An early start is always a good start, rather than thinking about investments and financial planning when you are already in the new year, how about planning your finances before you enter the year?
In our previous blog, we spoke about the major financial reforms of 2017 that made an impact on the personal financial plannings for the common man in India.
In this post, we will take a look at the trends to look forward to in 2018 and how can you plan to incorporate these into your financial plans for the new year.
Impact of GST
The effects of GST didn’t trickle down to the masses in 2017, but as the dust settles around the rules, tax rates and processes, the prices will surely fall and the benefits will be passed on to the consumers. This means that the households will be left with more money and this will have a bigger scope to plan on investments and grow their savings.
The 2018 Budget will be the first one post the GST regime roll out & last one to be presented by the current BJP government, it is fairly certain that there will be heavy focus on direct taxes and no major proposals for indirect taxes. With the current task force setup to review the tax rates and exemption norms and the government’s consistency in tax reforms, expect the tax base to be widened and the tax rates rationalized.
2017 was a great year for Indian equities as the market grew by around 25%. Some experts believe that the markets will not generate similar returns but will be around 15% and both global and local events will be constructive in nature and positive for the markets. The financial assets in overall household investments will continue to grow as financial literacy, improved long term domestic economic prospects, young and aspiring population will continue to invest in equities and mutual funds.
Following demonetisation, consumers quickly brought in cashless payments into their daily lives. SEBI took some bold moves in 2017 to make mutual funds more attractive to investors by standardizing scheme categories and allowing instant redemption facilities for some category of funds. RBI allowed new bank and loan accounts to be opened using Aadhar based KYC.
Apart from the above-mentioned major events, 2018 will see more changes especially in:
- The KYC norms to make the process simpler
- Introducing paperless payment mandates riding on UPI 2.0 and
- Introducing Digilockers to create a trusted paperless ecosystem to enable individuals to share data and enable multiple financial transaction avenues.
MoneyUp will always help you keep you updated about these events and how you should plan your finances better with for any reforms or changes. You can download our smart app for more help in financial planning and investments.