Saravanakumaran, Manamadurai.
Gold jewelery mortgage loan, gold jewelery overdraft loan… What is the difference between these two, which one is more profitable and which loan is suitable for whom?
V. Thiagarajan, Auditor, www.bizlane.in
Both gold jewelry mortgage loan and gold jewelry overdraft loan require gold as collateral. In gold jewelery mortgage loan, the total loan amount is credited to your bank account immediately. Interest has to be paid on it.
In gold jewelery overdraft loan you will be given an overdraft limit. For example, if the limit is Rs.10 lakh, if your current requirement is Rs.2 lakh, you can only borrow that amount and pay the interest on it. The remaining Rs.8 lakh can be used whenever you need it. Gold Jewelery Overdraft Loan is mostly helpful for professional and business people. Gold jewelery mortgage loans are suitable for individuals.
Sudalai Muthu, Tiruchendur.
I have Rs.5 lakhs. I will need this money after three years. Can I invest this money in stock market oriented mutual fund schemes?
AS Muralitharan, Chief Executive Officer, Veera Finserv.
Money for short-term needs of up to three years should not be invested in stock market-based mutual fund schemes for any reason. The reason is that there is a possibility of loss of capital in the short term.
If your investment tenure is three years then you can invest in fixed deposit or debt market based mutual funds.
Debt fund schemes are profitable on a post-income tax basis if the investment tenure is three years and above.
Generally, bank FD interest income is taxed according to whichever income tax bracket one falls under (5%, 20% and 30% in the old tax system). This means long-term capital gains from debt funds, after adjusting for inflation, are taxed at 20%.
Inflation adjustment means subtracting the rate of inflation from the return we get on our investment. As such, debt fund schemes are more profitable on a post-tax basis.
Currently, returns for bank FDs and debt funds are around 7.5 – 8 percent. Looking at it that way, it would be profitable to invest the money needed after three years in debt funds.
@Kanika
I have 825 sq ft leased land. I have decided to build a house with an area of 600 square feet. What problems are likely to occur in house construction without obtaining Building Plan Approval?
S. Satish Kumar, Founder, https://www.dacdevelopers.com/
“It is illegal to construct any building without the permission of the government. Not only that, if it is found that the building is being constructed contrary to the building permit, if it is found to be in violation of the regulations, it will be exposed to all legal actions including criminal action as per the rules and regulations of the municipality and corporation.
Also, houses built without building permission may face problems in getting home loan, electricity connection etc. There will also be problems in selling a house built without permission; Not expensive; So, selling that house will be a very difficult matter. It is better to analyze all these things and get a building permit to build a house.
Krishnakumar, Mumbai.
I am 50. Our native house is dilapidated. The current market value of this house is Rs.1 crore. No rental income. I have not yet invested enough money for my retirement (age 60). I have decided to sell this native house and meet retirement cash requirements. Should I sell now and invest the money equally in equity mutual funds and debt market funds in STP mode or sell my native house after ten years?
M. Kannan, Consultant, radhaconsultancy.blogspot.com
“The price of real estate varies from place to place. The price appreciation of the land will vary depending on its current development and the expected development level in the next ten years.
The first thing you need to keep in mind is whether your house is likely to appreciate more in ten years than the returns you get in equity and debt funds in mutual funds.
Aggressive hybrid funds investing in equity and debt securities have returned an average of 12.8% per annum over the past 10 years. If your property will generate more profit than this over the next ten years, it is better not to sell it. Since the old house you own is already dilapidated, the house is worth nothing; Even if you get a good price for the place, you also need to think about how much it will cost to maintain the house for 10 years.
If you think it is difficult to maintain this house, sell the place and invest the remaining income tax money in risk free debt funds and STP from it. (STP – Systematic Transfer Plan) It is possible to transfer monthly to equity fund. Equity funds are more likely to return an average of 12% – 16% per annum over a 10-year period. After 10 years, SWP (Systematic Withdrawal Plan) allows you to withdraw a certain amount of money from your mutual fund investment every month towards your expenses.
You can’t just sell a part of your existing home. But, you can sell mutual fund units whenever you want. As this is an investment for retirement, it is better not to withdraw money in between.”