Insurance is a means to secure oneself from financial losses. The person availing the service is called the insured, and the entity that provides the insurance is known as the insurer. The insured has to make periodical payments called premium over a fixed period of time to receive a lump sum amount at the end of the maturity period or when the claim is made. There are different kinds of insurance: Life Insurance, Health Insurance, Auto Insurance, etc. Although, in case of life insurance, the loss is not financial in nature, but the insurance claim received by the beneficiaries, specially if received upon the death of a close one, can be of great financial help if they were dependent on the deceased.

EMI, or Equated Monthly Instalments, is an amount paid by a borrower against a loan taken. The principal amount of the loan is divided into fixed, smaller parts over several months to facilitate ease of payment. By the end of the period, the borrower pays back the principal amount along with some interest on it.

Inflation refers to the increase in the general price level prevalent in the economy. It erodes the purchasing power of our money. Basically, the more inflation rises, the less our real income is.

Net Worth is the difference between total assets and total liabilities.Consider asset as anything that puts money in your pocket and liability as anything that takes money out of your pocket. Having more money incoming depicts that you have a better net worth.

A credit record is a detailed history of an individual’s borrowings and debt. A credit score shows the ability of an individual to repay a loan taken. The higher the credit score, the better is the individual’s creditworthiness.

Amount received= Principal amount + (principal amount*rate of interest*time).

The total amount withdrawn at the end of three years= ₹56375.

Principal amount for the next two years= ₹56375+₹15000= ₹71375.

Interest Payment for 2 years = 7138

A debenture is a medium to long-term loan taken by companies to raise funds at a fixed rate of interest. The debenture holder is not given any voting rights

Net worth is the difference between the total assets and the total liabilities of an individual. Thus, a net worth statement is required to include all assets.

accounts are liquid but are not marketable. Liquidity refers to the ability of an asset to be easily converted into cash. Marketability of an asset refers to its capacity to be traded at any given time at a given value. Savings account is highly liquid, but remains untouched by any market fluctuations.

Our cash inflows should be greater than the cash outflows for maintaining good financial health. A cash flow statement helps in ascertaining our total cash inflows and outflows over a particular period of time. Net Cash Flow = Total Cash Inflow - Total Cash Outflow. A positive net cash flow indicates that our total income exceeds our expenditure. Whereas, a negative net cash flow shows that we are spending more than we are able to earn. Try to be on the positive side of the cashflow statement.

Amount received= Principal amount + (principal amount*rate of interest*time)

A taxpayer is exempted from paying tax under the new regime if their total income does not exceed 250000. 5% tax is charged on income falling between 250001 to 500000. However in such cases, a rebate of 12500 can be availed, ultimately making the tax liability nil.

Inflation erodes the purchasing power of money. To withstand inflation, the growth in our money should be higher than the rate of growth in inflation. Inflation rate in India was 4.54% in 2019 i.e. the goods were priced 4.54% higher than what they used to be worth in 2018.

Making late payments or not being able to repay loans negatively impacts the credit score. It reduces the creditworthiness of a borrower. It also makes difficult to borrow money from financial institutions as they believe that there is higher risk of default on the part of the borrower.

IPO, or Initial Public Offering is a process by which a private company can go public. It refers to the first sale of shares by the said company to the public. It increases the capital raising opportunities for the company. Additionally, it helps in generating publicity of the company among the people.