An investment plan is a procedure where one matches the financial goals by investing in their financial resources. It is important to make the proper investment for proper financial planning and they are essential to one another. There are many avenues of investments open to us today and they can be done through the form of bonds, equities, properties or the good old fixed deposits. It is important to start early and have a strong foundation and as one’s age increase, they can make the necessary changes to cover the other aspects of their lives.
One has to be first and foremost sure about the purpose of their planning. It could be ensuring the safety of the family, it could be wealth building or it could be preparing for one’s retirement. Hence, it is important to determine that whether one will need the returns immediately, whether one would need it for post-retirement or whether one would not need it at all and the money is saved for the family instead. It is important to prioritize the goals before one starts making investments. Hence, if one is 55 or older one should opt for a retirement plan and this will be a good way to take care of your future expenses and then will also take care if you have any further deposits or withdrawals to make. It will also help you identify when you would need the money the most in your life. It is important to have a time frame in mind to set long term and short term financial goals. Most of the investment plans require a minimum investment amount and before one starts investing, they also need to figure out whether they would be able to pay the premium amounts consistently through the tenure of the policy. If not, it would be a good idea to invest in single premium plans, one-time investment plans or policies which have flexible premium options. For those who have a high-risk appetite, they could be investing in mutual funds, which can be started with very small amounts but they can be increased gradually. Buying stocks and bonds is also a good idea and if you do not have any risk appetite and want to be safe, then you can opt for fixed deposits in banks or post offices or opt for schemes like Public Provident Fund, all of which has guaranteed returns. Hence, it is important to figure out one’s preferences and financial goals before an investment plan is drawn up.
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