. For an extended period, tokens have been a source of contempt for bitcoin maximalists, who regard all cryptocurrencies other than bitcoin with disdain. A multitude of scams associated with these tokens has inflicted considerable reputational harm on the cryptocurrency sector, adversely affecting bitcoin as well. However, with the emergence of Ordinals and Runes, certain bitcoin enthusiasts have begun to reevaluate their perspectives on tokens. These protocols, which attribute value to satoshis (the smallest units of bitcoin) or facilitate the creation of tokens on the Bitcoin network, have ignited conversations regarding innovative applications for the blockchain. Following the initial excitement, both protocols are now experiencing only limited adoption. Since reaching their peak in 2023, daily Ordinals inscriptions have decreased from more than 400,000 to approximately 40,000. Similarly, Runes etchings have plummeted from over 35,000 in April to fewer than 400. Currently, bitcoin's primary function as a superior form of currency remains its most significant application, overshadowing other potential uses. In summary, bitcoin continues to excel in its decentralization and serves primarily as an alternative currency. In contrast, the wider cryptocurrency landscape appears willing to sacrifice some degree of decentralization in pursuit of innovation and new applications. Consequently, bitcoin and the broader crypto ecosystem are becoming increasingly differentiated. Read the full article

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7 Tips To Increase Sales And Make More Money In Your Business

Every entrepreneur aspires to enhance sales and elevate revenue; however, numerous individuals encounter difficulties in determining the initial steps. To attain sustainable growth and profitability, it is essential to implement strategies that resonate with customer requirements while effectively utilizing fundamental business practices. Sales serve as the fundamental engine that propels any business forward. In the absence of sales, revenue ceases to exist, and without revenue, a business cannot sustain itself or expand. The essence of selling lies in cultivating relationships, delivering value, and addressing the needs of customers. An effective sales strategy not only enhances profitability but also fortifies your brand, cultivates customer loyalty, and generates avenues for growth. In essence, sales are the vital force of your enterprise, and achieving proficiency in this area is essential for sustained success. Here are seven essential strategies to enhance your sales and expand your business. - Comprehend the Requirements of Your Customers. A fundamental aspect of boosting sales lies in comprehending your customers. By gaining a precise understanding of your audience's desires and requirements, you can customize your products, services, and marketing strategies to align with those expectations. Tip: It is advisable to invest time in collecting information about your customers through various means such as surveys, social media interactions, or direct conversations. Determine their challenges, what drives their decisions, and how your business can deliver optimal value. When your product addresses a particular issue, the sales process becomes significantly more straightforward. - Refine Your Sales Funnel The sales funnel illustrates the progression of a customer from the initial stage of awareness to the final stage of purchase. It is essential to enhance each phase of your sales funnel to create an effective sales mechanism. By utilizing targeted content, email marketing, and follow-up strategies, you can ensure that your funnel effectively directs potential customers towards making a purchase. Tip: It is advisable to monitor your conversion rates at each stage of your sales funnel to identify areas that require enhancement. For instance, if you observe significant website traffic accompanied by low conversion rates, this may suggest that your messaging needs to be refined to better align with the intentions of your target audience. - Emphasize the importance of maintaining customer loyalty. Acquiring new customers is essential; however, it is frequently more straightforward and economical to sell to your current clientele. Established customers already have confidence in your brand, and they are more inclined to make repeat purchases if they perceive that their value is recognized. Tip: Develop a customer retention strategy that includes loyalty programs, tailored offers, and exclusive promotions for returning customers. Maintain regular engagement through newsletters and follow-up emails to ensure your brand remains prominent in their minds when they require your product or service once more. - Promote additional products and services. Enhancing your average order value (AOV) represents an effective strategy for increasing sales without the necessity of acquiring new customers. Upselling entails presenting a superior version of a product that a customer is contemplating, whereas cross-selling involves recommending additional items that complement the original purchase. Tip: Enhance the capabilities of your sales team or implement digital solutions to propose pertinent products during the checkout process. For instance, when a customer is buying a laptop, recommend complementary items such as a protective case or an extended warranty to enhance the overall value and boost the final transaction. - Utilize the principles of scarcity and urgency. Creating a sense of urgency is among the most powerful strategies to stimulate immediate sales. Implementing limited-time promotions, flash sales, or scarcity techniques—such as displaying the remaining stock—encourages customers to expedite their purchasing choices. Tip: Incorporate expressions such as "limited stock available" or "promotion concludes in 24 hours" within your website and marketing communications. When consumers perceive a risk of missing an opportunity, they are more inclined to make prompt decisions. However, it is essential to apply this tactic judiciously, as excessive use may come across as disingenuous. - Provide Tailored Experiences. In the current market environment, personalization plays a crucial role. Consumers desire to perceive that companies are attentive to their individual preferences and requirements. By providing a tailored shopping experience, the probability of conversion is significantly enhanced. Tip: Utilize customer information to deliver customized product suggestions, promotions, or follow-up communications. Adapt your marketing emails in accordance with customer actions, such as providing discounts on products they have previously viewed or left in their shopping cart. Read the full article

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Personal loan: 5 reasons to get a personal loan to help finance life’s adventures

If you possess a passion for travel and an insatiable desire to explore, securing funds for your adventures may not always be straightforward. It is possible to travel and spend at a rapid rate without concern for financial limitations. However, one potential solution could be to consider borrowing money. There are limited options for borrowing when the expenditure is related to discretionary activities such as travel. It is important to note that a week-long journey to Singapore would typically require a minimum expenditure of ₹1 lakh per individual. Likewise, if you are considering a trip to Dubai, the costs for a week-long stay can range from ₹1 lakh to ₹2 lakh. Incorporating adventure sports into your itinerary will undoubtedly increase the overall expenses. However, lacking immediate access to the necessary funds does not necessitate the postponement or cancellation of your travel plans. On the contrary, it is perfectly reasonable to maintain a degree of skepticism in this situation. If you find yourself uncertain about obtaining a personal loan to support your life’s adventures, the following guide may be beneficial: Here are several important considerations to keep in mind when thinking about securing a personal loan for your life’s pursuits. - Acquiring a personal loan for life's endeavors can be likened to securing funds from your future to enhance your current circumstances. This approach allows you to access opportunities that would otherwise require waiting, enabling you to bring future possibilities into the present by obtaining financial resources now. - Limited Choices: When you have discretionary expenses planned, your only recourse is to secure a personal loan. Typically, banks and non-banking financial institutions do not provide loans specifically designated for personal luxuries outside of the personal loan category. - Saving and postponing the plan: On the other hand, if you choose to set aside funds for future use, it may be unwise to delay your travel plans when you have the opportunity to travel now. Your friends might not be available later, weather conditions could alter, and unforeseen challenges may arise in the future. Considering all these factors, it is acceptable to take out a loan for a luxury that holds significant personal value to you. - Anticipation of increased income: One compelling reason to consider obtaining personal loans at this time is the expectation of a higher income in the near future, which will facilitate the repayment of the loan you are about to secure. - Maximizing the experience of adventure: For certain individuals, travel and exploration hold significant importance in their lives. Engaging in these activities through the acquisition of a personal loan significantly increases the likelihood of maximizing their benefits. Ultimately, you have invested financially in them, quite literally. Read the full article

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Bitcoin: Russia Hits A Jackpot Of 3 Billion Dollars!

Bitcoin has assumed a novel strategic significance for Russia. Confronted with economic sanctions from Western nations, the country has discovered an unforeseen means in cryptocurrency mining to sustain its economy. Having mined over $3 billion in Bitcoin in the previous year, Russia appears to have identified a method to circumvent restrictions while simultaneously enhancing its tax revenues. The legalization of Bitcoin represents a significant economic achievement. In July of the previous year, the Russian State Duma made a significant move by officially legalizing Bitcoin mining. This action, which goes beyond a mere legislative formality, signifies a carefully considered economic strategy in light of growing international pressures. The Russian government, by formalizing this activity, enables companies to establish themselves as legal entities and take advantage of a supportive regulatory environment. This decision consequently facilitates significant investments in mining infrastructure and enhances the appeal for both domestic and international investors. From a financial perspective, this initiative has already yielded positive results. Estimates indicate that mining operations have contributed approximately 50 billion rubles (around $556 million) in tax revenue to the Russian government. This substantial amount, notable for its inaugural year, has the potential to grow further as new investors are drawn in by the stability of regulations and the prospect of lucrative returns. The legalization of Bitcoin is a component of a broader strategy designed to enhance the utilization of cryptocurrencies in global commerce. In response to the limitations set by Western nations, Russia appears to view digital currencies as a method to bypass economic sanctions while also invigorating its domestic economy. Sanctions evasion: A well-oiled tactic Russia's engagement with Bitcoin and cryptocurrencies extends beyond mere internal economic considerations; it also serves as a strategy to circumvent international sanctions. The economic restrictions enforced by the United States and the European Union have effectively isolated Russia from numerous conventional financial markets, yet cryptocurrencies present a potential avenue for relief. Chainalysis, a blockchain analysis firm, has raised alarms regarding the utilization of Russian cryptocurrency platforms as a means to bypass these sanctions. Garantex, a cryptocurrency exchange that has been sanctioned, has handled almost $100 billion in transactions since 2018, making it one of the prominent platforms in this sector. Despite being monitored by the Office of Foreign Assets Control (OFAC) in the United States and the Office of Financial Sanctions Implementation (OFSI) in the United Kingdom, Garantex continues to be a significant entity within the Russian cryptocurrency landscape. Analysts observe that exchanges such as Garantex and Exved are vital in enabling cross-border trade, thereby allowing Russia to sustain a degree of economic interaction in the face of ongoing sanctions. Exved is associated with the bank InDeFi and is reportedly co-founded by Sergey Mendeleev, who also leads Garantex, alongside Alexander Lebedev, a former KGB officer. This intricate web of platforms and individuals demonstrates Russia's resourcefulness in leveraging cryptocurrencies to bypass financial sanctions. Towards a parallel economy? Russia's extensive embrace of Bitcoin and other cryptocurrencies prompts significant inquiries regarding the future of international economic transactions. The utilization of cryptocurrencies enables Russia to maintain trade relations with the global market, thereby establishing a parallel economy that operates independently of conventional financial systems and international sanctions. This development has the potential to alter the landscape of global economic influence, as other nations facing sanctions might adopt similar strategies by leveraging digital currencies to bolster their economies. In addition, the legalization of Bitcoin and the increasing acceptance of cryptocurrencies in Russia may have significant implications for the broader digital asset landscape. By engaging more proactively in this sector, Russia could shape international regulations concerning Bitcoin and cryptocurrencies, thereby turning them into instruments of geopolitical strategy. Read the full article

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Best small cap mutual funds to invest in September 2024

Small cap mutual funds, which focus on investing in the shares of very small enterprises, achieved a remarkable return of over 40.44% in 2023. In July 2024, these small cap funds once again captured the attention of investors, resulting in an inflow of Rs 2,109.20 crore. Discussions regarding elevated valuations within the small-cap sector, coupled with recent market fluctuations, are leading numerous investors to acknowledge the possibility of an impending correction. Mutual fund managers and financial advisors indicate that while valuations appear high, investors should persist in allocating funds to small-cap schemes for long-term wealth creation. Many mutual fund advisors assert that despite the significant appreciation in the small-cap segment over the past six months, investors can still strategically invest in these schemes in a phased approach to foster wealth accumulation over time. Small cap schemes focus on investments in very small enterprises or their shares. In accordance with the regulations set forth by Sebi, these schemes are required to allocate funds to companies that are positioned below the 250th rank in terms of market capitalization. Furthermore, they must ensure that at least 65% of their investments are directed towards small cap stocks. Small companies often experience significant fluctuations, more so than their larger counterparts in the large and mid cap categories. Consequently, investing in small cap stocks is regarded as highly risky; this segment can exhibit considerable volatility, particularly in the short term. Therefore, small cap schemes are advised exclusively for aggressive investors who possess a substantial risk tolerance and a long-term investment perspective. Should invest in small cap funds? Have you ever considered the reasons behind the willingness of investors to engage in high-risk small cap schemes? These investment options possess the potential to yield substantial returns over an extended duration. For instance, the small cap sector has historically provided an average return of 19% over a decade. Nevertheless, to achieve such impressive returns, one must be ready to endure significant risk and market fluctuations. Identifying successful entities within the small-cap sector poses significant challenges. A considerable number of these firms remain relatively obscure and lack thorough research coverage. Additionally, their management teams may exhibit questionable ethics, often making exaggerated claims that lack substantiation. In certain instances, management, in collusion with market operators, may artificially inflate stock prices. These factors contribute to the market's tendency to disproportionately reward or penalize such companies. Should these companies achieve success, the market will gravitate towards their stocks, resulting in investors experiencing significant gains in their portfolios. Conversely, if they encounter difficulties, the stocks may face substantial declines, potentially rendering them worthless almost overnight. In summary, investing in small-cap stocks requires careful consideration and is not a simple endeavor. It is essential to identify proficient fund managers who focus on small-cap investments. Additionally, one must evaluate the performance of these funds during periods of market decline. To build wealth over the long term, consider investing in the following small-cap funds. Stay informed by following our monthly performance updates for these funds. The Axis Small Cap Fund has remained in the third quartile for the past 16 months, having previously spent two months in the fourth quartile. Meanwhile, the SBI Small Cap Fund has consistently occupied the third quartile for the last five months. Best small cap funds to invest in September 2024: - Axis Small Cap Fund - SBI Small Cap Fund - Kotak Small Cap Fund - Nippon India Small Cap Fund Our methodology: ETMutualFunds has utilized the subsequent criteria for the selection of Equity mutual fund schemes. 1. Mean rolling returns: Rolled daily for the last three years. 2. Consistency in the last three years: i)The Hurst Exponent, denoted as H, is utilized to assess the consistency of a fund. This exponent serves as an indicator of the randomness present in the Net Asset Value (NAV) series of a fund. Funds characterized by a high H value typically demonstrate lower volatility in comparison to those with a low H value. When H equals 0.5, the return series is classified as a geometric Brownian time series. Forecasting this type of time series presents significant challenges. ii) A series is considered to exhibit mean reversion when H is less than 0.5. iii) Conversely, when H is greater than 0.5, the series is characterized as persistent. A higher value of H indicates a more pronounced trend within the series. 3. Downside risk: For this analysis, we have exclusively focused on the negative returns associated with the mutual fund scheme. X represents returns that fall below zero. Y denotes the total of all squared values of X. Z is calculated as Y divided by the number of days used to compute the ratio. The downside risk is determined by taking the square root of Z. 4. Outperformance: The evaluation is conducted using Jensen's Alpha over the past three years. This metric reflects the risk-adjusted return produced by a mutual fund scheme in comparison to the anticipated market return as estimated by the Capital Asset Pricing Model (CAPM). A higher Alpha signifies that the performance of the portfolio has exceeded the returns forecasted by the market. The average returns generated by the mutual fund scheme can be calculated as follows: .Read More Read the full article

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GST Council likely to exempt term life insurance from tax, no change in investment-linked plans

The GST Council is anticipated to exclude term life insurance policies from the goods and services tax (GST), while maintaining the tax on insurance policies that include an investment element. This decision may enhance the demand for policies focused solely on protection. A senior government official, speaking on the condition of anonymity, indicated that the decision is expected to be formalized during the GST Council meeting scheduled for September 9. The official stated, "Life insurance that includes an investment component will not qualify for exemption. Exempting such policies lacks justification, as they fundamentally serve as investments. Our focus should be on exempting the uncertainties associated with life, rather than investments themselves." The estimated annual revenue loss resulting from the exemption of term life insurance from GST is approximately Rs 200 crore, he stated. This measure is expected to enhance the affordability of term life insurance, which may lead to an increase in its uptake among the Indian population. Sandeep Sehgal, partner-tax at AKM Global, a tax and consulting firm, stated, "This would represent a positive advancement. It would render insurance more accessible and could lead to a higher volume of business for insurance providers. Given that insurance penetration in India remains comparatively low in relation to other developed nations, this initiative would undoubtedly assist in closing that gap." Impact on Investment-Linked Plans The anticipated exemption on term life insurance is likely to motivate a greater number of individuals to select basic life coverage. However, the ongoing taxation of investment-linked life insurance plans may produce an opposing outcome. These plans, which integrate life insurance with an investment element, are expected to remain comparatively expensive due to the prevailing GST rate of 18 percent. Sehgal highlighted the possible consequences for these plans, remarking, "Simultaneously, this would affect investment and insurance plans, which would continue to incur GST and remain comparatively expensive." Term vs Investment-Linked plans Term Life Insurance serves as a straightforward protection plan designed to provide financial support to beneficiaries in the event of the policyholder's death within the policy's duration. This type of insurance typically covers a defined period, which can range from 10 to 30 years. The premiums associated with term life insurance are typically lower, as the policy exclusively offers a death benefit without incorporating any savings or investment features. Should the policyholder survive the term, no benefits are disbursed unless the policy has an added return of premium rider. Conversely, investment-linked life insurance policies integrate life insurance coverage with an investment element. These policies provide not only a death benefit but also build cash value over time, which can be utilized for investment opportunities. The premiums associated with these policies are higher than those of term life insurance, as they serve the dual function of offering protection and facilitating investment growth. Read the full article

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Term plans should be your first life insurance policy: Amit Jhingran, SBI Life Insurance

Amit Jhingran of SBI Life Insurance states that term plans should be the primary option for individuals embarking on their life insurance journey. These plans offer significant coverage at a reasonable cost. By prioritizing protection, consumers can ensure their financial stability while maintaining affordability. Amit Jhingran, MD & CEO of SBI Life Insurance, emphasizes to ET Wealth that life insurance ought to be regarded not as an extraneous cost, but rather as an essential instrument that safeguards all other financial objectives. A significant number of individuals perceive life insurance primarily as a means of investment aimed at yielding financial returns. What insights do you have on this perspective? It is essential to recognize that life insurance fulfills a distinct role. Prior to allocating funds to other investments, it is vital to safeguard your financial objectives. Lacking this fundamental protection, your aspirations may remain unattainable. Life insurance should not merely be regarded as an expense; rather, it is a key component in ensuring your financial security and the well-being of your family, and should not be perceived as an onerous financial burden. Historically, individuals have primarily purchased insurance for the tax advantages provided under Section 80C, often overlooking its role as a means of financial protection. Insurance has typically been viewed as a way to utilize the Rs.1.5 lakh tax exemption limit. However, this perspective has evolved in recent years, with an increased awareness of risk contributing to a growing demand for insurance products. As individuals recognize the necessity of prioritizing insurance over investments, the popularity of term plans is expected to rise, thereby enhancing the overall product diversity within the industry. Specialists assert that term life insurance plans represent the most advantageous type of life insurance. Do you concur with this assessment? Term plans ought to be the primary consideration for individuals embarking on their life insurance journey. These plans offer significant coverage at a reasonable cost. By prioritizing protection, consumers can ensure their financial stability while maintaining affordability. After achieving adequate coverage through a term plan, individuals may then consider various investment opportunities. What should one consider while buying a term plan? It is essential to evaluate the monthly expenditures of the household and determine the total amount necessary to ensure that monthly income is met. The coverage should be a minimum of ten times the annual income, in addition to any outstanding liabilities, such as housing or automobile loans. The surplus should be sufficient to sustain a monthly income that upholds the family's standard of living. Furthermore, it should take into consideration significant expenses, including children's education and major life events, such as a wedding for a child. It is crucial not to choose a round figure for insurance, such as Rs. 50-60 lakh, merely because it appears convenient. A thorough calculation of your actual needs is essential. Additionally, it is important to take inflation into account, as the purchasing power of money diminishes over time. Therefore, this aspect should be included in your monthly income assessment. Is there a policy offered by SBI Life that includes an inflation adjustment feature? SBI Life eShield Next provides enhanced protection, featuring a 10% increase in the sum assured at designated intervals. Nevertheless, as previously stated, one should not rely solely on rounded figures. It is crucial for individuals to thoroughly evaluate the total sum assured that they genuinely require. Have the proposed alterations to capital gains taxes in the Budget enhanced the attractiveness of life insurance as an investment option? The increase in the long-term capital gains (LTCG) tax from 10% to 12.5% represents a minor adjustment, and the Section 10 (10D) benefit for insurance has already been restricted to an annual premium of Rs.2.5 lakh in earlier Budgets. Therefore, I do not anticipate any substantial changes in this regard. A notable benefit of ULIPs is that the ability to switch between debt and equity within a ULIP is tax-exempt, in contrast to mutual funds, where capital gains tax is applicable. Read the full article

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Stocks under ₹ 200 in which LIC holds up to 6.57% stake to keep in your radar

The Life Insurance Corporation of India (LIC) stands as the largest government-owned entity in the life insurance and investment sector in India. Its main responsibility involves channeling funds obtained from individuals through various life insurance policies into global financial markets and other government assets. According to the corporate shareholdings reported for June 30, 2024, LIC publicly possesses 101 stocks, which have a total value exceeding ₹ 4,29,447 Crore. DCM Shriram Industries Ltd. DCM Shriram Industries Ltd. is a multifaceted organization with a varied portfolio encompassing sugar production, alcohol manufacturing, power generation, chemicals, and additional sectors. DCM Shriram Industries manages several sugar manufacturing facilities in Uttar Pradesh, boasting a total installed capacity of 38,000 tonnes crushed per day (TCD). Additionally, the company operates a distillery with a production capacity of 150 kilolitres per day (KLD), specializing in the production of ethanol and various alcoholic beverages. As of the June quarter of FY 23-24, LIC holds a 4.84 percent stake in the company. The company’s promoter holds a 50.11 percent stake and Foreign Institutional Investors hold a 2.23 percent stake in the company.  DCM Shriram Industries has experienced an 11 percent decrease in revenue year on year, falling from ₹2,351 crores in FY22-23 to ₹2,083 crores in FY23-24. Conversely, during this timeframe, net profit has surged by 92 percent, increasing from ₹60 crores to ₹115 crores. Bank of India (BOI) Bank of India (BOI) is a public sector bank in India that provides a wide range of banking products and services for both retail and corporate clients, encompassing retail banking, corporate banking, rural banking, and additional offerings. The net interest income (NII) of the bank experienced a year-on-year increase of 7 percent, reaching ₹ 5,937 crore. Additionally, the bank's global business grew by 11.6 percent year-on-year, amounting to ₹ 11.8 lakh crore, while the global return on assets remained stable at 0.6 percent. As of the June quarter of FY 23-24, LIC holds a 6.57 percent stake in the company. The company’s promoter holds a 73.38 percent stake and Foreign Institutional Investors hold a 3.61 percent stake in the company.  In the fiscal year 2023-2024, the company's consolidated revenue experienced a remarkable increase of 27%, rising to ₹47,932 crores from ₹61,073 crores in the fiscal year 2022-2023. Similarly, the net profit for this fiscal year saw a substantial growth of 71%, reaching ₹6,567 crores, in contrast to ₹3,839 crores recorded in the previous fiscal year. On Monday, Bank of India shares were priced at ₹117 each, reflecting an increase of 0.81 percent compared to the previous closing price. The company's market capitalization stands at ₹52,834 crore. Canara Bank Established in 1906 and based in Bangalore, Canara Bank stands as a prominent public sector bank in India. It provides an extensive array of banking services, including savings and current accounts, along with fixed deposit options. Furthermore, Canara Bank offers investment solutions, such as mutual funds and insurance products, to support customers in effectively managing their financial assets. As of the June quarter of FY 23-24, LIC holds a 5.83 percent stake in the company. The company’s promoter holds a 62.93 percent stake and Foreign Institutional Investors hold an 11.91 percent stake in the company.  In the fiscal year 2023-2024, the bank experienced a remarkable increase in consolidated income, rising by 28% to reach ₹1,10,519 crores, up from ₹85,885 crores in the fiscal year 2022-2023. Similarly, the net profit for this fiscal year saw a significant growth of 36%, amounting to ₹15,401 crores, in contrast to ₹11,345 crores recorded in the previous fiscal year. On Monday, Canara Bank shares were priced at ₹108 each, reflecting an increase of 0.98 percent from the prior closing price. The company's market capitalization stands at ₹97,646 crore. Disclaimer The opinions and investment recommendations provided by financial experts, brokerage firms, and rating agencies on theplotlinee.link are solely their own and do not reflect the views of the website or its management. Investing in equities carries the potential for financial loss; therefore, investors should proceed with caution when engaging in stock trading. Dailyraven Technologies and the author bear no responsibility for any losses incurred as a result of decisions made based on this article. It is advisable to seek guidance from your investment advisor prior to making any investments. Read the full article

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Waiting for ITR refund: Check who will get faster refund among ITR-1, 2 & 3

Individuals who submitted ITR-1, ITR-2, or ITR-3 for the fiscal year 2023-24 are left pondering a critical question: Which taxpayers will obtain their refunds sooner? Understanding ITR-1, ITR-2 & ITR-3 ITR-1 form: The ITR-1 form is applicable for an Ordinary Resident (ROR) Individual whose total income does not exceed Rs 50 lakh. This income may comprise earnings from salary, revenue from a single house property, and additional income sources, including bank interest, dividends, and agricultural income capped at Rs 5,000. ITR-2 form: This form is intended for individuals or Hindu Undivided Families (HUFs) who do not derive income from "Profits and Gains of Business or Profession" and do not qualify for ITR-1. ITR-3 form: The ITR-3 form is intended for individuals and Hindu Undivided Families (HUFs) involved in business or professional endeavors, necessitating the upkeep of comprehensive financial records. This category encompasses professionals such as chartered accountants, medical practitioners, legal advisors, and engineers, whose earnings are derived from actual profits. ITR-1 is recognized as the most straightforward of the tax forms, resulting in a generally expedited processing time relative to other forms. As a result, refunds are frequently issued shortly after the completion of the processing. Claims for refunds associated with ITR-1 are typically resolved more swiftly than those for ITR-2 and ITR-3, which is indicative of the less complex income reported in ITR-1 compared to the intricacies found in the other forms. Taxpayers submitting ITR-1 can often expect to receive their refunds within a few days to weeks, assuming there are no complications or necessary adjustments. However, it is important to note that filing returns near the deadline may result in processing delays, as stated by Adhil Shetty, CEO of Bankbazaar.com. The speed of refund processing can be influenced by various factors, irrespective of the ITR form utilized. The precision of the information provided is crucial; inaccuracies or inconsistencies in the Income Tax Return (ITR) may result in delays or potential denial of the refund request. E-verification: Timely e-verification of your return can greatly expedite the processing duration. It is essential to provide accurate bank account information in the Income Tax Return (ITR) to prevent any delays in the processing of refund credits. TDS reconciliation: Discrepancies between the TDS claimed and the TDS reported by deductors may necessitate further verification procedures. Substantial refunds: Significant refund sums may attract further examination, which could lead to an extended processing duration. How to check ITR refund The process of tracking income tax refunds can be conducted online via two main platforms: the National Securities Depository Limited (NSDL) website and the official portal of the Income Tax Department. Checking refund status from the income tax e-filing portal Access the official website for income tax e-filing. Authenticate your identity using your PAN information. After logging in, find and select the ‘My Account’ section. Proceed to click on the “Refund/Demand Status” option. You will be presented with the status of your income tax refund, which will include information such as the assessment year, current status, reasons for any refund issues, and the payment method. Checking refund status from the NSDL website  Access the NSDL TIN website. Log in using your PAN information. Select the assessment year for which you wish to verify the refund status from the dropdown list. Input the captcha code shown on the screen. Once you have entered the captcha, click the ‘Submit’ button. A notification will be displayed on your screen, revealing the status of your ITR refund. Click 'Proceed' to check your refund status. Read the full article

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Understanding the 8:4:3 rule and the rule of 72; maximise your mutual fund investment growth

In the realm of mutual fund investments, two fundamental principles can greatly influence your financial advancement: the 8:4:3 rule and the Rule of 72. It is essential to explore these concepts to comprehend how they can assist you in maximizing your investments and attaining sustainable wealth over time. What is the 8:4:3 Rule? The 8:4:3 rule is a well-established guideline aimed at assisting investors in visualizing the progression of their mutual fund investments. This principle relies on the concept of compound interest, indicating that an investment in a mutual fund yielding a 12% annual return is expected to double roughly every 8 years. Following the initial doubling, the investment is projected to double again in the next 4 years, and subsequently, a final doubling will occur within the following 3 years. Implementing the 8:4:3 rule indicates that your mutual fund investment is expected to quadruple in value over a period of 15 years and to increase eight times its original amount in 21 years. This strategy emphasizes the power of compounding over time, providing a straightforward avenue for significant financial growth. The Power of Compounding The concept of compounding interest plays a vital role in enhancing the value of your investments. When interest is earned not only on the original principal but also on the accumulated interest, the growth of your funds becomes exponential. For instance, if you invest Rs 100 at an annual interest rate of 10%, your balance will reach Rs 110 after the first year. In the subsequent year, you will earn 10% interest on Rs 110, increasing your total to Rs 121. This cycle continues each year, leading to remarkable growth over time. The Rule of 72: How Will Your Money Grow? The Rule of 72 serves as a straightforward method for estimating the duration required for an investment to double in value. By dividing the number 72 by the annual interest rate, one can ascertain the number of years necessary for the investment to reach twice its original amount. For example, if an individual invests Rs 100 at an annual interest rate of 10%, the calculation would be 72 divided by 10, resulting in 7.2 years. This indicates that the investment is expected to double in roughly 7.2 years. In the case of a more substantial investment, such as Rs 1,00,000, it is projected to grow to Rs 2,00,000 in approximately 7 years, provided that the investment is sustained and contributions are potentially increased. Becoming a Millionaire: How Early Investment Pays Off To build substantial wealth for retirement, it is advisable to begin investing at the earliest opportunity. For instance, if one invests ₹5,000 each month starting at the age of 25, and achieves a 10% annual return, the investment could grow to exceed Rs 1 crore by the time one reaches 60 years of age. This underscores the critical role of early and regular investment. When Will Your Money Triple or Quadruple? - Rule of 114: To determine the time required for your investment to triple, divide 114 by the annual interest rate. For an interest rate of 8%, the calculation would be 114 divided by 8, resulting in approximately 14.25 years. Therefore, your investment is expected to triple in roughly 14.25 years. - Rule of 114: To ascertain the time required for your investment to quadruple, you should divide 144 by the annual interest rate. For an 8% return, the calculation is 144 divided by 8, resulting in 18 years. Consequently, your investment will approximately quadruple in 18 years. Recent Investment Regulations Recent changes in mutual fund investment regulations mandate the inclusion of nominations, the linking of PAN and Aadhaar numbers, the use of one-time passwords, and the revalidation of KYC information. These modifications are designed to enhance the efficiency and security of the investment process. Benefits of the 8:4:3 Rule - Disciplined Investing: The 8:4:3 guideline assists investors in preserving investment stability, preventing impulsive choices amid market volatility. - Inflation Alignment: It guarantees that investments maintain their strength in the face of a 4% annual inflation rate, thereby safeguarding their value over the long term. The 8:4:3 rule and the Rule of 72 provide essential guidance for mutual fund investments and highlight the advantages of compounding. By following a systematic investment strategy and utilizing these principles, one can attain considerable growth and financial prosperity. Establishing a demat account with Angel One will grant you access to a wide range of stocks and mutual funds, as well as professional advice to assist in your investment choices. Notice: The content of this article is intended solely for informational purposes and should not be interpreted as financial advice or an endorsement to invest in any specific stock. Engaging in the stock market carries inherent risks, and it is crucial to perform comprehensive research and seek guidance from a qualified advisor prior to making any investment choices. Read the full article

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Your CIBIL score will be updated faster as credit information companies will now get fortnightly reports from lenders, says RBI

The Reserve Bank of India (RBI) has issued an important statement regarding credit information. The governor of the RBI has recommended that financial institutions are now required to submit credit information reports to credit information companies (CICs), including CIBIL, on a biweekly basis. Governor Shakikanta Das highlighted the advantages of prompt credit information disclosure for borrowers. He stated, "The biweekly reporting schedule will guarantee that the credit information reports issued by Credit Information Companies (CICs) contain more current data. This will serve the interests of both borrowers and lenders (CIs). Borrowers will experience quicker updates to their information, particularly after loan repayments. Lenders will benefit from improved risk assessments of borrowers and a diminished risk of borrowers becoming over-leveraged." The provision of precise credit information is essential for both lenders and borrowers. Currently, lenders must submit credit information to credit information companies (CICs) on a monthly basis or at shorter intervals as mutually agreed upon. A proposal has been made to enhance the frequency of this reporting to a biweekly schedule or even shorter intervals. As a result, borrowers will experience quicker updates to their credit information, particularly following loan repayments. Lenders, in turn, will be equipped to conduct more accurate risk assessments of borrowers, as stated by the Governor during his address. What could be the implications of this development? According to experts, this advancement will be advantageous for individuals, as positive credit behavior will be recognized more swiftly with the introduction of this change. Satish Mehta, Founder of Athena CredXpert, states, "Consequently, it will also assist lenders by offering more up-to-date information, allowing them to make more informed credit decisions." Experts indicate that this advancement may lead to a more expedited resolution of consumer disputes. Rajesh Kumar, MD & CEO of TransUnion CIBIL, stated, “This initiative represents a significant step forward that will greatly enhance the credit information framework. With banks and credit institutions reporting data more frequently, Credit Information Companies (CICs) will be able to update credit records more swiftly, resulting in more current data for credit grantors to make informed lending decisions. Additionally, this will facilitate quicker resolution of consumer disputes due to the availability of updated information in credit records. Credit information solutions play a crucial role in creating economic opportunities for millions in India, and we are committed to providing accurate data. As the leading credit information company in India, we continuously strive to improve the credit information ecosystem for the benefit of the public.” Joydip Gupta, the APAC Business Head at Scienaptic AI, states that the latest credit behavior of a borrower is typically the most significant factor. Therefore, having access to a more current credit history enhances lenders' capacity to make precise underwriting decisions. However, it is crucial to ensure that the quality of data submitted by lenders does not decline due to accelerated reporting. Presently, many credit bureau reports contain numerous missing fields or null values. As lenders upgrade their information technology systems to facilitate more frequent reporting, they should also focus on enhancing the accuracy of the data provided. Read the full article

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State Bank of India deploys 2,000 bankers to woo the wealthy

The State Bank of India, recognized as the largest financial institution in the country, is intensifying its efforts in wealth management in response to the increasing number of affluent individuals. The wealth management division of the bank is considered "outdated," and it aims to revise its strategy for engaging in this sector, as stated by Chairman Dinesh Khara. In pursuit of this goal, SBI is assigning approximately 2,000 executives to serve as relationship managers and is prioritizing partnerships with smaller enterprises nationwide, Khara mentioned during the bank's earnings presentation. Khara stated, in reply to an inquiry regarding the potential collaboration of SBI with other wealth management firms, "We produce a comprehensive range of products within the financial sector and possess the most extensive distribution network. This enables us to effectively deliver our products to customers." He refrained from providing details about the bank's existing assets under management. State Bank of India (SBI), boasting over 22,500 branches across the nation, is aligning itself with both international and domestic entities eager to capture a portion of India's expanding wealth management sector. A recent report from the Boston Consulting Group indicates that the country experienced an unprecedented increase in financial wealth, amounting to approximately $590 billion in 2023, marking the largest growth in its history. SBI is set to encounter competition from international entities such as HSBC Holdings Plc and Barclays Plc, as well as established local firms like 360 One WAM Ltd., which are broadening their offerings and workforce to cater to India's affluent population. Additionally, private banks such as ICICI Bank Ltd. and Axis Bank Ltd. have begun to penetrate the wealth management market in the country. Read the full article

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Life Insurers to seek extension on implementing surrender value norms

Several individuals familiar with the matter have indicated that life insurance firms are intending to request a three-month extension from the regulator for the enforcement of surrender value regulations. The introduction of new regulations may potentially cause a delay in the launch of new products, as they are required to be in place by September 30, 2024. It has been reported that insurers will require additional time to address the logistical challenge of revising traditional products and renegotiating commercials with distributors on the revised products. In June, the Insurance Regulatory and Development Authority of India (Irdai) released the 'Master Circular on Life Insurance Products', which implemented regulations to improve payouts for customers who prematurely terminate their policies. Life insurance companies are now required to offer an increased special surrender value (SSV) to policyholders who surrender their policies after the first year, as long as they have paid a full year's premium. Previously, insurers did not provide this enhanced value to customers surrendering their policies within the first year. Furthermore, the regulations specify that the discount rate for discounting the paid-up value in order to calculate SSV may be permitted to be up to 50 basis points (bps) higher than the 10-year G-Sec yield. Overhauling all of the conventional products in line with the new surrender value regulations, and renegotiating terms with the distributors within the specified timeframe, presents a significant challenge. Consequently, the industry is aiming to obtain an extension for the deadline to implement the new regulations, according to one source. Another source suggested that insurers are expected to request an extension beyond the end of September, as the industry will need additional time to re-price and re-file existing products. "Furthermore, the integration of these products into the platform and the training of distributors will also necessitate time. It represents a complete overhaul of the entire system," the source remarked. Life insurance companies will need to make adjustments to their current products and refile them in accordance with the new regulations, which include modifying offerings and commission payouts to distributors. Numerous analysts have suggested that due to the necessity for life insurers to increase surrender value on non-linked products, customers' internal rate of return (IRR) may decrease. Industry experts anticipate that the introduction of the new surrender value regulations will lead to a decrease in the number of new product releases in the current quarter, particularly within the non-linked sector. They further mentioned that new non-linked products will need to adhere to the updated surrender value guidelines. The life insurer mentioned that there is a high probability of a decrease in new product launches in the industry during this period. They also stated that more products are expected to be introduced after September, as insurers will be preoccupied with adjusting or reevaluating their current products to comply with the new regulations. This process of recalculation is anticipated to consume a significant amount of their time. Saurabh Bhalerao, associate director at CareEdge Ratings, mentioned that the industry must adhere to the new surrender value regulations by October 1, 2024. He pointed out that there could be some constraints during this period as companies are preoccupied with repricing and replenishing their current offerings. While there may be a reevaluation of products, the introduction of new products is expected to progress at a slower pace during this timeframe. In June, the life insurance industry had a total of 917 products, compared to 927 products in May. The number of products offered by private life insurers decreased from 875 in May to 865 in June, as reported by the Life Insurance Council. Bikash Choudhary, the chief actuarial and governance officer at IndiaFirst Life, emphasized the industry's dedication to introducing new products that adhere to the latest surrender value regulations, as well as making adjustments to current policies. Read the full article