Wednesday, March 25, 2009

The basics of PPF

It is that time of the year when most of us would have already made our decision as to where we will make our investments or would at least have had the chance of looking at different investment instruments.

At one point in time or the other we would have come across 'Public Provident Fund' as an effective investing instrument. But how much do we know about Public Provident Fund, or PPF?

What is the Public Provident Fund?

PPF is a long-term, government-backed small savings scheme of the Central government started with the objective of providing old age income security to the workers in the unorganised sector and self-employed individuals.

What is the interest rate offered through PPF?

Currently, the interest rate offered through PPF is around 8 per cent, which is compounded annually. Interest is calculated on the lowest balance between the fifth day and last day of the calendar month and is credited to the account on March 31 every year. So to derive the maximum, the deposits should be made between 1st and 5th day of the month.

What is duration of the investment?

People who are interested in liquidity or small-term gains would not be very keen about PPF because the duration for the investment is 15 years.

However, the effective period works out to 16 years i.e., the year of opening the account and adding 15 years to it. The contribution made in the 16th financial year will not earn any interest but one can take advantage of the tax rebate.

The account holder has an option to extend the PPF account for any period in a block of five years after the minimum duration elapses. The account holder can retain the account after maturity for any period without making any further deposits.

The balance in the account will continue to earn interest at normal rate as admissible on PPF account till the account is closed.

What is the minimum and maximum amount of deposit?

The minimum deposit that you can make into a PPF account in a year is Rs 500. The maximum is Rs 70,000.

Who can open a PPF account and where?

A PPF account can be opened by an individual (salaried or non-salaried) on his own behalf or on behalf of a minor of whom he is the guardian or on behalf of a Hindu Undivided Family (HUF) of which he is a member or on behalf of an association of persons or a body of individuals. An individual can open only one account for himself.

A PPF account can be opened with a minimum deposit of Rs 100 at any branch of the State Bank of India [Get Quote] or branches of its associated banks like the State Bank of Mysore [Get Quote] or Hyderabad. The account can also be opened at the branches of a few nationalized banks, like the Bank of India, Central Bank of India and Bank of Baroda [Get Quote], and at any head post office or general post office.

What are the tax benefits from PPF?

The amount you invest is eligible for deduction under the Rs 100,000 limit of Section 80C. On maturity, the entire amount including the interest is non-taxable.

Is it possible to withdraw the amount deposited at any time during the tenure?

Yes. You can take a loan on the PPF from the third year of opening your account to the sixth year. So, if the account is opened during the financial year 2009-10, the first loan can be taken during financial year 2011-12 (the financial year is from April 1 to March 31).

The loan amount will be up to a maximum of 25 per cent of the balance in your account at the end of the first financial year. You can make withdrawals during any one year from the sixth year.

You are allowed to withdraw 50 per cent of the balance at the end of the fourth year, preceding the year in which the amount is withdrawn or the end of the preceding year whichever is lower. For e.g., if the account was opened in 2000-01, and the first withdrawal was made during 2006-07, the amount you can withdraw is limited to 50 per cent of the balance as on March 31, 2003, or March 31, 2006, whichever is lower.

Wednesday, March 11, 2009

Sehwag hammers India's fastest ODI ton

Swashbuckling opener Virender Sehwag hammered a 60-ball ton to eclipse Mohammad Azharuddin and register the fastest hundred in One-Day Internationals by an Indian in the fourth match against New Zealand [Images] in Hamilton, on Wednesday.

Batting on 97, Sehwag danced down the pitch and hit a Daniel Vettori delivery over the bowler's head to bring up his hundred with a big six in the 18th over of the rain-truncated match to better Azharuddin's 20-year-old mark by two balls.

Incidentally, Azharuddin's 62-ball 108, had also come against New Zealand in Baroda in 1988.

Sehwag had earlier smashed a 69-ball century against the Kiwis in Colombo in 2001.

The Indian now has the seventh fastest hundred in ODI history, with Pakistan's Shahid Afridi topping the chart with his 37-ball 102 against Sri Lanka in Nairobi in 1996.

Don't make a nuisance of yourself in the name of Holi

Holi is the festival of colours, water balloons and revelry and Indians enjoyed it.

But let's face it, you need to exercise caution at the best of times -- Holi also spells skin ailments, altercations with strangers who are deluged with colour and massive hangovers for revellers who go overboard drinking bhang.

So, to make sure you have a healthy, happy experience celebrating tomorrow, we've put together a small list of dos and don'ts. Because good, clean -- well, as clean as possible, given the nature of the festival (!) -- fun is the order of the day.

Go the safe, organic way: First things first. Ensure your own wellbeing and that of your friends by opting for natural, organic colours as far as possible. Chemical powders are harsh on the skin and their side effects often catch up with you after you're done playing with them. Preferably, rub yourself down with baby oil before playing so that all the colour comes off your body easily. Wear old clothes that can be thrown away after playing around.

Set boundaries: Make a pact with everyone playing to limit yourself to acceptable Holi props. Often, what starts off with water balloons and colours ends up with people slinging muck and eggs at each other. And that kind of fun is not for everyone. So don't get carried away and ruin somebody else's good time. A vegetarian will not take kindly to being pelted with eggs and mud is unhygienic, it may cause a reaction with the skin or get in someone's eyes.

Don't pester bystanders: Don't assume an 'anything goes' attitude. Pelting strangers who are going about their business in and around your neighbourhood with colour and water, for instance, is a strict no-no. While you may be in the mood for fun, somebody else may not be and more often than not, altercations take place when passers-by are charged at. It ruins the celebrations and leaves everybody with a bad taste in their mouths. You don't want to drag somebody into the fray only to discover that one of his parents is in hospital and you upset him on his way there.

Show consideration towards people's property: Other than bystanders, make sure that you don't destroy people's property. Spraying water at someone's balcony in a bid to get him/ her to join you or pelting passing cars with eggs is not cool. Understand that you're severely inconveniencing people and have no right to manhandle anybody else's belongings; in the latter case, you may even cause a serious accident by obstructing a driver's vision.

Show some respect for the opposite sex: Guys, don't play rough with women in the name of the game and ladies, conduct yourself with decorum -- if you dish it out, be prepared to get it back. You can have a good time while still showing consideration towards each other.

Don't be a spoilsport: If you're not participating in the festivities, don't take to the street until the revelry are over. Chances are that even if people don't target you, the colour and water may be flung your way and your clothes will be ruined. If you're going to be a spoilsport about being dragged into it all, you'd rather keep yourself out of the way. If you're travelling by car, make sure that you roll your windows up and don't get annoyed if a little colour or water settles on your vehicle. It can be easily washed off.

Intoxication is a poor excuse for bad behaviour: A lot of people like to drink the intoxicating beverage bhang on Holi. Like all intoxicants, it can have serious effects on your health. The choice is yours, but remember, nothing in excess. If you must, make sure to have only as much as you can handle and don't start misbehaving -- getting intoxicated is no excuse to behave aggressive and loud. If you can't handle your drinks, it's better left untouched.

Don't impose on others: Don't try to force people into doing anything they are not comfortable doing and don't allow yourself to be convinced if you're reluctant either. Force-feeding people with bhang, dragging in folks who don't want to participate and creating a nuisance are not what Holi is about. Remember, to each his own.

Well, enough of the lecturing (!), but do keep these points in mind. That way, you'll have a great Holi and can create plenty of pleasant memories without creating a ruckus.

Have fun!

Friday, March 6, 2009

Does money make you happy, or does being happy make you money?

“The base majority of IT professionals are satisfied at work with 4 out of 10 being either ‘very’ or ‘extremely’ satisfied with their jobs. Indeed, the results show a direct correlation between job satisfaction and the amount of money that one is paid. Since more money equals greater job satisfaction, one could infer that for some, money does buy happiness–at least at work.”

While I’m not denying money can put a smile on most people’s faces, I’m wondering if this may be a case of what came first — the chicken or the egg. Instead of considering that money buys happiness, how about thinking of it as more money comes to people who like their jobs. If you like your job, you’re more likely to put in that extra effort, which is recognized by your manager who, in turn, issues you raises. If you’re happy in your job, it may have something to do with the fact that your talent is recognized with positive attention from your managers and others in the company. And that positive attention results in more money.

On the other hand, if you’re unhappy with what you do, you’re less likely to respond readily to new intiatives, and your negative attitude might impact effective communication with your co-workers.

What do you guys think?

--Toni Bowers