Life is full of commitments. We have commitments towards our family, children, their welfare and safeguarding our own life post retirement. Bifurcation of funds for each of the commitment in an individual manner is a prudent thing when it comes to Financial planning. To strike a balance between earnings and savings is an art by itself and any good financial planner can help you learn this art. If you want to have a strong financial health, we recommend you to fix short term and long term goals to achieve the same.
Fixing short term and long term financial goals is just the first step towards having a healthy financial position at all points of time. Splitting such goals into smaller tasks that can be executed on a regular basis is the next logical step. Strong financial health is basically a journey from financial planning to wealth accumulation. We provide here 7 Tips to be on right track to achieve your financial goals.
- Decide on the destination
We do not start on a journey without knowing where we want to go. We decide on the destination first and then plan our journey. A journey started without the destination in mind will make us live a nomadic life without purpose and means. This is true with our financial journey in life too. Chalk out a plan before you start saving. Clear cut ideas about your commitments makes you decide on the term of investment. For instance if you want to save for your children’s education or marriage, then you know that it requires a long term approach. Buying a new model car or purchasing a piece of land available for purchase can be considered as short term. Decide what you want to save for so you can actually start the savings.
- Set Financial strategies
As compasses are important for the ships to sail on the right direction, strategies are crucial for reaching our financial goals. Your mental stature plays a crucial role both in strategizing as well as in carrying out the strategies for long term. Ensure you set strategies not only pertaining to savings and investments but also pertaining to risk tolerance. Long term commitments are not only long drawn by time frame but also huge in terms of quantum. Such high quantum commitments can be easily met if you invest in Mutual Funds which yield high returns than any other financial products. A good financial planner will be able to guide you through the Best Mutual Fund products available in the market.
- Understand your current destination
The cost of reaching a destination depends mainly on the location from where you start your journey. Relate this to your financial journey. Assess your current situation. Understand how much savings and investments you have in the present day scenario. Now, take into consideration your destination which is your short term and long term commitments. Ascertain the gap between what is in hand and what must be accumulated within the stipulated time frame. This will help you strategize for filling in the resultant gap between the two. You can take the help of a qualified financial planner who will be able to provide you value adding guidance end to end.
- ‘Goal list’ is your guiding map
No ship starts sailing without a map in the Captain’s cabin. Start your financial journey writing down all your short term and long term goals in a paper. This paper is your guiding map and you are the captain of the ship. Writing down your financial goals motivates you to pull on with the journey through hurricanes half way through the journey. Visit your goals periodically to constantly monitor the distance you have travelled in your financial planning journey.
- Being pragmatic is the key
Now that you know where you stand and where you want to reach, think about the savings viz-a-viz expenses ratio in a realistic manner. Avoid being over enthusiastic since setting lofty savings goals may turn out to be a pain causing one. Assess and ascertain the maximum possible savings in a realistic manner and set strategies only based on the same. For instance, say you want to save 20% of your income every month to meet your goals as per your financial planning. If you end up on stressful debt management month on month you are not being pragmatic in your approach towards your goals.
- Seek professional assistance
Learning to sail a ship from a senior captain is the safe way to tread the high tide seas. Seek professional help from financial planners who are qualified to assist investors. Financial Planners guide you through the process of savings and investments by providing a holistic picture about the same. Financial planners will make you understand the risks involved in various financial products and high profit yielding products like Mutual Funds.
- Start immediately
A ship standing on the coast for long is of no use. In the same wavelength, procrastinating implementation of your decisions pertaining to financial plan will drown you sooner or later. Any financial plan initiated early in life yields high profits. You can invest in Mutual Funds for your long term commitments since the nature of the same is long drawn combined with profitability. Starting with Systematic Investment Plan, which is popularly termed as SIP provides you the confidence in Market related products. Investing in Systematic Investment Plan also helps you meet your short term goals.
All of us have dreams. All of us have maddening commitments. Any responsible human being tends to perform every responsibility of his with high levels of maturity. Many commitments are futuristic in nature taking a toll on our current standard of living. A strong Financial Planning acts as the basic requirement for achieving all our financial needs at any point of time in life. Take the help of professional Financial Planner. Make your financial planning your strong forte. Sail across the finance sea with confidence to reach your destinations in the planned manner. Happy sailing.