There are many people around the world who think that finance is overwhelming and quite complicated at the same time. Our dreams are often connected to our financial stability and more often we are left with confusion about the path we need to take to accomplish the same. Be it a new car you wish to buy, or an expensive travel, it is important to plan well ahead of time and make your dreams a reality.
Having financial success is the dream of many but it is not easy as it requires a focus on the goal. For example, the cost of higher education has increased by leaps and bounds and this is one of the reasons as to why students now opt for educational loans from banks. Most of the professional courses nowadays cost anything between Rs. 5 Lakh and Rs. 10 lakh and for some courses, it can go further till Rs 50 Lakhs. A number of parents start saving and investing for the education of their kids using policies and SIPs and the investment strategy depends on the age of the kid. If your kid is young and is of the age group of 4-5 years, you have good 13-14 years to plan for their education. If you have a short tenure and a massive goal to achieve for the kid’s higher education, you can start investing in a mix of fixed income schemes and various mutual fund instruments. Do remember that when you are saving for the education of your child, the total financial plan depends on the contributions that are made by you. Parents can choose from various child plans and choose from the two kinds of maturity benefits that are available.
Financial success and security does not come by luck or accident, instead, one needs to take careful steps to achieve financial success which will help build a strong financial future for your family.
7 Steps to a Better Financial Future
Know what you want to save for: For many, a goal is to reach their financial independence. Many want to save so that they can live in comfort and spend their time the way they like. One can start by having short-term goals like buying that dream car or clearing off the debt and so on. Writing your goals down will make them happen quickly as it helps you remain motivated.
Once you have started to achieve the short term goals, plan how and how much to invest to reach your long-term goals like saving for your retirement or buying that dream home.
Have smart saving goals: Having a financial planning for a better future is important and one needs to have concrete and smart goals. Your goals have to be achievable, specific and realistic. One can start by analyzing what is needed to achieve the goal and how much one needs to save every month to achieve it.
Reduce your expenditure: once you have set your long and short term goals, you need to look for sources to fund the goals. If you have any additional income coming your way, the same can be invested smartly. If not, it is time you have a look at your bank and credit card statement and see where you are spending your hard earned money. If you find anything that is not necessary, this is the time to get rid of that immediately.
Have a budget: Always think of your budget not only as a way to know about your income and the expenditure but also to know your values and the priorities. By having a budget, you can gain your control back on your money. This, in turn, helps to achieve your short term and long term goals in a lot easier manner. Prioritize your savings and cut down on expenses.
Pay yourself: If you want to start saving for long-term goals, make a start with yourself. One of the investments which is a must have for anyone is a retirement plan. You can choose from various plans that are available and start investing early to reap the benefits when you grow old.
Increase your savings with time: If you are in a situation when you cannot save much to start with, save less and increase your savings with time. This is known to be one of the most powerful ways to achieve financial success over time.
Always stick to the plan: Now that you have a budget and have made your goals, it is important you stick to the targets. Make sure to track your expenses and also have an alert to alert you when you are overspending. One can also keep a tab on expenses by having a separate bank account for savings.
A financial plan is a must for everyone and by following the above-mentioned steps; one can get on to the path of saving and this slowly becomes a habit. When you start saving smartly, the rewards are much greater than what you have expected.