Hyderabad: Being young has the power to do anything. Even if the income is low, the responsibilities are not heavy. Costs are limited. At the same time, one should try to make financial plans keeping the future in mind. Only then will your money work hard for you along with you in the long run. It can create wealth. And let's see what strategies to follow for this.
We are a nation of youth - 65 per cent under 35 years of age. But, reports say that most of them are not that concerned when it comes to financial planning. Good habits should be learned as early as possible. It should be recognized that money management is one of them. We depend on our parents while studying. But once you start earning, you should think carefully before spending every rupee you earn.
It is better to practice the 50:50 principle from the first salary. Set aside 50 per cent of your income for savings. Invest your hidden half salary first in risk-free schemes. This will basically deposit some money with you. Once you have an understanding of your financial goals and risk tolerance, you can look at higher return schemes.
Also Read : Covid, War, Adani won't impact your investments? Read on
Define your financial goals clearly. An investment can last long only when it is linked to a specific goal. Otherwise, it becomes a habit to start and stop in the middle. Hence identify short and long-term goals. To achieve them, choose suitable investment avenues and start investing. Many prefer to opt for schemes that convert into cash as soon as needed. These are perfect for short-term goals.
Those who are young may not have important family responsibilities. Sometimes you can be the breadwinner of the family. Retired parents and siblings may depend on you. In such cases, they should take an insurance policy to support them financially. Do not forget that it is a protective shield for the family. If you take an insurance policy at a young age, the premium will be lower. A higher-value policy can be chosen.
Financial planning is not done in one day. It determines how efficiently the available resources are being used. Your marriage, children, studies, other needs, and retirement should be a long-term vision. Earning 30-40 years and hiding some of it all should be done according to a calculation. Take advice from financial experts if necessary.
The schemes chosen for investments should be diversified. Choosing schemes that are too safe or too risk-averse will upset the portfolio balance. The risk of losing an investment is less when it is diversified. Your financial health should be monitored from time to time based on changing financial conditions, responsibilities and other factors. Review your investments based on market performance. Regularly revise the portfolio.
