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Ramalingam

Ramalingam Kalirajan  |4803 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 13, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Av Question by Av on Jun 13, 2024Hindi
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Sir my old organisation I.e Odissa power generation corporation has settled my amount without paying interest for the period kept( almost 18 months). I worked upto 2021 Dec and I got job in the month of March 2023. Due to this , I couldn't not transfer my EPFO amount from Odissa power to the new organisation. Odisha power has given interest upto Dec 2021 only though they kept my entire amount till Oct 2023. They are denying to pay interest for this 18 months. Pl advise me .

Ans: Understanding the Issue
You've encountered a significant issue with the settlement of your Employee Provident Fund (EPF) from your previous employer, Odisha Power Generation Corporation. They have credited interest only until December 2021, despite holding your EPF amount until October 2023. This discrepancy means you have missed out on the interest that should have been accrued over the 18 months from January 2022 to October 2023.

Legal Framework and EPF Interest Guidelines
According to the Employees' Provident Fund Organisation (EPFO) rules, interest should be credited to an EPF account for the entire period the amount is held, irrespective of whether the employee is actively contributing or not. This means that even if there is a gap in contributions, as in your case, the account should still earn interest until it is fully settled. This rule is designed to ensure that employees receive their full due for the period their funds are held within the EPF system.

Steps to Resolve the Issue
Communicate with the Employer
Your first step should be to communicate with the Human Resources (HR) department or the EPF handling department of Odisha Power Generation Corporation. Present your case clearly, citing EPFO rules that state interest should be credited until the settlement date. Provide necessary documents like your EPF account statements and any correspondence related to the settlement.

Effective communication with the employer can often resolve such issues. Ensure your communication is professional and includes all relevant details, including your employment period, EPF account number, and the specific discrepancy regarding the interest payment.

Formal Written Complaint
If your initial attempts do not resolve the issue, escalate the matter by submitting a formal written complaint to your employer. Clearly outline the problem, emphasizing that according to EPFO rules, interest should have been credited for the entire period your funds were held. Include all relevant documentation to support your claim.

Approach the EPFO
If your employer does not resolve the issue, the next step is to escalate it to the EPFO. Here’s how:

File a Grievance: Use the EPFO’s online grievance portal, EPFiGMS, to file a complaint. Ensure you provide all relevant details, such as your EPF account number, employment period, and the discrepancy in interest payment. Attach supporting documents to strengthen your case.

Visit the Regional EPFO Office: Personally visit the regional EPFO office and submit a written complaint. Ensure you have copies of all relevant documents, such as EPF statements and correspondence with your employer. A face-to-face discussion can sometimes expedite the resolution process.

Social Media and Other Channels: Sometimes raising the issue on social media platforms like Twitter, tagging the official EPFO handles, can bring your issue to their attention more quickly. Be concise and clear in your communication.

Documenting the Issue
Keep thorough records of all your communications regarding this issue. This includes emails, letters, and notes from phone conversations. Having detailed records can be crucial if you need to escalate the matter further or if it becomes a legal issue.

Seeking Support
HR and Union Support
If your employer has a union or employee representative body, consider seeking their support. They can provide additional pressure on the employer to resolve the issue and ensure you receive the interest due on your EPF balance.

Legal Counsel
If the issue remains unresolved despite your efforts, consider seeking legal advice. A lawyer specializing in labour laws can offer guidance on how to proceed and may help you recover the due interest through legal channels. Legal action should be a last resort but can be necessary if all other avenues fail.

Understanding Your Rights
It is essential to understand your rights under the EPF scheme. The EPFO mandates that interest should be credited to an EPF account for the period it is held by the employer or the EPFO, regardless of whether contributions are being made during that period. This interest is meant to ensure that your retirement savings grow over time, providing financial security.

Persistence and Patience
Resolving issues with EPF settlements can sometimes take time and persistence. Stay patient and continue to follow up regularly with the relevant authorities. Regular follow-up can ensure your case remains active and receives the attention it deserves.

Final Insights
Addressing discrepancies in EPF interest payments is crucial to ensuring that you receive the full benefits entitled to you. By understanding your rights and following the outlined steps, you can effectively address this issue. Communicate clearly with your employer, escalate to the EPFO if needed, and consider legal counsel if the problem persists. Persistence and thorough documentation will be your allies in resolving this matter.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Asked by Anonymous - Jun 30, 2024Hindi
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Hi I am a working women at 40. I have about 50 lacs debt in home loan. I have a house worth 2.0 crs and gold around 1 crore. I want to plan my retirement fund as I m in a high burnt out corporate job. My retirement age is 50 years. I can invest 75k monthly comfortably apart from my house emi and monthly expenses. What split do you suggest for me so that I have 4 crs corpus at the time of retirement. Thanks
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Current Financial Overview
Assets: House worth Rs. 2 crores, gold valued at Rs. 1 crore.
Liabilities: Home loan debt of Rs. 50 lakhs.
Monthly Investment Capacity
Comfortable monthly investment capacity of Rs. 75,000, excluding home loan EMIs and regular expenses.
Investment Strategy
Diversified Portfolio: Allocate investments across equity and debt instruments.
Equity Allocation: Consider equity mutual funds for growth potential.
Debt Allocation: Allocate a portion to debt instruments like debt mutual funds or fixed income options for stability.
Risk Management
Diversification: Spread investments to mitigate risks associated with any single asset class.
Regular Review: Periodically review and rebalance portfolio based on market conditions and financial goals.
Retirement Corpus Projection
Target Corpus: Aim for Rs. 4 crores by age 50.
Investment Horizon: Plan investments with a focus on long-term growth and compounding.
Financial Discipline
Expense Management: Monitor and control discretionary expenses to maximize savings.
Debt Repayment: Continue servicing home loan while focusing on wealth accumulation for retirement.
Final Insights
By adopting a disciplined approach to investment, balancing risk with growth potential, and staying committed to your financial plan, you can build a substantial retirement corpus by age 50. Seek professional guidance to tailor an investment strategy aligned with your specific financial circumstances.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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