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In this video by @DSPMutualFund_in you will understand the types of financial goals, smart financial goals to pursue ahead, why it is vital to make financial plans for the future, and much more.
Watch the video to learn more about it!
Financial success requires a little more than just good fortune. It involves discipline, commitment, perseverance, and constant sacrifice.
It entails establishing both short-term financial goals and long-term financial goals and then achieving them successfully. Unfortunately, many people appear to deal with issues related to them because of a lack of clarity or guidance.
Those with a clear financial roadmap and who establish attainable financial goals are more likely to experience success.
Types of Financial Goals
Financial planning should ideally be goal-oriented, taking into account the different phases of life and necessities. It's a good idea to start your personal and professional financial planning process by becoming familiar with the fundamental terms and concepts. Here are a few popular categories of financial planning.
Investment Planning: Investment planning aids in preparing for various other life milestones and ambitions, such as purchasing a new home or car, going on a memorable cruise ride or travelling abroad. These come under personal financial planning that needs to be executed carefully.
Liquidity Planning: This entails being mindful of your current income and expenses, estimating future needs, and creating a strategy to keep money on hand for those unexpected dry days.
Insurance Planning: This protects against unexpected, unplanned, and unavoidable health-related events that can be expensive due to treatment-related expenditures. Insurance planning can protect your home, car, and other priceless belongings and health.
Tax Planning: This lessens the high-stress levels and frantic searching for tax savings that people experience, particularly after each fiscal year.
Retirement Planning: Most people's lives include a retirement milestone, yet only a small percentage of people are adequately prepared for it. Retirement financial planning makes it more likely that you'll be able to live comfortably and independently in the future.
Smart Financial Goals to pursue ahead
Here are a few important actions that your investment advisor can assist you with, including evaluating your requirements and properly managing your investments and expenses.
Build an emergency fund: If you don't place your money aside at first for emergencies, no amount of money you set as a goal will be worth it. Most experts advise keeping at least three months' worth of living costs — and more, if possible — in separate high-interest savings accounts online. Avoid letting an unplanned expense destroy an excellent financial outlook.
Work on your budget: Financial planning includes budgeting, which is crucial. It assists a planner in figuring out where money is going and where you might make savings to achieve your goals. Using a budget calculator, you can determine whether your money is wasted.
Managing liquidity: Liquidity management is a crucial aspect of financial planning. In this scenario, a specific sum of money is set aside for unanticipated circumstances. When you save money for unforeseen expenses like home repairs, medical emergencies, or buying gifts for family or friends at the last minute, you avoid falling into a credit card debt trap.
Establish your risk appetite: This will help you choose the best financial instruments for your investments. You have to be well-informed about how to manage your risk. Financial planning urges you to set aside emergency funds to handle any potential risks to the family's income.
Financing Big Purchases: We all have to make those significant expenditures during our lives, including buying a home, a car, funding a college education, and shopping for a wedding, among other things. You must use your money to provide yourself with a higher rate of return than a standard savings account when saving for significant expenditures.
Monitor and revise: Market swings can directly impact the state of your portfolio. Regularly (especially during any geopolitically disruptive incident), you should assess how well your plan is working and make necessary changes.
To summarise, goal-based financial planning for the future today is critical if you want to be financially independent. DSP Mutual Fund is one of the best to help you focus and implement your financial goals effectively!
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