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| Capitalstars Investment Advisor |
Keeping anything until the last minute is never a good idea, especially when it comes to money matters. Making your tax-saving investments in the last minute can have long-lasting negative implications.
New year, new me. That is something that many of us have promised ourselves at the start of every year. I'll take care of my health; I'll lose weight; I'll eat less junk food; I'll spend more time with family - are just some of the resolutions people make. Being more prudent with money is also a resolution that people make.
To make 2020 (and possibly even the coming decades) financially sound, ET Online tells you about financial resolutions you can make.
1. File your ITR on time
Penalties were introduced for the late filing of income tax return (ITR) from FY2017-18. This year's ITR filing deadline was extended to August 31. For filing a belated ITR by December 31, 2019, you would have been penalized Rs 5,000. If you file between January 1 and March 31 of the new year, you end up paying Rs 10,000. So, if you did not file your return on time last year, make sure you do it on time in 2020 to avoid that hefty late filing fee.
2. Don't wait until the last minute to make your tax-saving investments
Keeping anything till the last minute is never a good idea, especially when it comes to money matter. Making your tax-saving investments in the last minute can have long-lasting negative implications. Just to save tax, you might end up investing in the wrong instrument. There can also be technical problems as well. Let us say you waited till just a day before the deadline, i.e., March 31. What if your cheque is not cleared on time or gets rejected? You will not be able to do anything then.
3. Keep an eye on your investments and all related things
From your stockbroker to your fund house and manager, keep checking in on your investments and the people handling them. Nobody wants to be stuck like a DFHL or a Karvy scenario.
4. Don't give in to market fluctuations
Your investments must be primarily determined by your financial goals and not by the equity market is on a high or low. By virtue of their nature, markets will face crests and troughs at various points. What you must not give into are knee-jerk reactions. Stay put, only be guided by your financial plan and goals.
5. Don't rely just on your employer's health cover
Many make the mistake of doing this. This is a mistake because when you leave your job you are no more covered until you join the next employer. Your health insurance policy terminates as soon as you leave your employer. Apart from this, you must also know that the cover may not be sufficient for you and your family. So you should at least buy a simple health insurance plan. This will give you the required cushion where you can also maximize your tax savings by claiming premiums (subject to a limit) as deductions under section 80D of the Income Tax Act.