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Planning for your child’s future is an important decision in any parent’s life. Child insurance plans have traditionally played an important role in securing the child's future. With a plethora of children insurance plans available in the market, it becomes difficult for most parents to evaluate them objectively. Individuals need to understand the dynamics for planning their children so that they can best utilize the alternatives available in |
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the market.
As a parent, one would generally plan from the perspective of making funds available for:
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Education |
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Marriage |
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Seed capital for business |
The factors to consider while planning:
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Time frame for building a corpus |
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Age at which the fund would be required. |
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Approximate amounts to build the corpus. |
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Investment avenues to be considered. |
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The amount available to the child in case of death of parents or disability of the premium-paying parent. |
Child plans come in two broad variants:
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Traditional child plans : |
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Unit linked insurance plans (ULIPs): |
The primary difference between the two lies in the way they invest their premium. Traditional plans invest a major portion of their money in debt instruments like corporate bonds and government securities (as specified by the regulator). Conversely, ULIPs can invest across equity and debt markets in varying proportions.
Parents have plenty of choice; they can either opt for a regular ‘Traditional endowment plan’ which carries relatively lower risk since it is invested mainly in corporate bonds and government securities. The bonuses are stable and give the parent considerable comfort knowing roughly how much he can expect. Regular endowment plans are suited for parents with a low risk appetite.
Parents with some risk appetite can opt for a ULIP child plan that invests across equity and debt markets. The reason why ULIP child plans can prove to be significant is because over the long-term (15-20 years), equities can add considerably to the corpus you plan to build for your child's needs. Equities are best placed to beat inflation over the long term. However, to achieve this, one must invest wisely. Debt on the other hand brings stability to a portfolio. While the returns for debt at times may seem unattractive as compared to equities, their importance in a portfolio (ULIP) cannot be understated.
Parents should consider taking on some risk (by investing in equities) to beat inflation, which is the main reason the cost of everything right from your child's education to his marriage is forever spiraling. Over a 15-20 year time frame, if wisely selected, a ULIP even with moderate equity allocations could add considerably to your child's corpus
Life insurance has much to offer to parents looking to accumulate wealth for their child's future. There are several plans offering enough flexibility to help parents with the same. In the end, it all boils down to making an informed choice and ensuring that your plan is working in line with your expectations.
Have a Glance at LIC’s Children’s plan
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Jeevan Anurag |
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Komal Jeevan |
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CDA Endowment Vesting At 21 |
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Marriage Endowment Or |
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Educational Annuity Plan |
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CDA Endowment Vesting At 18 |
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Jeevan Kishore Jeevan Chhaya |
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Child Career Plan Child Future Plan |
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Child Fortune Plus |
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The verification of these documents are critical, though commercial establishments that take office premises have a legal team to handle the formalities often the lone individual in search of a comfy apartment does not often realize the significance of such things nor do they actually get a chance to verify these details.
You often hear people say, “Nothing like living under your own roof!” Of course this is applied in different contexts and living in a rented house is one of them. A good landlord who does not bother you much and who does the needful when needed is a blessing not many have. Neither is a good tenant, who takes care of the house properly is a frequently seen sight.
However, there are certain things within your control when you find yourself scouting for a rented house. Here are some basic guidelines, which should keep you out of trouble. Rental laws again differ from state to state and hence these guidelines are restricted to some general laws.
The verification of these documents are critical, though commercial establishments that take office premises have a legal team to handle the formalities often the lone individual in search of a comfy apartment does not often realize the significance of such things nor do they actually get a chance to verify these details.
Below is a list of important house credentials that can be verified by the person renting the place.
a. Title documents - This is proof that the person renting or leasing out the premises is the actual owner of the place.
b. Share certificates - If the place rented out is part of a co-operative society or colony, share certificates also need to check.
c. Electricity bills - It is generally in the owner’s name.
d. Verification of built up area of the dwelling place - This is done by a qualified architect.
e. No-objection certificate - This is a certificate that specifies conditions for rent/lease, some do not allow bachelors and may have other forms of bias that is defined in the document.
Rental Agreement
There are several aspects in the lease agreement that you need to be careful about. However, three most significant aspects gain priority over the rest. These include the license period, the consistency of the license fee through the entire license period, clarity on costs associated with the house such as municipal taxes, society fees and charges etc. The owner is expected to bear such costs, conventionally.
There should be definitive clause regarding any deposits given initially prior to renting the house. The legal agreement should clearly state the refund of such deposits when the lease is terminated. This also includes any deposits towards electricity bills, telephone bills etc. Clauses defining what happens if this expectation is not met also need to be in place. Usually security deposits that are not refunded within seven days of the expiry of the lease are liable to be refunded with interest for each day’s delay.
Care needs to be taken to ensure the landlord does not indiscriminately retain funds from the deposit for supposed damage to the premises etc.
Below is a checklist the landlord needs to bear in mind:
- Estimate the rental value of the place based on market value with some leeway for negotiation for the person willing to rent the place.
- Do a quick reference check of the person requesting to rent the place. Place of employment and designation are good reference points.
- Be specific and clear about the time period of the lease.
- State facts regarding furnishing upfront.
- Keep all critical documents that refer to the credentials of the premises in tact and handy for verification.
Here is a quick check on associated aspects
Signature in the lease agreement - Ensure either the owner or a person who is the authorized signatory for the owner signs the agreement for it to be valid.
Accounting for furnishing- Make sure the lease agreement includes all fixtures and furnishings with a cost estimate of the same also specified.
Plumbing check- This needs careful scrutiny by the person who rents the place. There should not be any malfunctioning or leakages of the plumbing systems and maintenance costs for the same should be included in the entirety of the lease deal. These issues have to be discussed upfront before the agreement is made out, which gives either party to opt out if a common ground is impossible to attain.
Some last words
The usual term of the lease agreement is around 11 months with a notice of 2-3 months for either party to terminate the agreement. Notice clause is a must. The lease can be renewed every 11 months based on mutual consent.
Also, there should be a clause that allows you to retain possession of the house till the any dues that the landlord owes including deposit refunds are cleared.
Be clear about any clauses that denote the breach of contract and see you are well protected. The tenant should also be covered under any circumstance where a sale, mortgage, transfer etc. of the apartment takes place. Here the notice period can be the saving factor, to help you make alternate arrangements.
As the tenant you should be protected against natural calamity hassles. If you have to relocate due to one, you will then not be paying rent for a place you cannot dwell in further.
Also, make sure there are other amenities like car parking, general maintenance etc.
Ensure all legalities are in place and most important of all brush up your social skills to pave the way for amiable relations with your landlord. |
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What is heat stroke?
This is a body temperature higher than 40 degrees C (104 degrees F) with malfunction of the nervous system.
What does heat stroke mean?
Heat exhaustion is a warning that the body is getting too hot. If not treated the heat exhaustion can progress to heatstroke which can result in death
What do heat exhaustion and heat stroke look like?
Before heat stroke a person suffers heat exhaustion, the symptoms of which are:
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Confusion |
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Fatigue/tiredness |
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Heavy sweating |
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Dark yellow or orange urine |
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When the body is no longer able to control normal body temperature, heat exhaustion progresses to heat stroke the symptoms are |
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Elevated body temperature over 104 degrees F |
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Hot and dry skin |
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Absence of sweating |
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Muscle cramps |
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Rapid & weak pulse |
How to treat heat stroke?
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Emergency medical treatment is needed. Patient should be transferred to hospital or medical centre immediately. First aid should be initiated as soon as possible |
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First aid involves the following |
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Remove person to a shady place |
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Apply ice packs in armpits and groin |
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Cool person by sponging with warm towel |
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Water with electrolytes(electoral) fruit and vegetable juices should be given |
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Urgent rest is needed |
Ways to prevent heart stroke?
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Observe precautions to avoid overheating and dehydration |
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Wear light loose fitting cotton/linen clothing |
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Avoid strenuous exercise in hot weather |
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Drink plenty of fluids(especially water and tender coconut water) |
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Use cooling fans/air conditioners |
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Use an umbrella for shade |
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Do not stay or leave anyone in a closed parked car during hot weather |
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Enjoy summer by taking these simple precautions |
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Financial advisor Amar Pandit in his book “Financial Planning for Doctors” lists seven most common money mistakes that doctors make. On second thoughts these seven mistakes could apply to any one of us.
Presented here is an excerpt from 7 common money mistakes doctors make.
Indian doctors are among the best in the world and are highly respected in the global community. This is one of the reasons for the surge in medical tourism, as besides lower costs, proper diagnosis and treatment methods are superior or at par with medical facilities available in developed countries.
However, when it comes to money management, most doctors are guilty of several mistakes. We list 7 major, common money mistakes that most smart, intelligent doctors commit.
1. Too many loans
Although most doctors have a high and stable income, their expenses are equally high. One of the key reasons is that they have too many loans. Most doctors often have a home loan, practice property loan, car loan, equipment loan and loan against property. They end up paying a substantial amount of their income towards EMIs.
Besides EMIs, practice expenses, insurance premiums and personal expenses eat into earnings quite quickly. There is often a whole lot of spending on interiors, and acquisition of real estate (instead of just renting it out). Since these are big-ticket items, servicing debt and maintaining other expenses result in a liquidity crunch even for mature practices.
Some doctors also take on loans because their accountants advise them to do so from a tax planning perspective. This is primarily to harness the advantages of depreciation and interest deduction.
However, such ad-hoc decisions are considered without taking a holistic view of the doctor's liquidity and personal needs, which often put doctors in severe cash flow problems.
2. Over-concentration in real estate
Although it sounds stereotypical, most doctors hoard real estate like there is no tomorrow. One of the biggest reasons is that they have a lot of income in the form of cash that can be comfortably cushioned in real estate investments.
Additionally, they believe that not only is real estate insulated from market vagaries, but it also gives stellar returns along with tax benefits. As a result, they borrow to invest in real estate and are leveraged (which means they take on debt).
Like most Indians, doctors too have completely forgotten the Indian real estate crash of 1995 and the subsequent lull for several years until 2003.
This is a very dangerous strategy to adopt as this can prove to be lethal during real estate crashes, especially since real estate is an illiquid investment.
3. Inadequate insurance against risks of death
Most doctors buy life insurance as an investment and pump in a lot of money into life insurance policies. Given a doctor's busy schedule, these investments are often done in a rudimentary manner as and when patients or life insurance agents make pitches. Since doctors earn very high incomes, they often pay sizeable premiums and get a low cover.
Despite paying high premiums, most doctors are under-insured when it comes to life insurance in a big way. There is no assessment of the actual financial risk their family will face, in case of their premature death, and most liabilities are not covered.
At the same time, they have negligible or no professional liability cover, negligible disability cover, no income protection and no social or employer benefits.
This area must be adequately addressed to ensure lifestyle maintenance, wealth creation and wealth protection.
4. Investments done in an ad-hoc fashion
The portfolio of most doctors would probably look like this: more than 60 per cent in real estate investments, 10-20 per cent in debt (PPF, insurance policies, bonds and post office), 15-20 per cent in cash (savings account, fixed deposits and cash), and negligible gold and equity.
Many doctors have just these investments: real estate, PPF and insurance policies.
Considering that doctors are a busy lot and do not even have time for their families, they end up making decisions based on the advice of their chartered accountant, colleagues, banks , real estate agent, family members, insurance agents and patients.
As is evident in the sample demonstrated earlier, the portfolio is not sophisticated or balanced. You can clearly see that it is a haphazard hodgepodge of investments built over time.
5. Lack of planning and vision to build a business
Doctors usually spend a lot of money in doing up the interiors of their practice or sometimes in cosmetic fittings.
However, when it comes to building a business by investing in people or undertaking marketing initiatives such as doing a workshop at a cost, very few have the inclination or aptitude to do it.
Investing in essential equipment is great, but it is better to defer expenditures that will not generate revenue or improve client experience.
Doctors normally spend on upgrading their skill sets or in attending conferences; surprisingly, they mete out step-motherly treatment on spending on brand building and marketing initiatives.
6. Lack of a financial plan
Most doctors do not understand the concepts of financial goal setting, cash flow and debt management, insurance planning, asset allocation, maximization of post-tax income, retirement and estate planning (wills, power of attorney and trusts), for the simple reason that there is no formal education in personal finance or financial planning.
It is because of this limited knowledge that they end up making costly mistakes.
Their realization of the importance of a financial plan is reactive rather than proactive, in that it is only when an event happens that they realize the need for a financial plan or the need to take a holistic view of their financial situation.
7. Myopic view of tax planning
Some doctors generally believe that the objective of tax planning is to minimize taxes and often end doing things that are not in their best interest.
They take several loans, buy real estate and life insurance in an unplanned fashion, and indulge in tricks to fool the taxmen such as showing limited income or a weak balance sheet with the only objective of not paying tax. |
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If you opt for an Indian dental insurance plan, the costs incurred due to dental care would be paid for by the insurer. The Indian dental insurance sector is in its nascent stages and currently only a handful of dental insurance plans are available on a stand alone basis. A dental plan offers cover against sudden financial hardship due to dental emergencies.
Indian Dental Insurance: The Current Scenario
Unlike most western countries, specific dental insurance plans are not common in India. In India, oral health is normally integrated with the general health insurance schemes. However, some popular tooth care product companies have forged tie ups with general or health insurance companies to produce dental insurance products.
The efforts of the Indian Dental Association to bring out a comprehensive Indian dental insurance scheme have seen partial success so far.
Dental Insurance: Types of Plans
There are basically two types of dental insurance plans:
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Preferred Provider Organization (PPO) |
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Dental Health Maintenance Organization (DHMO) |
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Both these categories of dental insurance have their own benefits and drawbacks. |
Dental Insurance: Coverage
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Dental insurance generally covers the following, although the coverage may differ from one insurance provider to the other: |
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Dental insurance covers dental cleaning for removing plaque and tartar by a professional, which may be needed from time to time. |
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Dental insurance may also include extraction of teeth, needing surgery which can be included in non-cosmetic surgery. |
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Dental x-ray is also covered by dental insurance. Taking a dental x-ray is important because it shows the exact condition of dentition. |
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A person suffering from cavities and chippings can get fillings done. This is also covered by dental insurance. |
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Dental insurance also covers situations needing urgent dental attention in case of an injury or accident. The emergency may include tooth replacement or dental surgery. |
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All dental insurance providers make tall claims, but one needs to weigh the pros and cons carefully before parting with their hard earned money as there are several loopholes which one needs to be aware of. |
Tips on Indian Dental Insurance
Some popular health insurance policies that are offered by Indian insurance companies are the Mediclaim policy, accident policy and traffic accident policy. In cases where the Indian dental insurance is clubbed to these general health insurance policies, one has to look for the specific provisions that relate to the dental cover in these plans. |
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