About to buy insurance for your bike online? We will guide you through the whole process.
Taking insurance for your two and four-wheeler is mandatory in India. But despite the insurance purchase process being so simple online, most buyers are still buying two-wheeler insurance offline.
However, if you’re not one of them and want to buy two wheeler insurance online, then simply follow these 5 easy steps.
Steps to Buy Two-Wheeler Insurance Online
1. Assess your requirement
When buying a two-wheeler insurance online, always start by looking upon the policy features and riders that you are likely to require, as opposed to accepting every benefit and rider that the insurance provider offers you. Do note that, the more riders you accumulate in the policy, higher the premium goes. The insurance provider will fix the declared value of the policy based on the vehicle’s perceived depreciation over the years, possibility of theft or loss of the vehicle, whether you are transferring NCB (No Claim Bonus) from earlier insurer, etc.
2 Assess the best two-wheeler insurance plans
When researching online for 2-wheeler insurance plans, do check for comparable policies across leading insurance providers only. You can find recommendations for the best policies online from current customers, or ask an insurance broker, or approach your bank for the insurance providers they have tied up with. Do compare all their features and benefits and use an online premium calculator to find out how much your yearly premiums will be.
3. Transfer from an existing insurance provider to a new one
If you are a bike owner for some time, then you obviously have an insurance policy on the vehicle. But if you are looking to buy two wheeler insurance online from a new provider, then you must first transfer the NCB (No Claim Bonus) from the older provider to the new one. You can affect this transfer online quite easily – keep the policy details handy and fill out the application online as prompted.
4. Opt for online 2-wheeler insurance
Buying two-wheeler insurance online from companies like Tata AIG is not just faster and more convenient, but it also results in a lower premium. Insurance providers are happy to extend online policies to customers, because processing the plan becomes much easier. Since operational costs are lower on the internet and the insurance provider does not have to pay a broker their commission as compared to when you buy directly from the insurer, these savings are passed on to the customer. Thus, in most of the cases you pay a lower premium.
5. Start using your two-wheeler with valid insurance
Once your premium is paid and processed, the policy is deemed ‘in force’. This means that your two-wheeler insurance policy is now valid for a period of one year (depending on the plan you take). You can start riding your bike once the policy is valid – do note that riding a two-wheeler without insurance or with a lapsed policy can invite legal trouble.
While institutional and professional investors use the concept of leveraging debt funds on a regular basis, individuals can get burnt badly if they are not careful. According to Brian Davis, co-founder of SparkRental.com, a popular real estate blog, borrowed money can be a very powerful tool in accelerating the growth of personal net worth.
However, the risk of investing rises exponentially because you are employing more money than you actually have and if the investment tanks, there could be very real problems. Since financial security and safety should never be compromised, you need to consider the following tips before rushing in to borrow money for making investments:
Make a Detailed Analysis
If you are considering leveraging your home equity, mortgage or taking a 401(k) loan, you need to ensure that your investment appreciates to such an extent that the debt can be repaid on time. While on paper, this should not be a problem considering that the rate of interest on home equity is very low, the returns on investments are never certain even as the borrowing cost is fixed.
According to S. Michael Sury, a University of Texas, Austin finance faculty, it is usually the failure to recognize disconnect that results in a huge disappointment for even the most experienced investors. However, is some case, an analysis will reveal the gap between the cost of funds and return to be so wide that it could very well compensate for the risk involved.
Investors should ideally examine the risk very carefully and ensure that their investment portfolio is adequately diversified so that even if something does go wrong, it will not wipe them out.
Gain Experience Making Smaller Investments
A very common mistake made by inexperienced investors is to try to go in for the big kill that will boost their net worth to unimaginable heights. However, in their enthusiasm, they ignore the basic tenets of safe investing and end up risking their financial security.
Investors should first learn the basics of investing in a particular niche before they even think of leveraging debt to increase their profits. It is vital to understand the behavior of the market and especially how different asset classes react to different stimuli.
After understanding the fundamentals of investing, you should make your first investments with small sums of money, preferably under the guidance of someone who is more experienced so that you can learn the ropes without putting yourself at major risk. If you find your success rate to be positive, you can ramp up the investment amounts and only then consider borrowing money to invest more.
Play It Safe When Approaching Retirement
Investing can be extremely addictive, especially if you are making good profits. However, as you approach your retirement age, you should make a conscious decision to avoid borrowing funds for investing. Ideally, the best time of your life for investing is from the age of 25 to 50 years but thereafter, you should only invest in low-risk or risk-free asset classes so that you do not put yourself in danger of financial insecurity at a stage of your life when rebounding may not be possible.
Ideally, when you start investing with borrowed funds, you should have low personal debt and a relatively high disposable income. If you are finding multiple debts to be unmanageable you can consolidate them but not before getting debt consolidation loan honest feedback online,
Buy Undervalued Assets
As is evident to everyone, you can make more profit if you can buy cheap and sell for the maximum price the asset can reach. According to https://www.forbes.com, the optimum time for leveraging debt in the property market is when both prices and rentals are climbing.
Simple as it sounds, it can be really difficult to spot assets that are currently undervalued and have the potential to appreciate fast. You need to find out the reasons why the asset is undervalued at present and why it is ideally situated to appreciate fast to yield the desired profit.
Selling off the asset at its maximum value is also an art that has to be mastered over time; it requires a thorough understanding of the asset class and the ability to interpret market conditions. Also, waiting for too long may not be productive since the price may suddenly dip, however, sudden market movements are seen more in stocks while real estate tends to be more stable.
Buy on Margin
Investors in stocks can invest more profitably if they can do so using margin money. Essentially, this means that they use the value of their existing holdings to purchase more stock than the cash they have to pay for them. The investment pays off when the price of the equity shares increases allowing investors to liquidate their investment and pocket the difference.
While this strategy can be very effective in a rising market, it can result in very deep losses if the market turns bearish and the prices nosedive. Again, the only way of using this technique profitably is to understand in detail how the stock market works, why prices move up and down and how to interpret macroeconomic indicators as well as developments within the sector that may affect price movements.
Use Your Own Money to Invest While Using Cheap Debt
Since it is well known that the stock market can behave erratically, it may be difficult for an ordinary individual investor to handle; they can take advantage of using cheap debt to fund essentials like the purchase of a car or college tuition.
They can then invest their savings to make investments that can give them profits more immediately while the cheap debt can be paid back slowly. People in the age group of 25-50 can use this technique of using cheap debts to save money and build their overall net worth.
Even though investing with borrowed money can be immensely fulfilling, investors should be prepared for market downturns and have a plan ready of how to counter such events. They can either cut their losses by liquidating their investments or hold on till the market recovers, which also entails having enough resources to service the debt during that period.
Limited salary and unlimited expenses to take care of? Taking a loan seems like a viable option if you have a large expense looming over your head. If only, you have been to a bank with a loan application. A huge list of documents, verifications, and attestations and lastly, the credit score… phew!
Getting your loan application rejected on basis of a poor credit score or zero credit history is quite common when it comes to established banks and NBFCs. Wondering what is a credit score? Read on to know more about credit score and its impact on your loan eligibility.
Credit Score is a 3-digit number which decides your creditworthiness In simpler terms, banks and NBFCs calculate the risk associated on providing a loan to a user on basis of his/her credit score – the credit score defines the ability of loan applicant to pay the loan back on time.
The credit worthiness of a person depends on his previous track record of taking loans (or credit) and repaying them. The different credit score ranges and their grade are as follows
Credit Score Ranges
0 or -1
No Credit History
550 – 300
750 and above
Different countries have different credit score rating systems, issued by credit bureau functional in the said country. Popular credit score systems in India include CIBIL and Equifax CRIF, which range from 300-900 and 300-850, respectively.
In general, the higher your credit score is, the better chances you have of loan approvals. Banks and NBFCs reject loan applications if an applicant has zero or poor credit score. Anybody with a credit score of 750 or more has a high rate of loan approval.
A credit score of 0 or -1 signifies that the person has never taken a loan or used credit cards previously. Such loan applicants are considered ‘New to Credit’ and have ‘Zero Credit History’ and are by default denied a loan sanction by big financial establishments. Do you also fall under the same category? Chances are you would be denied a loan if you don’t build or improve your credit score.
The two common methods of building and improving credit score is by taking a personal loanor using credit cards and paying their dues on time. However, credit cards charge a high interest rate and due to our tendency of swiping the credit card everywhere for all the purchases, people end up getting higher bills than expected.
Which is why, taking a short-term personal loan makes much more sense. With PaySense, you can get a personal loan in a few clicks and the best part is that they serve people with zero credit history as well.
How a personal loan can help improve CIBIL Score?
To start buildingyour CIBIL score, you can use a personal loan of the small affordable amount and pay all your EMIs on time. Such small personal loans are easier to pay and help improve your CIBIL score eventually and incrementally. This method of improving your CIBIL Score or any other credit score in small incremental values is also known as ‘Snowball Effect’.
For instance, if you have a salary of 18,000 INR per month and have never taken a loan or used a credit card previously, your credit score will be 0 or -1. That makes it very difficult for you to get a loan, since banks and NBFCs reject the loan application.
However, PaySense can offer you an instant personal loan of Rs. 5,000 to Rs. 2,00,000; which you have to repay in a duration ranging from 3 months to 24 months. Let’s assume that you take a loan of 5,000 for 3 months and pay your EMIs regularly on time, your credit score will start increasing. After 3 or 4 such short-term instant personal loans which are easy and affordable to pay, your credit score will improve to 650 and above within a year.
So if you choose wisely, you can start building your credit score today with short-term personal loans and be loan-ready in the future for bigger expenses and emergencies.
Be it an electricity bill or a credit card’s bill, most people end up missing on-time bill payments and end up paying past the due date. Unlike electricity bills, credit card bills can have significant financial effects, if repayments are missed or delayed.
Whatever be the reason, lending institutions will de-rate you as a customer if you miss your credit card payments. Moreover, credit bureaus like CIBIL regularly monitor an individual’s financial discipline. CIBIL summarises this information into a 3-digit credit score.
How a missed payment impacts one’s credit score
Credit Information Bureau India Limited or CIBIL gathers and maintains an individual’s payment history related to loans and credit cards. CIBIL collects the details from various financial institutions in India. They prepare the person’s credit report, scoring him/her on the scale of 300 – 900.
A CIBIL score of 750 and above signifies the respective individual is creditworthy and has repayment capability. Naturally, a score below 750 indicates payment failures, inability to repay, and all such odds. Note that 35% of the score is made up of one’s payment history.
So, even a single missed payment of your credit card can decrease your credit/CIBIL score significantly.
How can a poor CIBIL score affect you?
Once your CIBIL goes down due to a failed credit card payment, here is how it can affect you:
Low chances of availing credit in future
Lending institutions consider the CIBIL score as one of the foremost credit card eligibility criteria. They use your credit report to evaluate your repayment capability and decide on whether to sanction the credit or not. Hence, a low CIBIL score (below 750) reduces your chances to avail credit cards or loans in the future.
Pay higher rates of interest
Under some conditions, lenders may approve you credit but with a higher rate of interest. You may also have to pay other additional charges as lenders consider you as a high-risk borrower.
Additionally, you may have to abide by stringent terms and conditions.
Prevent you from receiving special offers
Besides credit card eligibility, having a healthy CIBIL score entitles you for many special offers. For example, one of the top-most NBFCs in India, Bajaj Finserv provides with pre-approved offers on credit cards and many other financial products and services.
Also, you can enjoy comparatively low-interest rates.
How to avoid missing your credit card payments?
Where there’s a problem, there’s also a solution. You can follow certain ways to avoid credit card payments and being a defaulter.
If you tend to forget
Choose the auto debit option
Go for the auto debit facility if remembering the due date is difficult for you. It debits the due amount from your account on a particular date of every month. This reduces your hassle as well as consumes less time.
However, make sure to check the statement and verify if there is a sufficient amount in your account.
Pay at the earliest
It’s always better to clear the bill immediately after receiving the statement instead of waiting for the due date. This decreases your chances of missing the payment.
If you are in short of sufficient cash –
Convert your due amount into easy EMIs
In case the full bill payment isn’t possible, convert the amount into easy EMIs. Although this may reduce your credit limit, it’s a better alternative than to default.
However, this facility is offered by selected lenders like Bajaj Finserv. The Bajaj Finserv RBL Bank SuperCard comes with industry-first features which allow you to divide dues of more than Rs. 3,000 into EMIs.
Pay the minimum bill amount
Again, clearing the minimum amount due instead of the total due during financial crises can prevent you from paying additional interests and penalty charges.
Above all, you must keep track of your credit card’s usage and have a repayment plan beforehand to avoid being a credit defaulter.
As a parent, it is only natural that you want to provide a good future for your child. If your child is still very young, significant expenses will come later on in life. This doesn’t mean that you don’t have to worry about costs until the time comes. To accomplish your future goals successfully, begin financial planning for your child’s future today.
The rising cost of education
Today, one of the biggest expenses for a parent is the increasing cost of education. Most parents enroll their children in private schools to provide quality education to their kids. This can be quite costly.
Indian parents spend an average of Rs. 12.22 lakh for a child’s education from primary school to under-graduation, according to an international study. But when it comes to post-graduation, the story takes a different turn altogether.
Impact of inflation
Management students in IIM Ahmedabadpay an amount of Rs. 21 lakh for a two-year postgraduate program. Fees to courses have increased by as much as 7.7% since the previous year.
At this rate, the same program would cost at least Rs. 30 lakh by 2030. So, if your child is planning to crack the CAT exam, you need to start saving now to avoid a rude shock, ten years down the line.
This is not a problem only for MBA aspirants. Analysts believe that higher education in India has the highest rate of inflation. The cost of engineering and medical seats is also expected to rise in the coming years.
For example, if a four-year engineering course costs Rs. 8 lakh today, it could cost around Rs. 17 lakh in another eight years’ time.
Here’s how investing will help reach your goals
These numbers might seem huge now but don’t throw in the towel just yet. Reaching your goals through effective financial planning is possible. For instance, imagine that the required financial goal is Rs 20 lakh. If your child has not yet started his primary schooling, it gives you a 14-year period to come up with the required funds.
Invest in SIP
You could kick off your investment journey by investing in mutual funds through Systematic Investment Plans (SIPs). For instance, if you invest Rs. 5,000 each month in a mutual fund that offers annual returns of 12%, you could earn Rs. 22 lakh at the end of 14 years.
The best part about SIPs is that you can increase your investment amount every year as your income rises. You can also check out the exciting child-future plans offered by various fund houses specifically for this purpose. Start investing as early as possible to ensure you reach your goal much faster.
However, if you start investing later in life, you will have to put in higher amounts of money to reach your goal. For instance, if you have only ten years to reach the target, you have to invest Rs. 9,400 each month. This can put considerable pressure on your budget.
A good education is the best gift you can bestow on your child. Nevertheless, it is a known fact that the cost of higher education in India is rising steeply. Proper planning and a long-term focus on the investment goal can help you secure your child’s future.
Fixed or floating interest rate which is better? In the event that you will buy a home out of the blue, you might not have sufficient learning about these two kinds of lodging money alternatives offered by both open and private loan offering companies in India.
You need to comprehend the idea of each loan choice and in which way they can be helpful for you, check out Bajaj Finserv for more detail. A wrong choice may hurt your monetary position over the long haul.
Do you know fixed or floating interest rate which is better for the home loan? Fixed rate loans the interest installment is a fundamental piece of the loan. The borrower consents to pay interest at a consistent rate in the event of a fixed rate home loan.
The interest rate continues as before all through the loan term and does not vary with market patterns. It is dictated by banks based on the normal rebate rate over the fixed rate tenure. For example, fixed rates are more than variable rates when the rebate rate is verifiably low.
Then again, moneylenders offer borrowers a markdown with a specific end goal to set their interest rate when interest rates are verifiably high.
Fixed Rate Home Loan and Its Benefits
Benefits and negative marks of fixed-rate loans the essential advantage offered by consistent rate loans is sureness regarding future installments. Borrowers can without much of a stretch timetable their future money related commitments, accordingly hold their financial plans unaffected.
They can hold a low-interest rate for a fixed term when interest rates are low. This loan choice additionally has a couple of negative marks.
The loan choice does not enable borrowers to profit by diminishing interest rates. In the event that the borrower wishes to profit the advantage of falling rates, the loan ought to be renegotiated. Dissimilar to a floating rate loan, a fixed rate loan has no lesser early on loan.
Variable rate loans A variable rate home loan does not have a steady rate of interest all through the tenure. Interest rates will vacillate in view of a benchmark rate.
Floating Rate Home Loan and Its Benefits
Benefits and bad marks of variable interest loans Variable or floating interest rate loans have greater adaptability over consistent rate borrowings. Borrowers don’t need to stress over punishments in the event that they wish to draw out and settle their mortgages.
They can profit by diminishing interest rates. The adaptability offered by this loan alternative enables borrowers to spare a decent measure of money throughout their mortgages. On the off chance that market developments turn in the borrower’s support, they can additionally reinforce their money-related well being.
Variable rates don’t offer consistency and consistent quality. It is constantly confounded to fathom the developments in interest rates. In the event that interest rates begin moving an upward way, the cost of the loan will increment for the borrower.
Which alternative is better? Regardless of whether to choose a fixed rate mortgage or a gliding rate mortgage relies upon your necessities, money related positions and inclinations.
It is perfect to pick a steady rate mortgage if Interest rates are imagined to expand, you are alright with the EMI you are promising to dispatch (not surpassing 20-30% of the month to month profit) and Interest rates have cut as of late.
Alternately, you can pick a floating rate loan if interest rates are required to drop later on, you are not sure about developments in home loan interest rates and you are looking for a few funds on your interest costs in the close to tenure.
Mutual funds offer several benefits to investors, chief among them being stable growth and high capital appreciation. Mutual funds (MF) have risen in popularity amongst market-linked products in recent years, particularly for the many benefits they offer.
They are cost-effective and many of them also offer a lower risk. MFs have become the go-to investment option for every serious investor. The best part of investing in the mutual fund is that there are different types of funds available as per your risk-taking ability. And at the same time, you can also enjoy investing in the stock market.
Consider the 5 important benefits of mutual fund products:
1 Risk mitigation through diversification.
Risk mitigation is the process by which one reduces risk in a particular asset or process. Mutual funds are not as risk-prone as a novice investor would initially assume. Since they invest your money across different securities, the risk of loss is evened out due to diversification. The money is not invested in just one type of security – it can be invested in bonds, shares, etc. If one type performs badly, the loss is balanced by another doing well.
2 Simple to analyze.
There are so much information and real-time data available on market-linked securities that it can overwhelm you. Going through this data can be time-consuming. However, MFs collect and research all the relevant data by themselves, so you don’t have to.
Besides, you can compare the funds based on various metrics like price, return, risk propensity, etc. All this information is easily accessible, so monitoring and analyzing the fund becomes much simpler. You can even steer the investment in a different direction based on real-time market inputs.
3 The relative ease of liquidity.
Another advantage of MFs is not only can you easily apply for mutual funds online, but you can also liquidate them quite easily. Liquidity is the underlying benefit of the asset to be converted into cash when the need arises.
Mutual fund products are liquid assets which can be encashed quickly because the market is always clamoring to buy good funds. Your fund manager can advise you on the right time to sell to maximize the fund’s returns.
Besides, you are not charged LTCG (Long Term Capital Gain) tax on equity mutual funds, even when you sell the fund one year after buying it. LTCG only applies to debt funds when you hold them for 3 years or longer.
5 Professional management of the asset.
Investing in gold, bonds, shares, stocks, etc. is never easy. It needs constant market monitoring and data analysis – which you may not be equipped to do. But MF houses assign expert fund managers to track your mutual fund product for you. The fund manager offers valuable guidance for the fund to grow in the right manner.
So, without worrying about the ups & downs of the share market, one can easily start investing in mutual funds to create a short-term corpus or even a long-term wealth.
Most people aspire to buy their dream home. And if we were living in an ideal world, everyone would have enough money to fulfill their dreams. In real life, however, most of us have to rely on a home loan to turn our dreams into reality.
While applying for a loan isn’t too difficult, it is important that you carefully select your lender and calculate the equated monthly instalment (EMI) to make the entire process hassle-free.
Before applying for your home loan, it would be wise to calculate the EMIs in advance by simply using a home loan EMI calculator. Here you can input different figures until you finally get the results you’re most comfortable with.
It Helps You Plan Repayment:
After you’ve decided on the loan amount, now it’s time to divert your attention towards paying off the loan. Knowing your EMI amount will allow you to better plan your finances and avoid any default on the loan.
It Helps You Figure Out Prepayment:
A home loan calculator will help you determine if you can pay off the loan beforehand, i.e., before the completion of the tenure. This can help reduce the total interest outgo on your loan. However, some financial institutions and banks charge a penalty on prepayment, so be sure to check the terms before taking the loan.
Now that you know the importance of calculating your EMIs before applying for a home loan, let’s take a look at the components that determine your EMI amount on a loan:
The net income of an individual plays a crucial role when it comes to applying for a loan. As a rule of thumb, your EMI amount shouldn’t exceed 40% of your monthly income. This way you can ensure that you don’t default on the loan. Other factors like increase in income, job security or financial emergencies aren’t usually considered while deciding your loan amount or EMI.
Rate of Interest:
When choosing a home loan, an individual will also be given the option to choose between a fixed and floating interest rate. If you choose a floating interest rate, your EMIs will fluctuate based on the prevailing market lending rates. On the other hand, if you choose the fixed option, your interest rate will remain unchanged, and you will have to pay a fixed EMI amount throughout the loan term.
When using a home loan EMI calculator, you may want to calculate your anticipated future expenses too. For example, if you have children, it is wise to consider medical expenses, education, wedding and even vacation expenses. You must also be prepared for inflation and the resultant increase in the price of basic commodities.
Home loan calculators are extremely handy when it comes to financial planning. So, before you apply for a home loan, use this effective and efficient tool to determine an EMI and loan amount you can pay off comfortably.
We list the 7 vital ingredients required to ensure financial independence in the present and for the future. Every person wishes to be financially secure – but only a few are able to crack the code on the concept of financial independence’. We reveal the keys you need to become financially independent:
1. A good bank balance.
You’ve often heard the adage, ‘Money doesn’t buy happiness’ but you must agree that having enough money in the bank can ease many problems. A financially sound individual takes care to explore good banking services and open a savings account with the best banks in India.
A good Indian bank has a range of savings account to choose from, with good rates of interest and the best Internet banking tools. A hefty bank balance does a lot to mitigate future financial emergencies.
2. A home of their own.
Another important factor in the life of a financially independent individual is a home of their own. Such an individual understands the value of investing in reality, as opposed to living in rental accommodation for years.
They may borrow a housing loan from a good bank in India to finalize the purchase. They realize that property is an appreciating asset and can be monetized in times of need.
3. Buying A Car.
A car improves your mobility and ceases your dependence on (often unreliable) public transport. A financially savvy person doesn’t wait for buses or argue over surge pricing with private cabbies – they simply drive off in their own car! A car is a good asset to add to your financial portfolio.
4. Bright job prospects.
Young, upwardly mobile, ambitious…if this description fits you, then you are certainly on your way to a bright career. Talent and ambition aside, it takes gumption to succeed in the workplace, and individuals like yourself realize that working smart is more valuable than working hard. The brighter your prospects, the more moolah you rake in!
5. Investments for long-term
The path to financial independence does not come with just a well-paying job. You must be able to figure out a way to make your money work for you even when it is idle. The best way to create wealth is to invest in market-linked investments that build your portfolio over time.
6. A Pure Term Insurance Plan
Apart from creating wealth, safeguarding your life against future eventualities and making sure that your loved ones are protected in your absence, is also the hallmark of a fiscally-responsible individual. Buying insurance from a bank in India is a good way to protect your finances from future financial upheaval. Life, vehicle and health insurance are mandatory, apart from home and asset insurance.
7. A retirement fund.
Retirement might seem like a long way off right now, but it is never too soon to start saving towards it. Post-retirement, you will not have a regular income to sustain your daily expenses. Check the different banking services offering retirement income products (like pension funds) that can provide a regular income once you retire.