Dussehra symbolizes the victory of good over evil. The festival celebrates God’s incarnation on Earth to get rid of evil. Every Indian festival carries a message, and Dussehra teaches us to fight our own vices. It’s possible to have many vices when it comes to money management. As we celebrate the end of 10-day festivities with the burning of Ravan’s effigy, take a look at few vices you need to keep away for a healthy money life.
Splurging And Not Saving
In this era of online shopping where you’re spoilt for choices, it’s easy to get greedy and want to buy everything your heart desires – and so you spend heavily on non-essential items and are left with little savings. Saving is essential to secure your future financially. There’s nothing wrong with making discretionary spends. It’s just that you should save first, spend from what’s left, and manage your discretionary spends in a manner that they don’t hurt your finances. Create a budget that enables you to keep your finances on track, helps you meet your priority spends, and also allows you to make non-essential spends but within limits.
Ignoring Your Insurance Needs
Buying insurance is a necessity because it protects your savings and finances against death and diseases. However, out of ignorance, many avoid buying insurance. If this evil of ignorance is keeping you from buying term and health insurance, this is the right time to get rid of it. A term insurance policy works as an income replacement tool for your family after your untimely demise. A health insurance empowers you financially to deal with rising healthcare costs during serious illness or hospitalisation. While buying an insurance cover, do consider your crucial family needs like income replacement, debts, children’s education etc.
Having Runaway Debt
It’s impossible to imagine modern life without digital finance or plastic money. However, credit instruments should be used carefully and your dues should be repaid in full on time. If not, you should spiral into a debt trap. Any time you borrow, always have a repayment plan. Timely and full repayments will boost your credit score and help you access the best credit card or loan offers.
Thinking Retirement Is Miles Away
The ideal time to start planning you finances for your golden years is as soon as you start earning. However, we often tend to be lazy on this goal, thinking we have plenty of time. But time can whoosh by, and starting retirement planning can have terrible consequences – such as running out of money in old age. So for an enjoyable and dignified retirement, cut the sloth, start retirement planning, and create the right-sized retirement corpus.
Not Paying Attention To Tax Planning
Taxation is important, and paying your taxes on time makes you a responsible citizen. At the same time one hates to lose a big chunk of their hard-earned money to taxes. Tax planning is a legitimate way to save taxes by investing in qualified instruments to create wealth. But tax planning should begin as soon as the new financial year begins and should not be undertaken at the fag end of the financial year thinking it as an avoidable burden.
Since each individual and each family is different, assess your family needs regularly to make changes in your financial planning. Ensure you have an emergency kitty over and above the points discussed here to take care of uncertain future. Remember: vices can exist in many forms, and it takes determination to fight it away. Happy Dussehra!
The writer is CEO, BankBazaar.com