Does the word ‘financial year-end’ make you nervous? Do you rush to your CA near the year-end clueless? You don’t have to rush anymore, if you plan and streamline your finances throughout the financial year without waiting for the last moment.

Interested to know more? Here are five ways that can help you plan your finances throughout the financial year:

Decide whether to stick to the old tax regime or opt for the new one

In the new financial year 2020-21, individuals have the option to continue with the old tax regime or shift to the new tax regime. Under the new tax regime, the percentage of tax deducted under the various tax brackets is lower, but individuals won’t be able to opt for regular tax deductions.

Do a comparative evaluation of the tax structures with your CA to understand which tax regime will be more favourable for you.

Know whether to continue with your Home Loan

Reducing outstanding debt is one thing on most individual’s mind. Many loan takers have a hard time deciding whether to foreclose or continue with their home loans. EMI paid against home loans come with tax benefits. Also, home loans come with attractive interest rates.

The rule of the thumb is to check the option which option delivers higher returns.

In the current scenario, with the interest rates moving south, regular pre-payment of your MCLR-based home loan can help you foreclose your loan sooner.

However, if you invest in high yielding investment options such as equity mutual funds, continuing with your home loan and investing the remaining amount in equity mutual funds may fetch higher returns in the long run.

Plan your tax-saving investments

Hasty investment decisions can derail your financial future. So, plan for your tax-saving investments at the beginning of the year. Equity-Linked Savings Scheme (ELSS), Public Provident Fund (PPF), National Savings Certificate (NSC) and 5-year Tax saving deposits are some popular tax savings options. Take your time to understand these savings & investment options, and choose the option that fits you the best.

How do you plan to fund your business?

If you are a business owner, using your resources or taking a business loan from the bank are two common ways to fund your business. Most banks offer business loans without collateral, attractive interest rates and flexible tenures. You need to compare the pros and cons of taking loans or using your savings/capital to find out the right choice.

Periodic review and timely compliance for business

If you have a business, it is important to keep track of the compliance requirement periodically such as recording, maintaining, filing or submitting the necessary documents. It is essential to comply with the laws for the smooth functioning of your company. This will help you sail ahead, paying no extra interest or penalty.

Whether you are a salaried individual or a business owner, it is important to streamline your finances throughout the year to avoid any last-minute headaches. Follow these steps and ensure a stress-free year ahead.