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Have money, will splurge attitude

Onam finds customers in a mood to spend on clothes and consumer durables, reports Rema Sundar

PHOTO: V. SREENIVASA MURTHY

SHOPPING SPREE Purse strings are loosened to buy clothes, a must for Onam

Cashing in on the Onam fever are business establishments of all kinds as they tap into the `have money will spend' attitude of most customers.

Purse strings are loosened as many splurge on textiles, a must for Onam, and white goods. The festival allowance granted by the Government, private and public establishments fuel this shopping spree to a certain extent. A small percentage of people spend this amount to take a break while an even smaller percentage save the amount for a rainy day.

Shopping spree

However, for most people Onam is the season to go on a mega shopping spree. While buying clothes for the family is a common denominator, other items on the shopping list range from white goods and books to vacations and a facelift for the house.

For instance, both Hariharan S. and Manu Thampy G.S., State Government employees, plan to spend on clothes. But Hariharan, a bibliophile, adds that he would also spend a good amount on books.

On the other hand, people like Sivaramakrishnan R and A.V. Mohan plan to buy white goods such as refrigerators, televisions and so on.

Says Mohan, deputy manager, Kerala Financial Corporation, "I might buy a flat television and DVD to replace my 10-year old television."

Instead of following the path of consumerism, M. Subramanian, an employee of Hindustan Latex, plans to visit Tiruchy, his hometown.

Similarly Anil Kumar S, accounts manager, Overseas Development and Employment Promotion Consultants, is all set for a vacation away from the city while Roshini Thankachy is heading for Guruvayur.

Save smart

Pankaj C. Govind, senior partner of a leading chartered accountant firm in the city, gives you some tips on how to strike a balance between spending and savings or investment.

1. Ideally, not more than 40 per cent of the amount should be spent on consumer durables. The balance should be invested after considering tax implications.

2. Investment options under Section 80 C should be selected after taking into consideration existing investments in life insurance and pension plans.

3. Additional voluntary contribution to Provident Fund and contribution to Public Provident Fund (PPF) are good options considering the guaranteed tax-free return of more than eight per cent.

4. Check out unit-linked insurance plans offered by reputed institutions. Invest 20 to 30 per cent of the amount received.

5. The rest could be invested in any of the savings instruments under Section 80 C of the Income Tax Act 1961, which includes well structured pension plans of agencies. Check their previous three-year track record in terms of returns and growth.

6. Investment in equity linked mutual funds should be made with care after consulting financial experts.

7. Investment in mediclaim policies could meet unforeseen hospitalisation expenses.

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