Securing a stress-free financial future is a primary goal considering the current uncertain economic scenario. We have seen how the pandemic has caused a consistent economic slowdown that affected the lives of millions of people. Lack of a savings plan and the suffering caused by hardships have affected families.
Here are seven ways in which you can prevent such a situation in your life and be ready for a secure future.
- Ensure In-depth Financial Planning: It is the most important step. To make an effective financial plan, follow these simple steps:
- Identify your financial goals in the short term and long term. Quantify them in terms of the amounts required.
- Gather details about your income and expenses. Account for the daily expenses, loans and liabilities, family commitments etc.
- Considering your personal information and the set of goals, make a long-term financial plan with a defined time frame at different stages in life. Ensure to include investments and a saving plan to achieve the same.
- Analyse the different options available and choose the best one that will satisfy your needs.
- Implement the plan, stay invested and monitor the effectiveness of the plan. Be patient to see the results.
- Buy a Life Insurance Plan: It is a responsibility more than a choice. If your family depends on your income, ensure to protect their financial well-being by purchasing a life insurance plan. It will pay a sum assured to the nominee in case of the unfortunate event of your demise.
TATA AIA life insurance plans provide varied options for life cover, savings and investments for a longer term.
- Buy a Money-saving Plan: A comprehensive plan with savings insurance objectives customised for your needs is another way to secure the future. It is a guaranteed return life insurance plan that provides life cover and additionally, assured returns on maturity.
The guaranteed returns can be availed of as a lump sum amount, a combination of lump sum and regular annual income or regular monthly income for a set income period. You can further enhance the plan with add-on riders.
For example, with the return of the premium option, you can get a refund of the premium amount paid on maturity.
- Start early: To get the maximum real benefits out of the financial plan and the chosen insurance savings plan, you must get started early in your savings journey. The early 30s will be an ideal age to understand, plan and secure for your financial future.
- Avoid unnecessary spending: As you start earning a regular income, you could develop the tendency of spending high, often on impulsive buying. You should avoid wasting money on unnecessary items or aspects. Allocate a specific fund for entertainment and other desires every month and try not to cross the limit.
- Emergency fund: Set aside a specific amount for an emergency fund to give you financial security during times when you cannot have a regular income. It should roughly equal three months of your expenses. You can use long-term investments as part of the emergency fund. A savings plan will provide the maximum benefits only when you stay invested for a long time.
- Annuity plans: Annuity plans are the best way to park your retirement corpus. It will provide a regular fixed income for a set period. If you are not comfortable handling a lump sum amount or feel that it will get depleted soon after retirement, ensure to take the annuity plan to secure your financial future.
You should visualize a financial future that gets you financially independent, provides the necessary financial needs to your family in your absence and helps you acquire a comfortable, debt-free, and peaceful living. You can accomplish that by adopting the seven steps above in a systematic manner. So, set off on your plan and get a financially secure future!