It’s that time of the year again when we bid adieu to the previous year and look forth to the new year with a renewed vigour. A lot of us tend to usher in with resolutions around physical, personal, financial well being and more. New Year’s a great starting point and utilizing this point to review your financial health and setting up new goals for the upcoming period is a good way to go about it.
We here look at a few investment resolutions that will help boost your finances in the right way and put you in a commanding position of your financial health. Whether it’s about creating a retirement fund or investing for wealth generation or cutting back on your debts, these investment resolutions will help you out.
Financial Resolutions for the Year 2020
Budgeting is one of the first and foremost steps if you want to create a sound financial status. There are plenty of people who earn a lot of money but cannot manage the money well. Creating a budget and sticking by it may seem a difficult task but it is of utter importance as this one step will help you to be financially stress-free for a long haul. This will also help you to know whether you will have enough money to do the things that are required of you like investing and more. You can set up your budget and stick to it and also look for the potential to reduce your spending in some categories along the way.
Get out of the Debt
Another step into sound financial status is clearing off the debt. It’s not just about budgeting only as you also need to clear off your liability to take control of your finances. If you have some surplus cash then consider paying off your loans as pre-payment. This way you can save on the interest amount and later on use the same for investing purposes. You can also pay off the high-interest rate debts like credit cards and personal loans. Set up a debt payment schedule and stick to the plan. This will also help to boost your overall credit score. The credit score is an important parameter in present-day but it’s not uncommon to see many people stuck on bad credit score due to financial mismanagement and lingering in debt. This New Year takes a call on yourself to pay off your debts and improve your credit score. A good credit score will help you to build your credit profile and seek loans if required for in the future.
Saving money is an important criterion if you want to be financially sound. Not many people take note of this thing and indulge in spending spree which ends up exhausting your cash reserve. Saving is a very important aspect of life and even American business magnate and investor Warren Buffet testifies to it in his quote, “Do not save what is left after spending, but spend what is left after saving”. You should save a substantial amount of money every month from your income. This will quickly add up and will bail you out when you are in need of funds. We’ve often seen how people buy things that are not required for or go out for dinner every now and then. These habits just tend to create a dent in your savings. You can rather save the money by keeping your shopping in check, reducing your grocery bills or saving on the utilities. These small steps can help create a savings habit that will help you to set aside money for the immediate and future purpose. You can also look to secure your family’s future by investing in a savings plan or investing in an emergency fund.
Begin your Investment Journey
Merely budgeting and cutting back on expenses to save more money will not give fruitful results over the long term. As the market is prone to inflation, the savings that you’ve accumulated as of today will decrease in value in the future time. This is where investment can be a good option for you. The investment allows you to grow your money at a quicker rate and yield better value for your money in the long haul. If you have not started your investment journey already then let this New Year 2020 be the start of your investment journey. There are plenty of investment options that you can go for in the form of stocks, mutual funds, bonds, commodities and more. You can either invest based on your market research and analysis or you can also seek the help of the professional fund managers and advisors who can help you plan your investment and guide you in a proper way.
You can also invest via brokers who will conduct the deals on behalf of you. Since investing is about putting your money into the options that will yield high returns while reducing the risk, you should seek the authenticity of brokers and advisors. The current Indian market is brimming with news of unfaithful brokers and advisory companies. You can count the example of Karvy who was barred by SEBI from purchasing shares and accepting new clients. This is why you should seek whether the advisory company is authorized by SEBI or not.
Also if you seek professional advisory services, then look for past performance and referrals as it will be. If you are already into the investment scene, then you can look to expand your portfolio by investing in different verticals and investment options. You can add mutual funds, ETF’s, bonds, commodities and other investment options in your portfolio. This New Year review your portfolio and look to add new options that will increase your wealth and let go of the ones that will decrease the value.
New Year and resolutions are quite a common chore, isn’t it? We tend to make a list of resolutions that we will definitely start this upcoming year yet we never make it into reality. Why limit those resolutions when you can kickstart your life ahead with just a few steps. Why not add a new dimension with these financial resolutions. This New Year let’s not just start a journey to a physical and mental well being but also a journey towards financial well being. We hope the aforementioned resolutions will not only help you take control of your finances but also set you up for a brighter future. Happy investing!!