5 steps for last minute investments

Come March, everyone checks out one last time, whether their tax-saving investments for the financial year is in order. Some even try to make last-minute investments in the last week of March. Here is a list of steps to go through before making hurried investments.

Step one, of course, would be to invest well in advance and plan your investments to avoid financial inconvenience as well as last-minute rush at the cashier, agent or even heavy tariff at websites.

Step two is calculation, add up all your periodic investments such as insurance premium, SIP instalment and other investments that you have continued since your last years' tax planning and deduct them from your taxable income. Also, remember to deduct your expenses such as home loan repayment and children's school fees.

Step three, choose the ideal investment option according to your age and life stage. Your investments should be according to the risks that you can afford to take and the returns you expect from your investments. Generally, higher the risk, greater the return and vice versa. Accordingly, investments can be categorised as low-return low-risk traditional options like insurance, fixed deposits, PPF, NSC and high-return high-risk options like ELSS, ULIP.

Step four, don't forget to check out where the returns or the interest earned from your tax-saving instrument is tax-free at maturity or redemption. Your investments in a hurry should not become a tax liability at the end of their tenure. So check for E-E-E status, meaning exempt-exempt-exempt on the income earned. These include PPF, EPF and Sukanya Samriddhi Yojana (SSY).

Step five, don't delay, whatever your investment option leave a room of at least 4 working days for cheques to be credited and receipts to be generated before the end of March so that your investments are considered for FY19.