Spring clean your bank accounts, folios this Diwali
You clean your whole house ahead of the festivals. This year, along with cleaning your house, why don't you get your finances in order? Clean up your financial assets such as bank accounts, demat accounts, mutual fund investments and insurance policies. This will not only ensure good maintenance of finances but also provide a consolidated view your financial status.
Bank accounts that are not being used for a long time should be closed as they are termed as dormant and may invite penalty. Any balance should first be transferred to an active account. You can close such accounts by visiting the home branch and filling up the closure form and returning all cheque books, ATM cards, debit and credit cards linked to the account.
Investors can consolidate their demat holdings into one demat account by placing an off-market transaction request. An off-market transaction is carried out using the Depository Instruction Slip to be filled up for all the holdings that need to be transferred. An account closure request needs to be submitted with the DIS, requesting transfer of securities to the designated demat account.
Investors can get a consolidated view of their holdings across mutual fund houses with the Consolidated Account Statement (CAS) sent on a monthly or half-yearly basis. They can combine all their holdings (with similar pattern, order, tax status) with a particular mutual fund under a single folio. A folio consolidation form needs to be signed and submitted to the fund house.
Insurance policies held across insurance companies can be consolidated into a paperless form by opening an e-Insurance account. The form can be accessed at https://nir. ndml.in/pdf/ndml-form-opt2.pdf. Alternatively, you can fill up an online e-Insurance account opening form at https://nironline.ndml.in/NIR/onlineEiaApplicationHome.html. Upon verification of KYC documents, the insurance repository will open the online account and communicate login ID and process to set your password. Existing physical insurance policies can be converted to electronic policies by filing up a conversion form.
(Content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)