Savings are an indispensable part and parcel of your financial life and are the basis for potential investments, achieving various financial goals, and maintaining the lifestyle you want. Let’s also not forget how your savings come to the rescue in times of need such as medical emergencies, home repairs, and vehicle damage. While there are various methods to set aside promising amounts of cash from your income or monetary gifts, it is the goals you draw out that determine your financial path. Thus, setting goals is an important part of financial planning and management. Learn more about how to tackle three common and important goals: renovating your home, seeing the world, and, of course, financing your retirement.
Renovate Your Most Valuable Asset
Your home, the most valuable and immovable asset you own, requires maintenance and care, especially as it ages. Renovating it helps you restore the safety and foundation of the structure, increase your comfort and help you upgrade your lifestyle. Perhaps in-depth plumbing work can help clear the old drains that keep clogging up or installing a bath tub help you indulge in a small luxury.
It’s never too late or too early to add to the life of your property. However, you can plan for this in advance and schedule this goal around your mid-life phase, allowing you enough time to save for it. Starting an ELSS via an SIP for 5 years can help you, as can other options like FDs. If you’re already at the juncture of doing a renovation, consider investing in short-term options that give you lucrative returns, such as liquid funds or arbitrage funds.
Indulge In Traveling The Globe
Traveling to different countries not only gives you a lifetime of memories to treasure, but also exposes you to different cultures and customs and widens your perspective. Whether you want to travel for business or pleasure, planning and making bookings in advance can ensure the costs are manageable.
Consider setting up a recurring deposit that allows you to set aside funds every month so you have a corpus when you need it. Alternatively, you can start an SIP for travel or even invest in gold ETFs for higher returns. This will help you finance your globetrotting lifestyle without pinching your pocket.
For better last-minute travel deals, you can rely on a good travel credit card that offers you discounts on flight bookings and stays or allows you to redeem reward points as air miles. Lastly, you can also go in for a travel loan. In this case, ensure your credit score is high to get a more affordable sanction, and plan your EMIs in advance so repayment is a breeze.
Vest Your Best Efforts In Securing Your Golden Years
While you save and invest to meet various goals like buying a car, financing your child’s education or throwing your 25th wedding anniversary party, don’t forget to focus on building wealth for the future. You’ll need this corpus when you retire to maintain the same standard of living without depending on anyone else. To start, factor in medical expenses, sudden repairs, travel expenses, daily living costs, and funds to pursue your hobbies or passions while accumulating your retirement corpus. The best way to start building this reserve is to start early, right when you join the job market. If you haven’t, don’t fret. Just consider investing in instruments that offer higher returns, especially if you have fewer financial obligations or dependants. This include investing in equity or equity funds and real estate. As you age, you can also consider balancing out the risk in your profile with instruments that offer guaranteed returns such as FD, PPF, government bonds etc. The right combination of these, along with the right insurance policies, can come to your aid when you reach your golden years.
Remember these three important financial goals and work towards achieving them while pursuing your other financial motives.
The writer is CEO, BankBazaar.
BankBazaar.com is a leading online marketplace in India that helps consumers compare and apply for credit card, personal loan, home loan, car loan, and insurance.