Important Fundamentals of Personal Financial Planning “Worth reading” 

Financial Planning is a subject that is not taught in many schools but is something that nearly everyone has to deal with in their life. It helps you determine your short and long-term financial goals and create a balanced plan to meet those goals.

Keys to Happy Budgeting –

  • Income should be distributed-
    30% of monthly living expenses,
    30% of liability, if any.
    30% savings and investment for future living.
    10% entertainment, holidays.
  • Six months expenses should be available for an emergency fund (should be invested in LIQUID FUND, FD Etc)

Keys to Successfully Managing Your Personal Finances –

1. When you are buying the house: -House must be registered and the loan must be taken on both husband and wife’s name. (Both can get benefits on Home loan Tax benefits)

2. Second house: – Buying a second house for investment is not advisable (Survey reports says – it will give you a return of around 3% only).Take the appropriate advice before making a decision.

3. Timely Plan for BIG LIABILITIES: – After 45 years of age, one is not supposed to take any big liabilities (Higher education and the wedding of children normally take place when your age is between  45 to 50, so plan now for the same.

4. Nomination: –Regular check on Nominations for all financial instruments should be undertaken. Have a joint saving bank account with the spouse.

5. Insurance Policy Claim: –Only in case of a claim in an insurance policy, it is payable to the nominee. In other financial instruments, legal heirs certificate is required to get a claim.

6. Term Insurance: –Must have Term Insurance to financially secure future for your dependents.

7. Stay away from emotional buying: –Don’t take any financial investment decision EMOTIONALLY, and also avoid last-minute tax saving investment decisions. Plan well in advance.

8. Medical Cover: – Medical cover is a must nowadays because of high medical cost. In spite of Group medical coverage given by your office.

9. Tax Planning: – Must know all the Tax implications (You cannot avoid paying tax. But you can minimize by way of tax planning and investments).

10. All important documents must be kept safely nowadays digitalized and keep the family members informed about the same.

Last but not the least: – Review your portfolio at least once, in a quarter, investments Should be Goal Based and with the help of a prudent financial advisor.

Have a Healthy and Wealthy Financial Year 2018-19.


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