To increase our income, we should try to invest in different investment avenues available. It is true that to gain more returns, one needs to take higher risks. To mitigate these risks, one can diversify their portfolio. Portfolio diversification means to spread the investments among a number of different asset classes. Diversification lessens the risk arising out of one particular investment with the security that some other investment might provide.

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

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.

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.

A tax rate of 10% is applicable on LTCG (Long-term Capital Gains) earned on the sale of equity shares and equity-oriented mutual funds.

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.

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.

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.

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.

Mutual funds are investment funds which pool in funds from several investors and use it to invest in securities on behalf of those investors.The mutual fund manager is who decides which stocks to buy and which to sell. It is generally recommended for people who cannot invest the time to learn equity investing and want to play a little safe when compared to equity as the fund manager does all the research work and then transacts.

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

Equity investments are highly volatile in nature. They are always subject to market risks. There is an uncertainty about the amount of returns to be earned. It may so happen that the entire investment turns bad and losses are incurred.

Debit and credit cards are issued by financial institutions. Debit cards are linked to your savings and current account. While making a transaction using a debit card, the amount to be paid is deducted from your account. It does not allow any credit facility and carries some annual charges. A credit card, on the other hand, allows its holder to make credit transactions. The condition being that the holder repays the amount with interest and extra charges, if any.An annual fees is paid to the credit card company in order to use the credit facility offered.

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.

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.