The Tax Advantages Behind Investments – Simplified

With the new financial year, came some really good news. With the new tax slabs, there is an opportunity for you to save your taxable income.

Getting a major chunk of taxable income out of the way by making the most of Section 80C is a great starting point for most of us, but even while dabbling in 80C deductions, play smartly and make sure you give precedence to tax-saver instruments with EEE (exempt-exempt-exempt) status that not only help you save tax, but also earn tax-free income like the evergreen PPF, ELSS with growth options over dividend options, Unit Linked Insurance Plans (ULIPs) so that your returns don’t add to your tax burden.

Beyond this:

• Consider capitalising on up to INR 25,000 worth of tax deductions through medical insurance and purchasing National Saving Certificates (NSCs).
• Further, you could claim deductions on contributions of up to INR 50,000 under Section 80 CCD (1B) made exclusively towards National Pension Scheme (NPS), and
• If you use both 80C and 80CCD, a total of INR 2,00,000 could be saved from Income Tax.

But what if you’re just starting out in your career with a fresher’s salary but recognise the tax saving benefits you could reap if only you could invest in these specific instruments? Here’s why leaving your money in the bank isn’t such a good idea.

With those heavy rents and bills to pay, saving up enough to invest major chunks could truly be a challenge and we’ve all been through that phase. This is where external aid could come to your rescue. The internet has been burgeoning as a place to take care of all our modern needs and why should this be left behind either.

Fibe (available on Android and iOS) is a Pune-based, fintech portal that’s changing life for the average Indian by making possible convenient, affordable and fast lending from as low as INR 1,000 with interest rates starting as low as just INR 9 per day.  The best part is that these are no hassles and loans can be taken for any and every purpose including investments. Even newly salaried employees can avail loans as salary slips aren’t demanded as part of the particulars. To know more benefits of preferring Fibe, check out this post.

But why would I borrow when my returns would be eaten up by interest?

Tax benefits accrued on account of investments can go a long way in reducing your tax liability, leaving you with much more disposable income to begin with to take care of your interest requirements. The multiplier effect of more disposable income that can be reinvested to generate more money would eliminate the need for further loans to keep investing  soon enough and leave you with enough to plough back those benefits to keep investing without loans.

Still have concerns?

The fact that it’s so easy to obtain loans does make one wonder what the catch is and whether borrowing from such sources would be a good idea or not but Fibe is worthy of your attention. Running on a framework of a clear set of legal rules and regulations for borrowers and marking well against every existing industry standard including the Fair Practice Code for Non-Banking Financial Companies (NBFCs), Fibe is a trustworthy platform for young salaried persons seeking instant loans to seamlessly meet the gap in their cash requirements

So how does EarlySalary work?

Fibe’s customer assessment is conducted on the basis of your particulars and what it calls your ‘Social Worth Score’. It does not require a guarantor or collateral. The process merely involves completing particulars and uploading documents online and does not require any queues or hassles to be dealt with. While the first loan disbursement may take up to a day, future loans are disbursed within minutes.

Based on your score, separate limits are assigned to you for separate specific loan requirements and you can borrow according to your limit and set your repayment particulars. On becoming due, the amount is deducted directly from your salary account or you can also choose to prepay through the mobile app. Unlike bank loans, there are no fines and prepayment charges on early repayment.

Break out of the rut of planning your investments in tax saving instruments at the end of the financial year with Fibe’s instant cash advances, and plan ahead so you can chalk out a proactive, prudent investment plan that makes the most of your own and borrowed resources.