Difference between Savings Account AND Current Account.

Savings Account	Current Account
A savings accounts are deposit accounts which do not allow unlimited transactions	A current account on the other hand is meant for daily financial transactions
Savings accounts are best suited for salaried employees or people with a monthly income	Current accounts are ideal for individuals and firms that need to carry out monetary transactions on a day-to-day basis
Savings accounts earn interests which is normally in the range of 4% to 8%	Current accounts are non-interest bearing deposit accounts
Banks do not provide overdraft facility on savings account	Overdraft facility is provided
The minimum balance required to open a savings account is very low	The minimum balance for opening a current account is comparatively much higher
The main purpose of a savings account is to encourage people towards savings	The main purpose of a current account is to help individuals with multiple transactions

Differences Between Recurring Deposit (RD) and Fixed Deposit (FD)

Fixed Deposit and Recurring deposit are two most popular investment schemes in India, specially for the risk averse investors. The major advantage of investing your money in a fixed deposit scheme or recurring deposit plan is that there are fixed returns with no risk. But many a times, investors get confused if they have to invest in a RD plan or a FD scheme.

Both RD and FD are fixed income products that are offered by all major banks and financial institutions. In both the schemes, you can invest a specific amount and on the amount invested, you will receive a fixed interest. At the end of tenure, investors will receive both the capital as well as the interest.

While both RD and FD runs over a tenure, FD investors can deposit an amount once while RD investors must deposit a fixed amount at regular intervals.

Fixed Deposit

Customers who opt for fixed deposits will have to choose a tenure, which usually ranges from 7 days to 10 years, and must deposit an amount once. The interest on the amount will be credited to the investor’s account on a monthly or a quarterly basis. 

Recurring Deposit

When it comes to recurring deposits, investors can deposit a fixed amount every month and can earn interests. The interest is paid along with the capital at maturity.

Recurring Deposit vs Fixed Deposit

Features / Scheme	Fixed Deposit	Recurring Deposit
Tenure	Usually, for FD schemes, the tenure ranges between 7 days to 10 years. The investor can choose a tenure that he is most comfortable with.	Tenure for Recurring deposits usually vary from 1 year to 10 years. The customer has to deposit a fixed amount at regular intervals over the tenure.
Investment Limit	There is no limit on the amount that can be invested in a fixed deposit scheme. But, this limit generally depends on the bank and the minimum investment is Rs. 100 and multiples while the maximum limit is Rs. 1.5 lakh.	While there is no prescribed minimum or maximum limit, this usually depends on the bank. Many banks have the minimum investment limit as Rs. 1000 and and the maximum limit as Rs. 15 lakhs per month.
Rate of Return	For a period of an year, the interest rate varies between 6.96% to 8.00%. The interest rate depends on the capital and tenure opted for. The interest rate for FD is slightly higher than that of RD.	The interest rate varies between 5.25% to 7.90% for a tenure of one year. The rate of interest usually depends on tenure and monthly investment amount.
Tax benefits	For fixed deposit, a tax exemption under the section 80C of Income Tax Act 1961 is applicable.	Income tax will be not deducted if the interest you earn on your rd is up to Rs.10,000.
Documents Required	Identity Proof and address proof. Customers will have to submit documents like PAN card, passport and income documents, if required.	Address proof and Identity Proof. Investors will have to submit documents like PAN card, passport and income documents, if required.
Income Interest	Interest earned on your FD is taxable and most of the banks deduct TDS.	Interest earned on your RD is taxable and most banks do not have the facility of TDS.
Additional Benefits	Loan Facility	-
Eligibility	·         Resident Individuals ·         Hindu Undivided Families ·         Public and Private Limited Companies ·         Trusts and Societies ·         Resident Individuals ·         Trusts and Societies ·         Hindu Undivided Families ·         Public and Private Limited Companies	-
Withdrawal	At the end of tenure. Premature withdrawal is allowed with penalty.	At the end of opted tenure. Premature withdrawal is allowed with penalty.

What Should You Choose - RD or FD?

For people who do not have a lump sum to invest in a FD, but can afford a small portion of investment amount from income every month, a recurring deposit (RD) seems to be the right fit. Both RD and FD are best suited for risk averse investors who are mostly in the lower tax slab. Use an online recurring deposit calculator to see what suits best for the amount that you can invest. Although one single investment product cannot meet all needs, a RD is preferred by many because it puts considerably less financial strain and gives almost the same returns as FD.

Recurring Deposit vs Fixed Deposit

Fixed Deposits and Recurring Deposits are among the most popular investment options in India. If you are planning to invest in either of this, you must be aware of the differences between Recurring Deposit and Fixed Deposits. It is very common for the first time investors to get confused between RD and FD.

While both Recurring Deposit and fixed deposits are offered by most of the banks in India, each come with their own advantages and disadvantages.

Before investing in a Recurring Deposit or Fixed Deposit scheme, you must be familiar about certain important features of the scheme such as rate of interest and investment limit.

Tax on Recurring Deposit Interest rates

Recurring Deposit is a very popular investment scheme amongst the risk averse Indians mainly because of the good returns and savings benefits that it offers. In a Recurring Deposit scheme, you will have to deposit a fixed amount of money every month for a predefined period of time and the amount will fetch you interest. But, for interest that you earn on Recurring Deposit investment amounts, 10% will be deducted as TDS. Also, the Tax Deducted at Source (TDS) will be 20% if the Pan information is not provided. The Tax Deducted at Source (TDS) varies depending on your annual income, your age and the interest that your accrue on your RD amount.

Which Banks Offer the Highest Recurring Deposit Interest Rates in India?

One of the most preferred investment options in India, Recurring Deposit schemes offer good interest returns with almost no risks involved. In a recurring deposit scheme, the investor will be required to make deposits of a fixed amount every month over a fixed tenure. Almost all major private and Government Banks in India offer Recurring Deposit schemes with competitive interest rates. Generally, the interest rate for a RD scheme is based on several factors like tenure, principal amount and the plan that you choose. Also, the interest rate for recurring deposit schemes vary from bank to bank and it is important that you are well informed about the interest rates offered by all major banks so you can zero in the perfect Recurring Deposit plan for investing your hard earned money.

Benefits of Recurring Deposit Interest Rates

Safe investment - Recurring deposits carry no risk or very little at all. Choose a stable and secure bank to ensure that your money is safe. Recurring deposits are just a simple investment of your money and do not dabble in the markets. Therefore the interest rate will not fluctuate and you do not stand to lose any money.

Earn while you save - Your deposit will earn interest from your first contribution. The interest accumulated will increase through your tenure. The longer you invest, the more interest you will earn.

Lump sum payout - At the end of the RD tenure, you will receive a lump sum of cash. This amount includes your contribution plus the interest earned. You can use the money to reinvest it or spend it on what you were saving for.

Online access - Most banks offer Internet Banking services which you can use to open deposits, access your accounts and see the progress of your deposit. You can also view the different interest rates offered. You can pick the tenure and deposit amount suitable to you and also earn the highest interest offered.

Loan offers - When you have an RD with a bank, you sometimes get pre-approved loan offers. In other cases, your loan applications will be given preference and your processing might be faster. In addition to this, banks offer concessional interest rates on loans as well. 

Factors That May Affect Recurring Deposit Interest Rates

Type of account - The account you hold will make a difference in the eligible interest rates. Regular savings accounts usually get higher interest than the NRE/NRO accounts. Some banks offer the same interest rates to both account holders.

Tenure - The tenure of your deposit is one of the most important factors in determining the RD interest rate. Medium term deposits generally earn a much higher interest rate. Some banks offer the highest rate on long-term deposits of 10 years. But this is not always the case as some banks also offer the same interest rate on a 1-year deposit as well as a 10-year deposit.

Age - Almost all banks offer a higher rate of interest to senior citizens. This rate is usually 0.5% per annum higher than the regular interest rates. Junior accounts can also stand to earn a higher interest rate. This depends on the bank’s offer on minor accounts.

Choice of bank - Interest rates vary quite a bit between different banks. Currently, the top banks offer recurring deposits starting at 7% per annum interest. Nationalised banks tend to offer a higher interest rate of up to 8% per annum.

Schemes on offer - Banks also have different recurring deposit schemes running. Corporation Bank has a Millionaire Scheme on offer wherein you will receive a million rupees at the end of the scheme. This deposit carries a very high interest rate of 9.25% per annum. So the choice of your deposit scheme will also factor into the interest rate. Depending on the benefits offered with the RD scheme.

Recurring Deposit Interest Rates

The interest rates on RDs depend on which category you fall under and your choice between different banks. Senior citizens earn a higher rate of interest when compared to regular citizens. There are schemes offered to minors, students and parents to save for the children. These schemes may carry higher rates of interest. There are also special schemes devised to help people reach their goals. Your interest rates also depend on the type of account you hold. A regular savings account will generally earn a higher rate of interest than an NRE/NRO account. The current interest rates available from different banks range between 4.5% and 7.90% per annum.

Types of Recurring Deposit Interest Rates

Regular Savings Scheme - Banks offer recurring deposits to Indian citizens above the age of 18 years. Customers can choose to deposit a fixed sum of money for a period of time, usually between 6 months to 10 years. Interest can be computed on simple or compound basis. At the end of the tenure, the lump sum amount can be withdrawn. Some schemes allow you to reinvest the money. You can open a recurring deposit for as little as Rs. 10 per month. The interest rates on the regular recurring deposits range between 7% to 8% per annum.

Junior RD Schemes - Bank’s also offer recurring deposit schemes for kids. Parents or guardians can open these deposits for their children to start saving for their future, education and other needs. Students can also avail of these deposit schemes. Learning to handle finances and the importance of saving at a young age will help inculcate a smart sense of money. The interest earned on these deposits will either be equivalent to the regular RD schemes or be higher to encourage saving amongst the youngsters.

Senior Citizens RD Schemes - Banks offer higher rates of interest for senior citizens. Usually, 0.50% per annum is given over and above the prevailing interest rate. The interest rates range between 7.5% to 9.25% per annum. There are also schemes available that are designed to help senior citizens during their retirement and old age.

NRE/NRO RD schemes - NRE and NRO recurring deposit accounts may be offered a lower interest rate. Furthermore, senior citizens who hold NRE/NRO accounts will not be offered the additional interest rate. These accounts attract around 7.50% interest per annum.

Special RD Schemes - Banks offer different schemes designed to suit the needs and capabilities of a variety of people. These schemes generally carry a higher rate of interest as your goal is more specific. ICICI Bank offers the iWish deposit which allows you to contribute various amounts of money to your RD account. Furthermore, other people can also contribute to help you reach your goals. There are RD schemes with free life insurance available. With certain schemes, you are allowed to withdraw the money in part without breaking the full deposit. Other schemes reward you with a bigger lump sum amount which makes it a worthwhile investment.

10 things To Know About Pradhan Mantri Vaya Vandana Yojana.

Finance Minister Arun Jaitley has formally launched the Pradhan Mantri Vaya Vandana Yojana (PMVVY), or a pension scheme, for senior citizens on Friday. Speaking after the launch of PMVVY, Mr Jaitley said that settlement ratio of LIC (Life Insurance Corporation of India) is near to the maximum. Prime Minister Narendra Modi had earlier announced the launch of the scheme exclusively for the senior citizens aged 60 years and above. Under this scheme, senior citizens (60 years and above) in which they will get a guaranteed interest of 8 per cent for 10 years. Financial planners say that this pension scheme will offer more avenues to senior citizens to earn steady regular income at a time of falling interest rates. The scheme is exempted from GST or goods and services tax. LIC has sold 58,152 PMVVY schemes garnering Rs. 2,705 crore since its soft launch on May 4.

1) LIC started offering the scheme from May 4, 2017. The scheme will remain open till May 3, 2018. The shortfall owing to the difference between the interest guaranteed and the actual interest earned and the expenses relating to administration shall be subsidised by the government of India and reimbursed to the LIC.

2) PMVVY can be purchased offline as well as online through Life Insurance Corporation (LIC) of India which has been given the sole privilege to operate this scheme.

3) The scheme will provide an assured return of 8 per cent per annum payable monthly (equivalent to 8.30 per cent per annum) for 10 years.

4) The pension is payable at the end of each period, during the policy term of 10 years, as per the frequency of monthly/ quarterly/ half-yearly/ yearly as chosen by the pensioner at the time of purchase.

5) There is a minimum and maximum limit for investment in Pradhan Mantri Vaya Vandana Yojana Scheme. The amount varies according to the pension payment mode chosen. For example, under the yearly pension mode, the minimum amount that has to be invested in the scheme is Rs. 1,44,578 and the maximum at Rs. 7,22,892. In monthly mode, the minimum amount that has to be invested is Rs. 1,50,000 and maximum at Rs. 7,50,000. For other modes, see the table below.

Accordingly, Rs. 1,000 will be the minimum pension amount payable monthly for which Rs.1,50,000 has to be invested. Similarly, the maximum monthly pension shall be Rs. 5,000 per month for which Rs. 7,50,000 has to be invested. For other modes, see the table above. (It should be noted that the ceiling of maximum pension - pensioner, his/her spouse and dependants - is for a family as a whole.)

6) On survival of the pensioner to the end of the policy term of 10 years, purchase price along with final pension instalment shall be payable.

7) Loan up to 75 per cent of purchase price (amount invested to earn pension) shall be allowed after three policy years to meet the liquidity needs. Loan interest shall be recovered from the pension installments and the loan to be recovered from claim proceeds.

8) The scheme also allows for premature exit for the treatment of any critical/ terminal illness of self or spouse. On such premature exit, 98 per cent of the purchase price shall be refunded.

9) On death of the pensioner during the policy term of 10 years, the purchase price shall be paid to the beneficiary.

10) senior citizens should take advantage of PMVVY pension scheme as well as another popular senior citizens scheme called Senior Citizen Savings Scheme (SCSS). If one has to choose one over the other, then the PMVVY is better as one has a longer time frame need of 10 years while the SCSS is better for higher liquidity it provides. Though the interest earned from both the schemes are taxable, effective tax planning and higher tax slabs can greatly reduce the impact of tax for senior citizens.

Read more : https://www.licindia.in/Products/Pension-Plans/Pradhan-Mantri-Vaya-Vandana-Yojana 

Top 10 ways to send money to India

Transfast

This is a global money transfer company that has greatly reduced its fees and increased its exchange rates. If you are new customer and willing to wait for a few days for transfer, Tranfast is offering high promotional exchange rate and a $0 fee. This is one of the money transfer companies that could give you a lot of rupees from your dollars. Due to its $0 fee, Transfast is most certainly the lowest cost way to send money to India.

Click here for more details : https://www.transfast.com

Western union 

Western union is very fast and reliable. Nevertheless, this money transfer company charges higher fees for transfers that are made by an individual at a Western Union agent shop. If the receiver would need to pick up the money in cash, the fees would still be high.

Click here for more details : https://www.westernunion.com/ca/en/home.html

Ria Money Transfer

This money can be transferred from the bank account. The company provides a better exchange rate and $0 fee for transfers that would take 3-5 days. It can send money to any bank in India, therefore, it is very reliable and convenient locally in India. Due to its consistently cheap fees and good exchange rates, Ria Money Transfers is one great way to go smart about sending money to India.

Click here for more details : https://www.riamoneytransfer.com

Transferwise

TransferWise has a very fast delivery time which is usually 24 hours or 1 working day. It is actually smart and secure way to send money directly to India. During public holidays the transfers can take up to 2 working days. Its services are a smart way to get rid of the bank fees. If you try using this service you will realize you no longer need to send money through the expensive banks. TransferWise is commonly used by those sending money from the UK and the European Union countries.

Click here for more details : https://www.transferwise.com

Xendpay

This money transfer company specializes in foreign exchange and international money transfers. Sending money to India through Xendpay is very simple and easy since you’re just required to log in to your Xendpay account and transfer money at your own convenience. This is very popular with those who are sending money from UK to India. Opening an account on Xendpay is very fast and free of charge.

Click here for more details : https://www.xendpay.com

Online Transfer 

This is the easiest way to transfer money. To use this method you just need an internet connection and the use of local banking services in order to transfer money to India. You will be required to have the recipient’s information regarding the financial institution and the account the money will be sent to. For those who do regular money transfers this is the best method to adopt. 

PayPal

This one of the largest electronic mode of transferring money from one account to another across the globe. With an account at PayPal, you can instantly transfer money to your family in India. This is the best method that saves you time and money. You can get the services and great customer support 24/7. However, PayPal may have some restrictions on the amount of money that can be sent.

Click here for more details : https://www.paypal.com/in/home

Xoom 

Xoom is among the best money transfer services to India and across the globe. Xoom also guarantees fast transfers that can even be processed within 4 hours to banks in India if the transfers are made during the Indian bank processing hours. Nevertheless, Xoom has some restrictions on the amount of money that can be sent daily or monthly depending on the level of your account. There are also some hidden conversion fees.

Click here for more details : https://www.xoom.com/sign-in

MoneyGram 

MoneyGram has proved to be a big market player in offering money transfer services. Many NRIs have adopted the use of MoneyGram to transfer money to India because it is very fast. Its speed is very consistent and but the fees are slightly higher than some other money transfer companies. It also has some hidden currency conversion costs which can amount to $10.

Click here for more details : http://www.global.moneygram.com

Remitly

It is used widely in USA to send money to many different countries including India. Those who would prefer the express transfers which are instantly processed would be required to pay more fees. For the basic rates, they are usually processed within 3 business days without any fees. The instant transfers are always supported with many major banks in India making the process very simple. Remitly is very secure since it is registered as a money services business with US Department of Treasury. However, there are some hidden currency costs which could be more than $10.

Click here for more details : https://www.remitly.com/us/en/india

50 Money Saving Tips in Everyday Life for Everybody..

Here are some useful tips on how to save money in our everyday life:

1. Drink water: It is good for you and saves on daily cost of soft drinks.

2. Cut down on junk food:  Not good for your pocket, not a healthy choice either.

3. Shopping List: Make a grocery/shopping list before going to the store, so that you buy only what you need. It saves time and money.

4. Walk short distances instead of driving: It saves on gas/fuel, it saves environment and keeps you active.

5. Cut down on excessive TV: Find better use for your time, something less wasteful 

6. Minimize carry-out and eat-out food: Carry-out/eat-out is expensive and not good for healthy eating habits.

7. Don’t need most expensive gifts to please family:Buy something functional and useful instead.

8. Recycle: Recycling saves resources, money and it minimizes waste.

9. Use natural light: This helps with savings on electric bill and is better for eye-sight.

10. Cut down on Air-Conditioning and heating: Install programmable thermostats to save on gas bills.

11. Get your News online: Cut down daily newspaper delivery costs if you can get the news online

12. Avoid Loans: Don’t take a loan unless your life/marriage depends on it.

13. Avoid late fees on bills and credit cards: Enough said, commonsense.

14. Minimize banking-fees down to zero: Many banks offer this option with no transaction fees.

15. Buy on-sale items: Look for sales on the items that you need.

16. Don’t buy EVERYTHING that is on sale:Make a list of what you need and stick with shopping for only those items.

17. Avoid club memberships that you don’t use: Avoid health-club or any other membership fees for something you seldom use.

18. Shop around for insurance: This can save lots of money on insurance premium.

19. shop around for lowest interest on mortgage or other loans: This can save a lot on interest.

20. Save your identity: Keep your checkbook, your id and credit cards etc. safe and secure from modern ID thieves

21. Holidays shopping in advance: Don’t wait for the last minute, look for bargains in advance.

22. Exercise: Stay active and stay out of hospital

23. Medical insurance: Consider medical insurance depending on your health needs

24. Dental and vision insurance: You may want to buy this if your eyes and teeth need regular care

25. Don’t buy a gas-guzzler car: A fuel-efficient car saves on gas,  it save money, it saves the environment

26. Grow your own vegetables: An excuse for active and healthy lifestyle

27. Cook at home:  This is another good excuse for active and healthy lifestyle

28. Take advantage of benefits at job: Many workplaces offer discounts on related (or affiliated) products and all kinds of other benefits for their employers.

29. Find out what your town/city has to offer: Free local parks, YMCA, any other benefits and discounts from the city….

30. Use coupons: Look for discount or special sale coupons.

31. Combine/bundle services: Many services (e.g. phone, Internet, TV..) are cheaper when bundled by using the same service provider

32. Local Library:Use local library for renting book, renting DVDs, Internet use etc.

33. Sign up for free reward programs: Many credit cards and other services offer programs for frequent users that can accumulate valuable reward points.

34. Divorce is very expensive: Prioritize your personal life. Spend time with your family, and save your marriage. It will save you from financial burden and heartache alike.

35. Maintain your car and house: Regular maintenance can help with preventive savings by avoiding breakdowns and other accidents due to negligence.

36. Budget: Track your spending and control the urge to spend. Stick with your budget.

37. Use energy efficient appliances: Efficient dishwasher and dryers etc. can save lots of energy usage over time

38. Take advantage of the tax laws: Understand the tax laws for real-estate and other local tax-breaks to minimize taxes

39. Save and retain: Don’t throw-out something after one or two use if it can be re-used, saved or retained.

40. Don’t waste money on lotteries: You have a higher chance to be hit by lightening than winning a mega million dollar lottery.

41. Minimize hired-help: Do your own work, it saves money and keeps you active.

42. College saving plan:Investigate tax benefits and other options to save for future college education tuition.

43. Turn off lights, PC and TV etc. when not in use:Be environment friendly. Turn off computer,

lights, TV etc. when not in use, or when not needed.  it is a good money saving habit.

44. Minimize drinking liquor: This helps in saving your liver, it saves money and keeps you healthy.

45. Family Planning:Consider Family planning and family size. Kids are very expensive to raise these days. Cuteness comes with a price. 

46. Take a train or a bus: Take a local train instead of driving a car to high traffic (and traffic jam) areas if possible; it saves on gas-money and also on time.

47. Quit smoking: This can save some serious money and will keep you healthy

48. Avoid compulsive shopping: Don’t shop just to feel better; find some other creative ways or hobbies to please yourself. 

49. Minimize shopping trips, shop online: Avoid spending excessive time in the shopping malls and  minimize multiple shopping trips. Shop online if that is a cheaper option.

50. Needs and wants: Understand the difference between what you really need and what you want for luxury or for fun; allocate your budget based on your personal situation.