Sales loads are commission or charges incurred by an investor while buying or redeeming shares in a mutual fund. These are determined by the mutual fund company and vary according to different share classes. There are two common sales charges incurred- front-end load and back-end load. Although, no load funds are increasingly in demand.

Short selling means borrowing a certain stock that an investor believes will decline in value, selling that stock at the market price and then when the date of returning the borrowing arrives, buy the stocks at lower price and returning them back. The difference between the purchase price now and the selling price then, is the profit for the investor.

It is estimated that 70-80% of the pre-retirement income is likely required to maintain a similar kind of lifestyle during retirement. It is necessary to factor in the tentative expenses and sources of income that one might have during the retirement, and risks  like inflation, tax obligations, falling interest rates, etc. while making retirement decisions.

A late payment usually stays on the credit report for a period of seven years. It negatively impacts your credit score. A poor credit score makes it difficult for an individual to qualify for home or car loans, and even to be eligible for credit cards. Even if one receives the loan, the interest rate applicable could be too high.

The average monthly interest rate applicable on credit cards in India ranges mostly from 2.5- 3.5%.

The most efficient plan for retirement is to create alternative sources of income that can generate revenue during the retirement phase. Any income source that generates cash inflow can be considered as a viable retirement income option. Present income source worth ‘n’ number of years is an exhaustible fund. Also, its purchasing power will ultimately get reduced due to inflation. Whereas, royalty income, rental income, and mutual funds dividends are good sources of passive income, which ensure a continuous flow of income without having to constantly work on it. So, one should try to create such sources for a comfortable retirement.

Junk bonds are very low rated investments which are issued by companies with low credit ratings. These offer very high returns but are subject to high risks. Since these offer very high returns at great risk, these are speculative in nature.

Treasury bills cannot withstand inflation risk since a fixed amount is promised to be repaid when the treasury bill is issued. No market fluctuations are later considered when the investment attains maturity. The other options, however, are impacted by the highs and lows of the market and inflation as well. So although inflation makes the purchasing power of our money low, investments like gold, equity investments, and mutual funds, which achieve high gains during market highs, compensate the loss of our real income. This is absent in fixed income securities like treasury bills.

After exhausting the ₹1.5lakhs limit under Section 80C, one can file an additional claim of ₹50000 contributed towards National Pension Scheme to avail the benefit of deduction under Section 80CCD(1B). The other cases fall under Section 80C and any additional claim is not allowed.