Your August financial checklist: Here’s what you must know!

New month, new financial changes. Plan your August month - watch out for high-interest FDs, monitor the RBI's rate decision, file and verify tax returns, and more.

Six changes in the financial landscape

August 2023 brings significant shifts that can impact your investments, taxes, loans, and credit cards. Here are the top five changes you need to be aware of and take action on right away to secure your financial future.

  • August brings forth a set of critical financial changes that demand our attention.

  • Act fast! Secure high-interest FD schemes before they vanish.

  • Monitor RBI's announcement; brace for potential rate hikes.

  • Verify and file tax returns on time to avoid penalties.

  • Smart spending during festivals, beware of credit card changes.

1. Will the RBI follow the US Fed's lead?

In July, the US Federal Reserve raised its benchmark lending rate to tackle inflation, signalling further increases ahead. On August 10, the RBI will announce its monetary policy, garnering attention. This decision could impact your existing loans or future borrowing plans. Keep a close watch on potential changes in interest rates on home loans and other loans linked to the repo rate.

2. Special high-rate FDs—last chance!

With increasing repo rates, several banks introduced special FD schemes offering attractive interest rates. However, some of these schemes might be discontinued this month. For example, IDBI Bank's Amrit Mahotsav FD scheme and SBI's Amrit Kalash FD scheme have their last investment dates on August 15. If you've been considering investing in these high-rate FDs, act now before you miss out on this opportunity.

3. Filing of income tax return and verification

Failure to meet the July 31 filing deadline results in belated return penalties. If your total income exceeds Rs 5 lakhs, you may face a penalty of Rs 5,000, while income below Rs 5 lakhs could incur a penalty of Rs 1,000. Stay on top of your tax responsibilities and ensure a smooth process by verifying your return promptly.

After filing your income tax return, promptly verify it within 30 days to avoid penalties.

Also Read - Deadline Alert: Know These ITR-3 Facts Before Filing Your Return

4. Spend smartly during the festive season

As Independence Day and Raksha Bandhan approach, you'll encounter tempting offers from various retailers. To avoid overspending, craft a budget and adhere to it diligently. Partner bank cards may offer additional discounts and cashback, but be cautious of zero-cost EMI schemes that might lead to debt traps.

5. Credit card updates and changes

Keep an eye on changes in credit card features to optimise your benefits. For example, Axis Bank has revised the features of the Flipkart Axis Bank Credit Card, reducing cashback benefits for certain transactions. Understand the changes and adapt your spending strategies accordingly to make the most of your credit card rewards.

Find the latest articles on financial planning here.

Also Read Breaking news: Fed to raise rates again, what it means for your investments.

 

Disclaimer: This article is intended for general information purposes only and should not be construed as investment or legal advice. You should separately obtain independent advice when making decisions in these areas.

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