We all have had our ups and downs with life making us aware that it is unpredictable, to an extent which is beyond our comprehension. A pandemic like situation can ruin long term plans; devastate families & disrupt businesses beyond repair, and for those who lost their job, things will never be the same again. In such turbulent times, for being prepared, we all must ensure that we keep ourselves healthy both physiologically and financially. Apart from health, financial security too is a great satisfaction that you can accord to yourself and to those you love, suggests Apnapaisa.
Due to lack of proper planning and execution, many people in India and across the world continuously worry about their financial situations. Especially after the pandemic, people have become more aware of their lack of financial literacy.Financial planning can be dull and tiresome, most often we try to avoid it as it is stressful too, but planning your finances is vital to having a good life in the 21st century.
In most cases, even if majority of us are earning a decent income, the truth that lies underneath is that most of us are just a step away from going down a financial cliff, due to poor decision making. At times, it becomes challenging to even keep up with the bills & dues while still making decent savings and investments. To shed some light on this issue, we have enlisted a few points, following which anyone can plan and manage their financial situation efficiently. Let’s go through them:
1. Have the right bank account
The initial step one could take is setting up an account with the right bank which can deliver according to your needs. With the help of advanced banking systems nowadays, you can use accounts which allow easy withdrawal and deposit options topped with amazing benefits, all you need to do is to find the right one for yourself. Although, just having an account would not server the purpose, as one needs to have a fund kept separately for emergency purposes, an amount which is sufficient to take care of all your needs for at least 3 to 6 months.
2. Budgeting your way out
Like Rome was not built in a day, it is almost impossible to start building a corpus for the future needs without taking care of the current financial situation. For a full-proof financial plan, one needs to prioritize, clearing the existing debt and look for suitable debt consolidation plans. The next step can be creating a budget according to the current financial situation and sticking to it, in order to create a balance between the earnings and expenses.
3. Set realistic goals and plan accordingly
In order to plan for a specific need, one needs to have a set of goals which are relevant and realistic according to their current financial situation. When the goals are set, you are already halfway towards realizing your dreams. For goal setting, one needs to keep in mind that the plan should not only be achievable but realistic too, and while setting them one needs to consider their way of living, lifestyle, family needs, individual priorities and overall expenses to be incurred while going ahead with a plan.
Most people disregard the idea of consulting a financial advisor to chalk out a plan for themselves. However, once you have your goals set, a financial advisor is in the best position to provide you with a plan that can yield the expected results.
4. Care for your credit score
In the present scenario, in order to avail the maximum benefits, one must make sure to constantly work on improving their credit score. For all sorts of credit arrangements, a credit score is the first point of reference for a lender, and those who have an excellent credit score, get the best offers and benefits, which ultimately saves a good amount of money in the longer term. A good score not only gets you a discounted deal, but also opens up new opportunities to avail credit as and when needed.
5. Think twice before you spend
Last but not the least, an individual’s spending habits makes a lot of difference with the existing financial situation. For someone who is in a habit of spending lavishly, either through savings or on credit must make sure that they prepare a budget and stick to it. Thoughtful spending also includes carrying out a research before buying anything, as it can save a decent amount of money as compared to impulse buying.
Like Warren Buffet suggests: A penny saved is a penny earned.
Kindly, do not ignore your health in the process!
Many people nowadays are always in a rush to earn more in order to spend more lavishly. In the process, they overburden themselves and as a result their health takes the toll. While planning for your finances, one must keep in mind that the financial goals they are targeting cannot be achieved without sound health and mind.