We all invest so that we can earn sufficient returns to fulfil our financial goals and beat inflation. Best Financial Adviser Kuber Mindz Moneymindz asks you whether you know what are the check points you need to know before you start investing.
A budget consists of your regular income, expenses, savings, investments, insurance, financial goals and the time frame in which each financial goal is to be achieved. A household budget is framed to track household finances. You can also have a personal budget ton track your personal finances. Here is a tip to help you.
Follow the 50-20-30 rule in which 50% of your income goes to living expenses and groceries, etc, 20% goes to your entertainment expenses like outings, trips, movies, lunch/dinner outside, etc and the last 30% goes to your investments and insurance products (loan EMI included).
Buy adequate Insurance
Insurance is s necessity nowadays with increasing sedentary lifestyles and lifestyle related diseases. Term Insurance offers cover for your family if you no longer happen to be on this planet. Health Insurance offers health cover while Home Insurance provides coverage for your house and household objects. Travel Insurance covers all kinds of travel related losses and costs.
Insurance is helpful because prevention is better than cure. Don’t forget to buy adequate Insurance.
Uninformed visitors can be given many names and one such name is “emergency”. When hit with a financial emergency like job loss, hospitalization, urgent repairs, etc you tend to take additional debt. To avoid that, you can take money from your emergency fund and take care of urgent expenses.
You don’t have to borrow money from others or break into your other investments in case of an emergency. Just have an Emergency Fund. Experts say that a Contingency Fund has to contain 6 to 12 months of your regular income.
Spend less than you make
Remember to spend less than you earn. It’s ok to spend on a little luxury once in a while but not always. Take care of your basic necessities and save the remaining money. You can start walking to the store with limited cash in your hand to buy whatever you want rather than ordering online or paying by card.
Your income should be more than your expenses, savings, investments and emergency money put together. Bear that in mind.
Pay Off All Debt
Your priority must also be clearing existing debt and investing enough to make sure you don’t have to take any future debt. Use your card less and pay the balance quickly. Clear off existing loans and don’t take additional loans unless you’ve no alternative.
Debt is a huge hassle to financial freedom. Eliminate debt.
For more information visit www.moneymindz.com or give a missed call to 022-62116588.