When my wife bought a new Subaru Outback in March, the manufacturer offered special financing at 3.9% APR. We didn’t take it because while we could keep our cash in a money market fund earning 4%, the interest is taxable. The interest paid on the car loan would be after-tax. It would be net-negative if we financed.
2025 Subaru Outback
The new 2025 Trump tax law — One Big Beautiful Bill Act — made car loan interest deductible (with qualifications and limits). Had we known this was coming, we would’ve financed, but we can’t go back now to get a loan and deduct the interest.
Only New Cars Assembled in the U.S.
Not all car loans qualify for the new tax deduction. It must be for a new car, not for a used car. It must be for personal use, not a commercial vehicle.
Both electrical and gasoline-powered vehicles qualify. Cars, minivans, SUVs, pickup trucks, and motorcycles all qualify, but the vehicle must have had its final assembly in the U.S.
My wife’s Subaru Outback would’ve qualified because it was assembled in Indiana. Some brands and models have cars assembled both in the U.S. and outside the U.S. It depends on the specific car you get from the dealership. You can tell by the VIN. A car is assembled in the U.S. if the VIN starts with a 1, 4, or 5.
Timing
The loan must be taken out at the time of purchase after December 31, 2024. Refinancing an existing loan taken out before January 1, 2025 doesn’t count. Taking out a new loan now on a car you already own free and clear doesn’t count either.
We’re disqualified because we already paid cash at the time of purchase.
If your loan qualifies, refinancing it continues to qualify, but the new loan must not exceed the outstanding balance of the previous loan. In other words, no cash-out refi.
Income Limit
You’re allowed to deduct up to $10,000 in car loan interest if your AGI is $100,000 or less ($200,000 or less for married filing jointly). Married filing separately still qualifies. The deduction phases out by 20% as your income goes up toward $150,000 (or $250,000 for married filing jointly).
The $10,000 deduction limit is sufficient for most people. A 5-year loan of $50,000 at 3.9% APR would incur less than $2,000 in interest in the first year and less yet in subsequent years. There’s no limit on the number of cars or any maximum price.
The tables below illustrate how the deduction limit phases out at different income levels. Extrapolate when your income is between the numbers shown in the tables.
Single
AGI
Deduction Limit
$100,000 or less
$10,000
$110,000
$8,000
$120,000
$6,000
$130,000
$4,000
$140,000
$2,000
$150,000
$0
Married Filing Jointly
AGI
Deduction Limit
$200,000 or less
$10,000
$210,000
$8,000
$220,000
$6,000
$230,000
$4,000
$240,000
$2,000
$250,000
$0
Temporary Deduction
If your car purchase qualifies, your timing qualifies, and your income qualifies, you’re allowed to deduct car loan interest up to the limit each year between 2025 and 2028 (inclusive). If you’re planning to buy a new car in 2026, then you have only three years left.
It’s a tax deduction, not a tax credit. Deducting $2,000 in car loan interest reduces your taxable income by $2,000. It reduces your federal income tax by a few hundred dollars, depending on your tax bracket.
The deduction is available to both itemizers and non-itemizers, but it doesn’t lower your AGI. It doesn’t make it easier for you to qualify for other tax deductions or tax credits.
Higher Prices From Tariffs
Not everyone financing a new car purchase qualifies for the tax deduction, but everyone is affected by higher prices from tariffs. Subaru raised prices mid-year shortly after we bought the car. Dealerships also reduced their discount to the MSRP. We would have to pay $4,000 more if we were to buy the same car today.
Paying a higher price costs way more than the tax savings from deducting the interest on a car loan.
***
The headlines say no tax on car loan interest, but this deduction comes with many strings: only new purchases, only new cars and only specific cars, with an income limit, and only in the next few years. We would’ve financed because everything happened to line up, if only we knew. Even though financing and paying cash would be a wash financially, having more cash on hand helps with smoothing out cash flow to stay under the ACA health insurance premium cliff.
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Retirement brings peace, freedom—and a new kind of financial challenge for retirees. You’re no longer earning a paycheck, but your money still needs to work as hard as you did. That’s why a question we often hear at Fincart is: “Where should I invest ₹20 lakh after retirement?”
It’s a great question. But the right answer depends on your retirement goals—whether that’s generating steady income, growing your wealth, or building in some flexibility for life’s surprises.
In this blog, we’ll walk you through three smart ways to invest ₹20 lakh post-retirement. Each option is designed for a different kind of retiree and backed by our experience as a AMFI-registered investment advisor. Let’s help your money do what you need it to do.
Understanding What You Want From Your Retirement Corpus
Before deciding where to invest your ₹20 lakh, it’s important to pause and reflect on what you truly want from this money. Your goals will define the right investment path.
Ask yourself:
Do I need a steady income every month or quarter? If you’re relying on this corpus to manage household expenses post-retirement, prioritising predictable, low-risk income sources becomes crucial.
Am I looking to grow this money over time? Maybe you don’t need the funds immediately, but want to build wealth—either for your future security or to leave a legacy for your children or grandchildren.
Do I want some flexibility to access this money when needed? Life can be unpredictable. Medical emergencies, gifting, or travel plans may require occasional access to your savings without heavy penalties.
Each of these objectives leads to a different investment mix. The good news? With a thoughtful approach, you don’t have to choose just one—you can build a strategy that balances all three. Let’s explore how.
Case 1: Income First – For Retirees Who Need Regular Cash Flow
If your priority is consistent income, you’ll need to focus on safe, fixed-income products. The goal here is capital protection and predictable payouts—without taking on excessive market risk.
Strategy 1: Start With Senior Citizens’ Saving Scheme (SCSS)
Why it works:
Backed by the Government of India
8.2% interest rate (as of April 2025)
Quarterly payouts
Maximum investment limit: ₹30 lakh
Lock-in: 5 years (extendable)
How to use it: If you haven’t already invested in SCSS, put as much of the ₹20 lakh here as possible. The payouts offer peace of mind and beat most traditional bank FDs in returns.
Strategy 2: SWP from Debt Mutual Funds
If you’ve already exhausted your SCSS limit or want additional income, consider a Systematic Withdrawal Plan (SWP) from a short-duration debt fund.
Why it works:
Tax-efficient withdrawals (especially after 3 years)
Flexibility to set monthly/quarterly withdrawals
Potential for better post-tax returns vs. FDs
We usually recommend withdrawing no more than 6% annually to preserve your corpus.
Strategy 3: Add Equity Savings Funds for Inflation Protection
Relying entirely on fixed-income investments during retirement may seem safe, but it comes with a hidden risk—inflation. Over time, rising costs can quietly eat into your purchasing power, leaving you with less value than you started with.
That’s why it’s wise to allocate 25–30% of your retirement corpus to Equity Savings Funds, especially if you want your retirement income strategy to stay relevant and resilient over the years.
These funds typically consist of:
Around 30% equity exposure – to provide growth and help your money beat inflation.
30–40% debt allocation – offering capital stability and regular interest income.
Arbitrage positions – low-risk equity strategies that enhance tax efficiency.
This structure gives you a tax-optimized and future-ready investment mix—allowing for moderate returns, reduced volatility, and improved post-tax outcomes. Equity savings funds strike a balance between safety and growth, making them a smart addition to any retirement plan.
Case 2: Growth First – For Retirees Focused on Long-Term Wealth Building
Some retirees don’t need monthly income. Instead, they want to grow their wealth over the next 10–15 years—maybe to pass it on to children or to cover large future costs like healthcare or home renovation.
In that case, aggressive hybrid funds are your best bet.
Strategy: Invest in Aggressive Hybrid Mutual Funds
Why hybrid, not pure equity?
They invest 65–75% in equities and the rest in debt
The equity drives long-term growth
The debt component cushions market volatility
Potential Returns:
Let’s say you invest your ₹20 lakh in a top-performing aggressive hybrid fund:
In 5 years: ₹20 lakh could grow to ₹34–36 lakh
In 10 years: Around ₹60 lakh
In 15 years: You could cross ₹1 crore
These returns are based on 10-year rolling averages—not just best-case scenarios.
The Real Advantage
Remember the Covid crash in 2020? While the Sensex TRI fell over 38%, aggressive hybrid funds limited losses to around 28%. That’s the power of built-in diversification.
Pro tip: Choose funds with a strong track record across market cycles. Need help selecting? Fincart’s mutual fund investment planners are just a call away.
Case 3: Flexibility First – For Retirees Who Want Access + Growth
What if you want a little bit of both—growth + liquidity? Say, you’re mostly okay without income but want to dip into your corpus occasionally—for a medical need, a vacation, or a gift to your grandchild.
In that case, a balanced split strategy works beautifully.
Strategy: 50:50 in Equity & Debt
₹10 lakh in a flexi-cap equity fund
₹10 lakh in a short-duration debt fund
Why it works:
The equity part grows your money over time
The debt part acts as an emergency fund
If the market is down, you can access the debt portion without touching your equity at a loss
This way, you keep the growth engine running, while staying financially nimble.
Flexi-Cap Funds: The Ideal Growth Companion
These funds dynamically allocate between large-cap, mid-cap, and small-cap stocks. That gives your investment:
Better adaptability to market conditions
Diversified equity exposure
It’s growth without the rigidity of staying stuck in one market segment.
Mistakes to Avoid While Investing Post-Retirement
Going 100% into fixed deposits or SCSS
You’ll likely lose money in real terms over time due to inflation.
Withdrawing more than 6–7% annually from your corpus
That puts you at high risk of outliving your savings.
Not diversifying across asset classes
Equity, debt, and hybrids each serve a unique purpose.
Ignoring healthcare or emergency needs
Always keep 3–5 lakh in liquid instruments for medical emergencies.
Not consulting a professional
DIY investing post-retirement can be risky. A certified Fincart advisor can help you make informed, personalized decisions.
How Fincart Can Help Retirees Invest Smarter
As an AMFI-registered investment advisor, Fincart empowers retirees with the guidance needed to make smart, goal-aligned financial decisions.
Here’s how we help you build a secure and future-ready retirement plan:
Customized retirement planning based on your specific goals—whether it’s monthly income, wealth creation, or flexibility.
Selection of the right mutual funds and fixed-income products, tailored to your risk profile and time horizon.
Tax-optimized SWPs (Systematic Withdrawal Plans) to ensure your income is steady, sustainable, and efficient.
Diversified asset allocation strategies that reduce risk while protecting long-term returns.
Regular portfolio reviews and rebalancing, so your plan stays aligned with market trends and your evolving needs.
Whether you aim to preserve capital, generate income, or grow your wealth, Fincart helps you craft a retirement strategy that truly works for your life—now and in the future.
Conclusion: Let Your ₹20 Lakh Work for You
There’s no universal answer to “Where should retirees invest ₹20 lakh?” The best approach depends on whether you’re seeking:
Income → SCSS + Debt SWP + Equity Savings
Growth → Aggressive Hybrid Funds
Flexibility → 50:50 Equity + Debt split
At Fincart, we believe your retirement portfolio should be as unique as your life. You’ve worked hard for this money. Now it’s time for your money to return the favour—with growth, stability, and peace of mind.
Does Jane Street India impact markets and should mutual fund long term investors worry? Learn how much it takes to move Nifty 50 by 1%.
If you’re a regular investor putting money in SIPs or equity mutual funds, the recent headlines about Jane Street might have worried you. News of SEBI taking action against this big foreign trader for alleged price manipulation made many wonder:
“If a giant global trader can move prices, is my long-term money at risk too?”
If you look into the history, you will notice that in the short term, such price rejigging is not a new event for the stock market. Also, there is no guarantee that such things can’t repeat in the future. In such a situation, many long-term mutual fund investors feel concerned. This article is meant to address their concerns.
Jane Street India: Should Mutual Fund Long-Term Investors Worry?
In this article, let’s break down:
Who Jane Street is
How they operate in India
How much money it actually takes to move India’s biggest index — the Nifty 50 — by just 1%
And why all this barely matters for your long-term wealth building.
Who is Jane Street?
Jane Street is one of the world’s biggest proprietary trading firms, active in stocks, bonds, options, and other assets globally. They do high-frequency trading and arbitrage, often making tiny profits repeatedly in massive volumes.
Do they have an office here?
Disclaimer:Jane Street does not have any physical office in India. They trade in Indian stock and derivative markets through Foreign Portfolio Investors (FPIs) and Indian brokers, as allowed under SEBI’s rules.
So when you hear “Jane Street India,” it simply means Jane Street’s trading activities in the Indian market, not that they have an office on Indian soil.
What did Jane Street allegedly do in India?
Recently, SEBI’s investigation found that Jane Street’s FPIs and brokers allegedly manipulated prices in the Nifty Bank options market. They placed large orders which, according to SEBI, gave a false picture of demand and supply, influencing prices unfairly.
When SEBI caught this, it took strict action — penalizing the involved FPIs. Following this, Jane Street announced an exit from some of its India trades, calling the regulatory environment “unpredictable.”
Does this mean a big trader can easily move the whole market?
Many retail investors fear that if such a giant player can bend prices in options, they can easily push the Nifty 50 up or down too.
Let’s see if that’s really possible.
How much money does it really take to move the Nifty 50 by 1%?
Here’s where the scale becomes clear — and comforting.
What is Nifty 50? It’s India’s main stock market index, made up of the 50 biggest companies — like Reliance, HDFC Bank, ICICI Bank, Infosys, and TCS.
How is it calculated? The Nifty 50’s level is based on the free-float market capitalization — the combined value of shares that are publicly traded (excluding promoters’ locked-in shares).
Current free-float market cap (as of July 2025):
Approx. Rs.120 lakh crores (or about $1.45 trillion).
So, to move the index up by just 1%, you’d theoretically have to increase the combined value of these 50 companies by Rs.1.2 lakh crores — that’s about $14–15 billion!
But do traders really buy stocks worth Rs.1.2 lakh crores?
No. Traders like Jane Street mostly use derivatives — futures and options — to speculate on short-term moves. Derivatives need far less upfront capital because they’re leveraged bets. So, in the short-term, aggressive trading in derivatives can temporarily push the index up or down a few points.
But here’s the catch:
Actual stocks have to follow real demand. If someone wants to move the real index sustainably, they must actually buy or sell shares in huge volumes — worth tens of thousands of crores.
Other large investors — like mutual funds, insurance companies, pension funds — quickly counteract unusual moves. They spot overpricing or underpricing and bring the market back to fair value.
SEBI has strict surveillance systems that flag any unusual volumes or price patterns, exactly like they did with Jane Street.
So, the bigger the market — like the Nifty 50 — the harder it gets to push the whole index meaningfully. This is why small traders or even single big traders cannot “manipulate” it easily for long.
Let’s simplify with an example
Imagine:
The total free-float market cap = Rs.120 lakh crores.
A trader wants to push the Nifty 50 up by 1%by actually buying stocks — not just playing with options.
They’d need to buy enough shares across multiple big companies to increase their combined value by Rs.1.2 lakh crores.
That’s more than the annual budget of some states!
What if they just use futures or options?
They can try, but:
They need counterparties to take the opposite bet.
Any artificial price move gets corrected when the contracts settle.
SEBI monitors positions — large or suspicious trades attract surveillance.
So, while small manipulations in one stock or one options contract can happen for a short time, moving the whole Nifty 50 meaningfully is extremely difficult — both legally and practically.
What if someone is concentrating on high weightage Index Stocks to manupulate?
Nifty 50 is a free-float market-cap weighted index. Stocks like HDFC Bank and Reliance Industries have high weights (around 10%–12% each).
So here’s the math:
HDFC Bank — weight approximately 12% Reliance — weight approximately 11% Together: approximately 23% weight in Nifty 50.
This means:
If only these two stocks go up enough, they alone can push the index significantly.
Example: How Much Buying is Needed?
If you wanted to move the entire index by 1% only by moving HDFC Bank and Reliance, you’d need to move them up by approximately 4.35% each.
Why?
Combined weight approximately 23%.
If combined stocks go up by 4.35%: 4.35% * 23% ? 1% move in Nifty.
How much money does that mean?
HDFC Bank market cap approximately Rs.12.5 Lakh Crores ? 4.35% = Rs.54,375 Crores
Reliance Industries market cap approximately Rs.19 Lakh Crores ? 4.35% = Rs.82,650 Crores
So, in theory, you’d need buying demand worth Rs.54,000–Rs.82,000 Crores in these two stocks alone at once to push them up that much in a short time.
Is This Realistic?
Absolutely NOT in real markets!
– Stocks don’t trade their entire market cap daily. – The actual float is far less — but even then, creating this demand is extremely hard. – The moment prices surge, sellers come in — making it hard to keep prices artificially high.
Example: If you wanted to push HDFC Bank up 4–5% in one day, you’d need billions of rupees of aggressive buying, and you’d face regulators watching every unusual order.
What does this mean for your mutual funds and SIPs?
Here’s the good news for every long-term investor:
Mutual funds invest directly in real shares — not speculative trades. So your money is backed by real company ownership, not derivative bets.
Short-term swings don’t change long-term growth. A trader might cause a 0.1% or 0.5% blip today — but over 10–20 years, India’s economy, company earnings, and business fundamentals decide your returns.
Your fund manager is not gambling. They follow strict mandates, diversification, and risk controls.
SEBI actively polices the system. The fact that Jane Street got caught shows surveillance works.
A real-life perspective
Suppose you have a 10-year SIP in a Nifty 50 index fund:
Over 10 years, you’ll face thousands of news events — scams, manipulations, global crises.
But the index itself reflects India’s largest companies — which grow over time.
The temporary noise from traders is like tiny ripples on a large lake.
Key Takeaway
Yes — big traders can cause short-term blips. No — they can’t break the market’s long-term growth.
What you should really focus on
Keep investing regularly.
Ignore short-term noise and headlines.
Stick to your long-term plan — India’s growth story is not going away just because a trader misused loopholes for a few crores.
Trust SEBI’s checks — but more importantly, trust time and diversification.
Final Words
The Jane Street India incident shows that:
Short-term players will always exist.
SEBI is watching.
Long-term mutual fund investors have nothing to panic about.
So keep calm, keep your SIPs running, and let your money ride on India’s real growth — not the drama of daily trades.
Quick Facts Recap
Total Nifty 50 free-float market cap: Approximately Rs.120 lakh crores.
Money needed to truly move it by 1%: Approximately Rs.1.2 lakh crores.
Short-term manipulation using options can happen — but SEBI has strong eyes.
Mutual funds are built for the long run, not for daily trading bets.
Stay invested. Stay patient. That’s the real power.
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Baby Boomers grew up during an era of abundance, with many spending decades acquiring prized possessions—from classic cars to antique furniture and collectibles. However, times have changed, and what once seemed like valuable assets are now becoming impossible or wildly expensive to insure.
As insurance companies tighten their risk standards and phase out coverage for specific categories, many Boomers are learning the hard way that their treasured belongings may no longer be protected. This shift is leaving many retirees facing unexpected financial risks and difficult decisions about whether to sell, store, or simply hope for the best.
Here are 10 once-coveted items Boomers bought that are now becoming uninsurable or simply not worth the sky-high premiums.
1. Classic Cars and Vintage Vehicles
Owning a classic car was once a hallmark of American success, and many Boomers proudly invested in vintage vehicles from the ‘50s, ‘60s, and ‘70s. But insuring them has become increasingly difficult.
Many insurers now limit or refuse coverage on classic cars without strict usage restrictions, such as driving only to car shows or keeping the vehicle in climate-controlled storage. Others require costly appraisals and specialty policies with high premiums.
For cars beyond a certain age or in less-than-mint condition, finding any coverage can be nearly impossible, especially if parts are no longer available or repairs exceed the car’s value.
2. Antique Furniture
Boomers often inherited or collected antique furniture, believing it would grow in value over time. However, shifting tastes and shrinking demand have caused insurance companies to view these pieces as high-risk, low-return liabilities.
Fire, water damage, or moving accidents involving antique furniture are difficult to assess for insurers. Replacement costs are subjective, and repairs are expensive. Many companies now exclude antique items from standard homeowners’ policies or require costly riders to cover them.
As the market for traditional antiques declines, many insurers simply won’t cover them at all—especially if they’re fragile or hard to appraise.
3. Fine China and Crystal
China cabinets once symbolized status in Boomer households, filled with ornate dinnerware and delicate crystal. Today, most younger generations have little interest in these pieces, and their resale value has plummeted.
Because these items are extremely fragile and frequently damaged during moves or accidents, many insurers no longer cover them under standard policies. Specialty insurance is sometimes available, but premiums often exceed the value of the items themselves.
Boomers who invested in high-end china sets decades ago may now find them both uninsurable and nearly impossible to sell.
4. Collectible Stamps and Coins
Stamp and coin collecting was once a popular hobby among Boomers and many amassed sizable collections over decades. However, the market for these collectibles has cooled significantly.
Insurers are wary of covering stamp and coin collections due to their high portability and theft risk. Standard policies rarely cover their full value, and specialized policies often come with restrictive terms, high deductibles, and costly appraisals.
As fraud, counterfeiting, and fluctuating market values increase, many insurance companies now simply decline coverage for these once-treasured assets.
5. Original Artwork
Boomers who invested in original paintings or sculptures are also facing insurance hurdles. While high-value art remains insurable through specialty carriers, coverage has become more expensive and difficult to obtain.
Many insurers now require professional appraisals, detailed provenance records, and advanced security measures, such as in-home alarms and humidity control systems. Even then, premiums can be prohibitively high.
If pieces are damaged by fire, floods, or even accidental knocks, repair costs often exceed insurance payouts, leaving owners with major losses.
Image source: Unsplash
6. Jewelry and Watches
Boomers who collected fine jewelry or luxury watches now face growing challenges in securing full insurance coverage for these items. Standard homeowners’ policies typically cap jewelry coverage at a few thousand dollars, far below the value of many heirlooms or designer pieces. Specialty policies are available, but rates have soared in recent years due to surging theft rates and difficulty verifying ownership.
Insurers also increasingly reject coverage on vintage watches or jewelry pieces with limited market liquidity or uncertain appraisal histories.
7. Vintage Firearms and Weapons
Gun collecting was once a common hobby among Boomers, particularly for historical firearms or military memorabilia. However, insuring these items has become a legal minefield.
Many insurers refuse to cover firearms outright, while others severely limit coverage on antique or collectible weapons due to regulatory restrictions and theft risks.
Even when insurance is technically available, the process typically requires detailed documentation, locked storage, and sometimes compliance with additional local laws, making coverage too expensive or impractical for many collectors.
8. Musical Instruments
Boomers who invested in high-end musical instruments, such as vintage guitars, violins, or pianos, are also encountering difficulty finding insurance.
Musical instruments are prone to damage from humidity, temperature changes, and accidental misuse. As a result, many insurers have tightened their coverage, especially for instruments that travel frequently or are stored in non-climate-controlled environments. Specialized musical instrument insurance is available, but premiums are steep, and claims often involve complex disputes about depreciation and replacement costs.
9. Persian Rugs and Fine Textiles
Persian rugs were once status symbols in many Boomer households, with some pieces worth tens of thousands of dollars. Today, insuring them has become increasingly difficult.
These rugs are vulnerable to stains, water damage, and moths—common risks that insurers no longer want to cover under homeowners’ policies. Some companies even explicitly exclude textile coverage from policies altogether. Those seeking protection must often purchase specialized insurance, which may cost more than the declining resale value of the rugs themselves.
10. Recreational Vehicles and Vintage Campers
Boomers who embraced the RV lifestyle or invested in vintage campers are discovering that insuring these vehicles is more complicated than ever.
Many insurers now avoid covering older RVs or campers, particularly models without modern safety features or those that are difficult to repair due to obsolete parts. Specialty coverage is available but often comes with high deductibles, limited liability, and strict usage rules. For retirees looking to cash in on RV adventures, these insurance challenges can be a major roadblock and leave them financially exposed in case of accidents or theft.
Why More Boomer Belongings Are Becoming Uninsurable and What to Do About It
The shrinking availability of insurance for once-popular Boomer purchases highlights a hard truth: many prized possessions lose their financial security as markets change and risks evolve.
From vintage cars to fine china, insurers are increasingly unwilling to cover these high-maintenance, low-demand items, leaving many retirees exposed to financial loss in the event of damage, theft, or natural disasters. For Boomers holding onto these valuables, it’s crucial to take proactive steps:
Get professional appraisals to understand the current value
Research specialized insurers while comparing costs carefully
Consider selling or donating items before they lose further value or become impossible to cover
Discuss your situation with a financial advisor to understand the long-term risks
While some treasured items carry deep sentimental value, it’s essential to balance emotional attachment with realistic financial planning in retirement.
Have you tried to insure any collectibles or valuables recently? Were you shocked by the cost or the denial of coverage?
Riley Schnepf is an Arizona native with over nine years of writing experience. From personal finance to travel to digital marketing to pop culture, she’s written about everything under the sun. When she’s not writing, she’s spending her time outside, reading, or cuddling with her two corgis.
A sweeping new piece of legislation known as the “Big Beautiful Bill” is packed with tax breaks, expanded deductions, and changes to key government programs. This bill could dramatically alter the financial landscape for millions of Americans. Here’s what you need to know.
Read more:
Existing Tax Rates Become Permanent
PeopleImages.com – Yuri A/shutterstock.com
The lower tax rates from the Tax Cuts and Jobs Act of 2017 were set to expire in 2025. The “Big Beautiful Bill” will make those tax breaks permanent.
Taxpayers who receive tips will be able to deduct up to $25,000 per year in tips from their taxable income, provided they earn under $150,000 ($300,000 on joint returns). A “qualified tip” is money paid voluntarily by the payor; therefore, mandatory service charges do not qualify. Credit card tips are eligible, but the value of gifts are not. The taxpayer must be in an occupation that customarily and regularly receives tips.
For overtime, the deduction is capped at $12,500 ($25,000 for joint returns), provided they earn under $150,000 ($300,000 for joint returns).
Deduct Auto Loan Interest
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Those with car loans can write off up to $10,000 in interest paid to qualifying car loans for the next three years, and you do not have to itemize to claim the deduction. A key factor, however, is that the car must be new and assembled in the U.S.
The Big Beautiful Bill calls for a $6,000 deduction for those 65 and older who earn $75,000 or less ($150,000 joint). This would effectively eliminate taxes on Social Security for 88% of seniors.
Cap on State and Local Deductions Increases
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When you pay state and local taxes, you can deduct a portion of those funds from your federal taxable income. The cap on this amount is currently $10,000 but Trump’s bill increases that amount to $40,000 for the next five years.
Medicaid Work Requirement
Medicaid recipients in 40 states and D.C. will have to either work, volunteer, or go to school for at least 80 hours per month to continue to receive benefits. Recipients can receive exceptions, such as being disabled and having young children.
Some recipients may also see a $35 charge when seeing the doctor if their income is between 100% and 138% of the federal poverty line (between $15,650 and $21,597).
ACA Reporting Requirements
Photo by Nataliya Vaitkevich: https://www.pexels.com/photo/woman-in-black-long-sleeve-shirt-sitting-with-hand-on-her-head-6919757/
Those who receive their health insurance through the ACA marketplace will now have to update their income and other details every year, rather than being automatically re-enrolled.
Boost Child Tax Credit to $2,200
Photo by Robert Collins on Unsplash
The current child tax credit is $2,000, but that was set to expire in 2025, reverting back to $1,000. The bill permanently raises this credit to $2,200.
[Rewritten on July 5, 2025 after the new 2025 Trump tax law was passed.]
Because I’m self-employed and I’m under 65, I buy health insurance from a health insurance marketplace established under the Affordable Care Act (ACA). Every state has one. Some states run their own. Some states use the federal healthcare.gov platform. It’s for the self-employed, early retirees, and others who don’t get health insurance through an employer or a government program such as Medicaid or Medicare.
You may get a Premium Tax Credit (PTC) when you buy health insurance from an ACA marketplace. How much tax credit you get is based on your modified adjusted gross income (MAGI) relative to the Federal Poverty Level (FPL) for your household size. In general, the lower your MAGI is, the less you pay for health insurance net of the tax credit.
MAGI for ACA
Your MAGI for ACA is basically:
Your gross income;
minus pre-tax deductions from paychecks (401k, FSA, …)
minus above-the-line deductions, for example:
pre-tax traditional IRA contributions
HSA contributions
1/2 of self-employment tax
pre-tax contributions to SEP-IRA, solo 401k, or other retirement plans
self-employed health insurance deduction
student loan interest deduction
plus tax-exempt muni bond interest;
plus untaxed Social Security benefits.
Wages, 1099 income, rental income, interest, dividends, capital gains, pension, withdrawals from pre-tax traditional 401k and IRAs, and Roth conversions all go into the MAGI for ACA. Muni bond interest and untaxed Social Security benefits also count in the MAGI for ACA.
Tax-free withdrawals from Roth accounts don’t increase your MAGI for ACA.
Side note: There are many different definitions of MAGI for different purposes. These different MAGIs include and exclude different components. We’re only talking about the MAGI for ACA here.
2021-2025: 400% FPL Cliff Changed to a Slope
Your premium tax credit goes down as your MAGI increases. Up through the year 2020, the tax credit dropped to zero when your MAGI went above 400% of the Federal Poverty Level (FPL). If your MAGI was $1 above 400% of FPL, you would pay the full premium with zero tax credit.
Laws changed during COVID. This cliff became a slope for five years, from 2021 to 2025. The tax credit continued to drop as your MAGI increased, but it didn’t suddenly drop to zero when your income went $1 over the cliff.
Removing the cliff was a huge relief to people with an income higher than 400% of FPL ($81,760 in 2025 for a two-person household in the lower 48 states). The tax credit also became more generous during those five years at income levels below the cliff.
The Cliff Returns in 2026
The new 2025 Trump tax law — One Big Beautiful Bill Act — didn’t extend the slope treatment or the enhanced tax credit after 2025. The 400% FPL cliff is scheduled to return in 2026. The premium tax credit will also drop back to pre-COVID levels at incomes below 400% of FPL.
The chart above shows the ACA premium tax credit at different incomes for a sample household of two 55-year-olds in the lower 48 states. The blue line is for 2025, with the slope and the enhanced tax credit. The red line is for 2026, without the enhanced tax credit. The sharp vertical drop is the cliff.
How your premium tax credit will change in 2026 depends on where you are in the chart.
If your income is to the left of the cliff in the chart, your tax credit will drop slightly. It goes down from $18,900 to $17,200 at $50k income in this example. A $1,700 drop in the tax credit translates to an increase of about $140/month for health insurance.
If your income is to the far right in the chart, your tax credit will also drop, but you have the income to afford it. At $200,000 income in this example, the tax credit drops from $3,800 to $0, raising the cost for health insurance by a little over $300/month.
The drop is precipitous immediately to the right of the cliff. We’re talking about receiving over $13,000 in tax credit in 2025 versus $0 in 2026 for a two-person household with an income of $85k. How do you come up with an extra $13,000 for health insurance when your income is $85k?
The data for my example came from a calculator created by KFF. You can enter your specific zip code, household size, and age in this calculator to estimate how much your premium tax credit and your net health insurance premium will change.
Know Your Cliff
The chart I used as an example is for a two-person household. You also have a chart like this. The difference is where your red line drops to the X-axis. You must know first and foremost where the cliff is. The table below shows the 400% FPL cliff for different household sizes in 2026.
If your income is close to the cliff, you should manage it carefully to keep it from going over the cliff.
Manage Your Income
The most critical part is to project your income throughout the year and not to realize income willy-nilly before you do the projection. You can still adjust if you find your income is about to go over the cliff before you realize income. Many people are caught by surprise only when they do their taxes the following year. Your options are much more limited after the year is over.
If income from working will push your MAGI over the cliff, maybe work a little less to keep it under.
Tax-free withdrawals from Roth accounts don’t count as income.
Take a look at the MAGI definition. Minimize anything that raises your MAGI, and maximize everything that lowers your MAGI.
When you have self-employment income, you have the option to contribute to a pre-tax traditional 401k and IRA. Those pre-tax contributions lower your MAGI, which helps you stay under the 400% FPL cliff.
Choose a high-deductible plan and contribute the maximum to an HSA. The new 2025 Trump tax law made all Bronze plans from an ACA marketplace HSA-eligible starting in 2026.
On the other hand, Roth conversions, withdrawals from pre-tax accounts, and realizing capital gains increase your MAGI. You should be careful with doing those when you’re trying to stay under the 400% FPL cliff.
Accelerate Income to 2025
If you’re at risk of going over the cliff in 2026, consider accelerating some income to 2025 when the premium tax credit is still on a slope. If pulling income forward to 2025 helps you stay under the cliff in 2026, you lose much less in premium tax credit from your additional income in 2025 than the steep drop in 2026.
Borrowing
If your need for more cash is only temporary, consider borrowing instead of withdrawing from pre-tax accounts or realizing large capital gains. Spending borrowed money doesn’t count as income.
Instead of selling stocks and pushing yourself over the cliff by the realized capital gains when you buy a new car, take a low-APR car loan to stretch it out. HELOC and security-based lending are also good sources for borrowing.
You can repay the loan when you don’t need as much cash or when you no longer use ACA health insurance.
Income Bunching
If you can’t avoid going over the 400% FPL cliff, consider income bunching. When you’re already over the cliff, you might as well go over big. Withdraw more from pre-tax accounts or realize more capital gains and bank the money for future years.
Spending the banked money doesn’t count as income. Going over the cliff big time in one year may help you avoid going over again for multiple years.
100% and 138% FPL Cliff
There is another cliff on the low side, although that one is easily overcome if you have pre-tax retirement accounts.
To qualify for a premium subsidy for buying health insurance from the ACA exchange, you must have income above 100% of FPL. In states that expanded Medicaid, you must have your MAGI above 138% of FPL. This map from KFF shows which states expanded Medicaid and which states did not.
The minimum income requirement is checked only at the time of enrollment. Once you get in, you’re not punished if your income unexpectedly ends up below 100% or 138% of FPL. The new 2025 Trump tax law added requirements to Medicaid for reporting work and community engagement. You don’t want to have your income fall below 100% or 138% of FPL and be subject to those reporting requirements in Medicaid.
If you see your income is at risk of falling below 100% or 138% FPL, convert some money from your Traditional 401k or Traditional IRA to Roth. That’ll raise your income above 100% or 138% of FPL.
Say No To Management Fees
If you are paying an advisor a percentage of your assets, you are paying 5-10x too much. Learn how to find an independent advisor, pay for advice, and only the advice.
Everyone has financial dreams—some are right around the corner, like taking a much-needed vacation or buying a new gadget. Others, like planning for your child’s education or retiring comfortably, take years of effort and planning. These aspirations, big or small, shape our financial goals.
But not all goals are created equal. To manage your money wisely and make real progress, it’s important to understand the difference between short-term and long-term financial goals. Each type serves a unique purpose and demands a different approach when it comes to saving and investing
In this blog, we’ll explore what are short term and long term goals, how to prioritize them, and why aligning them with the right investment strategy matters.
What Are Short Term and Long Term Goals?
Financial goals can be broadly categorized based on the time horizon required to achieve them. Here’s a simple breakdown of what are short term and long term goals:
Short-Term Financial Goals: These are goals you want to accomplish in the near future—typically within less than three years. They’re often essential, time-sensitive, and require liquidity.
Long-Term Financial Goals: These goals are set for the distant future, generally seven years or more. They usually involve significant life milestones and require long-term planning and disciplined investing.
Understanding the difference between short term and long term goals helps you plan your savings and investments accordingly.
Examples of Short-Term Financial Goals
Short-term goals are often immediate financial priorities that support your stability and security. Some common examples include:
Creating and maintaining an emergency fund
Paying off high-interest debt (like credit cards or personal loans)
Purchasing insurance (life, health, vehicle)
Planning a vacation within the next year
Buying a two-wheeler
Covering education fees or rent deposits
These goals are typically less capital-intensive but extremely important for your financial foundation. They require investments with high liquidity and low risk.
Examples of Long-Term Financial Goals
Long-term goals are generally centered around major life aspirations or commitments. Common long term financial goals include:
Saving for retirement
Funding a child’s higher education or wedding
Buying a home or repaying a long-term mortgage
Achieving financial independence or early retirement
Building a large corpus for a dream business or project
Since these goals have a long horizon, they allow you to take calculated risks and leverage the power of compounding.
Key Differences Between Short Term and Long Term Goals
Now that you know what are short term and long term goals, let’s look at how they differ in approach, planning, and execution.
Aspect
Short-Term Financial Goals
Long-Term Financial Goals
Time Frame
Less than 3 years
More than 7 years
Purpose
Manage immediate needs and stability
Achieve future aspirations and milestones
Urgency
High
Moderate to low (initially)
Risk Appetite
Low (to preserve capital)
Moderate to High (allows growth over time)
Investment Options
Liquid funds, fixed deposits, recurring deposits
Equity mutual funds, PPF, NPS, EPF, SIPs
Monitoring
Frequent
Periodic
Flexibility
More flexible
Less flexible (needs long-term commitment)
Understanding the difference between short term goal and long term goal helps you avoid using long-term investments for short-term needs or vice versa, which can derail your financial journey.
How to Prioritise Your Goals
Given the limited financial resources most people have, you can’t chase all goals simultaneously. Here’s a logical sequence to follow:
1. Clear High-Interest Debt
Before anything else, repay high-interest debt like credit cards. These eat into your savings and delay progress toward any goal.
2. Secure the Basics
Protect your family with term life insurance and health insurance. Then build an emergency fund worth 3-6 months of expenses. These are non-negotiable short term financial goals.
3. Fund Essential Short-Term Goals
Cover any immediate, time-bound needs such as rent advances, school fees, or planned vacations. These should be well-planned to avoid dipping into your long-term investments.
4. Start Investing in Long-Term Goals Early
Even if your primary focus is short-term, begin small investments toward long term financial goals like retirement or education. The earlier you start, the better you benefit from compounding.
How to Invest Based on Goal Type
Tailoring your investment strategy based on the goal duration is the key to success.
Prioritize growth over time through high-return instruments.
Investment avenues: Equity mutual funds (via SIPs), National Pension System (NPS), Public Provident Fund (PPF), Employees’ Provident Fund (EPF), stocks, long-term ETFs.
Remember, the difference between short term and long term goals also determines your risk appetite and investment product selection.
Common Mistakes to Avoid
Mixing Funds Across Goals Don’t use long-term funds for short-term needs—it disrupts compounding and might result in losses due to market volatility.
No Goal Clarity Not knowing the time horizon or exact requirement can lead to under-investing or investing in the wrong product.
Ignoring Inflation Especially for long term financial goals, not accounting for inflation can severely impact your corpus.
Starting Late The earlier you start with long-term goals, the less you’ll need to invest monthly. Delaying them makes the journey harder and more expensive.
Why Goal Categorisation Matters
Knowing the difference between short term and long term goals allows you to:
Allocate your funds better
Avoid unnecessary financial stress
Stay on track even during emergencies
Use appropriate investment tools
Maximize returns over time
At Fincart, we work closely with individuals to understand their financial aspirations and help them categorise, prioritize, and plan accordingly.
How Your Life Stage Influences Financial Goals
While time horizon is a key factor, your life stage also plays a crucial role in determining your financial goals—and how you approach them. The definition of short term financial goals or long term financial goals may vary depending on where you are in your journey.
Early Career (20s–30s)
This is the stage where individuals are just starting out with limited income and possibly education loans. At this stage:
Short-term goals include building an emergency fund, repaying student loans, or buying health insurance.
Long-term goals may start with retirement savings via EPF/NPS or a small SIP.
The key is to develop strong financial habits and avoid lifestyle inflation early on.
Mid-Career (30s–40s)
This stage brings higher income and greater responsibilities (family, children, EMIs).
Short-term goals include school fees, vacation funds, or insurance top-ups.
Long-term goals revolve around children’s education, homeownership, and retirement planning.
You should aim for a balanced portfolio and protect your assets with adequate insurance coverage.
Late Career (50s and above)
With major goals either met or nearing, the focus shifts to wealth preservation and health expenses.
Short-term goals may include travel, medical funds, or helping children start out.
Long-term goals now focus entirely on retirement income, estate planning, and financial freedom.
Understanding how your life stage influences your short and long term financial goals ensures that your planning remains relevant and efficient.
Blending Short and Long-Term Planning
You don’t have to wait to complete short-term goals before working on long-term ones. A blended approach often works best:
Allocate a higher percentage of income to short-term goals initially
Begin with small SIPs for long-term goals
As short-term goals get completed, divert freed-up money toward long-term investments
This method ensures that you stay prepared for today while securing your tomorrow.
How to Track and Adjust Financial Goals Over Time
Setting financial goals is not a one-time activity. It’s an evolving process that requires ongoing review. Markets change, incomes shift, priorities evolve—and your plan must reflect those changes.
Here’s how to effectively track and adapt:
1. Use Goal-Based Tools or Apps
Use platforms that allow you to assign values, time horizons, and track progress. Many robo-advisors offer visual dashboards that show how close you are to your targets.
2. Annual Review of Goals
Revisit your financial goals every year:
Has your income increased?
Have your expenses gone up?
Are there new goals to be added or existing ones to be updated?
Adjust your SIP amounts, rebalance your investments, or shift your allocations based on these insights.
3. Emergency Adjustments
Life is unpredictable. If an emergency arises, pause some low-priority goals and redirect funds to more pressing needs.
4. Celebrate Milestones
Achieving a goal—short-term or long-term—is a big deal. Reward yourself modestly. This reinforces positive financial behavior and keeps you motivated.
By actively tracking your financial progress, you’re more likely to succeed in fulfilling both your short and long-term ambitions.
The way forward
In summary, the difference between short term goal and long term goal lies in the time frame, purpose, risk profile, and investment strategy. Both are essential components of a solid financial plan. While short-term goals provide immediate security and stability, long-term goals help you achieve major life milestones.
By understanding what are short term and long term goals, and aligning your savings and investments with them, you can walk the path of financial wellness more confidently.
Whether you’re just starting your financial journey or looking to streamline existing goals, Fincart’s financial advisors can help you create a customized plan that balances your short-term needs and long-term dreams.
In a world where everyone is always connected online, scams have become more sophisticated, targeting specific demographics with alarming precision. One group increasingly in the crosshairs? Couples over the age of 50.
This demographic, often sitting on substantial retirement savings and home equity, has become an attractive target for cybercriminals. But it’s not just about the money. These scams can also strain marriages, erode trust, and leave long-term emotional damage. What’s more alarming is that many of these scams disguise themselves as harmless emails, phone calls, or social media messages. Couples may not realize they’ve been duped until it’s too late.
Below are seven online scams currently preying on couples over 50 and how to recognize them before they take a serious toll on your finances and relationship.
1. Romance Scams That Target One Partner
Romance scams have traditionally focused on singles, but increasingly, scammers are targeting individuals in relationships. They use dating apps, social media, and even email to lure one partner into a secret online relationship. These scams often start as innocent messages but quickly escalate to emotional manipulation. Scammers create believable stories about being stranded overseas, facing sudden medical emergencies, or needing help with travel costs.
The targeted partner may start hiding these interactions from their spouse, sending small amounts of money at first, then larger sums as the scammer’s lies intensify. This creates not only financial loss but also marital friction when the deception is uncovered. Some couples report these scams nearly leading to separation or divorce, as trust is shattered on both financial and emotional levels.
2. Tech Support Scams Masquerading as Urgent Alerts
Tech support scams have evolved beyond the typical pop-up warning. Many now arrive via email or text, often disguised as urgent alerts from popular software companies or banks. These scams claim your account has been hacked or compromised, and they urge immediate action. The scammer then asks for remote access to your computer or smartphone to “fix” the issue.
What victims don’t realize is that these scammers install malicious software to steal banking information, passwords, and other sensitive data. Couples frequently fall victim because one partner may trust the scammer, allowing access before discussing it with their spouse. Once the scammer has control, they can drain bank accounts or steal identities in minutes.
3. Social Security and Medicare Impersonation
Impersonation scams are nothing new, but recently, there’s been a surge in scams pretending to be from Social Security or Medicare. These scams often target couples jointly because of the intertwined nature of benefits. Victims typically receive a phone call or email claiming their Social Security benefits are being suspended due to suspicious activity or unpaid debts. The scammer pressures them to “verify” personal information to avoid losing their income.
Similarly, fake Medicare representatives may offer new cards or claim eligibility changes, asking for Social Security numbers or banking details. Many couples comply out of fear of losing critical benefits, only to later discover their personal data has been used to commit fraud or open new lines of credit in their names.
Image Source: unsplash.com
4. Investment Scams Disguised as Retirement Opportunities
Investment fraud aimed at retirees is nothing new, but many scams now explicitly target couples nearing or in retirement. These scams often advertise on social media, YouTube, or even podcasts that cater to seniors. Pitches typically involve promises of guaranteed returns through gold IRAs, cryptocurrency, or “government-backed” programs. They often present a sense of urgency, warning about inflation or economic collapse.
Couples are convinced that acting fast will “protect their retirement,” but they end up wiring money into fake investment accounts that vanish overnight. Because these scams often involve joint finances or retirement savings, both partners suffer the consequences, leading to stress and blame within the relationship.
5. Fake Charity Scams Exploiting Generosity
Scammers are well aware that older adults tend to be generous, especially toward causes like veterans, animal welfare, or disaster relief. In many cases, couples jointly decide to donate to charitable organizations. Fraudsters take advantage by creating fake charities with convincing names and websites. Some even spoof legitimate organizations, making them harder to detect.
They typically strike after disasters, such as hurricanes or wildfires, sending emails and texts urging immediate donations. Many couples fall victim because they feel pressured to act quickly, thinking they are making a difference. Unfortunately, these “charities” pocket the money, and it never goes to the intended cause. Couples often don’t discover the scam until they later attempt to confirm their donation or receive no tax documentation.
6. Sweepstakes and Lottery Scams Targeting Joint Accounts
Another common tactic targeting older couples involves fake sweepstakes and lottery winnings. These scams usually claim the couple has won a large cash prize, vacation, or vehicle. Victims are told they need to pay processing fees, taxes, or insurance before collecting their winnings. The scam often pressures couples to wire funds or provide banking details for direct deposit.
Because many couples hold joint accounts, scammers take advantage of the assumption that one partner can act on behalf of both. In some cases, one spouse wires money without consulting the other, leading to disputes later on. By the time the scam is revealed, the couple’s funds are often gone, and the scammer has disappeared without a trace.
As older adults increasingly shop online, scammers have shifted their tactics toward this demographic, especially targeting couples looking for retirement-related purchases. Fraudulent ads often appear on social media, promoting heavily discounted items such as RVs, travel packages, medical devices, or exercise equipment for “senior health.”
These scams frequently involve fake checkout pages where victims input payment details, only to receive nothing, or, worse, cheap counterfeit products. Couples may not realize they’ve been scammed until weeks later, especially if the purchase seemed like a shared decision or if one partner handled the transaction alone.
Not only do these scams result in financial loss, but they can also lead to arguments over who made the decision and whether proper caution was exercised.
Protecting Your Relationship and Finances from Online Scams
Online scams targeting couples over 50 aren’t just financial threats. They can cause long-term damage to relationships, trust, and emotional well-being. The key to protecting yourself and your partner is communication and awareness. Discuss financial decisions openly, especially those involving online transactions, donations, or investments.
Consider taking cybersecurity workshops together or reviewing online safety checklists from reputable organizations. Never allow strangers remote access to your devices, and always verify the legitimacy of charities, investment offers, or government communications before responding. Being proactive can help prevent both financial and emotional losses.
Have you or someone you know encountered an online scam that targeted couples?
Riley Schnepf is an Arizona native with over nine years of writing experience. From personal finance to travel to digital marketing to pop culture, she’s written about everything under the sun. When she’s not writing, she’s spending her time outside, reading, or cuddling with her two corgis.
If you need to borrow money, you might consider applying for a personal loan. You can use a personal loan for all sorts of things but given the different types of personal loans out there, knowing which to use for different purchases can be difficult.
There are different types of personal loans. One of the most basic distinctions is between secured and unsecured personal loans.
📊 Learn more: Dive into the latest personal loan statistics for 2024, including rates, debt levels, and borrower trends in our comprehensive overview.
Unsecured Personal Loan
Unsecured personal loans are one of the most common types of personal loans, and most personal loans you see advertised will fall into this category.
An unsecured personal loan doesn’t require any collateral. The lender offers the loan based purely on your credit history, financial situation, and a promise that you’ll repay the loan. This contrasts with secured loans, like mortgages, where an asset serves as collateral for the loan.
The obvious benefit of unsecured personal loans is that you don’t need to have anything of value to offer as collateral. You also don’t have to go through the process of letting the lender examine your collateral and make sure it’s worth enough to secure your loan, which can speed up the lending process.
However, because there’s no collateral, lenders are more choosey about offering these loans. You’ll need strong credit to qualify for these loans, and your interest rate will be higher than it would be with a secured loan.
Secured personal loans are the opposite of unsecured personal loans. When you apply for one of these loans, you need to offer a form of collateral.
Many lenders will accept a Certificate of Deposit (CD) or savings account balance as collateral for these loans. For example, if you have $5,000 in a CD at a bank, that bank may be willing to offer you a secured loan. The size of the loan that you can qualify for will depend on the value of your collateral and your credit score.
Because you’re offering collateral to secure the loan, secured personal loans are generally easier to qualify for. Many lenders will also offer lower interest rates on these loans because of the reduced risk that they face.
A major drawback of secured personal loans is the fact that you need to have something of worth to serve as collateral. If you’re in need of a loan, odds are good that you don’t have much savings available and might not have enough to serve as collateral.
Offering something as collateral also puts it at risk. If you’re not able to make payments on your loan, the lender could take possession of the collateral.
It may also take longer to get a secured loan because the lender has to assess your collateral and ensure it’s worth enough to secure the debt.
If you’re shopping for personal loans, you may find that some lenders offer specialized or branded personal loans. For example, you may see loans described as vacation loans, home renovation loans, or debt consolidation loans.
These loans are advertised as special types of personal loans for a specific purpose. Some of these loans may offer special features related to their branded purpose. For example, if you apply for a debt consolidation loan the lender may pay your other creditors directly, so you don’t need to handle the money at all.
Keep in mind that personal loans are highly flexible. You can use a personal loan for almost any purpose; the few that are disallowed by most lenders are things such as paying for education, gambling, or illegal activities.
Some branded personal loans may be a good deal. You might find a debt consolidation personal loan that can help you save a lot of money. However, just because a loan is described as being good for a specific purpose does not mean that it is the best loan available. Always shop around and consider generic personal loans before going for a branded one to make sure that you’re getting the best deal.
Bad Credit or No Credit Check Personal Loans
Another common thing to see when looking for personal loans is a loan advertised as a bad credit or no credit check personal loan. These may seem appealing, especially If you don’t have a great credit score or have struggled to get approved for loans in the past.
As with anything, you pay a price for these types of loans. Lenders who are willing to offer loans to people with poor credit or without checking people’s credit need to compensate for that risk somehow. Often, they compensate for that risk with highly unfavorable terms such as high interest rates or large origination fees.
If you need a personal loan, but don’t have good credit You should still avoid these loans due to their predatory terms. You’ll get a much better deal if you are able to qualify for a secured personal loan. If you don’t have enough assets to serve as collateral, you are likely to be better off if you spend some time working to improve your credit and apply for a traditional personal loan instead.
A payday loan is a type of bad credit or no credit check loan. They share some characteristics with personal loans, but it is important to know that payday loans are highly predatory and should be avoided whenever possible.
Like bad credit or no credit check personal loans, payday lenders typically don’t look at your credit score when you apply for a payday loan. These loans have massive fees High interest rates and short repayment periods. For example, if you get a payday loan today, you might be expected to pay it off in 2 weeks. The idea is that you use the loan to make it the next payday and use your next paycheck to pay back the balance.
Payday loans typically come from specialized lenders, so if you look for loans from reputable Banks and online lenders, you are not likely to find them. Their high fees and interest rates can make it easy to get trapped in a cycle of debt, so try to avoid these loans except as a very last resort
Personal loans are a type of consumer loan, which is a wide category of loans that describes pretty much any type of loan that a regular person could apply for. Some examples include personal loans, mortgages, auto loans, and credit cards.
When looking to borrow money, it’s important to make sure that you’re applying for the right type of loan. Some types of purchases, such as a home or a car, have unique loan types designed specifically for those purchases. Trying to use a credit card or a personal loan will likely result in you paying more than if you used a specially designed loan.
Personal Lines of Credit
Personal lines of credit are similar to personal loans in many ways. Like personal loans, they’re highly flexible and can be used for many different purposes. They can also come in both secured and unsecured varieties.
What makes them different is that a line of credit is a pool of funds that you can draw from multiple times while a loan is a lump sum of cash that you can only access once.
That makes personal lines of credit more useful for people who have unpredictable financial needs. If you have a one-time expense and you know the size of that expense, you can apply for a personal loan for the correct amount. With a personal line of credit, you can take money out of the line of credit when the need arises and do so multiple times if you find that you need to draw money more than once.
For example, a personal loan might be a good fit if you have to pay an unexpected bill. A personal line of credit might be a better fit for someone working on a home improvement project who isn’t sure exactly how much it will cost.
Common Uses for Personal Loans
Personal loans can be used for many different reasons.
One of the most common reasons is for debt consolidation. If you have multiple credit card balances and other small loans, you can use one personal loan to pay off those balances. That leaves you with a single monthly payment to make and may reduce the amount of interest you pay.
Home renovations and vehicle repairs are also common uses for personal loans.
You can also use a personal loan for unexpected expenses. Because they have lower interest rates and credit cards tend to, using a personal loan in this way may help you save money.
Many people use personal loans for weddings, vacations, and similar costs. Be careful: you’ll be paying off that loan long after the party or the trip is over!
🚨 Learn more: Learn how to protect yourself from personal loan scams by recognizing the warning signs in our latest guide.
Bottom Line
Personal loans are highly flexible loans that you can use for a variety of purposes. There are many types of personal loans, but they all offer money that can be used for a range of personal needs.
If you need money for something, applying for a personal loan can be one way to get that cash. Just keep in mind that you will be paying that loan back with interest. It’s best to use these loans for essentials, not luxuries, and to avoid borrowing if your credit isn’t up to par!
Nio stock is one of the hottest in the electric vehicle stocks world right now. As of December 23, 2022, a share of Nio is $10.97. So, Nio is trading at a reasonable price. But the question is, is it worth it? After all, Nio is a new company (comparing to Tesla, for example); it is not profitable yet; and it’s a Chinese company.
Buying Nio stock, as buying any individual stock, should be approached with caution. The electric vehicle (EV) industry is on the rise. And Nio is a leader in that industry (at least in China). Therefore, the potential for the stock’s growth is high. However, before deciding to purchase Nio shares, you must do your research.
If you’re curious how to go about buying Nio stock here’s how to do it.
If you need help figuring out if Nio is a stock worth buying, a financial advisor near you may provide some guidance.
Buy Nio Stock: Learn About the Company
Before we address the question of how to buy Nio stock, we need to know about Nio. Nio was founded in 2014 by William Li. It is a public traded company involving in electric cars and clean energy. It’s often referred to as the Tesla of China. The company is headquartered in Hefei, China and has several offices (called Nio houses), in China, and Europe, including Germany, and Norway.
Specifically, Nio designs, develops, manufactures, and sells smart electric vehicles in China. It offers five, six, and seven-seater electric SUVs, as well as smart electric sedans. The company is also involved in the provision of energy and service packages to its users; design and technology development activities; manufacture of e-powertrains, battery packs, and components; and sales and after sales management activities.
In addition, it offers power solutions, including Power Home, a home charging solution; Power Swap, a battery swapping service; Power Charger, a fast-charging solution; Power Mobile, a mobile charging service through charging vans; Power Map, an application that provides access to a network of public chargers and their real-time information; and One Click for Power valet service, where it offers vehicle pick up, charging, and swapping services.
Further, the company provides repair, maintenance, and bodywork services through its NIO service centers and authorized third-party service centers; statutory and third-party liability insurance, and vehicle damage insurance through third-party insurers; courtesy vehicle services; roadside assistance; data packages; and auto financing and financial leasing services. Additionally, it offers NIO Certified, a used vehicle inspection, evaluation, acquisition, and sales service.
Nio is listed on the New York Stock Exchange (NYSE) and all prices are listed in US Dollars. Nio employs 15,204 staff and has a trailing 12-month revenue of around $43.1 billion.
Buy Nio Stock In 2 Ways
There are a 2 main ways to buy Nio stock. You can buy a Nio share through a brokerage account or through a financial advisor.
Buy NIO Stock Through a Brokerage Account
The easiest way to buy a Nio share is through a brokerage account. Here are some steps by steps:
Compare brokerage platforms to help you find the one that fits you. Webull, Ameritrade, Vanguard, Fidelity, Robinwood are great brokerage firms to to buy Nio stock from.
Open your brokerage account by completing an application with your information.
Confirm your payment information
Research the Nio stock. Find the stock symbol (NIO) and research it to decide if it is a good investment for you.
Buy your Nio stock now or later. You can buy your desired number of shares with a market order or use limit order to delay your purchase until the stock reaches a desired price.
Buy Nio stock through the help of a financial advisor.
Another simple way to buy Nio shares is through a financial advisor. Financial advisors can advise on multiple money subjects. They can advise on how to buy a house, how to save money for your children’s education, or how to invest money and in which investment vehicles to park your hard earned cash.
The fact that Nio has been growing does not mean its stock will be hot as well. Taking the time to research the company can help you make an informed decision as to whether you should add it to your portfolio.
Does Nio Stock Fits into Your Portfolio?
If you’ve decided that Nio is right for you personally, then the next step is to decide if its stock will align with your investment goals and risk tolerance.
Nio is in the electric vehicle sector, and that means it can add diversification to your portfolio.
For many people especially beginner or conservative investors, the best way to do that is through mutual funds or index funds. Rather than buying individual stocks, they invest in mutual funds that expose them to a range of different stocks.
So, if one stock within the fund is not performing well, the other stocks balance it out, thus spreading the risk. A Vanguard mutual fund and many other companies will likely hold shares of Nio when they are available.
How much you should invest in Nio?
Before you decide to buy Nio stock, whether it’s a thousand shares or 50 shares, you should be thinking how much money to invest.
Nio stock was in the 60’s at some point. Expect it to get to that point and beyond again.
Regardless of the price, you should invest your money in a stock that is likely to grow in value in the long term. In other words, make sure Nio stock is a good value stock before you buy it.
One of the best indicators of whether a stock has a good value is the PE ratio. The P/E ratio measures the price of the stock relative to the company’s earnings or profits, giving you a good sense of the stock’s value.
So, the P/E ratio is very important in evaluating a stock.
Another indicator is a dividends. Dividends is money the company pays yearly or quarterly to its shareholders.
Most companies pay out dividends. But the ones that have consistently paid dividends, during good and tough time, are usually good ones. The downside of owning Nio share is that the company does not pay out dividends.
So, the stock price alone does not tell the whole picture of a stock.
Buy Nio Stock: The Bottom Line
Nio stock might be a good buy for you. However, your decision to purchase Nio shares will be based on your research of the company and whether this type of stock fits into your investment portfolio. But if you’re looking for a great EV stock, then Nio could be a worthwhile buy.
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