Dusshera is one of the major Hindu festivals that also symbolizes the end of Navratri. The festival is celebrated as the victory of Lord Rama over Ravana. It also marks the triumph of Goddess Durga over the demon Mahishasura.
So this festival symbolizes killing demons or destroying negative and bad habits we have in our lives in order to lead a prosperous life.
This Dussehra, let’s kill the 10 financial demons together which are hurdles in our financial life!
1. Not planning your finances
– The saying “When you fail to plan, you are planning to fail” perfectly fits here!
– The 50/30/20 rule is a simple budgeting technique that helps you keep your responsibilities in check, work toward your financial goals, and reward yourself a little. – Here, 50% of your income goes towards utilities, 30% towards luxuries, and 20% towards savings and investing. These percentages can be customized as per your needs.
2. Making Impulsive Purchases to keep up with the Trend
– While spending your money is a joyous feeling, it is necessary to remember that all expenses come at a cost and should always be planned and not impulsive.
– As it will ultimately affect your savings and investments.
– Be SMART with your money!
3. Ignoring insurance
– In general, everyone thinks that they are healthy, so why bother having insurance, and they end up ignoring the reality that insurance is one of the most critical elements in Financial Planning.
– Life is unpredictable, and we have no idea what the future holds. To ensure that your family is financially secure in the event of your unexpected demise, make sure you have adequate Term Insurance coverage as well as Health Insurance, as sudden medical bills can put a dent in your financial stability.
4. Investing all your money in traditional investment options
– Women have traditionally invested in safe, government-backed schemes because they offer risk-free returns, but in today’s inflation-prone environment, this might be a roadblock to achieving your financial goals.
– Therefore, having a mix of investments is essential, including equity, debt, and gold, in order to generate returns that beat inflation, provide stability, and serve as a hedge against inflation.
– You can check out LXME portfolios which are diversified, well-researched and curated by experts.
5. Not paying credit card bills on time
– Not paying credit card bills is one of the major reasons why the credit score of an individual falls due to which you might face issues while applying for any kind of loan.
– You can activate your payment alerts or auto debit facilities so that you do not miss any due dates and get reminders to ensure timely payments.
6. Not creating an emergency fund
– In the event of an emergency, not having an emergency fund might harm your finances and long-term investments.
– Therefore, having an emergency fund that is equivalent to at least 6 months of your monthly expenses can help one stay afloat in times of a financial crisis.
-You can check out LXME Ultra Short Term Plan which is recommended for 1 to 11 months with targeted return of 6% (market linked). This portfolio is well-researched and curated by experts.
7. Waiting for the right time to start investing
-Waiting for the right time delays the investment decisions and then you miss out on the power of compounding.
-So, start small but take the first step. Invest in your dreams, the time is NOW.
8. Not planning for retirement
– I know what you’re thinking, that “Hey! I’m too young to start thinking about retirement”! But remember, the younger you start, the better!
– You should first calculate the corpus required and then you can move further to investing. You can check out LXME Retirement Calculator and LXME Long Term Plan in order to invest, this portfolio is diversified, well-researched and curated by experts.
– Retirement at some point is almost inevitable! Your expenses will continue but income will stop, so you’ll need a good financial cushion to sustain you through your dream retirement!
9. Copying Someone else’s financial plan
-While you and your colleague or neighbour or even your partner, might earn the same amount of money, your financial priorities might vary. There is no set formula.
-Every individual has different kind of goals, financial capacity, risk appetite and time horizon so one should first assess these parameters and then move forward towards investing.
– So, create Your Own Financial Plan Because Everyone Has a Different Story!
10. Leaving Tax Planning for the year-end
– Leaving tax planning for the year-end can lead to unfruitful decisions. As you might end up losing the chance of availing tax benefits you get by investing in tax saving investment options.
– Plan your taxes at the beginning of the year so that you make the best out of it, there’s no last-minute hassle and you’re planning for your goals in an efficient way.
– You can check out LXME Tax Saving Plan which invests in ELSS funds that is tax deductible under section 80C up to ₹1.5 Lakh.
As we have understood the 10 demons we need to kill this Dusshera let’s burn all financial demons now and have good and healthy financial life.
Let us know in comment section which demons you need to kill for your financial prosperity!
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