Fundamental of Financial planning.
Fundamental of Financial planning.
1. 30 % of your income must be used for monthly living expenses.
2. 30% of your income must be used for Liabilities repayments
3. 30% of your income must be SAVED for your future LIVING.
4. 10% of your income must be spared for entertainments, vacations………..
5. 6 moth monthly income must be available for emergency fund { LIQUID FUND }, it can be CASH or cashable investments
6. Home loan must be registered and apply on both husband and wife name. { Both can get benefits on Home loan Tax benefits }
7. Buying second house for investment is not advisable [ Survey reports – it will fetch you only around 3% return]
8. After age 45 years not supposed to enter into any BIG LIABILITIES [ Higher education of children and wedding of children will happen around 45 to 50 only ]
9. Joint account is compulsory @ Bank savings account.
10. Property must be registered on both Husband and wife name. [ As per legal act – after husband first legal heir is wife, after wife it will go to children only ]
11. Regular check on Nominations at all financial instruments
12. Only in insurance policy, Claims payable to Nominee. In other financial instruments legal heirs certificate is must to get back the settlement
13. 2 moths salary must be parked on LIFE INSURANCE POLICY [ it’s a universal thumb rule on insurance ]
14. Don’t take any financial investment decisions by EMOTIONALLY
15. MEDICLAIM is must [ in spite of Group mediclaim coverage given at office [ After retirement there is no mediclaim coverage. After 50 years its very tough to enter into mediclaim ]
16. For your jewelry LOCKER, Only one lakh is payable by bank, if theft or fire happen at bank. Provided insurance done.
17. Like same way Government guaranteed only one lakh for your FD also. [ Fixed deposits with Banks upto Rs. 1 lakh only are backed by deposit insurance ]
18. Must know all tax implications. You cannot avoid paying tax. But you can minimize by way of investments.
19. All financial documents must be kept safely.
20. Financial investments must be fallowed through personal financial advisor.
21. Review your financial port folio by every six month.