Here’s The Reason Why Investing Separately For Future Plans Can Help You Financially
If you find a person who invested a large amount of money in funds but still is not able to meet the financial targets then there is the major possibility that the person has invested money in a wrong place where it was almost like a piggy bank where you cannot expect to have good returns in the future. Someone who wants to invest they just have to make a few guesses about the financial needs in the future. Reasonable guesses mean that you have to decide the plans you have to do in the future.
For instance, the future requirement can be your child’s higher education or high amount of money needed in case of any medical emergencies or your retirement year is only 10 years from now and you would like to maintain the same lifestyle even after retirement.
You should decide as per the financial need in the future. If you think you require 10 crores after 5 years which means that you should have enough money to invest to get such big amount of money after 5 years. Try making decisions like whether 70 lakh in 5 years will be enough or the duration of investment can be increased from 5 years to 15 years.
With an exact plan in mind, one can decide where the money should be invested. The further steps become clear if someone is not able to fulfill the goals that were previously set. If a person has multiple goals for the future then multiple portfolios are required. The term “Portfolio” is used to signify all the investments and assets possessed by an individual or by the whole family. It is very important that the separate portfolios for separate requirements are made and all these different investments are aimed towards a major goal to be fulfilled.
The method is somewhat similar to how the housewives also called the ‘Budgetary Head’ organize the money. The housewife divides the amount of salary according to the different requirements like groceries or any other household related expenses. In the same way, like the housewives manage the money, it is very important to have a separate financial plan for each of your goals.
There are three points that a person should always keep in mind. At first, the amount of money invested should be calculated, secondly, the duration after which the money is required should be decided and at last, it is essential to see if there is any scope available in the amount of money invested and the duration of time after the money is needed. Because an investment can be immediate as well as a long-term one and it should be decided accordingly. As per the requirement in the future, the plans must be made so that you don’t have to struggle to meet your financial needs.