Tips on Managing Your Investments Before Becoming an NRI
All we are saying is now’s the best time to explore NRI investment options in India. Being a NRI makes it a little difficult to manage your investments back home. It, therefore, becomes important to find ways of managing those investments along with your professional responsibilities.
You may ask why. Well, what happens is shifting base to a new country will change your status from ‘Resident Indian’ to ‘Non-Resident Indian’ (NRI).With the new status of an NRI, your existing investments need to be in compliance with the present rules and regulations that govern NRI status.
Here are few points you need to keep in mind while making NRI investments in Indiawith the existing rules and regulations
• Open NRE Account If You have Repatriation Requirements – You will have to convert your existing bank accounts into NRE/NRO accounts. You will be allowed to deposit your earnings in India and transfer money overseas using these accounts. RBI guidelines allow you repatriate an amount of up to USD 1 million per financial year from your NRO account.
• Open an NRO demat account– NRIs face a few investment restrictions particularly in terms of equities. You can either sell off the shares or transfer your sharesfrom your existing demat account into an NRO demat account. You will not be able to sell off shares in your existing demat account beforeyou became an NRI.
• Mutual fund investments – Keep your Asset Management Companies (AMCs) informed about your profile change, including your address and bank accounts through a ‘Know Your Customer’ change form.
• Power of attorney - Give power of attorney to someone in India, maybe a family member or a trusted friend.Mutualfunds allow a power of attorney (PoA) holder to take these decisions on your behalf. Power of attorney is a legal way of giving power to someone to act on your behalf.
• Open a PPF Account –Open a fresh PPF account before you leave India. PPF Account cannot be opened by an NRI. Once you are an NRI, you can always deposit money in your existing PPF account that you opened before leaving India.
• Connect Your Loan Account With Your Bank Account– If you have a home loan running, and you still are paying EMI’s, remember to connect your loan account with your banking account before leaving India and continue with online payment.
• Insurance Policies – All your insurance policies will remain active and you continue paying premiums on it. However, do inform your insurance company about the change.
• Health Insurance – Getting a health insurance would be difficult once you leave India, with additional documentation and visits. It is better to get a health insurance before you leave India.
• Real estate – You can continue to lease/own residential and commercial properties in India.
Considering these important tips before becoming an NRI would help you have a smoother transition and a peaceful time abroad. Managing these tasks before you fly out of the country would help avoid a lot of paperwork and documentation related hassles in the future.
Insurance: A Guide
"Remember kids, I have life insurance" - Adam Savage
This is a guest article from Tatyana Levin
These days one must be financially savvy. Money is not easy to come by and should be managed carefully. With the availability of tools that make it easy to keep track of current events, the stock market, and even your own money, it would be almost a crime to not utilize these tools to make the best and most informed financial decisions. Unfortunately, the more there is, the more there is to keep track of. This applies both to tracking tools and money (the small curse within the comfort of having money to keep track of).
The savvier ones of us dabble in investments, and the savviest make their living that way. The key is that they know what to invest in. Not magically, of course; investors do a significant amount of research to learn how to optimize their portfolios, but they have the understanding.
A grossly overlooked investment is insurance. This may be because is not typically referred to as an investment with the exception of whole life insurance that has a specific investment component within it. Webster’s defines the word “invest” as a commitment of money for a return and “insurance” as a guarantee. This makes insurance the safest type of investment, because your returns are guaranteed. But returns are not always financial in the case of insurance. They can be, if there is an unforeseen accident, but the most certain return is the feeling of security.
Now there are many different types of insurance, and what you need depends on your current situation. Obviously you only need auto insurance, found using auto insurance leads if you have a car, and you only need renter’s insurance if you rent and have possessions that you would need insured. Insurance is for those who have something to lose. With an attachment to something, either emotional of physical (or dependence, not like physically being glued to your car), comes the fear that it will be damaged or ruined in some way. For example, if your house caught on fire, you would be devastated. What would add insult to injury is not having a way to recover from this horrible disaster.
These types of examples are not unique to this article. That is the way that insurance is sold. As they say that clichés are clichés for a reason, insurance is promoted this way for a reason. The foundation of the concept of insurance is uncertainty, and it is the same uncertainty that is conjured up when investing.
The main difference between insurance and investment is that not having insurance creates a feeling of uncertainty while investments by nature are uncertain. Therefore, investing in insurance creates security and is the only secure investment that exists (and is legal). Getting insurance should be one of the easier financial tasks if you apply all the resources available with technological advances like smart phones.
About the Author: This article was written by Tatyana Levin, a copywriter for InsuranceFiles.com
