5 golden rules of tax planning

Just as rules are important for good living, so also there are some golden rules of tax planning. The five simple yet effective rules of tax planning are:

1. Spread the taxable income among various members in your family;
2. Take full advantage of tax exemptions available under the law;
3. Take full advantage of permissible tax deductions and rebates available on stipulated tax-saving investments;
4. Make optimum use of tax-exempted incomes; and
5. Simple tax planning is smart tax planning.

Understood and used properly these rules will help you achieve handsome tax savings.

Rule 1: Spread your income among your family members

The first step in tax saving is to adopt the concept of divide and rule. The simple rule is that each family member must have his or her independent source of income so as to legally become an independent taxpayer under the provisions of the income tax law.

In case the entire income of a family belongs to just one member, the tax liability is much higher than when the same income is spread among different members of the family.

Now, under the income tax law it is not possible to arbitrarily divide one's income among different members of the family -- and then pay lower tax in the names of different family members. However, this goal can be achieved by intelligent use of the facility of gifts and settlements.

Gifts you receive are not your income

Generally, any gift you receive from various members of your family and specified relatives is not considered your income but a capital receipt. Thus, no income tax is payable on gifts received from relatives -- and also gifts received from parties other than relatives up to a sum of Rs. 50,000 and at the time of marriage up to any amount.

The first rule of tax planning requires that one develops income tax files for oneself, one's spouse, one's major children, the Hindu Undivided family, and for all other major relatives in the family, including one's parents. The development of different files of major family members can be achieved through the process of gifts and settlement.

No income tax on your inheritance

No income tax is payable on any amount received or inherited by you, whether in the form of movable assets or immovable assets, consequent to the demise of your friend or relative. Moreover, there is no upper limit to this exemption.

Hence, whenever you receive either bank fixed deposit, shares or immovable property consequent to the demise of a person, you don't have to pay any income tax at all on the value of all inherited assets.

The simple rule is that the asset so inherited by you is not your income; it is a capital receipt. Hence you are not liable to pay any income tax on the money and assets you inherit.

Rule 2: Take full advantage of all tax exemptions

The second step of tax planning lies in claiming all the exemptions and deductions which are permissible under the income tax law.

A list of most such exemptions and deductions is contained in Section 10 of the Income Tax Act. This list has to be optimised depending on your facts and circumstances.

If you and your family members are not claiming the optimum benefit of exemptions and deductions, then it is time to focus on investment planning in the group so that every family member gets full benefit of all permitted tax exemptions.

Rule 3: Take full advantage of tax deductions

Then, too, various tax deductions are available under the income tax law. One should try to avail of the benefit of these deductions for each and every member of the family.

The various investment options that offer tax rebates should be reviewed keeping in mind various aspects like the age factor, etc. A check-list should be prepared of the various deductions permissible under the income tax law.

Check whether each and every tax paying family member is claiming these. If special care is taken of this aspect, then it is legally possible to save a lot of income tax.

It is suggested that a chart be prepared of tax, deductions and exemptions for every family member for purposes of overall tax planning of the family.

It would be worthwhile if a group tax chart is prepared containing details relating to income tax, tax deductions, net taxable income, tax deducted at source, rebate of tax, and, finally, the net amount of income tax paid in the case of each family member.

With the help of this one simple chart, you can achieve substantial tax planning as it will show up those who have not made optimum use of tax deductions.

Rule 4: Exempted incomes

There are innumerable incomes under the income tax law which are exempted from the purview of tax. These incomes are known as exempted incomes.

For example, interest income from tax-free bonds as also any income from agriculture are some items of exempted incomes. There are other exempted incomes also which are discussed in this book.

Proper planning of your investments in a way so as to generate tax-exempt incomes is another golden rule of tax planning.

Rule 5: Don't overdo it; keep tax planning simple

Easy, simple, hassle-free should be the objectives of your tax planning approach.

The message which we want to bring to you is that you should adopt tax planning but never overdo it; just remember and follow the golden rules outlined above. These will help you achieve your tax-saving mission without going overboard.

It is possible to save tax perfectly legally provided you plan your affairs along the rules described above. This would also help you avoid all worries and tension as all your incomes, assets and investments would be duly accounted for from the taxation point of view.

- Source [VisionBooksIndia]

Words of Wisdom from Rakesh Jhunjhunwala

One of India's savviest stock market players, Rakesh Jhunjhunwala has been called the 'pin-up boy of the current bull run.'

It's an epithet that sits lightly on his shoulders. A chartered accountant with a penchant for dabbling in stocks with an uncanny eye for success, Jhunjhunwala started as a trader and investor in 1983. He now runs his Rare Enterprises company from offices in Mumbai's Nariman Point business area. What earned Jhunjhunwala fame is his skill to pick under-valued stocks, thus earning him the sobriquet: India's Warren Buffett.

Talking about his company RARE (derived from the first two letters of his name and that of his wife Rekha) Enterprises, Jhunjhunwala says, "My company has only one client -- my wife -- so that I don't need to handle others' money."

Enter the market when no one else does
---------------------------------------
Jhunjhunwala takes the cue from Warren Buffett when he says: "Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well."
• Don't follow stock picks by big investors
• Remember: the market is always right
• You can never be taught about market, you have to learn it
• You must balance fear and greed
Jhunjhunwala says he is 'well invested' in key growth areas like banking, retailing and infrastructure, all of which are based on India's domestic performance.

His private equity interests offer more detail -- education (private schools in Mumbai), hospitals and health care, a security company, pharmaceuticals, and dredging.


Markets are like women -- always volatile
----------------------------------------
"Markets are like women -- always commanding, mysterious, unpredictable and volatile," 'Big Bull' Rakesh Jhunjhunwala had told a gathering in Mumbai a few months back.

For Jhunjhunwala, trading by the hunches is the best thing to do. "If in doubt, listen to your heart," is what he tells young investors. Given below are some investment gems from him:
• Be optimistic
• Be opportunistic
• Study the market thoroughly
• Maximise profits and minimise losses
• Invest in a business not a company
• Have an independent opinion, always
• Be happy with your gains but take losses in your stride
• Be prepared for risks
• Despite sharp corrections, early this year Jhunjhunwala predicted that the Indian markets will reach its peak by 2010


Markets plunging? Don't sell in panic
-----------------------------------
Jhunjhunwala states that there is nothing to fear despite a sharp plunge in the Sensex this year. He assures investors thus:
• Nothing has changed as the Indian market is 'deep-rooted'
• Corrections, however sharp, are indispensable
• Panic selling during a sharp fall is the worst thing to do
• Stay invested and calm when the markets nosedive
• The country is poised to soon achieve a double-digit economic growth along with an impressive corporate profit growth
• This is bound to drive the bourses
• It does not take rocket science to understand that India's economic growth will be in double digits

Tips for beginners
-----------------
And for beginners in the stock market, this is what he has to say:
• Whatever you can do or dream you can, begin it. Boldness has genius, power and magic in it
• Do something you love
• The means are as important as the end
• Aspire, but never envy
• Be paranoid of success -- never take it for granted. Realise success can be temporary and transient
• Build a fighting spirit -- take the bad with the good
• When you see a horizon, it seems so distant. When you reach that horizon, you will realize how many more horizons are within reach
• Jhunjhunwala said enormous wealth was created over the last five years because opportunities in India have grown manifold.

Admitting that gains were going to be moderate in future unlike the manifold rise over the last few years, he advised investors to be realistic in their expectations.

- Source [Rediff]

Transfer Shares Via The Off-Market Route

For many long-term investors who own stocks of blue-chip companies, shares are a matter of legacy to be passed on from one generation to another. Just like Anandakumar and his wife Srilekha. They have been accumulating blue-chips over the last 35 years. And Anandakumar feels it is time now to distribute these accumulated assets among his two sons, Ravi and Ram, and reorganise their holdings. Each has a demat account with Integrated Enterprises (IEL).

As this is a transaction without any consideration—a gift—Anandakumar wants to transfer the shares through off-market trades. The procedure and financial implications of off-market transfer of shares are outlined here.

OFF-MARKET TRADE PROCEDURE

Listed securities. In this case, both the transferor and receiver are likely to have a demat account which can be with any of the two depositories—National Securities Depository (NSDL) or Central Depository Services (India) (CDSL). Off-market trades can take place between two individuals who have the same depository participant (DP), or different DPs. It can also take place between individuals having accounts with two depositories.

The same delivery instruction slip (DIS) can be used for market and off-market trades by choosing one of the two options given in it. In the off-market trade option, the transferor has to give details of the receiver, including the name of his DP, his DP identity number, the name of the security being traded, the ISIN number (a code unique to the shares of a company) and quantity of shares transferred.

If Anandakumar transfers 1,000 shares of Reliance Industries to Ravi, he will have to submit the DIS to IEL along with additional details like the purpose of transfer. IEL will load this into the NSDL database following which the credit will take place in Ravi’s account.

Ravi should have a standing receipt instruction (an instruction given by the client to receive any shares in his account) else he will have to fill up the receipt instruction with details of the transferor. The standing instruction is normally the default option.

The procedure does not change for a share transfer from a CDSL demat account to an NSDL demat account as the requisition form is the same. According to Bhavesh Shah, vice-president (research), Asit C. Mehta Investment Intermediates, a brokerage services firm, “NSDL uses a different form called inter-depository transfer (IDT) form. For transferring shares from an NSDL account to a CDSL one in an off-market trade, the transferor will have to use the IDT form.”

The transferor should fill out the correct details in the DIS and avoid overwriting. In case a receipt instruction is also required, the details in the delivery and receipt instruction must match. Investors need to be very careful with the execution date mentioned in the two forms. The transfer would be rejected if there is a mismatch in this regard even if all other details in the two forms match.

Unlisted securities. The transferor can transfer unlisted shares only through off-market transactions. And as many of these securities may still be in physical form, the transferor has to give the signed transfer form to the receiver. The receiver has to approach the company to get the transfer procedure completed. This will be the procedure for those who continue to hold listed securities in physical form.

Tax treatment for off-market trade Just like any other transaction, the tax implication of trades done via the off-market route also depends on the period of holding of the securities and the consideration received. “Off-market transactions are not always treated as short-term transactions,” says Uday Dhoot, chief operating officer, International Money Matters, a financial advisory firm.

As Anandakumar’s will be a transaction without consideration (a gift), he will not have any tax obligation upon transfer of shares to his sons. Dhoot feels it would be an advantage if there is a gift deed. And if Ram or Ravi sell the shares (after any period of holding) that they receive from Anandakumar through normal market trades, they will not have to pay tax as they will be eligible for long-term capital gains (LTCG). Share-holding periods of more than 12 months are considered as long-term. The shares that will be transferred to them have been accumulated by their parents over the last 35 years and, hence, are long-term holdings. They will have to pay the securities transaction tax (STT) on sale of their shares.

But if Ram or Ravi sell the shares through an off-market transaction, they will have to pay LTCG tax. Here, the cost of acquisition will be the rate at which the parent had acquired the stock. If Anandakumar had bought Reliance shares at Rs 200 and Ravi sells them at Rs 2,100, then Ravi will have to pay LTCG tax. Ravi will have two options.

One will be to pay 10 per cent tax on the difference of the sale and purchase consideration, that is, Rs 1,900. The second option will be to claim the benefit of indexation on the cost of acquisition (this will discount the effect of inflation on price) and pay 20 per cent tax on the difference between the sale price and the adjusted cost of acquisition. And to decide which option is suitable, it will be best to take the advice of a tax consultant. In case the off-market transaction takes place for a consideration within 12 months of acquiring the shares, the seller has to pay short-term capital gains tax depending upon his income bracket. If his income is above Rs 10 lakh, for instance, he will have to pay a tax of 33.99 per cent.

As the case of Anandakumar illustrates, the off-market route suits instances when consideration is not involved in the share transaction. If you, too, want to gift shares, you can bypass the market after taking into account the relevant factors. - feedback@outlookmoney.com

OFF-MARKET VS MARKET TRADES

• Market trades go through stock exchanges and the clearing house. Details like the quantity, price and time of the transaction are recorded. Off-market transactions take place without the involvement of the clearing corporation or stock exchanges and may not involve any payment (a gift, for example).

• Bhavesh Shah, vice-president (research), Asit C. Mehta Investment Intermediates, a brokerage services firm, feels that as off-market trades are not executed on the exchange, the price discovery mechanism may not be as efficient as it can be.

• Market trade has a cut-off time within which the delivery instruction slip (DIS) has to be given to the depository participant (DP). Off-market trade is between two parties and, therefore, not bound by any market schedules.

• Market trades attract brokerage, securities transaction tax and service tax. Off-market trades attract only transfer charges: depository charges of Rs 5 and DP charges in the range of Rs 10 to 0.05 per cent of transfer value. This amount is debited from the client’s account.

• Market trades are transfers made to brokers with a specific settlement number, whereas off-market trades happen to an individual’s account without the settlement number.

WHAT IS AN OFF-MARKET TRADE?

• A trade settled directly between two parties without the involvement of a clearing corporation or a stock exchange.

• The transaction payment, if any, takes place outside the environment of the depository, National Securities Depository or Central Depository Services.

• This is an option for bulk deals between institutions, trades between private parties, transfer of securities between a client and a sub-broker and transactions for unlisted securities.

• Until recently, people transferring shares through the off-market route did not have to offer any reason for the transfer. But efforts to prevent money laundering have gained a lot of significance globally of late. So, both the depositories have been advised to enhance the scope and quality of alerts sent to their DPs to identify suspicious transactions as a part of submission of information to the Financial Intelligence Unit-India (FIU-IND). NSDL and CDSL have instructed their DPs to capture additional information on off-market trades like the consideration and reason for transfer.

• FIU-IND was set up by the Government of India as the central agency responsible for receiving, processing, analysing and disseminating information relating to suspect financial transactions.
  

- Source [OutlookMoney]

Buying property? Why you MUST wait

A couple of weeks ago, a number of potential homebuyers went to the Bandra-Kurla complex in Mumbai to visit the property exhibition. A lot of them came back disappointed. The reason: most houses were priced way beyond their budgets. And even banks were not offering any special deals, except maybe a 25-basis point discount.

After four heady years, when property prices were moving only northwards, things have started cooling off. And the first sign came a while ago, when builders, who were only making two-three bedroom flats and selling at exorbitant prices, starting talking about targeting the middle-class segment with cheaper flats. And almost a month ago, when builders in Mumbai met before the buying season, they said they would offer cash discounts to buyers. Something that was unbelievable just a year ago.

And it is mainly because the cash flows have dried up for most builders and there is a serious slowdown in sales. Many leveraged ones have to slash prices to boost sales or abandon projects.

Many developers, who had got money from their initial public offers and from private equity funds, have already invested a major chunk in buying additional land at a huge premium. Additionally, banks and financial institutions have reduced lending because of the decline in sentiment. Many of them are tapping high networth individuals at exorbitant rates of 21-36 per cent to complete unfinished projects. No wonder, even the real estate stocks are reflecting the overall negative sentiment.

Strategies Negotiate for a 20-30 per cent discount Offer as much cash as you can Buy in projects that are near completion or completed

In fact, since last year, the real estate sector had started feeling the pressure. Along with shooting prices, rising interest rates had made buying a home affordable for many buyers. This led to a fall in sales by over 50 per cent in the last buying season. Even this year, buyers have been visiting exhibitions, seeing properties, but are refraining from signing on the dotted line.

If you are a potential buyer, this is an important period. While there has been some correction in property prices, there is a strong likelihood that there is more to come. Also, home loan rates, which are at 11-13 per cent (floating), will see some reduction. But all that will take some more time.

And, in such times, it is best to wait. This holds true even if you are purchasing your first home. Property prices will come down, sooner than later. In such circumstances, it is best that you do not get emotional about any property and think that you will miss an opportunity. Instead, there could be better opportunities available in the coming months.

Remember that, in the stock market, everyday price fluctuations are a norm. But in the real estate market, things happen slowly, but stay for a longer period. So, it is relatively easier to time the purchase. However, for some reason, if you have to buy a property, then follow some clear guidelines.

Negotiate hard with the builder by quoting a price that can be easily 20-30 per cent lower than the going rate. And don't get swayed by freebies like stamp duty waiver and free car parking. Ask for a cut in the rates or cash discount -- plain and simple. Just two years ago, it was a seller's market, but today it is turning into a buyer's market. That puts you in a significantly strong position. Also, a lower price will bring down your home loan outgo as well.

Another strategy is to offer a higher amount of cash. In today's market, everyone wants cash and that can get you a much better deal.

Most importantly, unlike earlier times, when getting into an under-construction project was considered great because there was a good chance that prices would double by the time the project was completed, today, things are quite different.

While the really big builders will not risk delaying projects, there could be quite a few who could get stuck in this cash crunch. This means a long wait before the project gets completed. In such uncertain times, the best strategy is to go for projects that are completed or are going to get completed in a month or so.

Finally, go for pre-approved projects by banks. For one, this could help you to easily get a home loan. Also, though banks do not directly guarantee the completion of the project, they do a proper research by looking at the paperwork and reputation of the builder.

- Source [Business Standard]

Your 6 transactions that the taxman tracks

When Priyanka Jhamanani (name changed) bought her friends' flight tickets for over Rs 125,000, the last thing on her mind was a notice from the income tax department.

Six months later, she was summoned by the IT department to explain the expenditure. Also, the notice asked her to meet an official and explain her source of funds.

"To catch tax evaders and prevent money laundering, the IT department has made a list of high value transaction. Notices are sent to consumers to explain these expenses, said K H Viswanathan, executive director, RSM Astute Consulting, a tax consultancy firm.

Experts explained that normally, the IT department sends notices to only those people whose yearly credit card transactions cross Rs 200,000.

But other than credit card companies, the Reserve Bank of India [Get Quote], banks, mutual funds and companies issuing shares and debentures need to file a report stating high-value transactions. This is done in form of an annual information report. Some even report the details every quarter.

Some of the yearly high-value transactions tracked by the IT authorities include:

1) Property purchase worth Rs 30 lakh (Rs 3 million) or more;

2) Deposits of over Rs 10 lakh (Rs 1 million)in a savings account;

3) Purchase of bonds of over Rs 5 lakh (Rs 500,000);

4) Investment in mutual funds of over Rs 2 lakh; (Rs 200,000);

5) Purchase of shares worth Rs 1 lakh (Rs 100,000) in a single company and;

6) Purchase of consumer durables like plasma television or expensive cars.

When faced with such a situation, you need to have all the documentation ready. "When IT called for an explanation, the person who has made such a transaction should carry all the documents supporting the source of funds. He also needs to carry his IT filings for the last financial year," said Kanu Doshi, a tax expert.

For instance, if the IT department calls to inquire on the purchase of a flat of over Rs 30 lakh, carry bank statement and documents that shows the loan amount.

"Make payments as much as possible through cheques or debit cards for large transactions and from an account that is your salary account. This will help to explain the source of money easily," explained Viswanathan. Further, if you have borrowed any money from a friend or relative for these purchases, take the loan in cheque. That would help clear any doubts.

To be on the safe side, mention all the high-value materials purchased while filing returns. This should include jewellery, expenditure on children's marriage, and others.

- Source [Business Standard]

Insurance cover for terror? Here's help

In the last few days, terror has grabbed more headlines than anything else. The Mumbai incidents have left citizens badly hurt and many dead.

But after all the hue and cry about the incidents, one has to face reality. That is, an important member of the family is dead. In 2006 train blasts, there were a number of families who found themselves in deep financial trouble because their earning member was no longer there. Worse still, there were home and other loans to be paid. Many households realised rather late that they were not adequately covered for such contingencies.

Last week again, many victims' relatives were left wondering whether their plain-vanilla life insurance policy covers terrorism or is there a separate policy that covers such incidents.

The good news is that any loss of life due to terrorism is covered by most life insurance policies. However, the insured will not get the advantage of riders like accidental death due to terrorism. This basically implies that if a person has a basic cover of Rs 40 lakh and, at the same time, an accidental death rider of Rs 10 lakh, the family will only receive insurance proceeds of Rs 40 lakh.

As far as standalone products go, an insurance broking firm, in association with New India Assurance, has launched a terrorism insurance policy that provides Rs 5 lakh cover for an annual premium of Rs 99 and is valid for 1 year.

When buying a life insurance policy, it would be a good idea to check the fine print. A lot of general insurance companies offer terror cover as an add-on to the main policy.

Remember that life insurance is an extremely important tool in transferring your risks. Every individual must not just look at life insurance, but also medical, disability, home and property. Though there are very limited options on the disability front, there are options on life, medical and property fronts. One must carefully evaluate one's needs and ensure that there is sufficient cover to address the financial risks one faces.

At the same time, property insurance will cover any damage to property like the one that we have witnessed in Taj and Oberoi and could also cover public liability, which includes risk of death or injury to guests and people in the premises.

And it is also available for homeowners.

There are certain basic things you must do. These include ensuring that the details of your existing life insurance policies are known to your family members. For instance, they should know the type of policy, coverage and what must be done, in case of claims settlement.

Also, maintain a proper log of all the benefits under each policy. And, most importantly, maintain the documents along with copies that can be accessed at the time of need.

As far as the settlements procedure goes, there is a simplified claim settlement process.

After an event, such as the Mumbai terrorist attacks, insurance companies relax their norms and settle the claim at the earliest.

- Source (Moneycontrol)

What are the various small savings schemes?

JUST a decade ago, the most sought after investment option were small savings +schemes.

Though many investors have taken a liking to equities now, some allocation to safe fixed income investments helps to balance the portfolio.

Here are the popular small savings schemes you can include in your investment portfolio.

1. Kisan Vikas Patra (KVP)
The Kisan Vikas Patra or KVP was launched with an eye on the large potential in the rural areas. Investments in KVP double every 8 years and 7 months. The rate of interest is 8.41 per cent pa approximately.

• Certificates are available in denominations of Rs 100, Rs 500, Rs 1,000, Rs 5,000, Rs 10,000 and Rs50,000.
• You can purchase the certificates at any Post Office.
• There is no maximum limit on the number of certificates purchased.
• An identity slip will be issued to you on request.
• On maturity, you can encash the certificates at the issuing post office. They can also be encashed at any other post office, once the officer-in-charge verifies your identity.
• You can also nominate someone to receive the money.

2. Post Office Monthly Income Scheme
If you want to receive a monthly income, this scheme may be right for you.

• You can open an account with any post office either singly or jointly, with a nomination facility available.
• Interest rate of 8 per cent pa is payable monthly.
• Minimum investment amount is Rs 1500 and maximum is Rs 450,000 for single accounts and Rs 900,000 for a joint account.
• Maturity period of the scheme is six years.
• You can transfer your account from one post office to another across India, without any cost.

3. National Savings Certificates (NSC) (VIII Issue)
This scheme has been designed for the benefit of not only adults but minors as well. The rate of interest is 8 per cent pa with a duration of six years.

• You can purchase NSCs for yourself or for a minor, where it can be taken jointly by two adults, a minor and a trust.
• Nomination facility is also available.
• Certificates in denominations of Rs 100, Rs 500, Rs 1,000, Rs 5,000 and Rs 10,000 can be purchased from any post office, either directly or through authorised agents.
• Besides cash; local cheques, pay order or Demand Draft (DD) drawn in favour of the postmaster are also accepted.
• You can encash these certificates at the post office where they are registered or at any other post office once the officer in charge verifies the registration.

4. Post Office Time Deposits
This scheme take investments by minors a step further since it makes it possible for minors themselves to invest in directly.

• You can open an account either singly or jointly. Even a minor of 10 years and more can open an account directly.
• The duration and rate of interest is: one year -- 6.25 per cent, two years -- 6.50 per cent, three years -- 7.25 per cent and five years -- 7.50 per cent.
• Nomination facility is also available.
• Different accounts for different maturity periods can be opened in one name.
• If you withdraw your amount after six months but within a year of investment, you wont get any interest. If you withdraw prematurely after one year of investment, interest will be paid at 2 per cent less than the rate of interest specified for the period for which you deposit the money.

5. Reserve Bank of India’s Savings Bonds
This is one of the safest investment since it is issued by the country's central bank.

• There is no maximum limit for investment in the bonds.
• Both half-yearly and cumulative interest options are available.
• The bond's duration is five years.
• Earlier, RBI bonds were of two types: 6.5 per cent tax-free bonds and 8 per cent taxable bonds. The former, that is, 6.5 per cent tax-free bonds have been discontinued since July 9, 2004. Today, only the 8 per cent bond is on issue.

Disclaimer: The contents of the article or are for information purpose only and are in no way meant to be advisory in nature. The author does not claim responsibility for actions taken by readers on the basis of the Article. Please consult your financial advisor for your personal money management.

- Source (Moneycontrol)

9 Survival strategies for working professionals

Not many had figured that the economy would slow down so fast. And now that it has, we can at best speculate how long it will stay this way. The global economic turmoil has added ‘sub-prime’ to the common man’s vocabulary, wreaked havoc in the stock market, and taken down some very big names in the financial world. It has not spared the job market either. Still, India is expected to grow at 7 per cent plus. While not as good as the 9 per cent of the previous year, it is still not as bad as the mayhem elsewhere.Every employer is getting ready for times that might get worse before they get better. So jobs are harder to come by. And every now and then comes fresh news of pink slips in some garb or the other. The difficult days in the job market are expected to continue for the next 18-24 months, if not longer. It is a scenario that is very different from what we remember from the last half-a- decade or so. So living through it will require certain survival skills and strategies that we haven’t had to use in a while. The good news is, now that things are slow for most people, you can try to close the distance to the leaders by adding new skills or re-skilling. In the following pages we discuss some of the strategies you can use to make the best of a bad situation.

1. Add skills to broaden your scope of work
2. Be prepared to move not only vertically, but also horizontally between-domains.
3. Maintain a good professional network so that, if needed, you can pass around the word that you are open to change.
4. If you have lost your job or anticipate a layoff, do not be closed to the idea of moving into a related sector if you have the required skills to make the transition.
5. Even if you are insulated, prepare a strategy for the worst and prepare for it.
6. Do a proper self appraisal and see whether your fundamentals are in place and find the weakness that need to be addressed.
7. Temper your salary and increment expectations. If there is a salary cut in real terms because of inflation, it may not be enough reason to chuck your job at this point. Move only when you get a better opportunity in a more stable company.
8. show more initiative and take on greater responsibility. Be disciplined. Ensure that you are not in the bottom quartile in terms of performance.
9. Be flexible and open to change. Give personal preferences like location a pass for the time being if possible it it hinders your progress.

- Source (StockAdv)