Best personal finance books for 2021

None of us are born as financial experts, but having some command over how to manage money is crucial for everyone’s lives. This pandemic has been further testament to this fact, and it has become crucial to learn everything you can about personal finance. In our opinion, personal finance books are an amazing place to start  learning some basic principles to be utilized in our day to day lives. 

In this post, we, at EarlySalary have curated a list of 5 Personal Finance books that is a must read for everyone looking to learn more about personal finance. 

1. Why Didn’t They Teach Me This in School?

Author: Cary Seigel

The author realized that schools ill-equipped their students regarding handling their own money. This is when he decided to undertake writing this book and therefore, sharing 99 principles of personal financial management. The good thing about the book, even though it was written for school children, anyone can master his 99 principles by reading this book, remember one is never too old to learn anything new. 

The principles are divided into 8 broad chapters quite digestible under 200 pages encapsulating various ideas and tips. It covers topics including budgeting, housing, and investing presented in a painless way that even a high-schooler could grasp. It is not a textbook, but a story of his personal experiences. The basic question a young adult would have regarding personal financing is covered in the book.

2. Rich Dad Poor Dad

Author: Robert Kiyosaki, Sharon Lechter

How can one miss this book while talking about personal financing? This book is more like a memoir with attached lessons for the readers on personal finance. The author walks the readers through his childhood reminisces talking about his not-so-wealthy father and one of the richest residents of Hawaii, the father of one of his friends. He compares to show managing money when you lack it, basically using the best of one’s means. It advocates financial independence, financial literacy, and building wealth by investing in real estate, assets all while increasing one’s FQ (financial quotient).

This book was initially published in 1997. Later on, on the 20th anniversary of the book, a newer updated version was launched which compares life today and 20 years ago, making it an insightful read.

3. I Will Teach You To Be Rich

Author: Ramit Sethi

The author Ramit Sethi while talking about personal finance outlines a six-week plan for living one’s ‘rich life’ as he would define it. This book is best for setting up systems that enable you to build wealth, make a plan, and also help with strategizing with your money. 

The readers are walked through various steps like automating everything, starting investing, optimizing your credit cards to get maximum rewards, and starting a conscious spending plan. It is said to be one of the building blocks for learning about personal finance. It is an easy-to-read book and if you implement the ideas in your life, highly actionable too while gaining better returns.

4. Broke Millennial

Author: Erin Lowry

This book is aimed at the millennials, people who are in their 20s and 30s, one of the initial pit stops of making personal financial decisions. The tone of the book is quite approachable and makes it easy to read and understand. It won’t scare you away while you are looking for solutions to pay off your debt or planning for the long-term future. It not only touches on several aspects for the target age group like investing and saving for retirement but also talks about the emotional relationship with money which the generation has in respect to having faced several financial hurdles like the 2008 crisis or the present pandemic of 2020-21.

The book is a step-by-step guide to smart and savvy money management. Going beyond just the basics, Erin Lowry tackles tricky money matters and most of the situations we face in real life. The advice given is quite simple with additional true and hilarious stories related to personal finance management.

5. Nudge

Author: Richard H. Thaler, Cass R. Sunstein

There are multiple decisions we take every day. And all these decisions impact our life and wellness in some or way, including how we use and spend our money. Therefore a couple of good choices would already mean better financial management. This book talks about that, how things work in the brain when it comes to making decisions. It acts like a manual helping you to do things differently, take better decisions which would help you with money matters. Behaviour is something which we can control, and Nudge helps us in correcting those controls.

What did you think of our list? Did we miss out on any of your favourite books? Do let us know through our socials.

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How to negotiate a lower interest rate on loans?

Before sanctioning a loan to somebody, banks (or other lenders) consider many factors such as your loan amount, your repayment capacity, your credit score, etc. Given all the constraints, you should make sure you meet all the requirements and try to get a lower interest rate on loans. Here are a few ways that could help you achieve that.

Maintain a good credit score

A credit score of 750 and more is going to give you a better chance to get a lower interest rate on loans. This could be done gradually by clearing your bills, debts, and dues on time, every month. Maintaining your credit utilization ratio within the 30 percent limit can also be an added advantage. Along with this, checking your CIBIL Report for mistakes, maintaining a healthy credit mix of both secured and unsecured loans, etc., too can help you get a lower interest rate on loans. You should also monitor your guaranteed or co-signed loan account to ensure timely payments, as delayed or missed payments can affect your credit score along with that of your co-signer.

Maintain a good repayment history

Instead of paying just the minimum payment amount on your credit card every month, try to pay the bill amount in full and clear off your debts. You should also follow up on other EMI payments and other loans. With a good EMI repayment history, you will have a better chance of negotiating a lower interest rate on loans with the lender.

Compare interest rates, look out for seasonal offers

Based on your requirement and eligibility, visiting an online financial marketplace can help you compare and choose the best option for you among various lenders. You can also check with your current lender if they are offering any offers during the festival season or if they have any scheme that provides a lower interest rate on loans. It might be beneficial for you to avail of a loan from your lender during such times. 

Check the interest calculation method

Despite the lender providing you with a lower interest rate on loans, you might actually end up paying a higher interest amount at the end of the loan tenure. This is because of the method of calculating the interest, and it differs for every lender. You might be provided with a loan at a flat interest rate, where the payment of interest is calculated on the full loan amount throughout its tenure, or at a reducing interest rate, where the payment of interest is calculated on the outstanding principal, where EMIs gradually reduce the principal amount. Therefore, availing of a personal loan at a “reducing” rate could provide you with a lower interest rate on loans, than a “flat” rate.

Credibility of employer

People who are working for reputed or multinational companies will be more eligible to get favourable deals. Their employers’ ability to provide a steady job is higher and therefore the lenders come to a conclusion that the borrower is more likely to have a  stable income to repay the loan dues on time. Thus, it will be easier to get a lower interest rate on loans.

Your employment history

Having a good job, residential stability, and maintaining good FOIR (Fixed Obligation to Income Ratio)  will help you in building a good credit score which partly impacts the interest rates too. FOIR is the debt-to-income ratio and it is the most commonly used parameter by lenders to determine the loan eligibility of an applicant. Few banks require you to have an employment history of at least two years, including a minimum of one year with your current employer. People who are employed with state or central government organizations are looked at favourably by lending institutions and have a higher chance of getting a lower interest rate on loans.

Ask for the same rate new customers get

If you are a person with a good credit history and no missed repayments, you can contact your lender and ask them about the interest rate offered to new customers, and get the same interest rate for your loan as well. Few lenders might be willing to negotiate to retain their existing customers.

Make sure you’re the ideal borrower

Give yourself the best chance to negotiate for a lower interest rate on loans and be the borrower banks love to lend to. Lenders generally look for a number of things before calculating your interest rate. They are:

  • A low LVR. Loan-to-Value (LVR) is the ratio of the first mortgage line, as a percentage of the total appraised value of the real property- (A higher LVR over 80% may hinder your negotiations)
  • Good credit score and no missed repayments
  • Steady employment

One should always check the service terms offered by various lenders before zeroing in on any lender. Make sure you base your decision not only on the interest rate offered but also on loan tenure, fees, loan amount, etc. You might not get a good deal if you have already taken too many loans. Your application might even get rejected if your CIBIL score is below 700. With the help of a Salary Card, you can now maintain your credit score, and be eligible to get a lower interest rate on loans. 

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Should we use a housing renovation loan to finance home renovation?

Building your dream house is possibly the most anticipated as well as the most financially burdensome task you might undertake in your life. In recent times, with the COVID-19 lockdown, our homes became our office, our gym and essentially a safe sanctuary for all of us. 

Our home, as often said, is the extension of our personality and sensibilities. To keep up with the changing times, and your evolving tastes, house renovation becomes pivotal. However, home renovations can be a very expensive affair, especially if it involves specially curated furnishings or the services of an interior designer. 

Here’s why you should opt for a personal loan for renovation:

  • A house renovation loan does not significantly impact your savings 

Since home renovation can put a huge dent in your savings, it is sensible to take a personal loan for renovation. It does not disturb your financial planning or empty your savings account, and home renovation loans in India are easily available from almost all banks and NBFCs. 

In fact, you can plan your home renovation loans well in advance by using tools like the Home renovation loan calculator to exactly know how much money you’ll have to shell out in EMIs so that you can plan the home renovations accordingly. 

  • House renovation loan does not usually require collateral 

Since it is in the form of a personal loan for renovation, it is usually unsecured and hence there is no requirement to provide any form of collateral or security. In most cases, a simple legal agreement or bond is sufficient. In fact, in case of home renovation loans online from lenders like EarlySalary, even that process is simplified. You just need to meet some basic eligibility criteria and you are good to go. 

  • Easily available online home renovation loans 

With the advancement in the FinTech sector, a huge number of NBFCs have cropped up who offer online home renovation loans without any hassle. You just have to satisfy certain basic eligibility criteria and upload a few KYC documents online, and the online home renovation loan is approved in a jiffy, while you sit in the comfort of your home. This significantly reduces the hassle of filling out multiple forms and signatures, and cuts down on multiple trips to the bank, which might make social distancing difficult.

  • Home renovation loan in India have fast approval rate and quick disbursal

As a corollary to the preceding point, online lenders have an extremely simplified application procedure, with next to no paperwork. The approval and the disbursal of the home renovation loan amount also happens instantly. For instance, if you take a personal loan for renovation from EarlySalary, the entire loan amount, ranging from eight thousand to five lacs, is approved and directly disbursed into your bank account. 

  • Personal loan for renovation gives you flexible repayment options 

Personal loans for home renovation are not only easier to get but also offer a lot of customisable options. Firstly, you can plan your home renovation loan in India by using the Home renovation loan calculator to plan your repayment. Furthermore, online lenders like EarlySalary offer you customisable options like: 

  1. Flexible tenure of repayment, from 90 days to 730 days 
  2. Option to auto-debit of the EMIs directly from your bank account
  3. Option of pre-payment or early repayment of the home renovation loan without any foreclosure charges or pre-payment penalties. 

House Renovation Loan – The right choice? 

At the end of the day, financial goals for everyone are different and their ideas about financial planning can be poles apart. There is no straitjacket formula which can give a conclusive answer as to whether or not you should go for a house renovation loan. 

However, the above mentioned points do make a compelling argument in favour of availing a housing renovation loan. In today’s time, online home renovation loan can be easily availed and used to make your idea of a dream house come true. Log on to the EarlySalary website and start your journey towards your dream house today. 

So, get started on the EarlySalary experience now!

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What are the ways to earn more credit card points?

Credit card points and rewards are a way of “rewarding” the loyalty of the customers by banks and other credit card companies. This is mainly done to cultivate good spending habits amongst credit cardholders. The interest on credit cards is pretty high ranging between 30%-60%. Missing or delaying a payment brings you the added penalties, late payment fees, and damaged credit score. Your credit score can even be affected by paying just the minimum due amount every month (check your credit score here). 

Then what is the right way to earn more credit points?

The right way to use your credit card and earn more credit card points is to make as many credit card transactions as possible and clear your monthly bills on time. If you fail this, even the best credit cards promising the best rewards will end up charging 30% or more interest. 

So, no matter what purchase you make, at the end of your card billing cycle, you should be able to pay it back. You should never have a partial payment on your credit card and end up paying interest on your spending. Now let’s see what are the ways to earn more credit card points.

Best ways to earn more credit card points

  • Go cashless, swipe for things that don’t charge a fee

Using your credit cards instead of a debit card or cash for transactions, and paying back your card at the end of the billing cycle, is one of the simplest ways to earn more credit card points. All the small purchases together when aggregated, ends up getting you rewards and bonus. For example, paying your WiFi bills and Netflix subscriptions through your credit card, instead of a debit card that doesn’t earn any points.

  • Use online shopping portals

Using shopping portals for online shopping can be a great way to earn more credit card points. 100s of brands such as Apple, Nike, Gap, etc., are available through portals. You can shop as usual through the merchant’s website, but before you do that, you will just need to take one extra step of navigating to their online shop through a link affiliated with your frequent flyer account. When you do that, a cookie is put in your browser to track your shopping activity, in turn crediting you with miles correlated to your purchase.

While this seems to be an easy option, sometimes your shopping expenditure might turn out to be really hefty to pay back the credit card bill, especially with the high rate of added interest. Instead, making use of a Salary Card can be more helpful. With a credit limit of up to Rs. 5,00,000, you can use the card for all your shopping needs with 2 times more limit, and availability of up to 6 EMIs.

  • Pay for your colleagues, friends, and family

Great offers are available on credit card payments at various merchandisers. Even though you are not planning to make use of the offer, think about how it might be used by people around you. See if your friends, neighbors, or other people around you are interested in using the offer. By making the purchase on behalf of them, you will end up earning more credit card points and they too will be rewarded by the discounts and offers. You should always avoid lending the card and instead, make the purchase on their behalf, and it is best to collect money from them in advance to avoid any problems further. 

  • Take on office expenses with your rewards card

If you have expenses at the office for which you need to pay first and collect from the office later, then you’ve found a way to earn more credit points. You can use your credit card for the following reasons:

  • Booking business trip tickets
  • Paying for team and business lunch, dinner, etc
  • Cab and travel expenses
  • Hotel stay during office travel
  • Business software and subscriptions

In case you are concerned about late reimbursements from the office, and missing the payment of your credit card bill, then you have one less thing to worry about. You can make use of a Salary Card that provides you easy EMI options with lower interest than a credit card, to clear your debt.

  • Insurance, Home Loans, Investments, Rent

There are a lot of places where you can use your card, instead of paying with cash or a debit card, UPI, or net banking. You can, later on, pay the money back into your card. Few such areas are:

  • Insurance payments
  • Home loans that let you pay through credit cards
  • Rent (check out paying the rent with CRED)
  • Utility Bills
  • Online Groceries 

Groceries and dairy products are something that everyone buys almost every day. Instead of making separate payments every day, making weekly or monthly payments for them through your credit card can get you more points on your credit card. They open up room for more offers and discounts too. For example, Amazon runs weekly and monthly rewards programs for various purchases made through credit cards.

Make the best use of the rewards structure available

Learn and understand the various rewards programs and rates offered by your credit card. Some of the best credit cards have multiple programs that offer you rewards through which you can earn more credit card points

  • Balance transfer option

From time to time card issuers run balance transfer programs that may give you points for transferring the balance from one card provider to another. Make use of it. End of the day, if you are planning to pay back the card, you may as well earn more credit card points and payback.

  • Travel rewards and Air miles conversion

Not just reward points, some cards will let you earn more credit card points and convert them for air miles. From time to time, they even give you a bonus % when converting rewards points to Airmiles. When using this, make sure the air miles value is the same or more than the value of your rewards points. There are a lot of cases where they hoodwink you and give you cheaper air miles that are worth a fraction of your reward points.

  • Statement Credit

Few rewards credit cards such as SBI and Axis, provide you statement credit on meeting spend criteria. By timely tracking them, you can make use of them and earn more points on your credit card. Even if you are not spending enough, see if your friends or family members have any large purchases coming up, that you can complete using your credit card.

The bottom line

There are several ways to earn more credit card points, but you should never spend more than you can repay. You might want to use your credit card everywhere just to earn more credit card points, but you should also remember that your credit score might get badly affected if you do not pay the bills on time. You can always rely on travel loans and shopping loans for your expenditures. 
In case you wish to have a huge credit limit, a salary card can be your savior. You can use this for shopping, travel and entertainment, educational purposes, medical insurance and even learning new skills. Unlike credit cards, they come with easy EMI options and you will get to choose your repayment tenure. An added advantage, you will not be damaging your credit score too.

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What can HR do to ensure successful retirements?

Retirement isn’t just about employees ending their careers at the respective organization, it’s more than that. The old guard exits the organization while new blood comes in. The vision of retirement involves much more than a simple goodbye. Many teams look exclusively at the financial aspects though, but this pandemic has taught everyone that efforts can be made for a smoother transition.

Here are some strategies and tips to consider for the HR function.

  • Overall Development: Retiring members should be given opportunity to talk to and guide their successors. Knowledge silos whereby the knowledge remains stuck in one place should be avoided and an inter-departmental ideas exchange should take place. Appreciation for other departmental workers can help reduce any future chaos or sub-standard work causing a dent in the organization’s financials. 

Consider periodic retirement assessments to understand how many retirements may take place in the next period so that you can focus on getting replacements and giving a seamless transition to the retiring employees.

  • Don’t undervalue the old guard: Respect the experience your retiring employee has given you and give adequate value to them, even in their last few days. This will let the employees know that you care about them, and they would willingly be ready to share their knowledge and experience with the new blood. This will help in organizational efficiency and will not let a vacuum take place once they retire while someone new comes in. 
  • Choose the better conversation: Rather than being blunt like asking them if they are planning to retire soon or if they are ready to transition to that life, ask them what they plan in their retirement years. Try suggesting to them things they can do to enjoy their after-work life. Talk to them with a positive mindset. The relationship with your employee is what is positioned at the highest level of meaning and purpose. It’s about the journey and not the destination. 

As an HR manager, try participating in that journey to enhance the employee experience. Investing in that experience can assist the organization reap better benefits as the employees will be motivated more to work better, even in their last days.

  • The greatest gift of flexibility: Rather than gifting them a parting gift like a retirement watch or stationery, gift them flexibility. Try creating a creative retirement program for your employees focusing on flexibility as an important factor. The idea is to create something without future expectations or pre-set notions of limitations. 

Find the right tools and resources; engage your employees to design such a plan which will allow the employee to have a seamless transition. You can also get a dedicated career coach. They would help the employees with the self-assessment for in-depth retirement plans. They can help ‘think out of the box’ while considering ‘normal’ retirement plans. You can also consider an alternative to full retirement plans like consulting or as a trainer for the organization.

  • Drafting a succession plan: Once your present employee retires, you need to find a suitable fit to replace them. Rather than just focusing on age, gender, or a particular characteristic; we should focus on finding similar or better skill-sets to help with their roles and responsibilities. This plan would disallow any kind of self-limits and create opportunities while searching for replacements for the retiring employees.

Try utilizing similar strategies before it’s too late. Get on with different programs like What Are Employees Truly Expecting from Financial Wellness Programs?. Early Salary has many blogs and ideas which can help you going ahead Planning for Retirement Extending Financial Wellness Into Retirement, With Technology Financial Wellness – All about having the financial freedom to make choices.

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This World Health Day: Let’s Stay Secure from Insecurities With ES Medical Loan

The World Health Day is an annual global health awareness day sponsored by the World Health Organization (WHO) and other related organisations that takes place on April 7th every year.

The World Health Organization (WHO) organised the First World Health Assembly in 1948. With impact from 1950, the Assembly declared the seventh of April to be World Health Day. 

The World Health Day commemorates the founding of WHO and is used by the organisation to bring global attention to an issue of significant significance to global health each year. On World Health Day, the WHO organises international, regional, and local activities around a specific theme.

On World Health Day, the WHO organises international, regional, and local activities around a specific theme. Various governments and non-governmental organisations with an interest in public health concerns, such as the Global Health Council, celebrate World Health Day by coordinating events and highlighting their support in media coverage.

World Health Day, along with World Tuberculosis Day, World Immunization Week, World Malaria Day, World No Tobacco Day, World AIDS Day, World Blood Donor Day, World Chagas Disease Day, World Patient Safety Day, World Antimicrobial Awareness Week, and World Hepatitis Day, is one of WHO’s 11 official global health initiatives.

The Theme for World Health Day 2020

The 2020 World Health Day theme was created in response to the global pandemic of COVID-19, and was dubbed “Help Nurses and Midwives.” Citizens all over the world spent the day thanking the nurses and health care staff who are fighting the COVID-19 coronavirus on the front lines. A presidential message from the US White House emphasised the importance of public health in “building healthy, stable, and free societies around the world.”

Due to the worldwide, broad-based “stay at home” order imposed by the COVID-19 coronavirus pandemic, the celebration of 2020 World Health Day took place in a largely virtual environment through online press conferences, announcements, and social media. The majority of the efforts went into raising funds for the COVID-19 solidarity response fund.

Nurses and other health workers are at the forefront of the COVID-19 response, delivering high-quality, compassionate treatment and care, fostering group conversation to resolve fears and questions, and gathering data for clinical trials in some situations. Simply stated, there would be no response if nurses were not present.

Aim for future

World Health Day will highlight the current state of nursing and midwifery around the world in this International Year of the Nurse and the Midwife. WHO and its partners will issue a set of recommendations aimed at improving the nursing and midwifery workforce.

A personal loan is a fast fix solution for some kind of contingent or unavoidable cost, whether it’s for a wedding, home renovation, or an unexpected illness.

A medical emergency in the family, on the other hand, can be exhausting not only physically, but also emotionally and financially. Add to that the confusion and fear that has consumed us all as a result of the COVID-19 pandemic, which is causing its own collection of mental health problems, and it’s a recipe for disaster. When cash resources are scarce, the situation becomes even more worrying. Personal loans are your best friend in this case.
When most of us hear the term “loan,” thoughts of a brick-and-mortar bank and a thick file of paperwork come to mind. Thankfully, our economies, technology, and society have progressed significantly since they were once needed to obtain a loan. In today’s world, not only banks but also a variety of other financial institutions offer instant personal loans. Some of them also provide instant loan disbursement and pre-approved packages to their customers as they relax on their couches.

The Process of loan sanction

For this loan, the majority of these organisations, such as EarlySalary, have a streamlined and paperless process. For example, there are only three simple requirements to qualify for a personal loan for a medical emergency, namely,

  • A salaried Indian citizen between the ages of 21 and 55 who earns a minimum of INR 18,000 per month.

EarlySalary’s high approval rate, combined with the guarantee that the money will be in your bank account in a flash and with minimal paperwork, results in a loan experience that rivals that of certain materialistic transactions.

In comparison to traditional loans, an instant personal loan from EarlySalary or either of these financial institutions comes with a number of advantages, including a high approval rate and immediate loan disbursement. Another noteworthy feature is the ease with which the loan can be used.

With EarlySalary, the loan sum can be used for anything related to the medical emergency – no questions asked – not just medical expenses like operations, medical costs, and so on. There are no needless limitations, such as those that apply to insurance claims, such as a limit on medical costs and room form, and so on.

Simply put, take the money, use it, and repay it on your terms, or even early if you prefer – there are no prepayment penalties!

What’s the bottom line? Money will never stand in the way of you and your family having the best medical care and treatment available.

Log in to our EarlySalary website, fill out the form, and upload the appropriate documents is as easy as buying anything online. That’s it; the money is credited to your bank account right away.

Users can rely on a reputable source, such as our website- EarlySalary, despite the fact that many online websites claim to provide instant personal loans, be wary of being duped by shady websites that will do more harm than good.

Along with the above advantages, EarlySalary also provides additional services such as no additional cost for prepayment, medical loans to research medicine, no additional renewal or annual charge, and flexibility in repayment tenure, among others. Thus you should opt for EarlySalary and never let money stand in the way of your family’s wellbeing!

With the growing covid-19 cases in the country know how you can keep yourself financial stable- 5 Ways To Stay Financially Hopeful Amidst Covid-19

We here at EarySalary make sure that you get the best of financial assistance in times of medical emergency (look at our hassle-free method) without worrying about the complexities of paperwork. 

Your Credit Score Affects Your Job? Here’s How

Whether you are a young professional or a seasoned professional in the workforce for over a decade, entering into a new work environment is like stepping on a new planet.  As you prepare your CV, learn new lingo, there is one more thing you need to check- credit history and credit score. Yes, your credit score can affect your employment. This has been made possible with the tie-up of TransUnion (global credit bureau) and hiring firms which have begun reviewing your credit score too. To know about credit score, read our post explaining everything you need to know here

Some public sector units such as the State Bank of India and private corporations have already added the candidate’s CIBIL score in the criterion. SBI in its notice (Ad. No. CRPD/CR/2016-17/01), dated April of 2016 also mentioned that an unsatisfactory CIBIL score, would result in the rejection of the job application.  Read on to know how your credit affects your employment and how it is being evaluated by employers.

Credit Score & Jobs: Security & Background Checks

Your credit report helps in the verification of your identity, background, past employers and education. This prevents identity theft or embezzlement and is a key information source especially if you have omitted any information on your CV/resume. While worthy references add value to your CV, a good credit score can also improve your chances of scoring a position, particularly if the new gig involves financial management or handling sensitive financial work. It is like a proxy variable used to evaluate personal attributes such as reliability and honesty.

Job & Role Fit  

An individual with a good credit score has good financial history and performance. This is seen as a positive act, indicating that you are responsible, unlikely to indulge in illegal activities and can potentially strengthen internal corporate ethics. It is like a macro snapshot of your past employers and how well you have fulfilled your financial responsibilities. It will also indicate whether you were or are in financial distress. Consider, for example, you are applying for an accountant’s job but made mistakes in personal financial management,  why would the employer risk hiring someone who did not fulfil their own obligations?

Impact on Present Performance 

Your credit score may not be high for some genuine reasons, especially in times like these where the pandemic led economic recession affected so many jobs. However, its impact may haunt you for long if corrective action has not been taken. If you are in a debt trap, that would be reflected in a bad credit score. This is likely to amount to financial stress which may affect your performance at work. Even if it might not always be true,  employers may see it as a performance determinant. 

Don’t Let Credit Score Affect your Employment

The best way to avoid any harm from a poor credit score is by ensuring that your credit history has either zero or minimal traces of financial indiscipline. Keep a check on your Repayment History Information (RHI) to trace missed consumer credit payments in the present or the past. This is a key factor in due diligence and reflects your capacity to afford a new loan or credit card. While CIBIL score is maintained through a transparent system, there may be some errors in your credit report, if false information is passed to CIBIL. Make sure you check your credit report yourself at least once a year or before applying for a job role where credit score can affect your chances. 

Avoiding a Credit Score Related Job Loss

Financial discipline in personal life is now as important as professional and educational qualifications when seeking a job opportunity. Credit score as a criterion for employment is more important in few sectors such as telecom, banking and insurance, credit rating agencies. Make sure you prioritise financial wellness so the right career opportunities don’t pass you by.

There’s a lot more that EarlySalary can help you with. To know how we can help you with financial wellness ideas, credit, or loans to fulfil instant cash needs, by downloading the EarlySalary app now. Reach out to us on:

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Know about the 3 loans that give you tax benefit

Tax rebates are certainly an added advantage for several types of loans. Education loans, home loans, auto loans, and personal loans are among them. However, it becomes extremely important to understand that while some loans carry a tax benefit along with then, not all loans do.

Any form of loan, no matter how small, is a major financial risk for any customer. Home and car loans, for example, have long repayment terms, making repayment a daunting and tedious process on a regular basis. The Government of India has understood this indeed for free-flowing credit within the economy, and has come up with different tax benefits as a measure to increase the general population’s standard of living. 
To know more about Income Tax 1961, how to maximize savings, check here.
Let’s take a look at three significant loans that are eligible for a tax refund under the Income Tax Act of 1961.

1. REPAYMENT OF EDUCATION LOANS: DEDUCTIONS UNDER SECTION 80E

  • Higher education, whether in India or abroad, is a significant financial investment these days. When faced with a financial emergency, an education loan from a recognized institution will help.
  • It may be used to cover expenditures such as tuition, books, housing, transport, research materials, and other academic-related costs. 
  • Only the interest part of the loan, not the principal, is liable for a tax deduction.

This deduction is in addition to the tuition fee deductions of up to Rs 1.5 lakh that a person may claim under Section 80C.

  • Tax incentives on school loans are available for up to eight years.

Borrowers are usually given a one-year moratorium period before they must begin repaying their loans.

2. DEDUCTIONS/SUBSIDIES UNDER SECTIONS 80C, 24, 80EE, 80EEA, AND CLSS FOR HOME LOANS

A home loan will assist both self-employed and salaried individuals in realizing their dreams of homeownership. But did you know that the loan will help you save money on your taxes?

The government’s tax breaks will significantly reduce the financial burden on home buyers. The Income Tax Act of India provides for interest and principal part exemptions.

  • Section 80C: Under Section 80C of the Income Tax Act of 1961, borrowers can seek a tax refund of up to Rs.1.5 lakh on principal repayment.

To qualify for this deduction, the house must be owned for at least 5 years. Both borrowers can avail a deduction of up to Rs 1.5 lakh for joint home loans.

  • Section 24B: On the annual interest of the EMI charged, a deduction of Rs 2 lakh may be claimed under Section 24B. Both parties to a joint home loan can demand a deduction of Rs 2 lakh each.
  • Section 80EE of the Tax Code: First-time homebuyers are the focus of this segment. Homebuyers have two options for seeking deductions under section 80EE.
  • Option 1: Homebuyers can claim an additional tax deduction of up to Rs.50000 under Section 80EE if the loan amount is less than Rs.35 lakh and the property cost is less than Rs.50 lakh.
  • Option 2: Under section 80EEA, homebuyers can deduct up to Rs 1,50,000 for homes sanctioned on or after April 1, 2019. The house should not be worth more than Rs 45 lakh, and the taxpayer should not have taken advantage of section 80EE deductions.
  • Credit Linked Subsidy Scheme (CLSS): First-time homebuyers can get a tax break of up to Rs 2.67 lakhs under the Pradhan Mantri Awas Yojana.

3. PERSONAL LOANS: INDIRECT DEDUCTIONS BASED ON LOAN USAGE

Personal loan, as we all know, are ideal for getting you out of a financial bind. They’re easy to get because they’re unsecured, but they’re a little pricey because lenders tend to charge high-interest rates.

You can look here to know more about claiming benefits while taking a personal loan.

Many people ask whether they can seek a tax refund on a personal loan because it is not considered part of their income. The tax gain of personal loans is dependent on how they are used. Personal loans for various reasons, such as college, home purchase or renovation, business expansion, and so on, are eligible for tax deductions.

  • Under section 24(b) of the Income Tax Act, tax deductions on interest charged on a personal loan can be claimed if the money is used to pay for a down payment on a home or renovations.
  • When borrowed money is used for a commercial purpose or to buy an asset, the cost of acquisition is increased by the interest charged. As a result, capital gains are reduced, lowering the tax liability.

As you can see, the three loans listed above not only provide cash flow when you’re in a financial bind but also provide tax relief. However, it’s important to note that having a loan, regardless of the sort, is a significant commitment that should not be taken lightly. It is, after all, borrowed money that must be repaid. 

If you’re looking for an instant personal loan for upgrading your quality of life, do check out EarlySalary’s credit suite, enabling you to avail loans for low interest (as low as INR 9/ day). 

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Should I Take A Debt Consolidation Loan?

Materialistic needs and high expectations can trap us in an endless loop of debt. After all, who can resist using that leftover limit on your credit card, a zero percent EMI offer, or that sale with huge discounts?

Would you be taken aback if we told you that the same financial system that gave you all the loans also gives you a way out of the problem? 
Lately, personal loans have become increasingly common – especially for debt consolidation.

A personal loan to pay off high-interest credit card debt might sound harmless, but it shouldn’t be done carelessly. 
Rolling multiple debts, typically high-interest debt such as credit card bills, into a single payment is plausible for moderate amounts of consumer debt.

You can use a personal loan for anything and everything you want. But if you’re thinking of using it as a debt consolidation loan, here’s  a list of things to keep in mind:

A good credit score:

If you want favourable terms and a low-interest rate on your loan, you’ll need at the very least, a good credit score.

You have debt with high-interest:

If you manage to qualify for a lower rate than what you’re paying currently, going for a debt consolidation loan should be a no brainer. 

You have a repayment plan:

Credit cards have no preset repayment plan. If you continually use your card and pay only the minimum amount due every month, you could very well be stuck in a debt trap. Personal loans have a set repayment term making them an outstanding alternative.

Single EMI vs Multiple EMIs:

A Personal Loan for debt consolidation allows you to centralize all your EMIs into a single EMI and pay off your debt, so you no longer have to keep track of the various EMI dates or fret about missing them. Of course, making a monthly single loan payment via EMI is easy.

Debt consolidation for debts on credit card:

If you fail to pay off your credit card dues on time, you will greet penalties. Instead of using revolving credit on your cards, you can take a single Personal Loan which enables you to pay a lower interest rate on your debt. You can also pay it off in easy EMIs over some time.

Quicker Debt Payoff:

A personal Loan comes with a fixed EMI and interest rate over a stipulated tenure, varying from 3 months to 3 years. After debt consolidation, you can also pay off your loan in a short period, with a single payment each month, at a fixed rate of interest. 

If you find yourself persuaded to step into the province of Debt Consolidation, before you apply, figure out what the loan’s lifetime cost will be. We suggest you use a credit card payoff calculator and analyze your expenditure if you continue paying on your credit cards instead.

Then determine if you’ll save sufficient to make the loan process worth it.
Consider the loan quantities, repayment periods, and other features to ensure you find the exact fit. The best debt consolidation loans offer low-interest rates, flexible repayment terms, and low or even no fees. Lenders mostly allow you to get prequalified for a loan before you officially apply.

A consolidation loan may be alluring because it frees up available credit on your credit card. But if you just transfer the debt, and rack up more on those cards you just paid off, you could end up in an even worse financial situation.

Before moving forward with a loan, we advise you to address potential spending issues.
Countless people are now turning to platforms like EarlySalary to avail loans instantly and especially in times when stepping out of the house is dangerous. Honestly, the SalaryCard from EarlySalary is your easiest solution.

At EarlySalary we offer Financial Wellness solutions, Financial Planning, and many more services. Click here to acquaint yourself with the benefits of availing loans from EarlySalary and the required procedures. We can be reached all day on:

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What do Appraisals Look Like for the Post-Pandemic Year?

Organizations are in a bind when it comes to performance appraisals this year, with interesting implications in line for pay increases, along with the retention of top talent, and overall employee morale in these unprecedented times.

We have already begun to feel the effect of the coronavirus pandemic on key business and people processes through sectors as the global economy struggles to cope. At this point, it’s difficult to estimate the possible cost of this outbreak because we’re still trying to deal with the crisis. However, we can see how the pandemic is impacting different organizations.

The objective of performance management is to pursue a method that helps individuals and teams manage themselves efficiently to achieve their objectives and organizational success. To be efficient, effective performance management should build unity and a common understanding of what needs to be accomplished and what individuals or teams must do, learn, and improve.

Performance reviews are used to equate an employee’s accomplishments to their objectives and aspirations, as well as to set performance criteria for various positions and levels.

Owing to the current state of affairs and low or no business demand, all companies in all industries have reduced critical operations. The aviation, transport, hospitality, and tourism sectors have been hit the hardest by the lockdowns. The car industry is also experiencing significant supply chain disruptions as a result of the outbreak. Salary increases and bonus pay-outs are likely to represent the financial effect of the recession across companies, and these industries are likely to be the hardest hit.

Projected Wage Increase: 9%

Also, the prolonged economic recession that followed the virus pandemic is expected to affect the pay-outs this year. In 2020, Indian workers’ wages are projected to rise by 9.1% on average. According to an Aon report, this wage rise was the smallest in a decade, reflecting the economic downturn we were witnessing. However, the impact of the pandemic on the global economy would be greater. Many companies are taking a wait-and-see approach to determine the current situation, so we can anticipate gradual delays.

Furthermore, we should expect hikes to be cautious, with a greater effect on bonus payouts than fixed pay raises since they are a result of an organization’s business success.

According to a study in a leading financial newspaper, India’s IT services sector will have to freeze pay raises and reduce incentives to cope with the losses incurred as a result of the Covid-19 pandemic. 

Many businesses have communicated the possible financial effect of the pandemic on their workers. Because of the coronavirus pandemic, Google has reported delaying employee performance evaluations and promotions. Back in 2020, Apollo Tyres had confirmed that its top management would receive a pay cut ranging from 15% to 25%. Air India, which is owned by the Indian government, has also announced a cut in allowances. 

Employees are also nervous at the moment, and they are vulnerable to rumors and speculations about appraisals and wage increases, which can damage employee morale. Although the economic downturn is inevitable, we must note that it will pass. Our workers are our most valuable asset.

Employers can create a loyal, committed, and empowered workforce during periods of crisis by being prudent and open in their decisions and communication. It’s time to connect with staff and control their desires. This necessitates companies being proactive and explicitly communicating to their workers the financial effect of the economic recession on revenue and profitability, as well as how this relates to bonus and salary increases. This will not only help them explain the salary changes they intend to make in the future, but it will also help them maintain employee productivity and minimize future turnover.

Organizations cannot afford to lose top talent at a time when they are searching for creative ways to ensure business continuity. As a result, rather than postponing assessment conversations, holding them now would help with future growth and aspirations. In addition to immediate monetary rewards, recognized talent must be told they are top performers through appraisals to be retained. Employee apprehensions would be reduced as a result of appraisal talks, as will greater openness in communication, which is critical during these periods.

This coronavirus pandemic has forced companies to make difficult choices, but it has also allowed them to reflect, rethink their strategy, search for ways to cut additional costs, be creative, introduce effective business continuity models, and most importantly, learn to cope with these difficult times resiliently when leading their teams. These are the groups that will assist organizations in regaining their footing when the time comes.

The year 2019-2020 witnessed a number of layoffs due to the effect of Covid 19.  The most famous of them being Uber technologies who laid off 3000 employees in India. A number of such other countries also laid off employees under pressure from lesser economic activities in the lockdown periods. This definitely resulted in resentment in the hearts of the employees. On the other hand, in the post covid scenario, companies are gradually coming back on track and have started with increasing the salaries of their employees. This has in fact given a boost in the moral status of the employees and increased their performance.

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