Everything about Savings Accounts explained!

 What do you generally do with all the money left after paying the monthly dues? Do you consider investment options like Mutual Funds, stock market, Retirement Funds, Fixed Deposits, etc.? Do you have any liquid cash left? Withdrawing funds from investments is not easy. There are some deductions and penalties involved. You can borrow funds through Credit Cards, but those come with interest rates.

So, how to arrange money during emergencies? Savings Account helps here. These accounts are basic and readily provide cash. Although the interest rates might be exciting on balance maintained, you always need a Savings Account. Let us better understand this attractive financial product.  

About Savings Accounts

It is a deposit that you hold with the bank that offers principal security for a reasonable interest rate and immense liquidity. They are best for holding emergency funds, which you might need to fulfil short-term goals.

Availability of Savings Accounts

Almost all banks in India offer a Bank Account. You can now open them either online or offline. The online medium lets you compare interest rates, check the minimum balance requirement and other offers. Once you make the right choice, fill out the online form, and submit the relevant ID proofs and other documents.

Different types of Savings Accounts

Besides the regular account, banks in India offer other accounts too:

• Joint Account
• Women Account
• Senior Citizen Account
• Minor Account
• Pradhan Mantri Dhan Jan Yojana

Are there limitations on the age and income for opening Savings Accounts?

Banks do not impose any such restriction while opening the account. However, there might be different minimum balance requirements, and minors require a parent or guardian to open such accounts.

Penalties upon no minimum balance maintenance

According to RBI guidelines, banks cannot penalise you for maintaining a minimum balance in Dormant Accounts. Only those with active accounts and who do not meet the desired limit are liable for non-maintenance fees besides the Service Tax and Education Cess at applicable rates.

Difference between private and public Savings Accounts

Regarding operational wise, private and public online Bank Accounts offer the same services. However, they differ in minimum balance requirement, usually higher under private banks than public ones. Meanwhile, the free-charge benefit public banks offers is better than private banks.

Savings Account interest rates

The Savings Account interest rates range between 4% to 7%. They either get deposited or credited half-yearly. The interests, however, get calculated either monthly or daily.

You can access Savings Account and its related services through the Banking app or Internet Banking. This does away with visiting bank branches often.

What is the step-by-step process of applying for a Gold Loan online?

 Gold Loans are a popular Secured Loan that has gained immense popularity recently. With the rise of digital lending platforms, it has become more accessible. Here are the steps to follow for applying for Gold Loans online:

Research lenders

When applying for a Gold Loan, you should research lenders. You can look for lenders on search engines or use Loan aggregator websites that list lenders offering Gold Loans. When researching, compare the interest rates, Loan amount, repayment tenure, processing fees, and other terms.

Check the eligibility criteria

After shortlisting the lenders, check your eligibility criteria. You should meet the lender's eligibility criteria if you qualify for the Gold Loans. Standard eligibility criteria include age, income, credit score, and the gold value you offer as collateral.

Calculate the Loan amount

Once you can consider a Gold Loan, you should know the Loan amount. This can be done over Banking apps using the Loan calculator.

Upload the documents

After calculating the Loan amount, you need to upload the necessary documents. The documents you require for Loan against Gold include identity, address, and gold ownership proofs.

Get the gold valued

After uploading the documents, the lender asks you to get the gold value. You can visit the lender's branch or request a doorstep visit. The lender checks the gold's purity, weight, and market value to determine the Loan amount.

Accept the terms

Once the gold is valued, the lender provides the Loan. Before accepting the offer, read and understand the terms and conditions thoroughly. These include interest rates, repayment tenure, processing fees, prepayment charges, and other costs.

Sign the Loan agreement

You can sign the agreement digitally through any mode. The Loan agreement includes all the terms and conditions, and it is a legally binding document.

Get the Loan amount

The lender deposits the Loan amount into your Bank Account once you sign the Loan agreement. Typically, the Loan amount is used within 24 hours of signing the arrangement. The amount is available for any use, such as debt consolidation, business financing, and medical emergencies.

Conclusion

Gold Loan online applications are simple and easy by following the mentioned process. You can easily apply for the Gold Loan by following them, and within 24 hours, the money gets transferred to your Bank Account. Lastly, be cautious and follow the steps carefully.

 

Purpose, usage, and benefits of Savings Account calculator

 Opening a Savings Account is an excellent way to grow your wealth. Its interest-bearing feature lets you expand your idle wealth and urges you to follow financial discipline. But to enjoy such benefits, you should know your interest earnings.

This is when a Savings Account interest calculator comes in handy. Here, you need not manually calculate your interest rates. This guide makes you aware of the other things about the calculator.

Purpose

This calculator aims to estimate the interest you earn on your Savings Account deposits or balance monthly. You need to input bank interest rates, account balances, present investments, and expected returns to estimate accurate values instantly.

How to use the calculator?

Using the Savings Account calculator is relatively easy. You need not hold any technical experience to get the desired results. Follow these steps:

1. Mention the account you use
2. Enter the average balance you usually maintain
3. Enter the interest rates offered by your bank
4. Enter the frequency at which you prefer to receive the interest in your account

Once you add such details, the calculator computes the interest income in your Savings Account. Note you can use this tool on your bank’s website or the Banking app.

Benefits

• Convenient

Manually calculating interest rates on your account is tedious. It takes a lot of time and could be inconvenient. It is also impractical in the long run. Instead, use the calculator and save yourself from this hassle. Only provide the mentioned details, and the calculator computes values for you instantly.

• Zero errors

Calculating the interest rates manually also leads to errors and inaccurate values. This eventually prevents you from arriving at sound decisions. One blunder, and you need to start all over. But with a Savings Account calculator, there is no worry about mistakes. Since it is online, it provides accurate results. In this manner, you can rest assured that the results are error-free.

• Helps with financial planning

Financial planning involves a thorough assessment of your expenses and savings. You could do physical or Online Banking transactions. Being aware of how much money you can accumulate after interest is imperative. It guides you in devising a robust financial plan. Therefore, make sure to use the calculator. It enables you to analyse your interest earnings in advance. That way, you can plan better.

• Free & easy to use

Nowadays, almost all banking portals offer this calculator to users. It is free of cost and readily available. Moreover, you need not hold extensive knowledge to use it. The fields in the calculator are self-explanatory.

Why should you save money?

 It is essential to prioritise savings. It is basic financial advice that you may get from everyone around you. You make your future more secure when you save a small amount from your salary every month. Saving money to secure your family’s future is essential for long-term financial well-being. You should know the reason and amount to save.

If investing long-term, you can use the Savings Account interest calculator to assess your overall savings, including the invested amount and the interest earned. It helps you plan expenses better, save for emergencies, and pay outstanding debts. Here are other reasons to save:

Financial freedom

Savings can provide freedom. You need not depend on someone else if you have saved money. Keep some cash aside for emergencies and unexpected expenses. It gives flexibility with lifestyle choices, whereas financial goals give stability. You can achieve financial flexibility by setting aside a small amount each month.

Financial security

It is evident that saving provides financial security, and having money makes life easier. You can open an account through a Banking app to store and invest excess funds. Ensure the products offer maximum returns and minimal risk for a hassle-free life. Most people save money for retirement plans and to stay financially secure during those times.

Emergency corpus

Emergencies are unpredictable. In such situations, an emergency corpus can save the day. You set aside some cash only for unexpected conditions, such as accidents, illnesses, injuries, etc. To keep the emergency corpus safe and accessible, consider opening an account online.

Comfortable retirement

You should save at least 15% of your salary for retirement. Start with a percentage under a manageable budget. Gradually, you can increase it by 1% each year to reach a good percentage. Saving money for retirement is one of the essential aspects. Have a proper understanding of the different investment options available. Use the Savings Account calculator for financial planning.

Taking calculated risks

You can save money for the future in various ways. The most common way is investing somewhere. You can make more money from your investments. However, it would help if you take calculated risks. Ensure you invest in low or moderate-risk products to get decent potential returns. Saving is a wealth collection method, while investment is a wealth creation method. You can install the app to manage your finances effortlessly.

No standard approach

There are multiple solutions to save money. A one-size-fits-all approach does not work in personal finance. You can either preserve it or invest in other monthly plans. Utilise the Savings Account interest calculator to deal with financial calculations and know the approximate value. Have a clear idea of using your funds and investing them.

Conclusion

Technology is of great help to investors. Using these tools, you can better gauge your financial requirements and grow funds by investing them in Savings Accounts, Deposits, and market-linked instruments.

Is NRE FD interest taxable?

 Non-resident Indians usually rely on Non-Resident External or NRE Accounts to park their foreign earnings in India. These accounts allow NRIs to transfer a portion of their overseas income to their home country while providing a great avenue for investments as Fixed Deposits. NRE FD is an extremely popular investment tool among NRIs due to their tax-free status.

You can open it in foreign earnings if you have an NRE Account in the same bank. They fetch you higher returns than resident accounts in India, with fully and freely repatriable interest and principal amounts.

Is the interest taxable?

According to the Indian tax laws, NRIs are liable to pay income tax in the country only on that income accrued in India. Since the NRE Account holds income earned overseas, it remains completely tax-free in India. It means that both interests earned on the NRE Fixed Deposit and Savings Account are not taxable as per the provisions of Section 10(4)(1) of the Tax Act, 1961.

FEMA guidelines

The primary eligibility criteria to maintain NRE FD Account and earn tax-free interest income is that you should qualify as an NRI under the Foreign Exchange Management Act. It guides whether you can invest in an asset or not. For instance, you can open an NRE Savings Account only if you qualify for it as per FEMA.

A person can be considered a ‘resident outside India’ if their stay in India was for less than 183 days during the preceding financial year. NRIs permanently settled or residing out of India continue to be treated the same under FEMA regardless of the duration of their stay in India.

When does the account attract taxes?

As FEMA considers returning NRIs as resident Indians from the first day, they should discontinue their NRE Accounts. You must change it to a resident account or transfer the funds to the Resident Foreign Currency Account immediately upon your return to India for an uncertain period.

You enjoy tax-free interest income on them only till you qualify as a resident but not ordinarily resident for up to three years to help you shift assets from abroad to India without attracting huge taxes.

Availing tax exemption

When you open an NRI FD Account in India, you need not file income tax returns if your Indian earnings consist of only the tax-free income and TDS deducted. You file ITR only when the total income you earn in India is higher than the maximum amount of INR 2.5 lakh exempt from tax.

Those planning to invest in NRO FD should remember that the interest income earned on these accounts is not tax-free. NRO Deposits hold rates in Indian currency and interest rates applicable to these vary between banks. Repatriation of principal investment is not offered but interest earned can get transferred to a foreign account.

Why Is Opening an NRE or NRO Account Important?

 A non-resident Indian according to RBI cannot open and operate a traditional resident Savings Account. They should be changed to an NRI Account by the bank before gaining an NRI status. An NRI needs to open a Non-Resident External or Non-Resident Ordinary Account to conduct any banking transactions in India.

The NRI or PIO (Person of Indian Origin) can open an NRE or NRO Account, or both, based on their transactional needs. As an NRI, your financial management and planning would be significantly impacted once you open NRI Account online. Even your standard account in India is subject to new laws and regulations. If you are wondering if you can continue holding a resident account in India once you earn NRI status, the answer is no.

Importance of NRE or NRO Accounts

An NRI cannot create or manage a standard resident Savings Account in India, according to the regulations of RBI. As soon as your residential status changes, the account you own should change to an NRI Account. To manage any banking transactions in India after becoming an NRI, you should open an NRE and NRO Account. NRIs should open these accounts to further deposit their foreign earnings and any domestic profits like rent, fees, dividends, pensions, etc.

The NRI interest rates on your deposits in the NRE Account are tax-free and freely remittable to your home country because they get generated outside of India. The interest accumulated in an NRO Account is taxed, though.

Tax Deducted at Source applies to the interest at 30%. Also, the maximum amount that can be repatriated is USD 1 million per financial year. It is of utmost importance to open an NRO Savings Account or convert your current account into an NRO if you are an NRI with income in India. Once you have effectively opened an NRO Account, you can easily manage and organise your revenue from India.

Lastly, do not forget to deposit and save funds in your NRE Account once you have decided to move abroad. Although it is not required, the purpose to open these NRI Accounts is to maintain your local savings under your name.

Conclusion

NRO Accounts may be more practical if you frequently deal with investments in India and continue receiving credits from income sources within India. NRE Accounts rank better concerning simplicity and tax-exempt status. After considering the mentioned aspects, NRIs should make an informed decision regarding opening an NRI Account.

A brief overview of Agri Loans

 Agriculture is the backbone of the Indian economy. With over 60% of the Indian population employed in the agricultural sector, it is vital to provide them with the necessary financial support to boost production and increase income. This is where Agri Loans come into the picture.

Agri Loans are financial products specifically designed to meet the credit needs of farmers, agriculturalists, and other allied activities. They are offered by various financial institutions, including banks, cooperatives, and non-banking financial companies. The following are a few things to know about such Loans:

• Types

Agri Loans can be classified into three categories based on the purpose for which you avail them of:

Production Loans: These are used for meeting the working capital requirements of farmers. This includes purchasing seeds, fertilisers, pesticides, and other inputs required for farming. These loans are usually short-term loans with a repayment period of six to twelve months. However, it is wise to check this with the lender beforehand.

Investment Loans: Such Loans are used for purchasing machinery, land, or for other capital-intensive activities related to farming. They have a longer repayment period of three to five years, and the interest rates are usually lower than Production Loans. An example of such a Loan includes an Agri Gold Loan where farmers can take borrow money against their gold.

Allied Activities Loans: These Loans are mainly used for activities other than farming. This includes activities like dairy, poultry, fishery, and horticulture. They have a repayment period of up to five years.

• Features

Like Personal Loans, Agri Loans also have a range of features that make them attractive to farmers. Some of these features include:

1. Easy availability: Agri Loans are readily available from various financial institutions, including banks, cooperatives, and NBFCs. This makes it easy for farmers to access credit when they need it.
2. Low-interest rates: The government of India has introduced various schemes to provide credit to farmers at lower interest rates. This includes the Kisan Credit Card Scheme, which provides credit at an interest rate of 7% to 9% per annum.

• Flexible repayment options: Such Loans come with flexible repayment options, which include monthly, quarterly, half-yearly, or yearly instalments. This allows farmers to choose a repayment schedule that suits their cash flow.

1. Collateral-free: As it is with an online Gold Loan, many financial institutions offer Agri Loans without the need for collateral. This makes it easier for farmers who may not have assets to pledge as collateral.

• Insurance

Many Agri Loans come with insurance cover, which protects farmers against crop failure, natural calamities, and other risks. However, it is wise to check this offering on your Banking app beforehand.

• Moratorium period

In most cases, such Loans come with a moratorium period. This allows farmers to repay the loan after the harvest season when they have generated income.