Understanding Taxes & Insurance Basics

1. 🧾 Income Tax in India – New & Old Regimes

New Tax Regime (FY 2025‑26):

Income up to ₹4 lakh → 0% tax
₹4–8 L → 5%, ₹8–12 L → 10%, ₹12–16 L → 15%, ₹16–20 L → 20%, ₹20–24 L → 25%, above ₹24 L → 30%
Plus: standard deduction of ₹75,000, and Section 87A rebate = 0 tax up to ₹12 L

Old Tax Regime (for those who prefer it):

Up to ₹2.5 L → 0%, ₹2.5–5 L → 5%, ₹5–10 L → 20%, above ₹10 L → 30%
Seniors get higher exemption limits (₹3 L for 60–79 yrs, ₹5 L for 80+)
Old regime allows deductions like 80C, 80D (health insurance), HRA, etc.

🔍 Paisa Pyaar Portfolio Tip:

Never blindly pick new regime because of lower slab percentages—calculate if losing deductions (like 80C, 80D) outweighs tax saved.
Switch options: salaried taxpayers pick every year; business owners get one-time switch only.

2. 📑 Why Understand Regimes?

Saves thousands of rupees every year
Helps you plan deductions smartly
Makes you less confused at filing time (“hai kya sir, regime samaj hi nahi aa raha?”)

3. 🛡️ Insurance – Your Financial Shield

Two broad categories:

A. Life Insurance

Term: Pure protection—pay small premium, family gets big cover if something happens
Whole-Life, Endowment, Money-Back, ULIPs, Pension, Child Plans: Mix of protection + savings/investment.

B. General Insurance

Health (individual, family floater, senior citizen, critical illness)
Motor (bike/car), Home, Travel, Fire, etc.

4. 🧠 Why You Need Both

Life insurance = family’s financial support if you’re not around
Health + asset insurances = cover your bills, valuables, risks—without dipping into savings

Plus, tax sweetener:

Health insurance premiums: up to ₹15 K (self + family), extra ₹15 K for parent (₹20 K if senior) under 80D.

5. ⚖️ Choosing the Right Insurance

Life:

If just one goal: go simple term insurance
Want combo of wealth build-up + cover? Explore ULIPs or endowment plans—but check costs

General:

Health: family floater or critical illness? Buy what fits your lifestyle
Other: Car? Go for third-party + collision cover

6. 🧩 Paisa Pyaar Portfolio Smart Combo

Tax: Pick regime + claim deductions (investments, insurance, housing loan, etc.)
Insurance: Keep term insurance = 10–15× your annual income + properly tailor general insurance
Review annually: coverage, premiums, and regime choice

TL;DR

“Bro, agar ₹12L tak kama rahe ho aur sahi deductions use nahi kar rahe, toh aap paisa taira rahe ho tax slab mein.
Insurance? Term = life ka hero, family floater = emergency ke liye backup. Investment plans me fan mat bano, pure coverage nahi milti!”

✅ Next Steps for Readers

Quick tax calculation: check both regimes for your income + deductions
Insurance audit:
- Do you have term insurance?
- Health cover enough for family?
File intentionally: opt right tax regime each year + keep docs ready.

“A tax is a fine for doing well, a fine is a tax for doing wrong.”
– Mark Twain

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This article has been written with original insights and tailored content by Paisa Pyaar Portfolio. All information is meant for educational use only and has not been copied from any external source.

Category: Finance Basics