Due to lack of Financial planing and Analysis, Year by year changing but the financial position is not improving. What to do this year? What not to do?
Everyone makes some resolutions on that. Exercising to maintain good health, following a diet, and spending time with family are just some of the goal setting shareware that you can use to make a new life and invite good habits into your life.
Similarly some decisions have to be made financially i.e knowing the importance of financial planning in financial management.
Most people do not think big about financial planing. Their perception is that they do not have enough money to save. It is enough to invest a small amount when you have a low income.
Make some new decisions in every new year as they are worth the revenue by investing good amount of money to save before moving out.
Ask yourself what is financial planning and know meaning
The past tense teaches me some lessons. According to the financial planning report, Financial experts say that if we take into account the experiences we have seen in the past and the lessons learned, we will be able to make appropriate financial plans for the future.
We have experienced corona conditions like never before in the pandemic years. What conditions did you encounter during this time?
To what extent has the Kovid-19 effect affected your financial goals? Did income and expenses increase? Are you down? Ask yourself that.
Only then will you be able to make realistic decisions that can be achieved stepping in the every new year.
Health insurance plans for family and self
Kovid-19 informs the public about the importance of health insurance in pandemic. Those who did not have health insurance policies for family have to face the difficult situation when any one of your family member hospitalized and searching outside for hospital expenses.
Yet Kovid-19 fears have not left it is continuing and we've to survive along with Kovid. Newly Omicron also created ringing bells everywhere and its effect on humans how much is not analyzed easily.
Everyone needs to take appropriate precautions to counter this. Be especially vigilant when it comes to health insurance plans.
Everyone should take out best health insurance policy with coverage that suits for your family health needs. Term insurance must also be taken in such uncertain conditions.
If an acquaintance dies accidentally, the family will face many financial difficulties. So if there is a good term life insurance policy it will be financially viable for the family.
So even if you do not have health, term insurance or adequate coverage for now, focus on these in the every new year.
Where should I invest my emergency money
Emergency fund investment options applies in case of accidental cessation of earnings, the onus is on the earner to ensure that family expenses are not interrupted in case of any reduction in earnings for any reason.
Therefore, make this decision if you do not have an emergency fund set up by now. For this, best way invest money in fixed deposits and liquid funds i.e Systematic Investment Plans (SIP). You must have at least six months' worth of cash to cover family expenses.
Scissors for Unnecessary Expenses
Where do you think the new money will come from to set up an emergency fund?
However, reduce your unnecessary expenses change your Lifestyle. There is the opportunity to save and on every spent just ask this question how to save an emergency fund when money is tight.
At the time of Online shopping, dining in hotels, foreign tours, movies, dinners, entertainment, etc. can be set up as an emergency fund if reduced to the required level.
However, analysts believe that it would be better to spend only what is needed and cut down on unnecessary expenses.
Every penny spent should be calculated. Make a list of all the necessary and unnecessary expenses. You will find yourself wondering how much you can save money by cutting down on small expenses.
So cut down on unnecessary expenses and invite new earnings in your pocket every new year with money saving tips. It is a good idea to list each expense in a book.
Examining the expenses each month will help you understand where they are spending the most.
Don't get into debt need financial planning
Debt is not good for your financial life and it'll effect on your need financial planning. But it has now become a habit for individuals to incur debts in order to fulfill their desires and interests.
With the rise of zero interest rates and credit cards, it is becoming easier to borrow money from others and pay on a monthly basis. Sometimes these can lead to financial losses.
Decide financial planning process not to borrow money from others in every new year. However, if the EMI is paying off existing loans, make it a decision to pay them off. It's okay to take out a loan in an emergency.
But as per financial planning report, financial experts suggest financial planning helps individuals to not take any loan for luxuries.
Repaying loans with high interest rates is not an good idea. Credit card loans carry an interest rate of 36-48% per annum and 12 to 24 per cent on personal loans. Using credit card is good or bad, Learn Art of credit card bill payment implementing financial planning tools.
These loans should be repaid as soon as possible if available, just imaging If Missed Home Loan EMI What happens if home loan emi not paid.
Paying off credit card or personal loans in the form of EMIs is not a wise idea to use the money for investments.
This is because the interest paid on the loans is higher than the total return on the investment. If the amount you owe on credit cards is more than your one-month income, it is a good idea to withdraw some of your investment and pay. How to reduce personal debt and search for Ways to pay debt off faster.
Review family financial planning
Review your portfolio once a year and check How to start personal financial planning. Last year saw a flurry of IPOs and NFOs.
With this many people bought new stocks. Review portfolio rather than clutter. Investors need to ensure that returns outweigh inflation. It is advisable to consult a financial professional before investing.
Second Source of income Idea
How to improve passive income to reduce personal debt, learn Ways to pay debt off faster and start financial planning today.
