How to become financially secure?

How to become financially secure?

09 Dec 2019

We all dream of a life, wherein we are financially secure and can meet our life goals with ease. But how many of us work towards converting this dream into a reality? To become financially stable, we need to draw up a holistic financial plan and undertake savings and investments in a disciplined and regular manner. Save and invest enough with the concept of financial security; this way, you do not have to rely only on your salary to maintain and upgrade your lifestyle.

Usually, the idea is to reach this level of financial security as early as possible in life, so that by the time you are ready to retire, all your debts have been taken care of and you have built a nest egg large enough to sustain you throughout your golden years.

Becoming financially secure means you match your financial goals perfectly with your financial resources. To achieve your various life goals such as retirement, travel, higher education, children’s marriage, etc., you need a healthy investment plan. It is important to be cognizant of our goals and identify the instruments that will help us achieve them. Let us discuss some rules of investing to become financially secure-

Follow a detailed plan: Develop a plan to eliminate the urge to buy or sell investments without careful thought. Write it down and set dates to review it periodically. Establishing your plan will help you in good times and bad, and it will help you scrutinize those wild tips you get from your favourite family member or close relatives. You can start investing in Mutual Funds to create a corpus and then invest in other segments like Property, Gold and direct Equity or capital market investments with a conservative approach; all such steps may help you achieve your goals quickly. However, all these investment decisions need to be planned in advance and should be followed up thoroughly.

Make clear-cut goals: This step will help you to take a call on various investment options. Also, you need to maintain a balance between asset allocations, as this will help you avoid bringing down the entire pack even if there is an adverse effect on one asset class. Let us consider the following typical goals:

  • Child's Future: Timely investments need to be prioritized when it comes to education and financially securing the future of your children. You should allocate at least fifteen per cent of your total savings for your children. You can always stay invested for the long run if you are investing early. Essentials while planning for your child’s future are investments in Gold, PPF, Equity Mutual Funds, NSC, ULIP, and Recurring Deposits.
  • Retirement Planning: It is essential to take care of your future. Retirement can be a harsh truth, but it is necessary to plan for the same. We suggest you go for a diversified portfolio across PPF, National Savings Certificates, NPS, Stocks, Pension Plans and Mutual Funds. Always look at products that have a tax advantage for saving for long durations because you are investing for the long term.
  • Estate Planning: Always ensure that you have a smooth transfer of your assets after your demise. Dreaming of the future cannot be enough and planning is what will make the dreams come true. It is important that you make a will during your lifetime.

Regular Investments: Every month, you should save a reasonable percentage of your salary and the earlier you start, the more are the benefits, which will help you create a secure future.

Choose appropriate time frames to meet your goals: It is essential to wisely choose your investment goals and time frames, or else it can lead to considerable disappointments later on.

Use benefits of diversification: Decide on the risks you are comfortable taking to achieve your financial goals. A diversified portfolio gives the dual benefits of safety and reasonably higher returns.

Keep updating your skills: Read financial articles and newspapers, and take industry-relevant courses to polish your skills further, help you remain relevant at the workplace and improve your career prospects of landing better-paying jobs.

To sum up, financial security brings along with it tremendous peace of mind and lets us sail through our financial goals smoothly.

We wish you all the best on your financial journey!

Founded in 2005 by new–age entrepreneur Abhishek Bansal, the Abans Group has evolved into a globally diversified conglomerate, providing expertise in Broking Services, Non-Banking Financial Dealings, Financial Services, Agri-Commodity Services, Warehousing, Realty & Infrastructure, Gold Dore Refinery & Manufacturing, Trading in Metal Products, Pharmaceuticals, Software Development & Wealth Management. The Group is a comprehensive financial and non-financial services and solutions provider, aiming to provide end-to-end solutions to its clients.