Retirement Global report ranks India worst for retirees

Retirement

Global report ranks India worst for retirees

MAS Team 10 August 2017

India is the worst place to retire, even among the BRIC countries, according to a research published by Natixis Global, a French asset management company. The research was done on the basis of four factors – Clean and safe environment, access to quality health care, material means for comfortable living and access to quality financial services to maximize the income from savings. Forth three countries were considered for the report, including the IMF Advanced economies, Members of the Organization for Economic Co-operation and Development (OECD) and the BRIC (Brazil, Russia, India and China) countries.

 

On all of the four factors, India has been ranked the lowest, the same as last year. Switzerland, Norway and Iceland topped the ranking.

 

India’s ranks in the main factors are as follows: 

• Quality health care - 43rd

• Material Well Being – 41st

• Quality of Life – 43rd

• Finances – 39th

 

It is understood that the top rank will be given to an advanced and developed nation; but even among the BRIC countries, India stood last.

 

It also has the lowest per capita income of all countries considered for the report.

Each of the four factors mentioned above are arrived at by scoring sub-factors which are related to the main factor.

 

In the ‘Quality health care’ sub-factors, India ranks last in all of them, such as Non-Insured Health Expenditure, Life expectancy and Health expenditure per capita.

 

In the ‘Material Well Being’ sub-factors, it has a top five finish by having the third highest score for the Employment indicator. However, it ranks last in Income equality and Income per capita.

 

In the ‘Quality of life’ sub-factors, India has the worst scores for happiness, water and sanitation and air quality. Progress in CO2 emissions per GDP has improved its Environmental factors indicator compared to last year. The country also has the second worst score for Biodiversity and Habitat.

 

The only improvement seen was in the ‘Financial’ sub-factors, where its overall ranking moved up three spots from last year. The main reason was improvement in these sub-factors: Old age dependency, Tax pressure and Interest rates. With the improvement, there has been a downgrade in the scores of ‘Banks’ non-performing loans

Accidental Death & Compensation:

Accidental Death & Compensation:
(Income Tax Return Required)
Knowledge is Power....
If a person has an accidental death and the person was filing income tax returns for the last three years, then the government is obliged to give ten times the average annual income of the last three years to that person's family.
Yes, you will be surprised by this, but this is right and it is Government rule.
For example, if someone's annual income is  4 lakh 5 lakhs and 6 lakhs in the first, second and third years respectively, its average income is ten times of five lakhs.. means fifty Lac rupees, family of that person is entitled to receive from the Government.
In the absence of much information, people do not take this claim with the Government.
If any return is missing, mainly last three years, this could lower the claim amount or even no claim because court takes ITR as only evidence.
NO wealth record, FD's; business etc. is given that much importance as compared to ITR in the eyes of law.
Many a time,  people do not file ITRs regularly..or it will be taken lightly..
Due to lack of information the family receives no economic benefits.

Source - forwarded
Section 166 of the Motor act, 1988 (Supreme Court Judgment under Civil/ Appeal No. 9858 of 2013, arising out of SLP (c) No. 1056 of 2008) Dt. 31 Oct. 2013.

HOUSING FINANCE Who is a co-applicant in Home Loan

HOUSING FINANCE

Who is a co-applicant in Home Loan

When taking a housing loan, there may come a situation when our eligibility in terms of quantum of funding or tenure of loan could be lesser than what we want. Is that the end of the road? No, the way out is in bringing in a co-applicant….

📌Who is a co-applicant?

A co-applicant refers to a person who applies along with the borrower for a loan. This is done so that the income of the co-applicant can be used to supplement the borrower’s income and increase his/her eligibility.

📌Can anyone be a co-applicant?

No, Banks and housing finance companies (HFCs) have allowed only a few specified relations to be co-applicants. Although, it must be noted that it is not compulsion or legal requirement to have a co-applicant. Banks also do not allow a minor to be a co-applicant.

We also need to note that any co-owner has to compulsorily be a co-applicant to the loan.

📌Who can be a co-applicant to my home loan?

Most of the banks in our country allow a few specified relations to be co-applicants. Brother-brother, father-son, mother-son, husband-wife etc are acceptable combinations for borrower and co-applicant.

👉Father and son

In case of father and son, if the borrower is the only son, then, he can jointly apply with his father where both of their incomes will be taken into consideration. The property should be in their joint names.

In case a person has two or more sons and if he wants to apply jointly with one of them or both of them, then he should not be the main owner of the property. This is because, on his death, his children should succeed to the property jointly and may cause an inheritance dispute. In this case, the father can only be taken as co-applicant and his income may be considered for the loan. He may be the co-owner or not own the property at all.

👉Unmarried daughter and father

An unmarried daughter is eligible to apply jointly with her father. In this case, unlike father and sons, the property has to be only in the name of the daughter and the income of the father should not be considered. This is to avoid any legal complications later on  when the applicant is married.

👉Unmarried daughter and mother

An unmarried daughter is eligible to apply jointly with her mother. In this case, unlike father and sons, the property has to be only in the name of the daughter and the income of the Mother will not be considered.

👉Brother and Brother

A brother may apply with his brother, provided, they are currently staying together and be determined to do so in the new property as well.

👉Husband and wife

One can include one’s spouse as a co-applicant for a home loan. His or her income will be included for working out of loan eligibility. In fact, from a bank’s perspective, this is an ideal situation and they would be very happy to have the husband/wife as co-applicant.

👉👉Who cannot be co-applicant?

As can be understood from the above discussions the following relationships cannot be a co-applicant for a loan:

Married daughter & Mother/FatherSister and SisterSister and Brother

👉What is the role of a co-applicant?

A co-applicant is completely responsible for the loan if the partner defaults, dies or otherwise refuses to participate in the partnership. The bank will pursue collection from one applicant without consideration of the partnership agreement.

Experts say that technically, a co-applicant becomes a co-borrower and by being a co-borrower, he is liable for the repayment of the loan and other dues.

Thus, a co-applicant becomes equally liable for repayment of the loan amount in case of non-payment by the borrower. The co–applicant will also be responsible for repayment of the loan in case of death of the primary borrower, even if there is insurance cover to the primary borrower.

Many banks and financial institutions insist on having a co-applicant but it is more of a necessity than a requirement. There is no legal requirement to have a co-applicant.

📌Benefits of having a co-applicant

Success rate of your loan approval could be betterIncreased eligibility can help you buy a bigger house and get a bigger loan tooTax benefits for both the applicants and co-applicants

What’s The “SAFE” Withdrawal Rate In Retirement? https://www.linkedin.com/pulse/whats-safe-withdrawal-rate-retirement-lew-nason

One of the most frequent questions retirees ask is… “How much can I safely withdraw per year from my retirement account?” If they retire at age 65 they could easily need their retirement income for 25 or 30 years. Miscalculating the withdrawal rate could result in an involuntary return to the workforce, or being forced to move in with their children.

Unfortunately, there isn’t a great deal of research in this area (most analysts devote their time to the question of accumulating capital, not spending it), so there have been only a few studies on “safe” withdrawal rates.

Most of the studies use data from Chicago consulting firm Ibottson Associates showing returns from stocks, bonds, and cash since 1926 as the basis for their analysis. Even though the average annual rate of return over the past 80 years for the S&P 500 is about 9%, you can’t reliably withdraw an amount that large because of inflation and the ups and downs of the stock market. Reputable studies on “safe” withdrawal rates attempt to answer the question for you and your clients.

The Bengen Study

In the February 25, 1997 issue, the Wall Street Journal columnist Jonathan Clements reported on a study by San Diego based financial planner William Bengen. Bengen looked at year-by-year returns since 1925 for a 50/50 stock/bond portfolio. He assumed half the portfolio was in the S&P 500 and half in intermediate term government bonds. Using a 30 year holding period, he calculated that a 4.1% withdrawal rate would allow retirees to survive the worst market declines.

The Harvard Study

In 1973, Harvard University did a study to determine how much they could safely withdraw from their endowment fund without eroding the principal. Assuming a portfolio of 50% stocks and 50% bonds and cash, Harvard’s analysts calculated they could withdraw 4% the first year and then adjust the subsequent year’s withdrawals for inflation. For example, if there was 10% inflation, the second year’s withdrawal would be 4.4% of the initial portfolio value.

The Trinity Study

Dallas Morning News columnist Scott Burns has written extensively on a “safe” withdrawal study by three Trinity University (San Antonio, TX) researchers. The Trinity Study measures the “success rate” of various portfolios from 1926 to 1995. The “success rate” is the percent of time a retiree could sustain a given withdrawal rate without depleting his retirement assets. One portion of the Trinity study adjusted withdrawals for inflation/deflation, much like the Harvard study. This analysis showed that of the portfolios considered, the optimal asset mix is 75% stock/25% long term corporate bonds. For a 30 year payout period and a 4% withdrawal rate, this mix had a 98% success rate. At a 3% withdrawal rate, the 75/25 mix had a 100% success rate. Interpolating these results would give you a “safe” withdrawal rate of slightly less than 4%, virtually identical to the Harvard study.

The consensus seems to be about 4% per year, but how should people interpret those studies? The first thing to consider is that these studies are based on investment returns before expenses. If you’re paying an investment advisor an annual fee of 2% of assets and he has you invested in no-load mutual funds with a 0.5% expense ratio, your annual expenses are 2.5%. Your “safe” withdrawal rate is 4.0% – 2.5% = 1.5%

Another consideration is that most of these studies are based on historical data. The fine print here should read “past performance does not guarantee future results.” While there is every reason to believe that investment returns in the next 80 years will be similar to the previous 80 years, there’s little chance it will be EXACTLY the same. To say that 4.0% is a “safe” withdrawal rate and that 4.1% will leave you broke implies a measure of accuracy in the forecast that just isn’t there. It may make more sense to say that the “safe” withdrawal rate going forward lies somewhere in the range of 3.25% to 4.25%.

Considering the above studies, annual management fees, income taxes and the historical annual returns of annuities, what is the justification for putting a retirees income producing assets at risk in the stock market?

Isn’t it time for you to start a marketing campaign for retirees that centers on things like safety, saving taxes, locking in past returns and providing a guaranteed income they can’t outlive?

Only a combination of fixed and immediate annuities can provide safety guarantees and an income they can outlive.

Do you want to know more about how you can help seniors and boomers to have a safe and guaranteed income they can’t outlive, then become a member of the Insurance Marketing and Sales Resource Center™!

Yours In Success,

Jeremy Nason

What is break in Insurance? Is there any grace period? what is the effect of break?

What is break in Insurance? Is there any grace period? what is the effect of break?

👉 When the Health Insurance Policy is not renewed on time it is called in break in Insurance. There is a grace period of 30 days to retain this continuity as per policy terms.

👉 The effect of break in Insurance is as follows:

1. The continuity of the policy will be lost.

2. Any cumulative bonus earned will be lost

3. Any No Claim Discount earned will be lost.

4. Any illness contracted during the policy period that was not renewed will become pre existing illness.

5. Policy will be treated as fresh for the purpose of providing risk.

6. First 30 days exclusion for illness will be applied

7. 1st , 2nd , 3rd & 4th year exclusions if any will be applied as per policy terms

8. In case there has been any major illness during the expired Policy period Eg. Heart Diseases, Tumor etc, getting a new policy from an Insurance Company will become either very difficult to get a policy again or getting denied.

9. Keeping track of your policy expiry date is not only the job of an Insurance Advisor but also your responsibility.

10. Ultimately if sufficient Health Insurance doesn't come to the rescue in terms of claim during break in insurance, it indirectly means that

A) All Your savings will start eroding
B) All Your assets may have to be sold if any critical/recurring illness strikes
C) You may have to get into more debts
D) If major illness strikes , no body will lend you as you may become jobless
E) Problems multiply if you are the only income earner in the family ,etc etc

Think wisely and save yourself & your family smartly 🙏🙏🙏