Latest news with #AdhilShetty
Indian Express
4 hours ago
- Business
- Indian Express
From buying to renovating: Choosing the right home loan
For most Indians, buying a home is a lifetime aspiration. A home loan can make this dream a reality. Now, most of us think of home loans as a single, straightforward product but home loans have several variations tailored to different needs. Let's find out what these are and how they can help you. 1. Home purchase loan: This is the most common type of home loan that can be used for purchasing a ready-to- move-in house, an under-construction property, or a resale flat. Most lenders offer this loan with either fixed or floating interest rates, for repayment tenures of up to 30 years. 2. Pre-approved home loan: If you're house hunting and want to know how much you can borrow, a pre-approved loan can be useful. Here, the bank assesses your income, credit history and overall financial health, and gives you a sanctioned loan amount in advance. This type of loan speeds up the home-buying process once you have finalised the right property. 3. Home construction loan: Planning to build your own house instead of buying one? This loan covers the cost of construction on a plot you already own. Typically, the loan is disbursed in stages as the construction progresses, for a tenure of up to 15 years. 4. Plot loan: If you want to buy a plot of land to build a house on later, this is the right loan. The loan amount depends on the market value of the land, your income, and your repayment capacity. However, do note that many lenders require you to start construction within a specific time frame after purchasing the plot. 5. Top-up loan: If you already have a home loan and need extra funds, a top-up loan can be a convenient option. You can use this money for anything, be it home improvements, funding a child's education, or even a medical emergency. Interest rates for top-up loans are usually lower than personal loans, and tenures are flexible. 6. Home extension or renovation loan: Need to upgrade your kitchen, add a new room, or just repaint your house? This type of loan covers all renovation or expansion needs. It is usually smaller in size than a home purchase loan but still offers competitive rates and flexible repayment terms. 7. Home loan balance transfer: Not happy with the rate, terms, or service of your current lender? You can transfer the outstanding balance of your existing home loan to another bank or housing finance company offering better interest rates or terms. This is an effective option if you're looking to lower their monthly EMI burden or extend your loan tenure. Choosing the right type of home loan depends on what stage of your homeownership journey you're in, regardless of whether you're buying, building, improving or simply trying to cut costs. Understanding your options can help you make smarter financial decisions. Always compare lenders and read the fine print before signing on the dotted line. Adhil Shetty is the CEO of
Time of India
28-05-2025
- Business
- Time of India
I am 55 years old and have Rs 50 lakh lump sum. How can I invest it to build wealth in 5 years?
I am 55 and have Rs 50 lakh as lump sum that I got from an earlier investment . With bank savings rates falling and markets volatile, what is the safest way to invest these funds so that I can build some wealth in five years. Rushabh Desai Founder, Rupee With Rushabh Investment Services: If you are looking for safety, investing in debt mutual funds and fixed deposits makes sense. However, in order to create wealth and generate inflation-beating returns, you need to get take some risk by investing in equity products. Keeping your age and medium-time horizon of five years in mind, if you agree to take some risk, consider investing in equity savings funds (hybrid funds) with 25-30 % exposure in pure equity. These funds will help you achieve inflation-beating returns with comparatively lower volatility and better consistency. Since equity savings funds are considered equity for taxation purposes, these will be tax-efficient as well. The current market volatility will help you generate better risk-adjusted returns, but an important thing to keep in mind is that chasing returns while ignoring risk is not the right strategy. If you are not able to stomach any kind of volatility, sticking with fixed-income products would be best. My wife and I are both 40 and earn a combined income of Rs 25 lakh annually, with yearly expenses of around Rs 10 lakh. We have two children, aged 10 and 7, and we want to plan for their higher education and weddings, while also building our retirement fund. We have saved Rs 50 lakh so far. How should we allocate this across equity, debt, and other assets to meet these goals without overexposing ourselves to risk? Adhil Shetty CEO, BankBazaar: Given your goals and savings, a balanced approach works best. You can split your Rs 50 lakh corpus into three parts: Rs 30 lakh (60%) in equity mutual funds, typically flexi-cap or index funds, for long-term goals like retirement (20+ years) and children's higher education (8-10 years); by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Beyond Text Generation: An AI Tool That Helps You Write Better Grammarly Install Now Undo Rs 15 lakh (30%) in debt instruments, such as PPF, short-duration debt funds or FDs, to cushion volatility and address nearer goals or partial education needs; The remaining Rs 5 lakh (10%) should be retained as emergency funds by investing in high-interest savings or overnight funds. Live Events Your annual surplus of Rs 15 lakh can be split in the same ratio—60% in equities, 30% in debt, and 10% in liquid assets. As your children near 16, shift their education funds gradually to debt. Begin separate SIPs early for each goal, for each child, and aim to increase these annually. This simplified plan will help you grow your wealth without excessive risk and can be easily adjusted to accommodate evolving priorities. It is recommended that you consult a financial planner for a more customised plan that takes into account your specific risk appetite, liquidity, and other requirements. Ask our experts Have a question for the experts? etwealth@
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Business Standard
23-05-2025
- Business
- Business Standard
The credit card reward mirage: High earn rates, low real returns
Swipe, earn, repeat. That's the rhythm many of us follow with our credit cards, driven by the thrill of earning points on every transaction, be it a coffee run, an online order, or a weekend getaway. But here's the catch: not all points are created equal. While flashy ads boast of earning '5X reward points' on spends, what they often leave out is the most important detail: What are those points actually worth when you redeem them? 'A high rate of earning points doesn't necessarily mean better returns if those points have low redemption value,' says Adhil Shetty, chief executive officer of It's not about how many, but what they're worth Credit card rewards are only as valuable as their conversion rate. Shetty explains with an example: a card offering 5 points per Rs 100 might seem superior. But if each point is worth only Rs 0.10, the return is just Rs 0.50 per Rs 100. Meanwhile, another card offering 2 points per Rs 100, but with each point worth Rs 0.50, yields Rs 1 in benefits, double the value. 'It's crucial to evaluate both how many points you earn and what they're actually worth when redeemed,' he adds. Why conversion rates vary Reward point conversion is driven by strategic partnerships and backend negotiations. According to Shetty, airlines and hotel chains often offer better value due to bulk deal arrangements. On the other hand, gift cards or merchandise typically have lower redemption value because of added costs and markups. For example: Travel bookings via card platforms like HDFC's SmartBuy can give Rs 1 per point. The same point might be worth just Rs 0.30 if converted to cashback. Best reward conversions in the market today Here's a quick comparison of some cards with strong conversion systems: Standard Chartered Ultimate: Rs1 per reward point across most options. HDFC Infinia & Diners Club Black: Rs 1 per point on travel via SmartBuy. Kotak Solitaire: Direct 1:1 conversion to Air India miles. Cards like Axis Bank Magnus and BoB Eterna also offer high earn rates, but their value depends on how (and whether) you redeem them effectively. (Above mentioned data is provided by Common mistakes to avoid Shetty points out several traps: Focusing only on points earned, not on their actual worth. Redeeming points for low-value options like merchandise. Overspending just to earn rewards, which can lead to debt.
Time of India
20-05-2025
- Business
- Time of India
Over 260 debt mutual funds beat fixed deposits rate in 2 years. Should you switch?
With SBI cutting FD rates by 20 bps and over 260 debt mutual funds outperforming them, many experts believe debt funds now offer a more attractive, tax-efficient option for low-risk investors seeking better returns than FDs. In the current market scenario, short-duration funds, medium-duration funds, dynamic bond funds, and gilt funds can be good investment options with different horizons. 'In the current environment, short-duration funds and medium-duration funds are ideal for those with investment horizons of 1–3 years and 3–5 years, respectively. Dynamic bond funds are also suitable for those who want fund managers to actively manage duration based on changing interest rates. For risk-averse investors, gilt funds, which invest in government securities, can be a good alternative, offering safety with potential for capital gains if interest rates decline further, said Adhil Shetty, CEO of Play Video Pause Skip Backward Skip Forward Unmute Current Time 0:00 / Duration 0:00 Loaded : 0% 0:00 Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 1x Playback Rate Chapters Chapters Descriptions descriptions off , selected Captions captions settings , opens captions settings dialog captions off , selected Audio Track default , selected Picture-in-Picture Fullscreen This is a modal window. Beginning of dialog window. Escape will cancel and close the window. 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View Details » by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Don't Miss The Top Packaging Trends Of 2024, Enhnace Your Brand With The Latest Insights Packaging Machines | Search Ads Search Now Undo Also Read | Sensex @82,300: Should mutual fund investors alter their investment strategy? State Bank of India (SBI) has cut its fixed deposit (FD) interest rates for both the general public and senior citizens, effective May 16, 2025. According to the website, SBI has reduced FD rates by 20 basis points (bps) across all tenors. The latest FD rate cut comes just a month after the cut announced on April 15. Live Events The interest rate applicable for a tenure of 2 years to less than 3 years is reduced to 6.7% against 6.9% before. ETMutualFunds analysed the two-year performance of all debt mutual fund categories alongside the interest rates on fixed deposits offered by SBI, India's largest public sector bank, in the same period. Around 264 debt mutual funds outperformed the bank deposit rate of 6.7% offered by SBI over the past two years. Four schemes gave double-digit returns, of which the top three performers were from the credit risk fund category. DSP Credit Risk Fund delivered the highest return of 18.7% over the last two years, followed by HSBC Credit Risk Fund and Aditya Birla SL Credit Risk Fund, which provided 13.8% and 12% returns, respectively, during the same period. Aditya Birla SL Medium Term Plan delivered a return of 10.4%, followed by Axis Gilt Fund and Axis Floater Fund, which gave 9.6% and 9.5% respectively in the same period. Motilal Oswal Liquid Fund was the last one to offer a 6.8% return in the said period. Also Read | Railways PSU ETF delivers 16% in a week. Is this the right opportunity for portfolio diversification? After the outperformance by debt mutual funds, the expert recommends that a prudent strategy is to match the fund category with your investment horizon, a laddering strategy, where you invest across different maturities, can help manage reinvestment risk and interest rate fluctuations and starting a Systematic Investment Plan (SIP) can also help average out costs and reduce the impact of market volatility. 'A prudent strategy is to match the fund category with your investment horizon. For example, use short-duration funds for up to 3 years and medium-duration or dynamic bond funds for longer terms. A laddering strategy, where you invest across different maturities, can help manage reinvestment risk and interest rate fluctuations,' Shetty said. He further advices that starting a Systematic Investment Plan (SIP) can also help average out costs, reduce the impact of market volatility and investors should focus on funds with high credit quality, avoiding those heavily exposed to lower-rated instruments. With the RBI MPC meeting scheduled for next month, it's worth noting that the central bank has cut the repo rate by 25 basis points in each of the last two meetings, following a prolonged pause at 6.5% across 11 consecutive meetings. The expert mentions that it's also important to monitor the interest rate cycle, if further rate cuts are expected, longer-duration funds may deliver capital appreciation and lastly, one should understand the exit load and taxation rules; debt funds held for over 3 years earlier benefited from indexation, but recent changes to tax rules mean post-tax returns should be carefully evaluated. Finance Minister Nirmala Sitharaman in the last Budget made no change for the debt mutual funds, which continued to be taxed as per the tax slab. Underperformers Around 40 debt mutual funds have failed to beat the fixed deposit interest rate offered by SBI. These funds gave returns ranging between 6% to 6.7% in the said period. Bank of India Credit Risk Fund gave 6.1% and Motilal Oswal Ultra Short Term Fund gave the lowest return of 6% in the mentioned time period. Also Read | BSE and Adani Enterprises among stocks that HDFC Mutual Fund bought and sold in April FD vs debt funds Now coming to the comparison between fixed deposits and debt mutual funds, fixed deposits are considered low-risk investments as they offer a guaranteed return for the predetermined period whereas debt mutual funds have a slightly higher risk associated with them because of the interest rate movement. The second point of difference comes on the taxation part. The investment in tax-saving fixed deposits is exempted under Section 80C of the Income Tax Act whereas for the debt mutual funds there is no such exemptions. But both fixed deposits and debt mutual funds are classified under the same asset class. As the fixed deposits offer lower interest rates compared to debt mutual funds, Shetty recommends that investors in the higher tax brackets benefit the most from switching to debt mutual funds, as traditional FD interest is fully taxable as per slab, while mutual funds—although recently taxed differently—still offer relatively efficient returns in some cases. He adds that savers seeking better liquidity and flexibility than FDs can also consider debt mutual funds, as they generally offer quicker redemption with lower penalties and retired individuals and conservative investors, who are looking for stable income but are open to a little market-linked risk, can shift partially to safe options like gilt or banking & PSU funds. 'Importantly, those with a long-term outlook and an understanding of interest rate movements can strategically allocate to longer-duration or dynamic bond funds for potentially higher returns. However, this shift should be made keeping in mind the risks associated with NAV fluctuations, especially in a volatile rate environment,' he said. We considered all debt categories such as gilt fund, long duration, medium to long duration, gilt fund - constant maturity 10 year, credit risk funds, liquid funds , money market funds, overnight funds, corporate bond fund, dynamic bond fund, floating rate bond, banking and PSU funds, medium duration, low duration, short duration funds. We excluded debt based target maturity funds. We considered regular and growth options. We calculated returns for the last two years. We calculated CAGR returns as in debt mutual funds, returns up to one year are annualised, and returns above one year are CAGR. Note, one should not make investment or redemption decisions based on the above exercise. One should always consider risk profile, investment horizon and goal before making investment decisions. ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times) If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle.
Economic Times
20-05-2025
- Business
- Economic Times
Over 260 debt mutual funds beat fixed deposits rate in 2 years. Should you switch?
ETMutualFunds analysed the two-year performance of all debt mutual fund categories alongside the interest rates on fixed deposits offered by SBI, India's largest public sector bank, in the same period. With SBI cutting FD rates by 20 bps and over 260 debt mutual funds outperforming them, many experts believe debt funds now offer a more attractive, tax-efficient option for low-risk investors seeking better returns than the current market scenario, short-duration funds, medium-duration funds, dynamic bond funds, and gilt funds can be good investment options with different horizons.'In the current environment, short-duration funds and medium-duration funds are ideal for those with investment horizons of 1–3 years and 3–5 years, respectively. Dynamic bond funds are also suitable for those who want fund managers to actively manage duration based on changing interest rates. For risk-averse investors, gilt funds, which invest in government securities, can be a good alternative, offering safety with potential for capital gains if interest rates decline further, said Adhil Shetty, CEO of Also Read | Sensex @82,300: Should mutual fund investors alter their investment strategy? State Bank of India (SBI) has cut its fixed deposit (FD) interest rates for both the general public and senior citizens, effective May 16, 2025. According to the website, SBI has reduced FD rates by 20 basis points (bps) across all tenors. The latest FD rate cut comes just a month after the cut announced on April 15. The interest rate applicable for a tenure of 2 years to less than 3 years is reduced to 6.7% against 6.9% before. ETMutualFunds analysed the two-year performance of all debt mutual fund categories alongside the interest rates on fixed deposits offered by SBI, India's largest public sector bank, in the same period. Around 264 debt mutual funds outperformed the bank deposit rate of 6.7% offered by SBI over the past two years. Four schemes gave double-digit returns, of which the top three performers were from the credit risk fund category. DSP Credit Risk Fund delivered the highest return of 18.7% over the last two years, followed by HSBC Credit Risk Fund and Aditya Birla SL Credit Risk Fund, which provided 13.8% and 12% returns, respectively, during the same period. Aditya Birla SL Medium Term Plan delivered a return of 10.4%, followed by Axis Gilt Fund and Axis Floater Fund, which gave 9.6% and 9.5% respectively in the same period. Motilal Oswal Liquid Fund was the last one to offer a 6.8% return in the said period. Also Read | Railways PSU ETF delivers 16% in a week. Is this the right opportunity for portfolio diversification? After the outperformance by debt mutual funds, the expert recommends that a prudent strategy is to match the fund category with your investment horizon, a laddering strategy, where you invest across different maturities, can help manage reinvestment risk and interest rate fluctuations and starting a Systematic Investment Plan (SIP) can also help average out costs and reduce the impact of market volatility.'A prudent strategy is to match the fund category with your investment horizon. For example, use short-duration funds for up to 3 years and medium-duration or dynamic bond funds for longer terms. A laddering strategy, where you invest across different maturities, can help manage reinvestment risk and interest rate fluctuations,' Shetty further advices that starting a Systematic Investment Plan (SIP) can also help average out costs, reduce the impact of market volatility and investors should focus on funds with high credit quality, avoiding those heavily exposed to lower-rated instruments. With the RBI MPC meeting scheduled for next month, it's worth noting that the central bank has cut the repo rate by 25 basis points in each of the last two meetings, following a prolonged pause at 6.5% across 11 consecutive expert mentions that it's also important to monitor the interest rate cycle, if further rate cuts are expected, longer-duration funds may deliver capital appreciation and lastly, one should understand the exit load and taxation rules; debt funds held for over 3 years earlier benefited from indexation, but recent changes to tax rules mean post-tax returns should be carefully Minister Nirmala Sitharaman in the last Budget made no change for the debt mutual funds, which continued to be taxed as per the tax 40 debt mutual funds have failed to beat the fixed deposit interest rate offered by SBI. These funds gave returns ranging between 6% to 6.7% in the said of India Credit Risk Fund gave 6.1% and Motilal Oswal Ultra Short Term Fund gave the lowest return of 6% in the mentioned time period. Also Read | BSE and Adani Enterprises among stocks that HDFC Mutual Fund bought and sold in April Now coming to the comparison between fixed deposits and debt mutual funds, fixed deposits are considered low-risk investments as they offer a guaranteed return for the predetermined period whereas debt mutual funds have a slightly higher risk associated with them because of the interest rate movement. The second point of difference comes on the taxation part. The investment in tax-saving fixed deposits is exempted under Section 80C of the Income Tax Act whereas for the debt mutual funds there is no such exemptions. But both fixed deposits and debt mutual funds are classified under the same asset the fixed deposits offer lower interest rates compared to debt mutual funds, Shetty recommends that investors in the higher tax brackets benefit the most from switching to debt mutual funds, as traditional FD interest is fully taxable as per slab, while mutual funds—although recently taxed differently—still offer relatively efficient returns in some adds that savers seeking better liquidity and flexibility than FDs can also consider debt mutual funds, as they generally offer quicker redemption with lower penalties and retired individuals and conservative investors, who are looking for stable income but are open to a little market-linked risk, can shift partially to safe options like gilt or banking & PSU funds. 'Importantly, those with a long-term outlook and an understanding of interest rate movements can strategically allocate to longer-duration or dynamic bond funds for potentially higher returns. However, this shift should be made keeping in mind the risks associated with NAV fluctuations, especially in a volatile rate environment,' he said. We considered all debt categories such as gilt fund, long duration, medium to long duration, gilt fund - constant maturity 10 year, credit risk funds, liquid funds, money market funds, overnight funds, corporate bond fund, dynamic bond fund, floating rate bond, banking and PSU funds, medium duration, low duration, short duration funds. We excluded debt based target maturity funds. We considered regular and growth options. We calculated returns for the last two years. We calculated CAGR returns as in debt mutual funds, returns up to one year are annualised, and returns above one year are CAGR. Note, one should not make investment or redemption decisions based on the above exercise. One should always consider risk profile, investment horizon and goal before making investment decisions. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times) If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle.
