“I’M FROM IRDA. YOU’LL GET 1.8 LAKH BONUS IF YOU buy A NEW POLICY”

Posing as employees of the regulator or insurance companies, fraudsters are luring policyholders with offers of bonus if they buy a new plan. Here’s how they take gullible policyholders for a ride.

    Ten seconds is all that Vijay Sharma gives a telemarketeer. But since the call was from the insurance regulator’s office, he didn’t disconnect it abruptly. Instead, he put everything else on hold and listened intently. “I am calling from the service management department of the Irda. You are losing money on your Ulips because the bonus that accrued on them has gone to the agent,” the caller explained. “If you want, it can be refunded to your account.” 

    Sharma is usually circumspect about such offers and SMS marketing. However, the caller knew his name, phone number, address and full details of the plans that the Delhi-based sales executive had bought in the past 3-4 years. So, there was very little reason to doubt his words. Besides, he had nothing to lose. 

    Or so he thought. Sharma’s suspicions were aroused when the caller spelled out the terms of the deal. “Your code has been activated and if you link your existing policies with that code, the accrued bonus will be credited to your account directly. To do that, you have to buy a policy from any company through us,” he went on.
    Sharma was lucky not to fall for the fraudster’s bait. Mumbai-based Ajit Majhi did and got

trapped. In February, he was promised a similar deal by someone posing as an official of an insurance company. “She told me that to claim the bonus amount of 84,000, I would have to take another policy of 25,000 from the company,” he said in an angry complaint to a consumer forum. 

    He bought the policy, but far from getting a bonus, his gullibility encouraged the fraudster to go for a bigger kill. She kept fobbing him off with excuses and then announced that the bonus had been enhanced to 1.85 lakh, but that he would have to buy another policy of 50,000. “I told her I couldn’t afford to buy another policy and asked her to give me only the original bonus amount of 84,000,” Majhi said. 

    The fraudster was not finished with the milking. For the original bonus too he had to buy another policy. “I told her I had no money, but she advised me to borrow from friends and repay them when I get the bonus money,” says Majhi. Eventually, he bought another policy of 25,000 in his wife’s name. 

    By doing so, he only dug a deeper hole for himself. He hasn’t got the money yet because there was no such bonus coming his way in the first place. Now he has two insurance policies he didn’t need. “Paying an annual premium of 50,000 will be a burden for me,” he says. Before Majhi fell into the trap, the fraudster was calling him 6-7 times a day. Now, her phone is constantly switched off. 

    A senior manager in the customer care department of the company says that after the first policy was sold to Majhi, the company made a welcome call and explained the features of the policy in detail. Majhi admits he was told that there was no bonus offer. “When I called the adviser, she told me that customer care would not know about the bonus details and it would be credited to my account shortly,” he says. 

    Insurance companies are now warning their customers not to fall for such frauds.

What should policyholders do?
Don’t go by verbal promises: Never believe an offer till you see it in black and white. Also, make sure that the brochure or table shown to you is authorised by the company. Agents often get promotional material printed with promises of lofty returns. 

Check credentials of agent: Make sure you see the seller in person. Check his identity card and other details. This is a litmus test: if he refuses, he is probably not authorised to sell. 

Don’t buy in a hurry: Anybody who pushes you to buy a policy within a deadline is probably mis-selling. Don’t close the deal in the first or even the second meeting with the broker. Ask for at least 7-10 days to study the plan and compare its features. 

Take a second opinion: Tell the agent you will be discussing the plan with another consultant before deciding. Fraudsters often ask the victim not to discuss the plan with anybody else. 

Use freelook period: If the policy document does not mention the promised benefits, return the policy within the 15-day freelook period. Agents try and buy time till 15 days are over.

Source: ET Wealth 23th Jully 2012

OPT FOR FLEXI HOME LOANS AND MORE ON SURPLUS FUNDS

How savings account-linked smart housing loans can take care of your emergency needs as well as bring down your loan liability

Home buyers in India have little say in the interest rates on their loans. A high credit score, healthy repayment record, bigger pay package and so on do not fetch any discount in interest rates. They hinge primarily on the overall interest rate scenario in the economy. That is why products with flexible interest payable are a big innovation in the home loan space. Although they are nowhere as popular as the regular home loans, banks such as SBI, Citibank, Standard Chartered, HSBC, among others, offer loans where the interest payable can be flexible. 

THE WORKINGS
These products – called flexi or smart loans – come with some variations, but they work like ‘sweep-in, sweep-out’ deposits. Now, such deposit accounts automatically transfer funds that cross the threshold limit in your savings account into a fixed deposit. This helps you take care of your emergency needs and earn higher-than-savings-account return at the same time. ‘Flexi’ home loans use a similar mechanism, although with a slight difference. In this case, your loan is usually linked to a current account. “The loan works like an overdraft account where the interest is charged on the outstanding balance on a daily basis. You have the option of withdrawing the unused amount as per the limit sanctioned,” says VN Kulkarni, chief credit counsellor with the Bank of India-backed Abhay Credit Counselling Centre. “The broad concept used here is that of the weighted average, where your principal outstanding is adjusted for the balance kept in the linked current account,” adds Kapil Narang, COO, Ameriprise India, a financial planning firm. It could especially benefit borrowers who may have bought an under-construction property, with payments made to the builder being linked to the stage of construction. Here, you would be paying relatively small amounts in installments. If you have a flexiloan, you can withdraw funds only to the extent required and thus save on the interest outgo. Remember, however, that features could vary as per the bank you may have chosen. 

COUNT YOUR BENEFITS
Now, say, you’ve opted for a regular home loan. In this case, your salary would be credited to a savings bank account that will fetch you a return of 4-7%. The amount required for your EMI payment would be transferred to your loan account and the balance would continue to earn the savings bank rate. “In a flexi home loan, the amount lying in your home loan account will be factored in, while interest will be charged only on the outstanding balance on a daily basis. If you have parked your entire salary on the first of the month and have not withdrawn any amount say till the 10th, you will save interest on the loan to that extent,” explains Kulkarni. “In effect, your savings will fetch interest at the rate which you are paying on your home loan. Your return will be around 10.5-11 %, depending on the rate being charged to you. This will enable you to bring down your interest cost and ultimately the repayment period.” This feature could also spur you to use your income judiciously. You can look at parking as much money as you can in the linked current account to reduce the interest burden. Consequently, your total repayment period, too, will shrink sooner. With a regular home loan, on the other hand, a tendency to splurge the amount remaining after paying EMIs sets in. 

WATCH OUT FOR THE PITFALLS
“The rate of interest is usually higher than that of regular home loans,” points out Madan Mohan, independent loan counselor. “Also, borrowers should enquire about the processing charges on such credit facilities. There could be other services charges, too, which a regular home loan does not levy.” Therefore, study the terms and conditions carefully. This apart, you should go for this facility only if you are sure about making optimum use of its features. Remember, this facility will work to your advantage only if you diligently park your surplus funds into the account regularly.

 

GAUGE ITS SUITABILITY
Though the concept may seem attractive, it may not fit into the requirements of all borrowers. “The scheme will be best suited for the double income category, where both husband and the wife have a sufficient disposable income,” says Kulkarni. They can make good use of their surplus money, which otherwise would have been parked in lowyielding savings bank account. “It is also suitable for those who earn certain incentives on a regular basis and can afford to park such extra income in a flexi-scheme. Likewise, all those who find that they can pay more than the stipulated EMI every month could also consider such facilities,” he adds.

Source – Preeti Kulkarni - The Economic Times – 20/07/2012

10 Ways To Create Passive Income

10 Ways To Create Passive Income

lets go a little deeper  and learn ways by which you can create passive income in your life. I could see a lot of you are interested in creating passive income, so now let’s move from just being interested to being committed to creating passive income. To take a step forward, let’s do some brainstorming on how passive income can be created. Don’t just read but really share new ideas that you have in your mind.

The rich get richer. Not only because they have surpluses with which to invest, but because of the overriding emotional release they experience from having wealth

- Stuart Wilde

I really want you to take a day off from your routine life and name the day as “passive income day” of your life. On this day you won’t touch upon other areas of your life you will only and only think about creating passive income. Than the next step is creating a special kind of account in your life “Easy earned money account”, in this account you will accumulate residual income, it should not come from real work and no active labor. Get this very clearly all the money is not always hard earned; you don’t have to sweat under the sun always. Don’t have only one account in your life which is “Hard earned money”.

Here are the 10 ways of creating passive income in life: (Do not discard ideas instead start thinking how the ideas can get into your life)

Real Estate- You can create rental income with the help of real estate if you have two properties the rent you get from one can help you pay the EMI of other property. You can give your office space on rent or your house on rent. You can create boys/girls hostel if you have more than 1 flat. Some even create small office units in one big flat and give it on rent to people who do not have frequent visitors. Make sure that you are selecting right people and paper work is properly done.

ATM Centre- This is one of the best ways of creating passive income. Generally in a building the space which is below the stairs gets sold at lower rate and it is an ideal place for ATM Centre. Banks pay around 50k per month to ATM centre owners but again it depends on the location and the area.

Parking lots- Parking is one of the biggest problems everyone is facing. Our client has created passive income from parking space that he owns in his building. Also I know someone who owns open space next to a multiplex; it is given on rent to multiplex for parking purpose. This may not be possible for all but as I said do not discard ideas from your life.

Websites & Blogs- The machine age is over and we are now into information age where no one cares where your office or how many people staff you have, with the help of internet from a remote place you can create a lot. Always remember that you have one special thing in you which only you can give to the world. Creating a blog or a website is free (or not much money required) and is one of the best ways of creating passive income. You can do this as a part time activity and start creating additional income in your life. This is a slow process and at times takes time for you to attract people.

Advertisement hording- If your building is on main road with proper visibility you can put some banners or hording on the terrace of your building or even in garden or open space of building. If you own terrace rights the money will come to you otherwise it goes to society kitty as passive income. Some permission & authorization might be required to take this step.

Interest income: This is one of the simplest ways of creating passive income. You can either create interest income through bank products or by offering loans to people.

Dividends- You can either receive dividends through Stocks or mutual fund schemes. This income depends on the performance of stock or fund and depends on market conditions.

Royalty Income- Your talent can definitely help you to create passive. You can put something in a book that you would like to share with the world and you can create royalty income in your life. Most people are disconnected with their true talent which is really very important. You really do not need a publisher you can either self-publish it or get in touch with websites who promote new writers.

Referral business model- If you are into business you can create a referral business model where your overall strength increases, business expands and you also get an opportunity to create passive income in life.

Buy cars and give on rent to companies- Many BPO’s and companies hire vehicles on contract. Some people provide vehicles in the company that they are working and create passive income out of it. Here you need to be careful about the terms and conditions and driver who will be handling your vehicle on daily basis.

If you do not have passive income it means you have yet not created it as a project. How many attempts in the past you made and failed at creating passive income, may be none. You are unable to create passive income because you are glued to the idea of only creating active income in life.

Come on make a list of possibilities, make list of people who can help you, see what leverage you can get in creating passive income, see what best you can do with the resources you already have, what talents you have in you that can help you create passive income or TAKE PROFESSIONAL HELP. The biggest opportunities are always hiding in the biggest problems. So if you can’t find opportunities find problems for which you can provide solutions to the world

Creating passive income has to do a lot with your mindset. You will have to step beyond something called farmer’s mindset. Yes farmers do not make money till they do not step out of their house and touch their land, they have to do a lot of hard work to be able to earn from crop that grows in their farm .If you want to find additional stream of income you can help enough people in enough ways. Remember what you are seeking in life is seeking you

Source: Jagoinvestor