78 Year Old Widow with around 70-80 lakhs

Alchemist

Administrator
Staff member
#2
The tax outgo won't be much for a depositor of this age.

If safety and liquidity are considered, I think there is no better alternative than bank deposits.

The depositor can set aside some money for tax-saving deposits and invest the rest in regular deposits including "Senior Citizen Savings Scheme "

The money can be distrbuted between PSU banks and high quality private sector banks like HDFC Bank and Kotak Bank.
 
#3
What about Corporate Deposits like Bajaj Finance, Mahindra Finance, HDFC Finance etc - how safe are they?
 
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Alchemist

Administrator
Staff member
#4
What about Corporate Deposits like Bajaj Finance, Mahindra Finance, HDFC Finance etc - how safe are they?
The three that you have mentioned are quite good.

My family has invested in Mahindra Finance and HDFC deposits. If the rates offered are better than banks, there is no harm in investing a part of the corpus in these companies.
 

Alchemist

Administrator
Staff member
#6
Any opinion on PNB Housing Finance Fixed Deposit & LIC Housing Finance's Sanchay Public Deposit Schemes? Can these be considered safe?
LIC Housing is promoted by LIC and therefore I consider it as safe as the government.

PNB Housing's deposits are reasonably safe, but I feel longer tenure deposits should be avoided and if possible the financial health of the company should be reviewed from time to time.
 
#7
One more question about the same person.

Last year, when her husband what alive, both of them put together had an income of about 6-7 lakhs per year (interest income, pension, etc). Both of them never filed tax returns since they retired which was 15-20 years ago. They just filled up Form 15 everywhere to avoid TDS & since the total income split by 2 came within the tax-free bracket, they never bothered to file returns.

Now, since the husband died, it's just the wife who will have around 7 lakhs per year of income?

Should she start making some ELSS 80C deposits & filing tax returns or will it invite questions about why she didn't file returns all these years?
 

Alchemist

Administrator
Staff member
#8
Should she start making some ELSS 80C deposits & filing tax returns or will it invite questions about why she didn't file returns all these years?
She should start filing tax returns. Even if she gets a query, she can always explain her case.

(ELSS is a risky investment for an investor of this age).

Usually, the tax department doesn't bother senior citizens, especially in cases where most of the income is interest income.
 
#9
Why not just put them with highest percentage banks for fixed deposits, but to several ones with each guaranteed amount ?! I think it's a very good plan and solid and safe income, I am more than sure about that. I plan do to such for my own mather when it will be the need.
 
#10
One way of saving on taxes is to gift your children and parents assets and cash for investments. You can gift them any amount of cash for investing in high-return instruments such as senior citizen's savings scheme. As senior citizens do not have to pay any tax. Some may say fixed deposit, but I think mutual funds are better. One reason to prefer mutual funds over fixed deposits—one is the potential for better returns, and the other is for a more advantageous tax treatment.
 
#11
One way of saving on taxes is to gift your children and parents assets and cash for investments. You can gift them any amount of cash for investing in high-return instruments such as senior citizen's savings scheme. As senior citizens do not have to pay any tax. Some may say fixed deposit, but I think mutual funds are better. One reason to prefer mutual funds over fixed deposits—one is the potential for better returns, and the other is for a more advantageous tax treatment.
I agree with you. Mutual funds are a risky at 78 years old and should avoid it. 5 years fixed deposits should be the only option for them, I can also suggest to leave 10% to liquid/debt fund.
 
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