3. Planning for a residential house
Every one should plan to have at least one residential house or flat. This is an absolute imperative for financial freedom during retirement.
Fortunately, under the Income Tax Act, a deduction up to Rs 150,000 is available in respect of interest on borrowed funds for purchase or construction of a residential house.
Thus, one's own savings coupled with borrowed funds from banks and other financial institutions would enable you to own a house in due course.
Further, even the repayment of the loan is deductible under Section 80C of the I.T. Act.
Thus, a good deal of tax saving is possible by smartly planning the utilization of one’s own savings and borrowed funds for acquiring a home of your own.
Image: An Indian family at their home in an apartment building in the Dharavi slum | Photograph: Uriel Sinai/Getty Images
Also read: Want to earn like Warren Buffett? 24 tips
Advertisement
