The new year is a fresh start with new hope, energy, enthusiasm, and resolutions. As we make a resolution to stay fit this year, let’s make a resolution to keep your finances fit as well. Don’t worry; we are here to make your journey easy. All you have to do is pick one resolution from the seven we have listed below and follow it diligently.
Set a Budget and Track Your Expenses
Budgeting helps you prioritise your spending and encourages you to save more while avoiding unnecessary expenses.
So, start with noting your day-to-day expenses like rent, electricity bill, gas bill, mobile recharge, EMIs, etc., and set a budget limit for each. Increase your allocation only if needed. Doing so will make you aware of your spending and avoid unnecessary expenses.
Start Saving for Short and Long-Term
Long-term goals are plans we make for our future, usually for a year or more. These goals include retirement goals, a down payment for a home, etc. Whereas, short-term goals include saving for a foreign trip, car or mobile phone.
It does not matter if the goal is big or small; the first step is to plan and save. Later, you can start investing your money regularly and make your dreams come true.
Invest in a Diversified Portfolio
Diversification means reducing risk by investing in different asset classes such as stocks, bonds, gold, etc. It is one of the best ways to deal with market volatility and earn good returns in the long term while reducing risk.
A Debt-Free New Year
Recently, because of consistent repo rate hikes, we saw an increase in loan interest rates. Hence, in this new year, let’s focus on paying old loans and avoid taking new loans. When it comes to credit cards, pay your bills on time and swipe them only at times of need.
Secure Your Future with Insurance
No one knows what will happen in the future, as life is unpredictable. But by opting for insurance, you can protect yourself and your family from the worst financial situations. You can opt for life insurance and a mediclaim policy at the start of the year and stay secured for the rest of the year.
Plan For Major Life Events
Financial planning becomes very important for these major events like marriage, children’s education or any business idea. Expenses also increase with these life events. It is a plus point if your income increases with your expenditure. But what if it doesn’t? Hence, you must start financial planning as early as possible. The younger you start saving and investing, the faster your money will compound.
Seek Advice From a Financial Planner or Advisor
Financial advisors can help you create a sound financial plan and meet your financial goals. It is said that financial planning is only for the rich. But that’s not the case. A financial plan not only helps you in planning your future but also helps in growing your money.
Teji Mandi is a leading Sebi-Registered Research Analyst who will help you with your investment journey so that you can make your dreams come true on time.
It’s chapter 1/365; without wasting a minute, pick a resolution and start working on it.
Have a Prosperous Year Ahead!