We all can be pretty handful with money. More we have, more we tend to spend it. So, what can we do to be more organised with some spare money??
Here is some advice for you :
1. If you plan to save for a period of more than 5 years, it’s better to invest in equity mutual fund. It’s almost not possible to have negative return in equity if time horizon is more than 5 years.
Returns can be from 5% to 25%. Don’t get panicked with ups and downs of market. It will turn up after completing market cycle. Simply continue your SIP’s instead of looking at market every now and then.
2. The next, almost everyone’s favourite, is bank deposit. You can either invest in flexi-deposits every month or else make one time investment in fixed deposit.
But remember to divert your investment in more than one bank. Do not make a mistake to trust single bank for your money. We can learn from the example of PMC bank that banks can rob you too.
3. It is mandatory practice to set aside few bucks every now and then so as to provide your household expenses for at least 6 months. This will be utilised in adverse situations like when you loose your job or you are facing financial trouble in your business. You gotta run your household, thus, this Contingency fund is must.
Review your present scenario. You are wise enough to know whether there are any upcoming threat in your life like inflation in industry, any health issues etc. Thus, accordingly, keep yourself prepared. Your contingency fund must be able to pay off your bills, school fees, rent etc.
4. Insurance is must in order to save your family from sudden crisis such as death or life threatening diseases. In any case, life insurance & health insurance is a must part of your portfolio. An bypass surgery alone can cost you around ₹ 10 lakh. Look for various insurance policies as per age, health crisis and family issues.
5. Don’t do every investment after looking at their tax benefit. Set your goal, it could be to buy property or to buy car or just to keep some money aside for emergencies. Accordingly, take expert advise or else do your research and take decision.
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