I was giving my regular financial advice to a friend of mine when I happened to ask him under whose name does he invest?
and to my surprise he said in the name of the sole Bread-Winner.
So I inquired around and asked other folks who are married to a housemaker and to my surprise I found very few of them actually did a regular investment in the spouses name. I wonder why?
The reason why I would invest in my spouse’s name would be:
1) Indian marriages are more or less stable and wives are more tolerant… so the risk is low.
2) In case of an premature demise, all unsecured loans would be settled against the assets owned by the male member… the spouse’s money cannot be touched. That way you can secure a decent living for your family.
3) Over time your investments are going to grow by leaps and bounds.
eg: the rent from a small 800sqfeet apartment can easily by 12k pm which is a salary in itself.
So by dividing your income over different members of the households you can save a lot on tax, and also prevent yourself hitting the highest IT Bracket and surcharges. Personal tax exemption limit enjoyed by a male taxpayer is Rs 1.10 lakh (Rs 110,000), while it is Rs 1.45 lakh (145,000) in the case of women taxpayers.
4) As per the IT Law, you can claim IT rebate only on 2 houses during your entire lifetime. However if your housewife is also an IT payer (because of rental, interest, stock market income) you can claim it double the number of times.
4 replies on “Financial Planning”
It makes sense .
//In case of an premature demise//
and in the case of the wife’s , the properties goes to the husband and the children equally….the money remains in the family.
thanks for agreeing.
but the odd thing is today, very few people are making investments in the name of their spouses and children… while in the previous generation.. investing in the family name was common….
probably the reason was in the Control and license Raj, you had to do apply multiple applications to increase your odds of allotment and all purchases involved a lottery and a wait for a few years.
Most people I know invest in the name of the wives. It may change gradually as no of divorce cases are increasing.
yups all men who understand finance invest in their wives names (esp if she is a housewife)…
but techies seems to be an exception.. of the 4 people i talked to… 3 were not aware of its benefits.