Learning from Comments [Part 1]

POSTED BY manish ON March 31, 2010 COMMENTS (48)

Do you read comments ? There is huge amount of discussion doing on in comments section, however many readers do not find time or interest to dig into the comments and follow the discussions, I would say comments have more knowledge than the article itself , as there are personal experiences and knowledge from many different readers, there is a threaded discussion on some topic in comments, which are more lively and engaging. So if you are just reading articles and not comments, you are missing a lot of things . So I went through some articles comment one by one and consolidated some learning and facts for my readers 🙂 .

  • RBI has changed the way of interest calculation on your saving account now, earlier the interest was paid on the minimum balance in your account between the 10th of the month and the end of the month. Now the interest is paid on daily basis , Read More
  • As per research Women are better investors than men, This is because of many factors like women risk adjusted returns are generally higher than Men , women tend to hold investments in stock market for longer then men . Read in detail  Here and Here
  • In Public Banks the cashier or officers can tell you things like “ULIP’s are for young people , PPF is for old people” , and hence try to influence your decision-making. Once they find out that you are an NRI or from upper middle class, they can start pestering you too much because of the sales pressure or the attractive commission’s attached to it .
  • Why the Guaranteed NAV Plans stress over number 7 ? Anoop asked me this question and my views were that the stock markets in India has been running in a 8 yrs cycle from last some decades, so after this recent crash, another big crash is expected to be after 7-8 yrs now. So they want to make sure they are giving investors “highest NAV in 7 yrs” which will be the maximum point in coming 10-11 yrs assuming markets do crash after 7-8 yr and then stay below that point for another 2-3 years .  8 Year cycle Trend : Sensex is following an eight year cycle trend. The break of the channel lines in 1992 saw the index correcting over 53%. After eight years in 2000, the index once again fell into the grip of bearish cycle and corrected over 57%.  In 2008, the faced the similar fate. Breaking the long term rising channel, the index once again echoed the similar trend and has shed more than 63.7% of its weights from the top : LINK
  • If you sit back and think for just a moment, you’ll realise that there is reasonable outward evidence that the Unit Trust’s history could repeat itself with LIC. It’s true that there’s a lot that is different about the regulatory framework and the nature of LIC’s liabilities. However, the core reasons that led to UTI’s collapse also exist for the LIC today: there is an unapologetic tendency to use the LIC as a bottomless pit of money of which there wasn’t enough accountability. The blatant use of this money to bailout the public sector IPOs is only the most recent and the most visible example-given the lack of public information, it’s not possible to make any assumptions that everything else must be OK with LIC’s investments-just as it wasn’t with the Unit Trust.  – Views of Dhirendra Kumar of Valueresearchonline at  “LIC can be the new Unit Trust of India?” .
  • The way KYC is done in banks is different from Mutual Funds. Banks KYC is to be done at time of A/c opening only. They just take your documents and the concerned form is attached with A/c opening form. Since you are signing A/c opening form you don’t need to sign KYC form seperately. Thats the reason banks only take your documents for the proof.  Even later also you need to give only the proof. – Thanks to Jitendra Solanki for answer .
  • A horrible Credit Card Experience from Brij Mohan
  • My Experience with HDFC CC is very terrible, I paid all my dues before I left for UK, and this was a free CC, after one year when my CC expired, they sent me a new CC and made some charges of around 300-400 rs (approx). Since I was not in India so I was not able to receive the Credit Card, I sent them a mail first few mails I did not get proper reply as I was referring to my old credit card number. I also tried to call on ISD rates to HDFC call center they said we can’t help you as you do not have valid Credit Card. When after around 2 years I returned I found my bill is blown up to 6000. I tried to convince them, at last they told that they have their office in Bangalore too you can go and settle there, as they have added my name in defaulters database also. I went there and literally they were blackmailing that if you don’t pay all the amount they will not remove my name from the defaulters database, and finally I paid whatever the amount they said. I thought it’s all over. Finally last year when I tried to apply for car loan, it was rejected by ICICI Bank and few other bank, fortunately it was approved by Axis bank. But still just to check I applied for ICICI Bank CC, and CitiBank credit card they rejected my application without mentioning any reason. I am feeling like I am a terrorist or they have banned me in this country for my life time, even though I paid off all the dues(which was all illegal). Just last week only i came to know about CBIL properly, so I have sent a snail mail to them for my credit record. Just to check my credit record. but still I don’t know what will be the Next surprise. I will only tell if you are using CC use it very carefully and never take anything lightly, even if it is a single paisa, just clarify this and clear it off and make sure it is really done. In short I feel using a Credit Card is like walking on the Sword or Fire. It’s very dangerous thing.

  • Difference between Auto-Debt and ECS : ECS is a facility to credit/debit funds between banks using clearing house. However Auto-debit is the facility within bank.
  • Tip from Partha Iyenger : If you want to complain about some products, the customer care is generally not helpful and they do not care, However the CEO’s and MD’s of the company are helpful and are very sensitive to customer feedback, they are generally responsive. The problem lies in contacting them, so here is a Tip : If you have a complaint against dell computers. First find who is the CEO of the company , for example its Michael Dell , now simple write to ceo@dell.commichael.dell@dell.com, michael@dell.com, michaeldell@dell.com and michael_dell@dell.com. One of them will work. Please use cc while addressing to the CEO, the person you are addressing will get jitters and before he can act, he will get a call from the ceo’s office to sort it out asap. This trick can work most of the times .
  • Again an info from Partha Iyenger : Many people know that our credit cards and other credit history is stored and tracked by CIBIL, but do you know now even your other utilities bills get tracked and reported to industry associations and in turn to cibil ? for eg, if you don’t pay your mobile bills by moving to other city, you can be easily tracked or for that matter if you do not pay electricity bills of reliance, your phone connection would get cut and your rating system would go for a toss, its all happening In india now , but you don’t know 🙂 . That means when you apply for your home loan or car loan or personal loan, you would be disqualified. so every one, please pay check your bills, resolve any payments with the bank or respective firms (file complaints with the ceo,  don’t ever talk to call centres. It doesn’t work ) and clear it . Read A close look at Real Estate Returns in India
  • Personal Debt to GDP ratio has tripled in 5 years in India. Personal debt includes – credit card, personal loan, auto loan, home loan and consumer durable loans. To be precise, India’s personal debt to gdp ratio has moved from 5% to 15% and micro finance institutions adding to this kitty in a ferocious pace, of course its nothing compared to america’s 120% ! but we could get there in the next 10-15 years, if we don’t watch ourselves. The onus is on us to be prudent in our spending. Today, most youngsters swipe the cards through emi schemes to buy consumer durable and electronic goods as if there is no tomorrow. Our older generation saved first and then bought it, today we don’t wait, we want everything now. The credit cards is a great tool for instant gratification rather than saving and buying it.
  • We feel ECS is very convenient and safe, while that is true, but anything which is good can turn out to be very bad also. Read a horrible experience on How a customer faced Experience like Hell with Kotal and ICICI for stopping his ECS facility . Here is another article on ECS from PV Subramanyam , a must read .
  • Jitendra Solanki shares a shocking story on how you can become an LIC Agent. “Around three years back I went to an LIC DO to talk to him for an agency.After submitting the required fees i was given a question paper and the answers of the same and was told to just ratto the answers and start generating business.Is this how an agency of LIC is given? ”

Conclusion

All this wealth of knowledge is present in Comments section and different readers provide these information when there is discussion , so please ask questions, those questions will lead to discussions and in turn it will lead to more information from other readers who have faced an issue or have some experience .

Comments , Let me know how you liked this “Learning from Comments” section  ? Is it a good idea ? What are your experiences with comments overall ?

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48 replies on this article “Learning from Comments [Part 1]”

  1. Sathya says:

    Hey manish!
    Cant we have a more simpler comments section like the one of Facebook?…that helps actually…ppl tend to be lazy (like me) to scroll down…as i can see, there seems to be more and more comments increasing day by day….so scrolling down is a heavy job….

    Satya

    1. Sathya

      Not sure what kind of plugin to install to make it better, do you have much idea on wordpress ?

      Manish

  2. yogesh says:

    Manish..good article.

    Reading comments is really very fruitful

  3. Siva says:

    Hi Manish,

    Can you please provide me your valuable suggestion on switching term plan. Im holding max newyork term plan for rs 32L with early premium of 8k. But, I checked religare they are offering 80L for same premium of 8k. Can I switch to that term plan by stopping the payment for max netyork and applying for religare?

    Is there any disadvantage in switching term plan?

    Thanks
    siva

    1. Siva

      The only thing is that you will get higher cover policy with no option of riders , if you are ok with it , you can go ahead , Also i would suggest you should split your cover in two companies .

      Manish

      1. Sunil Date says:

        @siva.

        1 Since you took your MAX plan your age has progressed, so please check the premium for the Religare plan at your current age with the premium of Max plan at issue age (date)
        2 Verify if your current health condition is acceptable to Religare medical underwriting.
        3 So get your new plan issued before exiting from the existing plan. Otherwise you may exit the old plan and the new proposal may be rejected and you may land up with no cover.

        1. Siva says:

          Thanks Mainsh & Sunil. I will check the same. And I will apply for new term plan first and then exit current one.

          Thanks
          siva

      2. Sunil Date says:

        @manish When you split the SA in two companies you may be loosing the higher SA discount. There is no benefit in diversifying. Yes there is flexibility in having two smaller SA policies vis a vis one policy with a very large SA. If required you can stop one policy and continue the other which is not possible in a single policy. But its my belief that his benefit becomes relevant when the total SA is in the range of 50L and above.

        1. Sunil

          I agree , i make it a general suggestion because most of the people in india need more than 50L of insurance atleast the urban salaried class people . correct me if my way of thinking is narrow and i am missing anything .

          Manish

  4. bose says:

    Hi Manish,

    Nice to see, how you convert a simple topic of words into an article of substance. I guess that’s the reason I have been a vivid reader of Jagoinvestor.

    I have always seen you point out to the flaws in the administration and other dependent entities of the system like Brokers, Agents etc. However, may I know what if we won’t deal with the rules and regulations that our systems created for us appropriately. e.g. I have recently come to know about a fact that the Saving Bank accounts provided by the Banks actually lapse if we won’t have our salaries credited to those accounts for more than 6 months and they turn those accounts to normal savings account and charge with all sorts of bank charges (Talking about salary account holders) . Is it true, how can we avoid these kind of problems, and If we fall into this zone is there any harm in the future related to our Credit scores (ratings just like for non maintenance of proper loan repayments and all). I didn’t read the fine prints when I have taken that salary account. Do you have any thoughts on this.

    1. Bose

      I am not sure on this .. I will find out . Anyone ?

      Manish

      1. JayaprakashReddy Kanreddy says:

        Bose,

        You heard it right. Time period again defers from bank to bank. I had my salary account with ABN AMRO Bank and they said it will be savings account if my salary is not credited for 3 months. I Also had HSBC salary account and they said it is 6months. Please verify what is the QAB (Quarterly Average Balance) required for that bank and maintain that amount in your account or else close the account immediately like I did.

        1. Thanks for replying 🙂

          You are showing the community participation , good luck 🙂

          Manish

  5. Brij Mohan says:

    Thanks Manish for Posting my Comments, I would like to tell you that finally I received my CBIL Report last week. I did not found any problem in my credit history. All my past records are also clear. But due to my HDFC CC Issue and late payments (Status is Settled), and 2 late payments of HSBC CC, I feel other banks dont want to take risk of providing me any other Credit card or any other loans. couple of weeks back I received a snail mail from CitiBank too, mentioning that due to some CBIL reports they regret to issue any Credit Card to me. To rectify this. I will need to keep paying my bills on time for other banks and after some time I can again apply for the Same.

    But good to know at least I dont have any Big payments or any other ugly surprises from any other banks, and my Credit History is almost clear.

    1. Brij

      Nice to hear that there is no issues with your credit score 🙂 . Make sure you take care in future 🙂

      Manish

      1. Brij Mohan says:

        Manish,

        Just wanted to share the useful link for those who want to know their credit scores from CBIL.

        http://www.cibil.com/accesscredit.htm

        Hope this will help those who is facing similar problems.

        1. Brij Mohan

          Thanks for the link

  6. Hitesh says:

    Definately agree to the point.
    We kept discussing how tio stop ULIP after 3 years and so on..
    in the comments section, i found out that if ULIP is stopped before 5 years, the complete money (previous installments) become taxable for that year. (phew)
    Clear indicator to followup on comments.
    Keep up the good work.

    Hitesh

    1. Hitesh

      yup , thats the ULIP tax rule which most of the people dont know .

      Manish

      1. Krishna says:

        Hi,

        In that case if we surrender the ULIP after 3 years how to recalculate taxes for previous years for which returns have already been filed ?.

        1. Krishna

          It can get little complicated , better to see a CA for this

          Manish

          1. Sohil says:

            Well but where it says if we stops after5 years the 80c deduction which we took gets safe?

            I guess even if its 15 years and if u default after say 12 years and on 13th u asked for withdrawal all your deduction of previous 12 year u claimed needs to be withdrawal.I am not sure but i”ll confirm asking my CA.

            i myself am caught in ULIP pension plan of 29 years(got fooled while opening account in hdfc in my young age)…And have recently made the 6th installment..Have to get out but the deduction withdrawal will hit me so trying to sort the issue

            1. Sohil says:

              Sorry i meant for all 12 years your 80C deduction u claimed will get nullified and the amount u get in your account will be added in your present salay and will be taxed at present rate…There is no edit options?

            2. Sohil

              No , you can surrender after 5 yrs and all the amount will be tax free .

              Manish

            3. Sohil says:

              Are u sure…Ill upload my pension ulip policy of hdfc …DO lemme know whether i can surrender and used the invested amount to reduce my home loan liability with it…

              DO give me time..Thanks again for replying

            4. Sunil Date says:

              As far as I know if one surrenders (exits) a pension plan then the amount received from insurance company is taxable i.e added to income. Only after the pension plan matures one can withdraw one-third of the corpus tax free; it is compulsory to avail pension for the balance two-third and unfortunately the pension is also taxable.

            5. Sohil says:

              Sunil even i thought same …But after hearing above line by hitesh and manish i did some search on income tax site and this is what it says

              ANd in faq i found this

              In case Tax Rebate is allowed in an assessment year, can it be withdrawn in a subsequent assessment year?

              Answer::2) If the tax payer fails to pay premium for ULIP before contributions have been paid for 5 years.

              So it looks correct by them

              Still i have asked a CA ….waiting for his reply too

            6. Sunil Date says:

              @sohil – Pl see Direct taxes Law & practice by Dr Girish Ahuja and Dr Ravi Gupta Pg 547 of 2009-2010 edition.
              Point 11.3 Quote ” If the assessee or his nominee receives any amount standing to the credit of the assessee in respect of which decuction under section 80CCC has been allowed to him :
              1 on account of surrender of the annuity plan, whether in whole or part in any previous year
              2 Any pension from the annuity plan
              such amount shall be included in the total income of the assessee or his nominee in the year of receipt.
              Section 10(10A)(ii) states that where employee receives gratuity also, the commuted value of 1/3 of the pension is exempt from tax.
              Where employee dos not receive gratuity, commuted value of 1/2 the pension is exempt from tax.

            7. Sunil Date says:

              UNIT linked insurance plan (ULIP) & Unit linked pension plans (ULPP) are different.

  7. S S says:

    Its a good idea, (for people like me). Its not possible to go through comments, time is a big limiting factor. But one must appreciate your effort.
    This Credit Card thing has been a big nuisance to many. Years back I tried a lot for ICICI CC, now whenever I read about CC generated troubles I feel so relaxed!

    1. Shweta

      Nice to hear that , So you dont have any credit cards at this moment ?

      manish

      1. S S says:

        No. Abhi tak to kaam chal raha hai, every time I think of applying for one, purana experience yaad aa jaata hai.

  8. mitesh says:

    hi manish..

    After reading ur blog i m now prepare my self for investment in MF bt one thing not able to understand about expense ratio. Ex. if i bought ELSS mf HDFC Tax saver and suppose it has expense ration is 2 % apprx. how it apply on my investment ? reaaly it affect in long term if i invest more then 20 years? pl explain details if possible for better understand.

    mitesh

    1. Mitesh

      Expense ratio is cut from the NAV itself before we see it , lower the expense ratio , better it is for us investors , so try to choose a good fund with less expense ratio ,

  9. Praveen says:

    I will mostly follow ur comments sections, and it true as said by you I got much info from comments section also 🙂

    1. Praveen

      Ya, the best thing would be to subscribe for comments from http://feedburner.google.com/fb/a/mailverify?uri=JagoinvestorComments . That would mail you the comments everyday :0

      Manish

  10. Anu says:

    Also tip from Mr. Iyengar regarding complains was superup !

  11. Anu says:

    I completely agree with you that comments are very useful. I make it a point to read the comments (Yes sometimes it is very lengthy, but still worth going through it). But i am wondering how did i miss about the ‘ 8 year circle’… intersting !
    Have to make some time to read on that.

    Manish keep up the good job !

    1. Anu

      That was deep down in comments or may be it came after you read it 🙂

      Manish

  12. som says:

    Good one manish …

    rgds,
    som

    1. Som

      Thanks , what are your views on comments , are they too big and not easy to follow up ?

      Manish

  13. anonymous says:

    Who said KYC ? Grow up kids and get full knowledge first, before publishing post ! if You don’t know try to learn via respective authority web ika rbi

    1. @anonymous

      Is it wrong ? It was an answer given by Jitendra Solanki who is a CFP himself . I think it was an answer for a question asked by some “anaonymous” only , may be it was you . have a look at : https://www.jagoinvestor.com/2010/03/how-do-highest-nav-guarantee-plans-work.html#comment-6880

      What is wrong there ? Please share the correct information about KYC .

      Manish

      1. anonymous says:

        ask anyone who works in bank (PSU) KYC compliance …
        my frnd work in pvt bnk, as per her KYC can be done any time and related with AMC KYC though she is not much clear
        looked into earlier post, unfortunately it is not me

        1. anonymous

          I am not sure if she can be beleived , Jitendra is also a CFP who has given the comment , let us hear from him .

          Manish

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