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Earned Wealth Raises $200 Million for Doctor-Focused Financial Services Platform

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Earned Wealth Raises 0 Million for Doctor-Focused Financial Services Platform

Earned Wealth has raised $200 million for its business that advises doctors on their professional and personal finances.

The company provides one interconnected platform that doctors can use to consult with wealth management experts on topics that include financial planning, tax planning, wealth management and investing, Bloomberg reported Wednesday (July 10).

Earned Wealth was founded in 2021 and raised about $18 million in a funding round in 2023, according to the report. At that time, the firm was valued at close to $40 million.

Today, it has more than 3,000 clients and $2 billion of assets under management, per the report.

With its new capital, Earned Wealth aims to expand its offerings and pursue acquisitions of other businesses that serve medical professionals, according to the report.

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Commenting on the Bloomberg report in a Wednesday post on LinkedIn, John Clendening, founder and CEO of Earned Wealth, said the investment “will help us further our mission of transforming financial services for healthcare professionals.”

“Our goal is to become the one-stop shop — the only financial services provider that doctors need for both their personal wealth and practice needs,” Clendening said in the post. “Our recent acquisition of Thomas Doll has expanded our services to include tax planning for individuals as well as tax and retirement plans for practices — and we’re excited to continue growing even further!”

In an announcement of that acquisition on the Earned Wealth website, the firm said that Thomas Doll has been committed to meeting doctors’ and dentists’ financial needs for some 40 years.

“Thomas Doll’s and Earned Wealth’s values, cultures, philosophies and service offerings are closely aligned, and this combination will expand our capabilities and enhance our commitment to serving our clients with excellence,” the announcement said.

The digital age has brought about significant shifts in consumer expectations and demands when it comes to wealth management, PYMNTS reported in April.

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While traditional wealth management services often involve face-to-face interactions with financial advisors, extensive paperwork and opaque fee structures, consumers have prompted the industry to adapt and innovate.

In another recent development in this space, Voyant said in April that it expanded its financial wellness and wealth management software to include new financial planning and modeling tools focused on retirement planning.


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BASIC Bloc Slams 'Leadership Void' on Climate Change, Finance

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BASIC Bloc Slams 'Leadership Void' on Climate Change, Finance
By David Stanway SINGAPORE (Reuters) – Rich countries have left a “leadership void” in climate politics and must provide trillions of dollars to help developing nations cut their greenhouse gas emissions, the BASIC bloc of Brazil, South Africa, India and China said late on Wednesday. Ministers from …
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Bajaj Finance loan loss provisions jump, NBFC to focus on collection efficiency | Mint

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Bajaj Finance loan loss provisions jump, NBFC to focus on collection efficiency | Mint

Mumbai: Bajaj Finance’s loan loss provisions surged in the first quarter (April-June) of this financial year, driven largely by muted collections and higher provisioning requirements for ageing delinquencies.

This, the Pune-based non-bank lender said, has prompted it to now focus on improving its collection efficiency, which indicates the proportion of a loan’s repayment amount that is collected.

Gross loan losses and provisions for the quarter were 1,790 crore. During the quarter, the non-banking financial company (NBFC) utilized a management overlay of 105 crore towards loan losses and provisions, as a result of which net loan losses and provisions were at 1,685 crore.

Management overlay is a kind of management-level provision buffer made by companies for use during emergencies or crises. In this case, Bajaj Finance built this overlay largely during the pandemic.

Also read | Bajaj Finance Q1 results: Net profit up 13.8% YoY to 3,912 crore, revenue at 14,04 crore

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In an analyst call late on Tuesday, the management said that while portfolio quality was steady and bounce rates were lower compared with the March quarter, significant movement of delinquent loans from stage 1 to stage 2 owing to muted collections led to the rise in loan losses in the June quarter.

Stage 2 assets, which warrant higher provisioning as against stage 1 assets, increased by 865 crore sequentially.

“The company is augmenting its debt management infrastructure as a mitigation measure,” it said in the investor presentation, with the management adding that they remain watchful of portfolio stress across business verticals and are “proactively pruning” exposure to certain customer segments.

“BAF (Bajaj Finance) reported higher than expected credit cost at 1.97%, an increase of 33 basis points sequentially. The surge in credit cost was on account of collection efficiency being impacted due to the elections,” Emkay Global Financial said in a note, adding that credit cost is expected to normalize over the next two quarters and be around 1.75-1.85% for FY25.

A basis point is one-hundredth of a percentage point.

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Also read | HUL Q1 Results: Net profit rises 2.7% to 2,538 crore, revenue up 1.3% YoY

The company had also seen a rise in loan losses during the previous election cycle in 2019 and is seeing similar trends this time, the management said, adding that when loan losses surge either due to higher bounce rates or muted collections, it takes one to three quarters for levels to stabilize. As a result, loan losses are expected to remain at current levels in the ongoing quarter and should start to normalize by the third quarter (October-December) onwards, they said.

The company will have a clearer view on whether the muted collection trend is transient or not by the October quarter, they added.

Bajaj Finance’s gross non-performing asset (NPA) ratio improved marginally to 0.86% in the June quarter, from 0.87% a year ago. However, the net NPA ratio worsened to 0.38% from 0.31% a year ago, owing to the higher provisions. In the previous quarter, the gross NPA ratio was 0.85% and net NPA ratio at 0.37%.

So far, the stress is largely being seen in two- and three-wheeler finance, rural business-to-consumer, or B2C, (retail lending) and SME (small and medium enterprise) loan portfolios, even as growth in the rural business-to-business segment remains robust. Asset quality for the urban B2C segment is also steady, but the management is watchful for any signs of stress.

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The management highlighted that the rural B2C portfolio has been seeing sluggish growth of 5-6% for the past year, including the 5% growth seen in Q1FY25. However, it expects some pickup going forward, pegging credit growth for FY25 at 10-11%. The company has been fine-tuning the borrower profile for the past year and is looking to broad-base the customer profile as was the case pre-Covid, it said.

Rural B2C loans for Bajaj Finance largely comprise cross-selling of personal loans, which have taken a hit following the increase in risk weights for the segment by the Reserve Bank of India (RBI). This led to stagnation in disbursements from November 2023 to June 2024 and is expected to temper growth in unsecured loans for the industry going forward.

Bajaj Finance’s share of unique customers, with no existing credit exposure, fell to 58% in June 2024 from 63% in March 2020. This means that of the current customers, 42% already have a relationship with the market in terms of unsecured or personal loans, an increase of 3% on year.

However, the company said that the overall borrower profile remains healthy, with the share of customers with outstanding personal loans having fallen from FY23 to FY24 in percentage terms.

The RBI, on 2 May, lifted the restrictions on sanction and disbursal of loans under ‘eCOM’ and ‘Insta EMI Card’ verticals, following which the NBFC restarted the EMI card business from May 10 and eCOM business from the first week of June, leading to a drag on disbursements during Q1. Both of these should pick up over the next three quarters, the company said, pegging overall loan growth for FY25 at 26-28%.

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How Budget 2024 Reforms Shape Your Personal Finance – Forbes India Blogs

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How Budget 2024 Reforms Shape Your Personal Finance – Forbes India Blogs

Image: Shutterstock

Budget Day is always a momentous occasion, sparking keen interest as we dissect its implications on our finances. While the certainty of taxes is something we all face, our primary concern is often how these changes impact our take-home pay, particularly for salaried individuals. Let’s break down this year’s Budget and see what it means for you.

As we adapt to these updates, keep your focus on what you can control: your personal growth and income. Investing in yourself and working to enhance your earnings can make a significant difference. Although taxes are a constant, steering your financial future lies in your hands.

Changes in your tax slab:

The Budget has revised the tax slabs in the new tax regime to enhance its appeal to taxpayers. Under this regime, the standard deduction is proposed to increase from ₹50,000 to ₹75,000.

Pay No Tax on an Income of up to ₹7.75 Lakh

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The recent changes in tax slabs will result in significant savings for lower and middle-income groups, while those in higher-income brackets will see minimal impact. These adjustments allow salaried employees in the new tax regime to save up to ₹17,500 in income tax.

The higher standard deduction of ₹75,000 means that anyone with an annual income of ₹7.75 lakh will not have to pay any tax. Additionally, under the new regime, taxpayers with an annual income of up to ₹7 lakh are eligible for a full tax rebate under Section 87A.

This is the second change in the new tax regime’s slab structure in as many years. Last year’s Budget reduced the number of slabs from seven to six and extended the standard deduction to the new regime. Let me explain:

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Improved Financial Stability for Pensioners

The Budget 2024 proposes increasing the family pension deduction from ₹15,000 to ₹25,000, providing greater financial stability for pensioners. Meanwhile, taxpayers who prefer the old tax regime will see no changes in their tax liabilities, as no updates were announced for that system.

Simplification of capital gains on real estate transactions:

The Budget 2024 has removed the indexation benefit for property sales, changing how capital gains are calculated. Previously, sellers could adjust their purchase price for inflation, reducing their taxable gains, and were taxed at 20 Percent on long-term capital gains (LTCG). Now, the LTCG tax rate is reduced to 12.5 percent, but without the inflation adjustment.

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Here is an example to illustrate this change:

Mr. A bought a property for ₹50 lakh in FY 2004-2005. He sells the property in FY 2023-2024 for ₹1.5 crore. Under the previous rules, the purchase price of ₹50 lakh would be adjusted for inflation using the Cost Inflation Index (CII) numbers provided by the Income Tax Department. However, under the new rules, there will be no adjustment for inflation. The capital gains will be calculated by directly subtracting the purchase price from the sale price. Although the good news is that the LTCG tax rate has been reduced from 20 percent to 12.5 percent, the lack of indexation requires careful calculation to determine the actual tax impact.

Also Read- Budget 2024: Higher taxes for markets investors, F&O clampdown

The objective is to simplify capital gains taxation by reducing the LTCG tax rate to 12.5 percent and removing the indexation benefit. This change is intended to make capital gains calculations easier for both taxpayers and tax authorities.

How the Indexation Removal Affects Real Estate Investors

The elimination of indexation benefits poses a challenge for long-term real estate investors. Without this adjustment, taxable capital gains are likely to rise, increasing the tax burden on property sales. This could reduce net profits and potentially deter investment in real estate, especially for those who have held properties for an extended period where inflation has had a greater impact.

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New Tax Relief for Multiple Properties and Short-Term Rentals

Under the new tax rules, individuals can now designate up to two properties as self-occupied. This change is advantageous for homeowners with multiple properties or those renting out homes on short-term platforms like Airbnb, providing relief and simplifying tax management.

Increased Long-Term Capital Gains Tax on financial assets

The long-term capital gains tax (LTCG) has been raised from 10 percent to 12.5 percent across all financial and non-financial assets. Short-term capital gains (STCG) on specific assets will now be taxed at 20 percent. The exemption limit for LTCG has also increased from ₹1 lakh to ₹1.25 lakh. The Budget clarifies that listed financial assets held for over a year will be deemed long-term, while unlisted financial assets and non-financial assets must be held for at least two years to qualify.

Also Read- Budget 2024 is a quest for equitable growth: CRISIL

I see these changes may create concerns about potential future tax increases, but it’s essential to remember that equity gains could offset some of these taxes. Equity mutual funds remain a compelling investment option. As I always say, “Death and taxes are certain,” so focusing on increasing income and controlling what you can is key.

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Budget 2024 Highlights: STT Hike and NPS Enhancements

STT Increase for Futures and Options:

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Futures and Options (F&O) traders will face a significant tax increase as the Security Transaction Tax (STT) rises from 0.01 percent to 0.02 percent. This adjustment will effectively double the tax on equity and index trades.

Boost in NPS Tax Deductions:

The deduction limit for employer contributions to the New Pension Scheme (NPS) is set to rise from 10 percent to 14 percent. This enhancement will benefit both public and private sector employees, aligning their tax advantages with those of government employees.

Introduction of NPS Vatsalya for Minors:

The new NPS Vatsalya scheme allows parents to contribute to a minor’s NPS account, which will convert to a regular NPS plan upon the child’s 18th birthday. This scheme fosters early financial discipline and seamlessly transitions to a standard NPS plan.

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Changes to Buyback Taxation and Reporting Requirements

Buybacks Taxed as Dividends:

Starting October 1, buybacks will be taxed as dividend income, significantly reducing their appeal to investors. This proposal may alter investment strategies, making buybacks less attractive compared to before.

Relaxed Penalties for Foreign Assets:

The Budget introduces a relaxation in penalties for not reporting foreign assets up to ₹20 lakh. This change aims to ease the burden on small taxpayers who may have inadvertently overlooked reporting overseas assets.

Eased TDS for Salaried Employees:

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From October 1, salaried employees will benefit from reduced Tax Deducted at Source (TDS) as they can now declare Tax Collected at Source (TCS) to their employers. This update will help manage cash flow better and allow any refunds due to be adjusted directly against TDS.

These changes bring both challenges and opportunities. The shift in buyback taxation may prompt investors to reconsider their strategies, while relaxed penalties and adjusted TDS rules offer significant relief to taxpayers. It’s crucial to stay informed and adapt to these updates to optimise your financial planning.

The writer is a Chartered Accountant and founder of NRP Capitals.

The thoughts and opinions shared here are of the author.

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