Hello readers! Today we are going to discuss an important topic how to Pay off Business Debt Quickly with 6 important tips for managing debt. Debt is something which can help a business grow and also can be the reason of business failure. The main reason behind debt resulting in failure is the mismanagement of debt. So today we at financehelps.in are going to explain to you everything about business debt and how one can control the business debt.

First, let us have a clear idea of what is business debt?

Debt by the term means owing money to another party at some rate of interest. Businesses take debt to carry out their business for a certain period. Now business also takes debt in various ways in the form of loan from bank against some rate of interest, borrowing from family or friends on certain terms, Credit from suppliers etc.

Now to manage your business debts one needs to have a proper debt management plan about which you can read our post on Debt Management Plan and How to Eliminate Debt Fast. There you can download the free template. This post is about concept on personal debt management.

How can we reduce business debt is where the question lies. So, these are the points which we need to follow to reduce business debt.

6 Tips for Pay off Business Debt Quickly

1. Identify your debts and prioritize
2. Consolidation of debts
3. Cutdown on your expenses
4. Build relationship with vendor or suppliers
5. Generate more income
6. Manage debtors efficiently

Now let’s understand the above-mentioned points in detail.

Identify your debts and prioritize

To understand the company’s financial status, it’s important for an individual to go through the company balance sheet to check on the outstanding debt. Now, what is important is to identify and differentiate between a good debt and a bad debt. How do one know what a good debt and a bad debt is, the answer to this is if the debt is going to provide profit to the company on a long-term basis it will be considered as a good debt.

For example:-If the company has liability related to office space it could be considered as a good debt due to the potential of increase in the value of the space .Thus any debt that is backed by collateral should be paid of first as failing the same may result in loss of asset .Also any taxes or govt related payments should be prioritized  to avoid additional penalties .Once the good debts are paid off the company can focus on clearing of other creditors .Doing this will help in reducing the overall debt burden of the company.

Consolidation of debts

 By consolidation of debts, we mean to clear off several debts by using a single debt. To simplify it lets understand it this way. Say for example X must pay off to 50 different debts of certain amounts. Now he also will have to pay interest at different rates and different time which not only would be difficult to track but will also may result in missing out any. Thus, it’s always better that X takes up a loan of a bigger amount and try to clear of several debts which will help in reducing the number of debts and also might help in getting loan at a lower interest rate. This will also help in saving money over time.

Cutdown on your expenses

Managing the monthly expenses which is one of the most important factors. Because unless you know what the amount is you will need for your business monthly expense and how much you will be able to save it will be difficult for you to fund for your debt repayment. Thus, one needs to figure out the amount they would be spending for incurring the expenses and where can there be cut down on expense. The best way to keep track of expense is to segregate the expense into recurring (expense which the business will have to incur every month) Operating (Expense which the business has to incur in the process of the functioning which comes up once or twice in a year) With this one would be able to understand the amount required every month for incurring the expense and set aside enough for other operating expenses.

Build relationship with vendor or suppliers

It’s important for a business to form a good relation with the vendors and suppliers because it’s the suppliers who will help the business keep on going by providing credit to the business. Any supplier will only provide credit to the business if both are on good terms. Also, the business should discuss with the supplier on payment terms and also credit limit which will help the business to plan well the payment. If a business enters into any credit agreements should be done with a clear understanding of risk and reward, if need be one should not hesitate in taking up professional help as is required to assure mutually beneficial outcomes to both parties.

Generate more income / funds

To pay off the debts obviously you will need to have enough funds. And if you don’t have enough funds with you then generating more income for the business is something which will help in clearing off your debts. One easy way to generate more income is increase your margin by raising the rates. This can be done by raising the prevailing rates and communicating the same to the customers also if they desire must be provided with the option to buy the product or service before the rise in price. This could help in enhancing one time revenue. Try to diversify your income buy adding products or by investing your existing money in FD or other mutual funds to earn money out of money. Clearing out old stocks at discounted rates can also help in generating revenue.

Manage debtors efficiently

Maintaining payment terms with your clients is important to manage proper funding for the business. One should try to maintain shorter time – period for payment to max of 60 days and 90 days in case of consistent clients. Also, business can provide discounts etc to the ones who agrees to pay larger part of due at a go. Suppose A buyer is ready to pay 70 percent of the amount on the day of purchase if he would be offered with additional 5 percent discount on the amount which can influence other buyers to pay early too.

These are 6 tips for pay off business debt quickly. These are the points which a business can implement to reduce off the debts. Debts are not always a burden for the company its just that one needs to efficiently manage it which would prove as a benefit for the organization in the long term.

Do get back to us with your comments and questions we are more than happy to help. Keep visiting financehelps.in for more such contents.

More on financehelps.in

How to Pay off Business Debt Quickly | 6 Tips for Managing Debt

Debt Management Plan Template | How to Eliminate Debt Fast?

Mutual Fund Calculator in Excel | SIP Calculator |Mutual Fund Lumpsum Calculator

Investing in Mutual Funds for Beginners | What is SIP in Mutual Fund?

Personal expense tracker excel template | Format |Download

EMI Calculation for Loan Amount | Excel EMI Calculator

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FINANCEHELPS

Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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The post How to Pay off Business Debt Quickly | 6 Tips for Managing Debt appeared first on FINANCEHELPS.

Hello readers! Today’s topic is going to help you in planning and managing your debts. At some point in time, we all prefer taking up loans for personal use /home/education depending upon our requirements, also there are a lot of entrepreneurs arising be it on a small scale or large scale, to set up a business funding is one of the key factors which most of the times is in form of Debt which sometimes become a hassle for the owner of the business as he/she gets into a juggling position between the business and several other tasks. Amongst these tasks comes debt. So to minimize your worries and save your time we at financehelps.in have come up with a Debt Management Plan Template which will help you to manage your debts (like, home loan, car loan, etc.) in a simplified form. Today we will discuss personal debt management.

Download sample debt management plan template/excel format.

Download the monthly debt monitoring excel sheet.

What is Debt Management Plan?

Debt Management is the process of planning and controlling of your debts. Generally, a credit counseling agency is hired to create a plan for managing debt, but we at financehelps.in are here for you to help in creating one for yourself by using our debt management plan template excel format which is both simple and easy to use.

Using the excel you can plan to pay off debts as per some principle and general rules, specified by us for better managing your debt but you can customize the rules as per your convenience. The rules are given in the excel template as our thought. The best part of this excel is that you will get a clear picture of your funds and also get into a regular habit of repayment which will not only help in lowering your debt but also help you pay off the debt in a particular prefixed span without fail.

Let’s understand it better with the help of the excel we have created.

Say X has four kinds of Loan-Personal loans, Educational loans, Home loans, and Car loans.

He took a personal loan of $4,000 @9.5% for a period of 3 years. Education Loan of $12,500 @7.5% for a period of 8 years. Home Loan of $98,000 @ 6.8% for a period of 20 years and Car Loan of $10,000 @6.5% for a period of 5 years. (Table view attached)

Now if X plans to pay the loan on a monthly basis, we find that he has to pay the following amounts per month.

For Personal Loan -$128 /month

For Education Loan-$174 /month

For Home Loan-$748 / month

For Car Loan -$196 /month

Considering all the total per month comes to $1,245. Here we see that X actually took a loan of $124,500 but on the calculation of the final payment the loan repayment comes to around $2,12,551 which comes to around 70% approx as interest payment.

However, if we increase the per month loan payment by 10 percent, we find that the total per month payment will increase to $1,370/ month and total loan repayment at the end of the period amounts to $2,06,544

Comparing both the cases we find that we are saving around $ 6,006 on total interest payment. Thus, for the above table, we understood that if we increase the amount of debt repayment per month then it will lead to saving in the amount of interest.

Download the debt management plan sample template (excel format) and use it to create your own debt management plan without any hassle.

As we believe that below are some tips or strategies that you may be followed to pay off debt faster

• Deep understanding of Terms and Interest rates

While taking a loan some people generally miss out on the vital points in the contract. Thus, it’s highly important to go through the term and conditions very deeply and not miss out on any point. Also, check on the interest rates properly.

• Pay more than the minimum period.

It is better to pay more amount as monthly repayment than look for the period of payment. You can plan your own strategy or you can follow our above 10% increase plan to better manage your monthly debt.

For Example;

• Pay off your most expensive or highest rate of interest loan first.

While planning the debt payment one should try to prioritize the debt in the sequence of high to low amount and then high to low-interest rate. Using this strategy you will be able to pay off the debt which has higher interest rate first because for the longer time you keep it in your list the more is the amount of interest you will have to pay .

• Shorter the length of your loan.

One should try to take loan for minimum period. As the shorter you keep the time of your loan the lesser amount you will pay on interest. You are supposed to try to increase your monthly amount payment as per your own plan or you can follow our above strategy to shorter the length of your loan.

For Example;

• Track the monthly expenses for better managing of funds.

For managing debt properly, one needs to manage the monthly expenses which is one of the most important factors. Because unless you know what is the amount you will need for your monthly expense and how much you will be able to save it will be difficult for you to fund for your debt repayment. Thus, one needs to figure out the amount they would be spending for incurring the expenses and where can there be cut down on expense. With this you would be able to understand the amount of your requirement.

• Set up a monthly budget.

The best way to track the monthly expense would be to prepare a budget keeping in mind the monthly income and accordingly prioritizing the expenses as per need. Budgeting will give clear picture of the amount which you will be left with to pay off the debt.

• Keep track the monthly debt payment.

While you have started with the debt payment you need to track the amount you are paying as debt and look for possible ways to increase in the amount of debt repayment to reduce the interest amount.

 For Example; sample monthly debt monitoring sheet.

Download-Monthly debt monitoring excel sheet

• Work part time or generate passive income.

As we believe that in many scenarios it’s not easy to sustain only on monthly active income thus it has become important to have a passive income (which means generating income from additional source. For example, now a days there are freelancing, content writing, social media management, blogging, etc. which one can choose to generate additional revenue) this will generate additional revenue apart from the fixed amount. Which as a result will lessen the burden of debt repayment.

Following these strategies you can plan your debt easily and smoothly.

Do comment if you have any queries. We would be more than happy to help you out on the same.              Keep visiting financehelps.in

FINANCEHELPS

Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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The post Debt Management Plan Template | How to Eliminate Debt Fast? appeared first on FINANCEHELPS.

Hello readers! Today we are going to discuss on how we can calculate our mutual fund return and understand the return on investment. As we have committed that at financehelps.in we will help you learn the tricks through which you can be financially healthy and save some amount of your income for future requirements. In this article we are providing mutual fund calculator in excel, through which you can not only calculate your return on investment via sip but also the return expected via lumpsum investment. Also we are going to explain you the procedure by using a simple example for easy understanding.

SIP Calculator

Other Calculators

Mutual Fund Calculator in Excel:

Mutual Fund Calculator in Excel [DOWNLOAD–sip calculator & mutual fund Lumpsum calculator].

Now let me explain you how can you calculate the following:-

Firstly you need to fix up an amount which you would require after a certain period .In our case we are considering that Mr.X needs 6, 00,000/- after 5 years for buying a car for her family. Now she is confused how she can generate such a huge amount after 5 years. Also she is confused what to do whether she should go for SIP or she should invest a lumpsum amount. So today we are going to solve this confusion of Mr.X

Let’s understand the amount she will receive after 5 years if she makes a lumpsum investment.  Assuming that she has a bulk amount of 3,50,000/-.Now if she invests 3,50,000 in a mutual fund and we  consider the rate of interest on the mutual fund would be around 12% .On calculating the same we find that she will receive an amount of 6,16,820 after 5 years .Snap for the calculation attached below:-

In the following image attached below the terms represent the following:-

P-Principal (value invested)

r- Rate of Interest or rate of return or compound annual growth rates

t -Time period

A-Amount of return (This is the total amount which one would get after the end of the term of investment)

Return on investment or amount of return (A) = 350000 x {1+ (12/100)}^5

= 350000 x 1.762341683

=6,16,820

SIP Calculator in Excel:

Download the SIP Calculator in excel.

Now let’s see what return she would get if she makes an sip investment in mutual fund. Let’s assume she starts a SIP Investing 8,000/- pm for a period of 5 years rate of interest which we will consider will remain same as 12% p.a. Now on calculating the same what interesting  we find is that the amount of return on the investment is somewhere close to 6,59,891/-.Snap of the calculation attached below:

Now to make your understanding more clear on this we have created a comparison table .

FAQ:

What is lumpsum investment and SIP investment in mutual Funds?

Lumpsum investment is a way of investing a bulk amount in a go to any specific fund. Sip means investing a certain small amount of money on a monthly basis or in on a periodic basis as per ones convenience in a specific mutual fund

What do you mean by power of compounding?

Power of compounding means the profit earned on the principal amount gets added and next interest is calculated of the total amount i.e. the amount invested plus the return on investment resulting in getting interest on interest.

Is lumpsum mutual fund good?

Every investment has some level of risk, similarly Lumpsum also have the risk level but lumpsum Mutual Fund is a good option only of you have spare amount to invest also you don’t have to keep track of monthly fund investment.

Is it better to put lump sum or monthly?

If you have bulk amount for investment then you can go for Lumpsum investment but you have to think about risk diversify. If you are thinking for periodic investment then SIP is the one of the option that you can do. 

Which time is best for Lumpsum?

You have to analyze the market situation (share market), and need to compare the different Mutual fund plan for better understand and performance of MF. Before investing on the mutual fund, we believe that following points need to be considering;

• Current share market scenario.
• Analysis on MF based on data, performance factor, compare the MF and then select the best one. 

What are disadvantages of lump sum investing?

Market volatility has greater impact of lumpsum investment.

How to start SIP?

We have published a post on it, to know details read more..

How do you calculate return on mutual funds?

You can calculate return on mutual funds through the calculator which we have created .Just put in the values and you get the return value. Download the excel mutual fund return calculator from the above given link.

Hope with these information you would have got better clarity of how to invest .Also we have tried covering up all the questions which arise into ones mind as soon as they think of making an investment. If you still have any queries on the related topic reach through us .We are more than happy to help you and make you financially healthy.

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FINANCEHELPS

Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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The post <strong>Mutual Fund Calculator in Excel | SIP Calculator |Mutual Fund Lumpsum Calculator</strong> appeared first on FINANCEHELPS.

Hello readers! Today we are going to help you gain financial strength yes you heard it right we at financehelps.in are here with the motive to make our readers financially strong not only by providing knowledge but also help you in learning the procedure to implement the same with clarity in your concept. And here also we will discuss details on Investing in Mutual Funds for Beginners.

Today we will understand how a small amount of investment can fetch you a good amount without any burden of investment. We are talking about SIP in Mutual Funds. We all have heard in advertisements Mutual funds are subject to market risk read all scheme-related documents carefully. So we are here to take you through the tour of this risky yet simplified process of Investment.

We will start with the basics of mutual funds first.

What is mutual fund and what is mutual fund sip meant?

Mutual Fund is a financial instrument which take money from different investors and invests the money collected in different securities like shares, stocks, government or corporate bonds, and other assets. It’s basically a group of different investors investing in a fund which consist of several assets like equity, debt, money market instrument, and others.

Generally, mutual fund investments are made via professionals who manage our money, whom we call as money managers or fund managers. They try to diversify funds of an investor in different sectors to ensure maximum return on investment as per the investor’s goal. Once the investment is made an investor is allotted with the units with respect to the amount invested.

Now let’s understand why we call it a mutual fund. When you invest money in any fund though you don’t directly own the company stock but you become an equal gainer and loser in case of profit and loss along with the other investors and thus we term it as mutual. 

One can invest in mutual funds either by giving cheques to an agent or SIP. Today we will talk about Sip and understand how it works.

What is sip in mutual fund?

SIP stands for Systematic Investment Plan. SIP leads to auto debit or manual transaction of a certain amount in a periodic manner from the investor account and invested in the selected mutual fund. It helps in starting with a small amount which one can increase as per their convenience.

Like every other thing, SIP too has its Pros and Cons (sip advantages and disadvantages):

Let’s discuss on it;

SIP Advantages: –

• Through SIP auto debit of the specified amount takes place thus you don’t have to worry about the investment.
• It helps one to start as small as investing 100/- a month
• It helps in escaping market volatility as we invest on a monthly or periodic basis it helps in averaging the volatility of the market.
• SIP follows the compounding method which helps us in saving a good amount little by little
• It is flexible as we can switch the amount of investment as per our convenience as and when required.

SIP Disadvantages:-

• SIP takes a certain time for actual application and starts.
• SIP also has some predefined dates for investment.
• Returns get lower in the rising market
• If you don’t have the consistent cash flow it might be challenging to invest via SIP.

Looking at the Pros and cons it’s completely your choice what you want to do. But for Investing in Mutual Funds for Beginners, who are going to invest in mutual funds in directly online /digitally should have basic knowledge e.g. types, fund risks analysis, NAV, CAGR, Min. investment amount, Exit load charges, Expense ratio, AUM, Lock-in period, fund manager, investment sectors, etc.

Details Process in Investing in Mutual Funds for Beginners:

There are several ways in which you can invest in mutual fund:

Through Agents-The most used way for investment in Mutual Funds are through agents.

Via Online Platform -You can directly login through the respective fund house portal and start investing. Online one can even invest in several funds via Available online portals like Karvy, Zerodah, and Edlewiss to name a few.

Direct -One can directly visit the respective fund house and deposit the duly filled and signed form with respective documents.

Today we will learn here to invest online via available platforms.

Let’s better understand it with the help of an example:-

Let’s say Rimpal wants to save money to buy a car which she is planning to buy it after a span of 3 years. Her monthly income is 35,000/- out of which she wants to save enough to buy a car which costs approximately 5.5 lk. Now if she invests 15000/ month for a period of 3 years and we consider the interest rate as 10%. By investing 15000/  month she will have approximately 6,30,000 at the end of 3 years (her investment was 540000/- approx. and interest on her investment is around 91950/- approx., which gives her 6,30,000/- )

Note- all value given in the above example is for learning and understanding purposes only.

How to start SIP online in Mutual Funds?

Now before we start with the steps the most important thing is to understand the goal towards the SIP. The amount which we expect from the SIP. We need to keep a soft copy of all our identity proofs.

Step-1: Go to the respective site of the fund house where you get the option of invest with us /Initiate a transaction. It varies in different websites.

Step-2: First it will ask for the PAN no. and initiate the signup procedure.

Step-3:- Once you signup it will ask for KYC updating.

Step 4:-Now other details like scheme name plan and option (for the option we should choose the direct option) etc needs to be updated.

Step-5:-After this one needs to confirm if they want to invest in lumpsum/sip and the date of SIP initiation.

Step 6:-Then payment of the first instalment needs to be done for which the payee needs to select the payment option as net banking .then the site takes him to his respective bank site and payment of the sip needs to be made

You can also start investing SIP through specified apps, provided by online portals.

1. Create an account / register an account in apps.
2. Login to Apps.
3. Select Mutual Fund AMC-Asset Management Company.
4. Select the SIP option then, enters the initial investment amount.  Periodic instalment SIP amount, frequency, etc., and finally create SIP.

FAQ:

Q1: Can I start SIP by myself?

Ans. Yes definitely following the above-mentioned steps you can easily do it.

Q2: Can I start SIP without broker?

Ans. Yes absolutely.

Q3: Can I invest in SIP online?

Ans . Yes, you can.

Q4: Is SIP risk free?

Ans:-No, without pain there is no gain. SIP does contain risk it depends however as we invest on a monthly basis thus our investment maintains the average.

Q5: Can I withdraw SIP anytime?

Ans:-Yes one can withdraw SIP anytime unless ELSS, where there is a lock-in period in ELSS-MF. However, there is a clearance period which is generally T+3 (may vary, please confirm by fund house/ service provider). Also, you have to look into “Exit Load” charges and applicable periods.

Q6: Is SIP better than FD?

Ans:-Now this varies with respect to every individual perspective if you want risk free fixed return then FD is for you. But if you are ready to take risk and uncertain amount of return then go for SIP. However, in maximum cases, SIP does give a good amount of return if kept for long term.

Q7: Will I get my money back if I cancel SIP?

Ans:-Yes but it will take the time period depending on the type of fund. The final return amount depends on many factors like P&L, exit load charges, etc.

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Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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The post <strong>Investing in Mutual Funds for Beginners | What is SIP in Mutual Fund?</strong> appeared first on FINANCEHELPS.

Hello readers! Here we will be discussing on personal expense tracker excel sheet template or format. As all of you know that managing finance is an art. In our daily life, we are spending money as and when required. But very few people monitor and track their daily expenses. Personal budget-making and tracking expenses can help one stay financially healthy. Budgeting helps us in understanding not only the expenses but also the inflows out of which we can easily find out where to spend and how much to spend and accordingly prioritize our requirements. I am using the below personal expense tracker excel sheet and getting more benefits on expense control and easily managing the monthly income. If you would like to use our sample personal expense tracker sheet then, download it from the below-given link.

Download Personal expense tracker excel sheet template.

Personal expense tracker excel sheet template2-Download

Monthly budget sheet template-Download

If you want to keep track of your monthly expenses with the simple format or template then, you can use the below simple monthly budget sheet.

This format consists of the single worksheet, where you can simply track your monthly income and monthly money left over.

How to use this template:

Step-1: Download the excel template from the above link given at the top of this article.

Step-2: Manually enter the monthly total income in excel format

Step-3: Enter the total monthly budget expense in the excel sheet. For recording the daily expenses you can use our monthly expense entry sheet. Download the template and use it.

Step-4: Select the month from the drop-down list.

Step-5: Enter the data at the appropriate place in the excel sheet and then, the template is ready for budget interpretation.

By using the above simple tracking excel sheet you can easily understand your monthly personal expenses overview.

Monthly Expense Recording Sheet:

Personal Expense Tracker Sheet

This personal expense tracker sheet consists of two worksheets, i.e. [1] a personal expense tracker sheet and another [2] an expense recording sheet. First of all record the daily expense in the record sheet, which includes the data, expense type, and expense amount. After doing so you are supposed to enter the monthly total income in “personal expense tracker sheet” and then, enter the year and select the month from the drop-down list. Now your template is ready, where you can easily compare your budgeted expenses with the actual expenses value that can help you to quickly realize where you might be overspending. This template also helps you visualize the eye-catching charts for understanding the overview of monthly expenses and aid you cut on unnecessary expenses.

Personal Expense Tracker Sheet2:

The 2^nd personal tracker has been made in a more simplified way which requires you to just enter the data and have a graphical view of your money utilized. Let me explain you the process.

Step 1 :-

Choose the month and year for which you are creating this from the drop-down option provided.

Step 2:-

Fill in your monthly income in the column named as MONEY IN.

Step 3:-

Fill in all your expenses for the month(we have given the general category names you can add on if you have any other expense apart from the above-mentioned ones)in the column named as Expense.

Step 4:-

Fill in all the savings amounts you have that respective month in the column named as Savings.

   After filling up all the required information you would get a complete view of your money used and invested in a chart format with which you can easily analyze where you need to cut down or add own as per your needs. The Chart shows you the breakdown of your monthly income the amount used as expenses savings which you have made and the amount you are left over after making all the expenses and investments.

We have designed this personal tracker in such a way that with the help of this personal tracker 2 even homemakers can keep a track of the money they receive for their running their monthly expenses and easily understand what are they spending, where are the spending and how can they cut down on the same. A kind of complete solution to track and figure out your own financial without any 3^rd party help in the same.

Keep visiting Financehelps.in

FINANCEHELPS

Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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The post <strong>Personal expense tracker excel template | Format |Download</strong> appeared first on FINANCEHELPS.

Hello readers! Today I am going to discuss on EMI calculation for different types of loans e.g. CAR loans, Home Loan, Bike loans, Study loans, etc., and similarly, also we will cover how to calculate EMI in excel by using function. If you are interested to download the EMI calculator excel then download the same from given below link.

Download the Excel EMI Calculator.

The EMI terms equated monthly installment is a process of payment of a fixed amount to a moneylender by a borrower for a specific time period.

EMI Calculation Formula:

E = (P x r x (1+r)^n)/ (1+r)^n -1

Where, P = Loan Amount,

E = Monthly EMI

r = monthly rate of interest

n = number of months

Loan Calculator (Car, Home, Bike & Personal Loan)

Other Loan calculators

CAR Loan EMI calculation:

Suppose the loan amount is Rs 750000 and the rate of interest is 8.5% P. A and the loan tenure is 5 years. For this scenario, I am going to calculate the EMI.

Data:

Calculation:

E = (P x r x (1+r)^n)/ (1+r)^n -1

E = (750000 x 0.007083 x (1+0.007083)^60) / (1+0.007083)^60 -1

E = Rs 15387 per month for 5 Years (60 months)

CAR Loan calculation in Excel Sheet by using the function:

Step-1: Open the excel sheet

Step-2: Type the data in an excel sheet.

Step-3: Type the excel function “=PMT” and select it.

Step-4: Select the data as per the below instructions given in the image.

Step-5: EMI value is calculated

Example-2:

Home Loan EMI calculation:

Suppose the home loan amount is Rs 40 lakh and the rate of interest is 9.5% P. A and the loan tenure is 20 years. For this scenario, I am going to calculate the EMI.

Data:

Calculation:

E = (P x r x (1+r) ^n)/ (1+r) ^n -1

E = (4000000 x 0.007916 x (1+0.007916)^240) / (1+0.007916)^240 -1

E = Rs 37285 per month for 20 Years (240 months)

We have calculated the same in excel by using the function, the comparison image is given below;

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Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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Hello readers! Here we are going to discuss on SWOT analysis of financial services industry with examples. You can also download the template/ format of both the Risk identification template and the SWOT analysis format given below link.

Download the SWOT analysis template/format.

Download the Risk analysis Format/template.

As all of you know Risk assessment is an important thing for the financial services industry. You can identify the risk and opportunities of the financial services industry by using several tools but here we will discuss only the two common tools i.e. [1] SWOT Analysis tool and [2] Risk and Opportunity Format.  Both tools will be helpful to control and mitigate the Risk.

SWOT Analysis:

The full form of the “SWOT” is S-Strengths, W-Weaknesses, O-Opportunities, and T-threats.

How to do a SWOT analysis?

1. Form a CFT team.
2. List out all types of Risks related to individual functions and activities.
3.  Seat together for the final list and do the SWOT analysis.

 The financial sector consists of organizations such as banks, Insurance companies, Mutual Fund Companies, Investment agencies, non-banking sectors, etc.

Here I have taken the banking sector for SWOT analysis, given risks are on a sample basis and not limited to. And may vary from bank to bank.

Example:

Similarly, we have taken one of the above risks for risk analysis and ranking as a bank Operational Risk.

We have discussed both two methods by using different tools one is SWOT analysis and another is Risk analysis. You can also use other different tools for the analysis of risk. But the important point is to identify the risk, risk rank, control mechanism, and mitigation plan.

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Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

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Hello readers! Here we will be discussing how to manage financial risk. Managing personal finance is one of the important things, because, if we can’t manage our funds properly then, there will be a financial risk in our life, which is difficult to manage. So earlier, we have to identify the personal financial risk for controlling and mitigating the risk level. Some common personal financial risks are given below;

• Income Risk
• Expense Risk
• Investment risk
• Debt risk, etc

The above personal risk may occur due to some of the potential causes, which are identified in the below table,

[Potential causes may vary from person to person]

If sometimes you are facing the above problems in your life then you are supposed to find out the significant causes considering all your factors and situations. After finding the significant causes you can take the adequate preparation to overcome the risks.

How to manage financial risk?

As all of you know that life is not a straight line, there are always up and down in life, so if you are planned and prepared yourself then you can easily control, manage, and reduce/mitigate your personal financial risks. From my own experience sharing here some common practices that you can properly manage your personal financial risks;

Risk/issue-1: Income Risk:

Here I am sharing my own experience on how I’m managing income-related risk and these practices are given below;

• Currently, I’m generating income from several sources of income/ revenue like blogging, share market investment (e.g. mutual fund investment, investment on equity, etc.), Trading, and other investments. But there are other common ways for passive income like YouTube channel income, sponsorship income, freelancing, digital marketing income, etc. 
• Stay employable, it can be benefited you to generate monthly salary income.

Risk/Issue-2: Expense risk:

The best ways that I personally follow for managing my expense-related risks are;

• Maintain adequate emergency funds, I personally keep the emergency funds at least per month average expense of the last 6 months multiplied by 6 to 12. (Emergency funds = average per month expense X 6 to 12).
• Monitor the expenses.
• Categories the “need” and “want” in your life then, plan your funds accordingly but if possible avoid the credit purchase, EMI purchases, etc.
• As we know health is wealth, so take care of yourself and your family’s health conditions. So carry the proper amount of insurance that can manage your medical expense. 

Risk/Issue-3:  Investment risk:

A proper Investment may make your financial health or freedom. So we can plan our investment before doing the appropriate risk analysis, all investments have a certain level of risks like high risk, medium risk, and low risk.  According to your risk factor, we can invest our money in the long term or short term. I always try to diversify my investment so that I can get the maximum benefits. Below are some common ways of investments that I follow

• Investment in PPF
• Fixed Deposit (FD) Investment
• RD-recurring deposit
• Insurance
• Investment in Pension scheme.
• Mutual Fund –SIP investment.

Proper investments not only give you financial freedom/healthy but also help you related to inflation, depreciation, etc.

Risk/Issue-4: Debt risk:

Always try to keep your debt to a minimum. I personally follow the below steps to manage debt risk as;

1. List out your EMI according to the interest rate
2. Paid EMI amount according to interest rate i.e. paid more EMI amount on high-interest rate w.r.t low-interest rate.

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FINANCEHELPS

Hi, I’m SG. Pradhan, the author & owner of the website “financehelps.in”. My expertise is in Financial Management & Accounting, Quality Management, Operation Management, Business Excellence, and Process Excellence. I am mech. engg. & certified internal and lead auditor.

financehelps.in

The post <strong>How to manage financial risk | Tips | Example</strong> appeared first on FINANCEHELPS.