Personal finance encompasses managing your money, saving, investing, banking, budgeting, mortgages, investments, insurance, retirement planning, and tax planning. It includes the entire industry providing financial services to individuals and advising them on financial and investment opportunities.

Mutual fund: A mutual fund is a pool of money managed by a professional fund manager. It collects money from multiple investors with a common investment objective and invests in equities, bonds, money market instruments, and other securities. The income/gains generated are distributed proportionately among the investors after deducting expenses and levies, calculated using a scheme’s Net Asset Value (NAV). In essence, a mutual fund is made up of money pooled in by a large number of investors.

NPS (National Pension Scheme) – First and foremost, the sole reason for investing in the National Pension Scheme is tax saving and thereby securing a place in the retirement portfolio. If you are investing in NPS for any other purpose, you are doing it wrong. There are two types of NPS accounts – Tier I & Tier II.

👉 Tier I Account: This is a lock-in account.

👉 Tier II Account: This account allows you to invest and withdraw at will.

The Tier I Account is the account where all tax deductions are applicable. There are no tax deductions in Tier II. It’s useless to even open a Tier II account.