Month: September 2007
Balance your liabilities
Balance your liabilities
26 Aug, 2007, 0441 hrs IST,Aman Dhall & Dheeraj Tiwari, TNN
If you thought getting a good deal for a home loan is the end of journey, then you may be missing out on a lot of action. Of course, getting a loan on a competitive interest rate is the first step, but if you’ve made regular payments and created a good credit record, you can use that to your advantage.
For those not in the know, this concept is known as balance transfer (BT), wherein the unpaid portion of your home loan is transferred to a new HFC at a lesser interest rate. We at SundayET find out what to look out for before you decide to go ahead with a BT.
Today, banks (read housing finance companies) are looking out for customers from whom they can benefit in the long run, and if you are looking out for a better deal, it’s not a bad idea to approach a housing finance company (HFC) to refinance your loan on a more economical interest rate. That’s not all. Banks such as ICICI, IDBI and SBI also offer additional benefits such as payment of your pre-payment charges or processing fee.
But there’s a catch here. On the face of it, the picture may look rosy. But if you don’t read between the lines, you can end up in a debt-trap. Take the case of Abhishek Shekhar, a 35-year-old doctor. He took a home loan of Rs 20 lakh at an interest rate of 10% two-years ago from Bank X. The tenure of the loan is 20 years. Now, recently he checked out with Bank Y, and after some negotiations, the latter offered him an interest rate of 8.5%. Now, let’s check out the financial gains of this deal:
On paper, such a calculation looks attractive. But what you need to check out is whether the bank has added the pre-payment amount to your overall loan principal. In fact, some banks hide this clause, thus increasing your loan amount by a considerable sum, plus the effect of compounding interest. Warns Kartik Jhaveri, a certified financial planner and a chartered wealth manager:
“You need to check out what all benefits you may get. The important points you should keep in mind before opting for a BT are — how will the bank handle your pre-payment charges, what other features you’ll get such as mortgage insurance and whether the bank calculates your interest on a monthly or annual basis.”
Jhaveri has a pulse on the problem. In fact, owing to competitive rates across the industry, there are not too many balance transfers happening as of now. Customers are also reluctant to opt for it due to the cumbersome documentation involved and the gains are not too big at the moment. “That’s a major reason why there aren’t any special rebates with reference to processing fees or rate of interest being offered to balance transfer cases. Although we have a facility where we can include the pre-payment charges to the principal outstanding balance, to be paid to the existing bank/ NBFC,” explains Sujan Sinha, senior VP, AXIS Bank.
On their part, the banks are trying to place their offers in a more positive light. “We generally have two kinds of options — ‘Simple Balance Transfer’ and ‘Balance Transfer with Top-up’. In the second option, along with balance transfer, a customer can avail of top-up loan amount based on the vintage of the loan,” says Rahul Mallick, general manager, ICICI Bank. The key levers for making a customer switch from one HFC to another is processing fee and preferential interest rate on balance transfers. “Typically, the new interest rate will be 200 bps lower than the existing loan rate. However, a lot depends on the customer profile and tenure of loan,” he adds.
So before you opt for a balance transfer, it is necessary to check with your housing finance company about the current rates. If you’ve made timely payments, it’s quite possible that the HFC can offer you a better deal. Also, compare that if you go ahead with a BT, will the cost be higher than repayment and switching to another housing finance company. “Balance transfer is not a good move if you’ve only five or less year of repayment left. But otherwise, it is a very easy process,” says Sanjeet Shukla, GM, SBI Personal Banking.
Small steps such as finding out the paperwork required, and if the new bank, will be using the original EMI cheques or fresh ones, can save you from further hassles. Balance transfer need not mean saving money, you can also utilise the same for investing in different options. After all securing a home loan is not the end of journey.
Tackling your anger
Anger is a letter short of the word – ‘Danger’. Ask where your anger is coming from. What is it that makes you mad? Try to tackle it at it’s root cause. Recognising situations that spark your fuse can make it easier to avoid or work through them.
Relax
Simple relaxation techniques such as deep breathing and meditating can help calm you down.
Think out-of-the-box
Your thinking becomes confused and exaggerated, when you’re angry. Most situations do not portend the end of the world, so try to put happenings in perspective.
If you slow down, you might find a way to solve the problem. The world is not out to get you, even though it may seem like it.
Thinking logically might not alter the reality of the situation, but may keep your anger from exaggerating the problem.
Solve 
Channelising your anger towards solving the problem or trying to cope with the situation is the way out.
You can’t stop it from raining, but you can open your umbrella and stay dry.
Listen
Listening (though that is the last thing you want to do!) what the other person is as important as getting your point across. In fact you may sound exaggerated, hurtful, or aggressive. Say what you want the other person to hear-they may already know you’re angry. Then, listen carefully to the response.
This will help you stay calm-not to mention you improve your chances of resolving the problem.
Change your environment
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Move out of the milieu you were in. Try indulging yourself in any activity that will give you some time to cool down. A calm, rational mind and body will make better decisions.
Learning to manage and control your anger will surely make you healthier and happier for the rest of your life.
Islamic history exhibition to be held in Abu Dhabi
Islamic history exhibition to be held in Abu Dhabi
Compiled from WAM and staff reports / GULF NEWS Published: September 04, 2007, 00:37
Abu Dhabi: The capital will host an exhibition on Islamic history and heritage. The “Walk into Islamic history” exhibition will be held under the patronage of General Shaikh Mohammad Bin Zayed Al Nahyan, Abu Dhabi Crown Prince and Deputy Supreme Commander of the UAE Armed Forces, and is organised by the Abu Dhabi Music and Arts Foundation at the premises of the Abu Dhabi Cultural Foundation in collaboration with the Abu Dhabi Authority for Culture and Heritage.
Free treatment for children with cerebral palsy
Free treatment for children with cerebral palsy
By Dina El Shammaa, Staff Reporter / GULF NEWS Published: September 04, 2007, 00:37
Abu Dhabi: Children with cerebral palsy (CP) can now benefit from updated technology, physiology, physiotherapy and phonation treatment.
The symptoms for CP are mainly developmental delay. The Health Authority in Abu Dhabi (HAAD) announced the launch of the free treatment programme at Shaikh Khalifa Medical City (SKMC). The programme has been established in association with the Special Needs Centre at Mafraq Hospital and the Zayed Higher Organisation for Humanitarian Care.
“HAAD has formed a committee to monitor the medical rehabilitation services available in the emirate and provide recommendations for their development as well as to assess the need for setting up new specialised rehabilitation according to the highest international standards,” said Saif Al Qubaisi, Director of the Health Provision Sector at HAAD.
Dr Khalid Mohammad, Senior Consultant in Pediatric Neurology, SKMC; fellow of the Royal College of Pediatrics and British Pediatric Neurology Association, UK spoke to Gulf News regarding CP.
“CP is a common cause of disability in children worldwide and affects around three children in each 1,000 births,” he said.
Project management body launched at Knowledge Village
Project management body launched at Knowledge Village
Compiled from staff reports / GULF NEWS Published: September 04, 2007, 00:37
Project management body launched at Knowledge Village
Dubai: Dubai Knowledge Village has announced the launch of an independent Professional Project Management Association based in its premises. The announcement was made at a project management event held at the DKV Conference Hall on September 1. It was sponsored by DKV and SUKAD. The event was an occasion for project management professionals to share their experience and know-how on the strategic importance of this management discipline. Dr Ayoub Kazim, Executive Director of Dubai Knowledge Village and Dubai International Academic City, spoke of the growing awareness in Dubai and the region about project management as a special skill and competency. Hasan Makansi, Partner Development Manager, assured support to the association aimed at developing and promoting industry and professionals.
Innovation unit established
Innovation unit established
Dubai: The Knowledge and Human Development Authority (KHDA) has announced the establishment of its innovation unit that will engage in future studies and aid in creating a better educational future for youth. Dr Abdullah Al Karam, Chairman of the Board of Directors and Director General of KHDA highlighted the need for the unit saying that the it is necessary for the authority to forge ahead.
Shaikha Lubna among world’s most powerful women
Shaikha Lubna among world’s most powerful women
BY A STAFF REPORTER / Khaleej Times 4 September 2007
DUBAI — Shaikha Lubna Al Qasimi, the UAE Minister of Economy, is one of the five women in the Middle East considered by the US-based business magazine Forbes to be among the world’s 100 most powerful women.
The Forbes article credited Shaikha Lubna with creating more transparency and corporate governance in the UAE, and recognised her effective negotiation skills and intensive trade relations programme that sees her travel to four countries each month to promote the UAE.
The announcement comes only days ahead of Shaikha Lubna’s visit to Italy, where she will be the first Arab woman to be awarded the ‘Stella Re’ prize by the Italian Foundation, Sandretto Re Baudengo. The prize is awarded to only one woman every year. A special committee selected Shaikha Lubna for the Stella Re prize, which will be presented during an awards ceremony in Turin later this month.
No work visa for visitors
No work visa for visitors
By Ahmed Abdul Aziz / Khaleej Times 4 September 2007
ABU DHABI – The Ministry of Labour (MoL) will not approve work visa applications for workers who have entered the UAE on visit visas, according to Saleh Al Jabri, head of the Firms Department in the MoL. “It is a clear violation of the Labour law as visitors are not allowed to work on visit visas,” he pointed out.
Al Jabri told Khaleej Times that any company desirous of employing an expatriate should obtain a temporary work permit or employment visa, not visit visa.
In case of violation, the employers would risk Dh10,000 fine and suspension of transactions for six months.
Sources at MoL said that the ministry had recently rejected an application that had been initially approved by the Abu Dhabi Naturalisation and Residency Department (ADNRD) because the company had sought to hire employees on visit visas.
Using Fear To Your Advantage
Using Fear To Your Advantage
Facing your fears can help you achieve successes you never knew were possible
A friend of mine worked for a large Indian telecommunications company. After about six years of working there, he found that the initial excitement had died down and that his learning and growth had plateaued. That was when he received an offer to start up operations of a new entrant. The initial meetings clearly indicated to him that the role would be exciting. In fact, this was just what he was looking out for. There would be many challenges, especially since the company was new. At the same time, there would be tremendous learning.
However, after about three long months of discussions, my friend decided not to accept the offer. The reason he gave me was ‘fear’. He loved the job description but was afraid. He was afraid of stepping out of his comfort zone, of losing himself in unfamiliar territory, and of starting something entirely new. Fear made him flee from a great opportunity.
Fear happens to all of us and most of us normally react in one of two ways. We either flee, wherein we try to run away, or we hide and freeze, where we do not know what to do and are paralysed. These make people let their fears play on their minds and allow them to reach uncontrollable levels — leading to anxiety and pessimism. Like my friend who decided to give up on his opportunity, they continuously tell themselves, “I do not want to take risks. I do not want to do anything that I fear. It does not matter whether I am growing or learning, as long as I am safe in this old place where I have no fear.” But the problem is that, with time, your fears only get worse. You even begin to start fearing things that have absolutely no risks attached to them. You end up losing out on all the great opportunities in life.
How Do We Tackle Fear?
As the lines of a recent television commercial go, ‘at the end of fear, there is success’. The commercial shows two youngsters who are excited by an opportunity to tackle their fear. They react by fighting it, and enjoy every moment of the experience. Can we do this? Yes, of course. Think about adventure parks and horror movies where we pay good money to be scared out of our wits. We find this fear exciting. We deliberately trigger automatic reactions of fear in order to experience the thrill.
Like any other emotion, fear has both positive and negative aspects. Negative fear is debilitating. Positive fear is exhilarating. Life is boring without fear. Successful leaders constantly search for new, risky ventures. They even consciously focus on doing things that other people are afraid to do; go places where others fear to tread. Counteract the discomfort of fear by focusing on the positive side — the learning and the growth that every event generates. See events in a positive light that would give you power to overcome your fears and help you accomplish what you want to do.
People think that fear is paralysing and reduces your potential. Actually, the opposite is true. Fear can generate super-human feats. Have you not heard stories where normal people fought valiantly to save their friends and family from grave danger? Facing fear is empowering for leaders. It gives you strength you never knew you had. Fear is only damaging when you run away and do not confront it.
People avoid fear in order to preserve independence. Fear is only enslaving when someone else is purposefully trying to be fearsome and controlling. But the fear of reality — the possibility of missed opportunities — can motivate you to get to where you want to be. Rather than being afraid about losing security, comfort and predictability, start fearing about losing out on opportunities; start fearing about getting nowhere in life. Be afraid of being mediocre. Be afraid of waking up one morning and saying to yourself: “Why did I waste my life?” Use fear to your advantage. Fears accompany you until the threshold. Beyond that there is no fear, just success.
ON LEADERSHIP: SANGEETH VARGHESE for Business World.
The author is a leadership scholar from the LSE and founder of LeadCap. His book, Decide to Lead: Eight Decisions That Can Make You A Leader, will soon be published by Businessworld. will soon be published by Businessworld. He can be contacted at sangeethv@leadcap.org
Use More To Have More
Use More To Have More
The more you use your abilities, the more you will be able to benefit from them.
We often wonder why people who are already capable are blessed with more, while most others live average lives. How can a Jack Welch also be a successful speaker, author and columnist? And how could Vikram Sarabhai, the father of India’s space programme, simultaneously be a successful physicist, businessman, educationist and statistician? How could he possibly create institutions as diverse as the Indian space research organisation (ISRO) and the Indian institutes of management (IIM)? Are people like Welch and Sarabhai blessed with extraordinary talents, or does something else tip things in their favour?
Human capabilities can be divided into two broad sorts: Obvious capabilities are those that we are conscious about. We exhibit and utilise these every day. Our obvious capabilities are pretty much on display all the time. Or they could be discovered with very little effort. They are embedded in our basic tendencies. For example, from an early age, Bill Gates had always showed a deep interest in computing. When he set up Microsoft with co-founder Paul Allen, Gates knew that his strengths were in computing and that was where he invested his time and money. How a college drop-out used his passion to become the richest man in the world is plainly visible to everyone.
Hidden capabilities are different from obvious capabilities. They can be developed only by wilful determination, requiring some amount of effort before their discovery. To discover your hidden capabilities, you would have to boldly embrace opportunities, even when you are not sure. This requires you to be aware of the new opportunities you are exposed to. By being at the helm of the world’s largest software corporation, Bill Gates was constantly thinking about the future of technology to give his company a competitive edge. That led him to the broader realm of how technology could change the world. His thoughts were no longer limited to emerging technology, but he was now imagining the future. He was constantly building and improving it. He was no longer just a computer geek, but a management guru —evangelising the latest management techniques. A futurist — defining the way things would be. An author — writing about how things are changing and even a world reformer — driving projects that were changing lives for the better.
How can you improve your obvious capabilities and discover hidden capabilities? The basic law regarding your hidden and obvious capabilities is the Law of Use and Possess. According to this law, if you use more, you have more; if you use less, you have less.
Use more to have more: Very simply, the more you exploit opportunities around you, the more you will come across them. If you utilise the immediate, short-term opportunities that you come across rather than wait for that perfect situation, you will receive more long-term opportunities. If you did not start out on the first conquest, you would never have had the opportunity for more. That one initiative told you about your warring capabilities and your leadership qualities; and legions fell before you. If you had instead chosen to stay put and deal with your kingdom, you would never have gone out and made the whole world your kingdom. The more you use your capabilities, the more you reveal about yourself, to yourself.
Use less to have less: You could also choose to destroy your capabilities by running away from situations; by never learning or by never making an effort. You squander away your capabilities — and they are never again able to regain their original shape. The less you use your capabilities, the less you will benefit. Slowly, you will lose all that you had once owned.
As a leader, choose more. When situations demand, face them by investing your capabilities wisely. As you develop them, more doors will open up for you. Only in this way would you improve your existing capabilities and discover more hidden ones.
ON LEADERSHIP: SANGEETH VARGHESE for BUSINESS WORLD
The author is a leadership scholar from the LSE and founder of LeadCap. His book, Decide to Lead: Eight Decisions That Can Make You A Leader, will soon be published by Businessworld. He can be contacted at sangeethv@leadcap.org
Catch Them Young
Piggy banks are for new-borns. And in this jet age, all kids know that money certainly doesn’t grow on trees. On your part, you may have invested in the right options and charted out your short or long-term investment plan, but the benefits that you may reap from making your kids financially aware cannot be quantified in monetary terms.
In fact, in this era of pay cheques, it becomes even more important to make your kids understand the concept of fiscal accountability. After all, it’s you who has to take the ultimate responsibility? That said, making your kids aware about dollar and dimes (in our case rupees and paise) is no miracle.
SundayET spoke to captains of different industries to find out how they have planned to secure the financial future of their kids. Besides encouraging habits such as sharing, understanding the value of money and even charity for the overall development of the child, they highlight a step-by-step journey on how to introduce your child into the financial world….
Budgeting
Although he hates to call Jetlite a budget airline, the habit of budgeting is what Jetlite CEO Gary Kingshott emphasised to his kids. “Budgeting is the first step of sound investment planning. You should know the resources that are available and accordingly you should allocate and spend them,” he says. According to Kingshott, from the very beginning, he inculcated this practice in his kids.
“I did two things. I set up a limit of $100 a month. And I gave them an option that either they can take the whole yearly amount or ask for it per week. In this amount, they had to manage their expenses such as buying presents for their friends, partying or others. This not only gave them a real-life experience about money, buying and selling but also taught them to make their own decisions whether to spend or save or on different things,” he muses.
Kingshott believes that this also generates interest in children and makes them responsible. “But you’ve to play smart. Set the terms of the allowance and make it clear to your children at the outset, otherwise they’ll always find an excuse to ask for some more amount,” he cautions. Today, he feels that the habit of budgeting has helped his children not only to manage their finances but also in their personal lives.
Open an account
Vikas Vasal, director, KPMG India, advises firms on issues which can turn around their fortunes. As a director of one of the world’s leading advisory firm, it’s not easy to miss on the numbers. “Numbers are important for your kids too,” he says. He has two children — seven year-old Chahat and five-year-old Muskan.
“Recently, I opened a bank account for my eldest one. I made her go through the terms and conditions just to make sure that she understands the purpose of opening a bank account. She did make some childish inquiries but that was the purpose of her going through the content. I also made her fill the form and wherever she was at sea, I bailed her out by explaining the financial literature in simple and easy manner,” he says.
Vasal feels that since the child’s account is linked to the parents, you can make sure that your kid deposits a part of his/ her monthly allowance in the bank. “ Later on, you can gradually introduce your child to the entire range of banking services, such as ATM cards, net banking, debit cards and even statements,” he adds. For young adults, Vasal suggests that the parents can set a spending limit for the card and keep a track of the money that the child spends every month.
Mutual fund SIP
An expert on financial matters, Reliance Money CEO Sudip Bandyopadhyay feels that when it comes to teaching your kid the nuances of growing money, there’s no difference between an adult and a child. “To inculcate investment habits in my children, I have introduced them to mutual funds through systematic investment plan (SIP). With micro SIPs available in the market, you can get your child started with an investment of as low as Rs 50 per month,” he says.
According to him, the charm of managing money is exciting for youngsters and seeing the money grow only adds to the confidence of the child. “Your children would be on their feet, literally. Once you get them going, they would start inquiring about any financial product they are exposed to, with you,” asserts Bandyopadhyay.
He believes that making your child invest in SIPs involves a two-pronged approach. “Not only they’ll use their allowances for making investments but it will also help in future if they wish to pursue higher studies,” he adds. Bandyopadhyay feels that you should involve your child as much possible as in the decision-making process.
“For instance, whenever we are planning for holidays, I take suggestions from my children on how can we efficiently budget our travel plan. At the end of the day, your children should realise that they are growing up and are part of the think-tank of their family,” he reasons.
E-banking
Insurance is subject matter of solicitation. And the same stands true if you really want your kids to be financially aware, believes Nitin Chopra, CEO, Bharti-AXA Life Insurance. “You’ve to generate a curiosity among your children so that they ask for details.
Most parents forget that any young adult would love to take on responsibilities, provided you give him space. In my case, from the very start, I made sure that my daughter, Vidita, was aware of my financial transactions. And in this Internet age, I made sure that she learnt almost everything about banking on the Net. Today, she advises me when it comes to handling accounts,” he laughs.
Chopra feels that today parents don’t have enough time for their kids. But taking out some time and imparting the right lessons can help in shaping their future in a much better way. “I went along with my daughter to the US at the time of her college admissions but she needed little help from me.
She was confident and filed all the papers, including opening an account, all by herself,” he remembers. According to Chopra, ‘e-banking’ is the future and if kids have a basic understanding, it will help them in the long run. “Today, you can do anything and everything on the net and if you are comfortable with it nothing is better,” he adds.
Money games
He may be dictating terms to his subordinates on how to bargain in the wholesale market while sourcing fruits and vegetables for Food Bazaar outlets, but when it comes to educating his kids, Pantaloon Retail Food Business CEO Arvind Chaudhary believes that playing money games is the best way to teach the secrets of a good deal.
Now be it the game of monopoly or learning the bulls and bears of the stock market over the Internet, “I encourage them to play lot of money games. They really help sharpen their mind and bargaining skills,” says Chaudhary. The Chaudhary family, in fact, assesses every family member on the last weekend of a month on how efficiently he/ she bargained for goods. “Negotiating ability should be inculcated in a child right from the beginning. It gives them a broad picture about the importance of money,” he feels.
Chaudhary also tries to involves his children in daily financial matters. “If I am making some payments through cheque, I ask them to cross-check whether I have filled up all the relevant details. Similarly, I ask them to keep a track of the due date of an insurance premium,” he reveals. Chaudhary believes playing stock games over the Internet has made his children more aware of how actually the stock market operates and this will help them in future.
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