Six Ways To Improve Your Financial Health In 2024

 Six Ways To Improve Your Financial Health In 2024

When your finances are in good shape, you are better equipped to handle unexpected financial challenges, and successfully achieve your aspirations

A financially secure individual would make adequate contributions to meet his financial goals, maintain adequate liquidity to achieve short-term goals or unexpected exigencies and have adequate income replacement instruments for ensuring his family's well-being in case of his absence. Here are some of the key financial decisions that one should take to maintain a healthy financial life

Maintain an adequate emergency fund

An emergency fund would allow you to meet unforeseen financial exigencies or deal with periods of loss of income due to illness, job loss or disabilities.Without an adequate emergency fund in place, any unforeseen emergencies might force you to redeem your investments made for your crucial financial goals, default on your existing repayment obligations, and/or avail of loans at much higher interest rates.Thus, create an emergency fund which is big enough to meet your unavoidable expenses such as your insurance premiums, existing EMIs, monthly contributions to your financial goals, utility bills, children's tuition fees, etc. for at least six months. As financial emergencies can strike at any time, ensure to park your emergency fund in highly liquid instruments including high-yield savings accounts or high-yield fixed deposits offered by scheduled banks.

Prepare a financial plan

Start the process by estimating the amount required to attain each of your financial goals after factoring in an inflation rate, the time horizon left to attain your financial goals and assuming the rate of returns. Then, take the help of online SIP calculators to calculate the monthly contributions required to achieve those financial goals. Apart from providing a clear direction to your investments, financial planning would also help in creating an appropriate asset allocation strategy based on your risk appetite, investment horizon and liquidity requirements.A proper asset allocation strategy would help you strike a balance between risk and rewards by diversifying your investments across various asset classes such as equity, fixed-income instruments, debt, gold, etc.

Purchase adequate insurance cover 

Many people confuse insurance with investments and thereby, end up investing in money-back plans, ULIPs, endowment policies, etc. from insurance companies. These policies provide inadequate life cover while generating sub-optimal returns. Ideally, one's life insurance cover(s) should be at least 10-15 times of one's annual income. The most cost-effective way of purchasing such large life insurance covers is to buy term insurance plans. Also, ensure to buy adequate health insurance policies to protect yourself from rising healthcare costs. Purchase at least Rs one crore with the base health cover of Rs five lakh and super top-up cover of Rs 95 lakh. If you already have group health coverage through your employer, purchase super top-ups to avail bigger health coverage at very low premiums.

Invest through the SIP mode

Systematic Investment Plans (SIP) allow investors to invest a predetermined amount in mutual funds at predetermined intervals, say, monthly, quarterly, etc. As the SIP amount is automatically debited from one's bank account, it ensures regular investment and financial discipline. Moreover, the minimum SIP ticket size of Rs 1,000 (even lower in some mutual funds) allows investors with limited investible surpluses to avail diversification while simultaneously benefiting from the power of compounding. Automated and regular investments through SIPs also help investors to benefit from rupee cost averaging during market corrections by purchasing more units at lower NAVs. This eliminates the requirements of monitoring markets and timing investments.

Start investing early for your retirement corpus

Starting retirement investments in the early stages of one's life increases the chances of creating a bigger retirement corpus with much smaller contributions. On the contrary, starting late would reduce the chances of creating an adequate retirement corpus and/or may also adversely impact the achievement of other financial goals in the later stages of work life. For example, a 30-year-old individual would require a monthly SIP of just Rs 2,700 in equity mutual funds to build a post-retirement corpus of Rs one crore within the next 30 years, assuming an annualized return of 12 per cent. For a 45-year-old, building the same corpus would require a monthly SIP of Rs 20,000, assuming the same rate of return over the next 15 years. Since equity as an asset class outperforms both fixed-income instruments and inflation by a wide margin over the long run, equity is the most suitable asset class for achieving such long-term financial goals.

Build a strong credit score

Lenders and credit card issuers consider credit scores as one of the first filters while evaluating your credit card and loan applications. Those having higher credit scores have higher chances of availing of loans and credit cards. Many lenders also offer lower interest rates to loan applicants having higher credit scores. As there can be no credit score without a credit history, those who have never availed of any loan or credit card can build their credit score by availing credit cards. Credit card transactions are considered as equivalent to availing loans and hence, these transactions are reported to the credit bureaus. The bureaus then use these transactions to calculate credit scores. Those who cannot avail of regular credit cards due to inadequate income, unserviceable locations, etc can avail of secured credit cards to build their credit history.

These areas are poised for growth in 2024

 These areas are poised for growth in 2024

In 2023, Chennai’s real estate witnessed a rollercoaster ride with a few highs and a few lows.  In this New Year, the real estate market is expected to see a surge in demand, especially in the following markets.

Areas poised for growth in 2024

Tambaram

A residential locality in southern Chennai has a rich history and is one of the bustling areas of Chennai.  “It is located around 24 kms from the city centre and is well connected to other parts of Chennai via road and rail networks.  The upcoming new airport at Parandur will boost real estate growth in Tambaram due to it’s strategic location.  Also, it’s easy accessibility to major city expressways like Chennai-Bengaluru Expressway and Chennai-Salem Expressway will pave the way for significant real estate development.  It’s diverse economic landscape is further enhanced by industrial and logistic parks, automobile industry hubs, research centres, medical colleges, and even cold storage factories, making it a highly desirable residential zone.

Navalur-Kelambakkam 

The Navalur-Kelambakkam micro market has also made waves because of the rising demand.  “The micro market is well connected via OMR, the IT corridor of Chennai.  The area thus receives excellent demand for housing from IT employees.  Upcoming Metro Corridor Three connecting Madhavaram to Siruseri would further accentuate the real estate developments and ease connectivity.  Existing as well as upcoming commercial supply in the Navalur and Siruseri areas is expected to create good demand for housing.  The area consist of projects from well-known developers with a good mix of affordable and premium projects.  Approx. 5000 units were under various stages of construction between 2021 and 2023.”

Old Mahabalipuram Road (OMR) 

The IT Expressway connects OMR with various locations in Chennai and surrounding areas.  Recent infrastructure developments include Phase 2 of Chennai Metro Rail linking Madhavaram to SIPCOT.  “The road project will also connect four national highways (NH5, NH205, NH4, NH45) and eight state highways to ensure smooth connectivity.  The OMR runs parallel to the East Coast Road (ECR) and provides convenient travel options beyond the city limits.  Apart from unmatched connectivity, OMR offers an excellent social infrastructure for a comfortable life, with schools, universities, hospitals, banks, ATMs, and restaurants along the corridor.  Several infrastructure projects are currently underway to reduce traffic congestion, improve water supplies and sanitation systems, and increase green space.  Access to tourist attractions and theme parks is also a big draw for apartment seekers in the city.  Property price in the area ranges from Rs 9,000 to Rs 12,000 per sq ft”.

YOU NEWLY LAUNCHED SUPPLY (IN UNITS)
Micro Market	Year 2022	Year 2023
Pallikaranai	129	2702
Manapakkam	134	2252
Sholinganallur	464	1583

Oragadam 

The area is known as one of the promising industrial areas in Chennai “Oragadam has a diverse and promising real estate market due to its presence in several industries, such as automobiles and research and development.  It’s proximity to the Chennai-Bengaluru highway, excellent connectivity to the city centre, and location between NH 45 and NH 43 make Oragadam an excellent location for business.  Numerous renewed real estate companies offers townships, clusters and villa communities in the region.  A variety of trends, such as multi-living, serviced apartments, and preleased apartments, provide tenants with a quality living experience and high rental yields”. 

Pallavaram Thoraipakkam Road 

The area is considered as one of the emerging locations for real estate.  “The proximity to two growth corridors viz. OMR and GST has accentuated the investments in the region.  Further, a few of the upcoming infrastructure such as Metro Corridor five, and the widening of PTR, would aid the development potential in the region.  Upcoming commercial supply of approx. 3.6 mn sq ft would create good demand for housing.  The area boasts projects by well-known developers with a good mix of upper-mid to premium projects.  Approx. 4,200 units were under various stages of construction between 2021 and 2023.

Pallikaranai, Manapakkam and Sholinganallur 

The three areas are bound to witness growth in the coming year and the number of launches is proof of the same.  “As per Anarock Research, these three localities remained most vibrant and witnessed the highest new supply in 2023.  The three areas saw a total new supply of nearly 6,537 units between January and December period in 2023 in the wake of growing demand by prospective buyers.  The average price in the three localities remained between Rs 6,497 per sq ft and Rs 7,328 per sq ft.  Going ahead, these markets continue to remain promising in 2024 as well because of their growing demand.

Buying a home for the first time? Don’t forget to claim these benefits

 Buying a home for the first time? Don’t forget to claim these benefits

As a first-time homebuyer, you may qualify for some sweet perks like tax savings, reduced interest rates, and even special discounts from developers. So, keep an eye out  as you might have a chance to save a handsome amount

Purchasing your first home can be pretty overwhelming. But don’t worry, there are a bunch of perks that can make this experience a bit smoother - not to mention easier on your wallet!

Benefits galore:

Under Section 80C, first-time buyers can claim tax benefits of up to Rs 1.5 lakh on the principal repayment of a house loan, but this is applicable only for homes that are completed and owned for at least five years from the date of acquisition; 

Additionally, Sections 80EE and 80EEA provide a tax credit of Rs 50,000 on interest repayment for first-time homebuyers;

You can also get interest deductions of up to Rs two lakh per year under Section 24, provided the home is owned and not rented;

Section 80EEA of the Income Tax Act, 1961, provides an additional deduction on home loan interest for first-time homebuyers of affordable housing. The deduction is limited to a maximum amount of Rs 1.5 lakh per financial year, provided the property value is up to Rs 45 lakh and the loan is sanctioned between specific timeframes. 

“The Real Estate Regulation Act (RERA) ensures transparency and accountability in the real estate sector, thus protecting the interests of buyers by curbing malpractices. The Pradhan Mantri Awas Yojana (PMAY) is aimed at providing “housing for everyone” and benefits first-time home purchasers from lower and middle-income families. The subsidy rates on the principal amount vary based on the buyer’s income, with additional income brackets recently introduced to extend the benefits to a wider segment of the population. Moreover, the housing subsidy GST has been reduced from 12 per cent to eight per cent for residences acquired under PMAY, allowing eligible first-time homeowners to avail of a higher subsidy of up to Rs 2.7 lakh,” informs Pritam Chivukula, vice president, CREDAI-MCHI.

Money matters :

First-time homebuyers can avail of competitive home loan interest rates from top banks and lenders. These rates are generally tailored based on various eligibility criteria. Besides, if you’re a salaried employee, your interest rates could be lowered by 15-20 basis points as compared to those who are self-employed. Akash Pharande, managing director of a real estate firm adds, “Banks occasionally roll out special offers for first-time homebuyers. You might see slight reductions in interest rates or other benefits such as a waiver on processing fees and prepayment charges, among others. However, these offers are usually available during the festive season. So, keep an eye out for these sweet deals.” The interest rates you might end up paying on your home loan depend on several factors which include the size of your loan, the term of the loan, and your credit score. So, keep these factors in mind while planning your finances.

“Bigger loans, longer payback periods, or a weak CIBIL score may attract slightly higher interest rates. Remember, not all banks and financial institutions offer the same rates and terms for their loans. It’s essential to compare offerings from multiple lenders to get the best deal,” says Vickash Choudhary, founder of a real estate firm.

The one mistake that first-time homebuyers often make is that they focus mainly on securing lower interest rates, but they should also consider other terms such as prepayment charges and processing fees while comparing loan offers.

Developers play their part :

Developers often extend special reductions and benefits to attract first-time homebuyers and promote their projects. These benefits can vary depending on the developer’s marketing strategy and the property being offered. Common offers include discounts on the base price of the property, thus making it more affordable for first-time buyers. Some developers may also provide additional incentives such as free furniture or appliances, or free membership to gyms or clubhouses. Additionally, to ease the financial burden on first-time buyers, developers might offer flexible payment plans with staggered payments or lower initial down payment requirements. Developers may offer discounted prices to first-time homebuyers, especially in affordable housing projects. Some developers may waive off additional charges such as floor rise charges, preferred location charges, or clubhouse membership fees to attract first-time buyers. Developers may have tie-ups with specific banks or financial institutions, thus providing special home loan interest rates or processing fee waivers for buyers of their properties. Chivukula cautions, “Prospective homebuyers should thoroughly review all the terms and conditions of such offers before making any decisions to ensure they fully understand the benefits and implications.”

கம்பி கட்டு வேலையில் கவனக்குறைவு ஏற்பட்டால் அது கட்டடத்தை பாதிக்கும்!

 கம்பி கட்டு வேலையில் கவனக்குறைவு ஏற்பட்டால் அது கட்டடத்தை பாதிக்கும்!

புதிதாக கட்டப்படும் கட்டடங்கள் பெரும்பாலும் பிரேம்டு ஸ்ட்ரக்சர் முறையில் கட்டப்படுகிறது.  இவ்வாறு, கட்டுவதில், அஸ்திவார தூண்கள், பீம்கள், மேல் தளம் ஆகியவை அத்தியாவசிய அமைப்புகளாக உள்ளன.

இந்த அமைப்புகளுக்கான கட்டுமான பணியில் சில அடிப்படை விஷயங்களை புரிந்து செயல்பட வேண்டும்.  இக்கட்டுமானங்களின் அளவுகள் என்ன என்பதை ஆரம்ப நிலையிலேயே வரையறுக்க வேண்டும்.

அதாவது, பணி முடியும் நிலையில் என்ன அளவில் இருக்க வேண்டும் என்பதை கணக்கிட்டு அதற்கு ஏற்ற வகையில் செயல்பட வேண்டும்.

குறிப்பாக, கம்பி கூடுகள் அமைக்கும் போது, அவற்றுக்கும், வெளிப்புற தாங்கு பல கைகளுக்கும் இடைப்பட்ட பகுதியின் அளவை துல்லியமாக கணக்கிடுவது அவசியம்.  தூண்கள், பீம்கள் அமைப்பதில் கம்பி கூடுகளுக்கு நடுவிலும், வெளிப்புறத்திலும் கான்கிரீட் கலவை கொட்டப்படும்.  இந்த பகுதிகளின் அளவுகள் எப்படி இருக்க வேண்டும் என்பதை சரியாக கணக்கிட வேண்டும்.

கம்பி கூடுகளுக்கு வெளியில் கான்கிரீட் பரப்பு எப்படி அமைய வேண்டும் என்பதில் கவனமாக இருக்க வேண்டும்.  இதை துல்லியமாக பார்த்து தாங்கு பலகைகளை அமைப்பது அவசியம்.  இதில் கம்பிகளுக்கும், தாங்கு பலகைகளுக்குமான இடைவெளி குறைந்தால், அது கட்டுமானத்தை பாதிக்கும்.  அதே நேரத்தில், இந்த இடைவெளி தேவை இல்லாமல் அதிகமானாலும், சிக்கல் தான்.  இதே போன்று மேல் தளம் அமைப்பதிலும், கம்பி கூடுகள் தாங்கு பலகைகளுக்கு இடைப்பட்ட பகுதியின் அளவை சரியாக பராமரிக்க வேண்டும்.

இதில், கம்பி கூடுதல் தாங்கு பலகைகளை தொடாமல் இருப்பதை உறுதி செய்யுங்கள்.  இந்த இடைவெளியில் கான்கிரீட் கலவை நன்கு பரவ வழி செய்ய வேண்டும்.  மேல் தளம் அமைப்பு பணியின் போது, கான்கிரீட் கலவை பரவலை உறுதி செய்ய நடவடிக்கை எடுக்க வேண்டும்.

குறிப்பாக, கான்கிரீட் கலவை, சரியாக பரவாத நிலையில், அது நீர் கசிவு போன்ற பிரச்னைகளுக்கு வழிவகுக்கும்.  எனவே, தாங்கு பலகைகள் அமைக்கும் போது அதில் மிகுந்த கவனத்துடன் செயல்படுங்கள் என்கின்றனர் கட்டுமான பொறியாளர்கள்.

Make the right choice : Standalone home vs. flat

 Make the right choice : Standalone home vs. flat

In the bustling real estate landscape of Chennai, here is a guide to help you choose between an independent house and apartment

With its diverse real estate landscape offering everything from luxurious villas to modern apartments, prospective homebuyers in Chennai are often confused with a pivotal decision: whether to invest in a standalone home or an apartment. Each option presents its own unique set of advantages and considerations.

Current market scenario

As per Anarock Research, as many as 28,300 units are available for sale in Chennai as of H2 2023. These include all property types such as apartments, villas, plotted developments, etc. Though apartments are the first choice of property seekers, it’s interesting to know that villas as a property type gained much traction during the pandemic. This was also revealed in Anarock’s Consumer Sentiment survey wherein demand for villas went up across cities. Interestingly, villas were popular among buyers in Tier II and III cities. As per the survey, almost 27 per cent of respondents who are looking to buy in Tier-II and III cities chose villas as their first preference. As for the top seven cities, notably the southern cities have a higher demand for villas. For instance, in Hyderabad, almost 19 per cent of respondents preferred to buy villas, in Bengaluru 14 per cent preferred it, while in Chennai, nine per cent of respondents preferred villas.

Apartment or an independent house: What is the ideal choice in Chennai?

Both apartments and villas depreciate over time in terms of value and strength, as compared to the newer buildings. Buying a home in a new building would always be a tad bit more expensive than the resale market. What one thus needs to consider is the purpose of their purchase. Apartments generally come with lesser work in renovations and repair (water connection, electricity, gas line, etc). On the other hand, if buying a villa, along with the utilities, you may also have to take care of either building the structure or renovating the existing one including the desired type of fencing as everyone’s security needs vary. The stress of ensuring there are no trespassers also lies with the owner in the case of a villa. However, your preferences and needs should be the priority before deciding between the two.

Where to buy a house in Chennai?

“In the past, central regions of Chennai like Nungambakkam, Alwarpet, and Mylapore have typically featured standalone homes. As the city expanded, some of these homes were transformed into apartments due to an increase in the number of buyers and evolving consumer preference for gated communities catering to urban lifestyles. This shift has also been supported by the growth of the office sector, with increasing IT/ITeS firms in OMR in South Chennai and buoyant industrial activity in Oragadam-Sriperumbudur and surrounding locations in West Chennai. Thus, over the recent years, South and West Chennai have garnered a dominant share in launches and sales of housing units. Notably, South Chennai now holds around 60 per cent of the city’s housing stock, with prominent zones such as OMR, GST Road, ECR, and neighborhoods such as Velachery and Adyar. This growth has also been fuelled by urban expansion and increased property values in central areas,” informs Anshuman Magazine, chairman and CEO - India, South-East Asia, Middle East & Africa, CBRE.

What is the best bet for you?

Advantages of apartments:

 Apartments offer convenience and shared amenities. They often come with security features and have maintenance handled by society management. Their central locations provide easy access to various facilities and can be more affordable than houses.

Disadvantages of apartments:

 There are often rules set in place by the building management that can limit how much you can personalize the space. Plus, the resale value of an apartment might not increase quite as quickly as you’re hoping.

Advantages of independent houses:

 Independent houses offer ample space and privacy. They often come with private outdoor areas, giving residents more freedom for gardening and outdoor activities. The resale value can be pretty good, and no shared amenities or restrictive rules usually exist.

Disadvantages of independent houses: 

Apartments come with minimum hassles of maintenance. On the other hand, in an independent home, the owner must go through the hassles of finding plumbers or carpenters, and even take it upon himself to manicure the lawns. Although most of the amenities (pool, and garden) can be built into an individual house, the financial implications are huge. Also, owners have to install CCTV cameras or burglar alarms to monitor the property, which is an additional expense.

– Manju Yagnik, senior vice-president, NAREDCO

 

இன்சூரன்ஸ் வேண்டுமா? - காரை ஆன் செய்யாதீர்கள்! 

வெள்ளத்தில் கார்கள் மூழ்கினால் இன்ஸ்சூரன்ஸ் பெறும் வழிமுறைகள் என்ன? எந்தெந்த காப்பீட்டிற்கு எவ்வளவு சதவிகித தொகை கிடைக்கும்? என்னென்ன தவறுகளை செய்யக்கூடாது? உள்ளிட்ட தகவல்கள்

https://youtu.be/rcbxXUBfeFQ?si=BRKWsv89gxmOqqEo

Have you inspected the property before signing on the dotted line !!

 Have you inspected the property before signing on the dotted line !!

Just visiting the place and pointing out a few cracks aren’t enough. A thorough home inspection is important for a smooth stay

Jayanthi and her husband Kannan recently bought a home in Chennai. During our conversation with them, we asked if they conducted a home inspection before making their big purchase. And their reaction was, “Oh! What’s that? Is it even legal?” On educating them that, though not quite popular yet, it is legal to get a home inspection done before or just after you sign the deal. They said, “We wish we knew that. So far, we haven’t faced any troubles with our new home. But, this seems quite useful and would suggest our friends and family to do the same.”

When you’re out and about exploring the property (for end-use or rent), a broker or sales executive will likely join you. They’ll guide you through the property, and discuss the costs and all, but in this whirlwind, you get a limited chance to properly check out the house yourself.

During a typical site tour, you might notice newly painted walls, yet it’s impossible to inspect the building’s structural quality. You’ll likely see a beautifully maintained home, but the possible presence of leaks or pests won’t be visible. Hence, it’s crucial to make a thorough home inspection your top priority.

Although it is not a popular practice in India, unlike Western countries where it is a regulated industry, there are still a few new-age companies that offer this service. Experts in the sector hope that some government guidelines are formed in India as well to aid homebuyers. “There should also be proper codes and tolerance limits set for the finishing aspects of building construction,” says Venkat, chief business officer of a leading home inspection company.

Questions To Ask Your Landlord !!

 

Questions To Ask Your Landlord !!

Here’s a handy list of questions to ask your landlord to ensure your stay at your new place is hassle-free

Thinking about renting a home? It’s crucial to have a chat with your landlord about some key points first. This way, you won’t face any surprises down the line.

1. Rent and payment terms

What is the monthly rent, and when is it due?
What are the accepted modes of payment (e.g., bank transfer, check, cash)?

2. Security deposit

How much is the security deposit?
When will the security deposit be returned once you vacate the property?

3. Maintenance and repairs

How are maintenance and repairs handled?
If something breaks, who will repair it?

4. Utilities and amenities

Which utilities are included in the rent (e.g., water, electricity, gas, etc)?

Are there any shared amenities (e.g., gym, swimming pool), and are they included in the rent?

5. Guest policy

Is there a policy regarding guests and overnight visitors?
Are there any restrictions on the number of occupants?

6. Security and safety

            What security measures are in place (e.g., locks, security cameras)?
        Does the property come equipped with fire safety gear, such as smoke detectors? 

7. Parking and storage

           Is parking available, and if so, is it included in the rent?
       Is there storage space available for tenants?

8. Notice period

          How much advance notice do we need to give to terminate the lease agreement?
      Can either party terminate the lease before its expiration, and under what conditions?

9. Legal obligations

          Can you review a copy of the lease agreement before signing it?
      Are there any specific rules or regulations you should be aware of, such as building rules or local law?    

10. Appliance and furniture

           Which appliances and pieces of furniture come with the rental? 

Asking these questions can help you make an informed decision. Besides, you should also make sure that everything that you have mutually agreed upon should be documented in writing, preferably within the lease agreement, to avoid any disputes in the future.