Today , I am going to share How I have planned my financial life for next couple of years. This is the plan which I am planning to execute and hope to have a worry free financial life. This includes preview of all my investment which will help me to grow the money and secure my family.
The financial plan that I have designed for myself includes my priorities and my family needs. I believe that financial planning should always be done after assessing the person’s conditions – his past and his future needs.
My family is important for me. So first and foremost , the most important thing for me is to secure my family. Before we move on to core of my investment strategy – Have you gone through my post on “Are you ready for financial planning“
We are a family of Four Persons. So , this is what I have done to secure my family –
Securing Yourself and your family:
- Term Insurance with a coverage ONE Crore and with a policy duration of 30 years
- Health Insurance for all four members of our family which include medical expense coverage up to 5 lakh per person.
- Home Insurance to secure my Independent House
The Cost for all above products roughly turns out to be around 50,000 INR per Year. So with an investment of around 50,000 , I am securing my family and I am very happy with this part of my life.
50,000 INR Per year is really a small amount that I incur to the services which I get.
It is recommended that every household should have this protection. Once you feel that you have taken necessary steps , it is time to grow your hard earned family. This is where I would like to inform where my investment for growing money and beating Inflation goes —
Investment for growing money:
One important thing to note here is that I am not disclosing the specifics of where my investment is going. I am here to share which products/ instruments I am investing.
As per this Wiki page, the average age of Indians is around 65.
I am 30 and believe that I still have a long way to go (WISH ME TO HAVE A LONG LIFE 🙂 ).
As per my strategy, till I am 40, I will be taking a high risk after which I will gradually lower my risk and look for safe investment.
When I told you that, I am ready to take a high risk, what I meant was I am going to park around 80% of my money in Equity related Instruments. So, let me go through instruments
- Monthly SIP of 20,000 INR in Equity based mutual funds.
- Investment in Stock Market where I analyse the market and then take a decision to invest. I DO NOT TRADE.
- I am also availing Portfolio Management Services with one of the startups who are specialised in Algorithmic-based trading, I expect around 50 to 60% return on yearly basis which will be a passive income for me.
The amount of money going towards mutual funds is to cater to my goals. I would call it a GOAL-BASED INVESTMENT.
To create WEALTH, I am learning Stock Market and investing for a long term for a minimum tenure of 10 years.
To generate passive income, I am availing expertise of Portfolio management services like Minance.
Apart from these market-related instruments, with my full-time job I am getting benefits of Employee Provident Fund which gives me Compounded returns.
THIS IS HOW I HAVE DESIGNED MY FINANCIAL LIFE FOR NEXT TEN YEARS. THIS IS BOUND TO CHANGE WITH TIME.
Let me know how you are planning your financial life.