Personal Finance Tips

1. Learn about financial planning
It is the general advice for all the readers. Financial planning is important for every one who want to achieve the long term and short term goals in their life. Learning about the financial planning to not so hard as you think. Anyone can become master on planning for their family. It needs following few useful websites and discuss with your friends who already done good planing for their family. If you have not done already, 2010 will be the starting point and learn how financial plan will improve your living standards. The survey shows that very less number of people in our country has the proper knowledge on future financial plans for their family.
2. Long term goals
Set the long term goals for your family. Typically we can list few of the long term goals with high priority:
Son/Daughter Marriage
Son/Daughter education when they join college
Constructing own house or buying apartment
Post retirement plans
My Suggestions for the long term savings:-
Public Provident Fund(PPF)
Provident Fund(PF)
Gold ETF
Post Office Savings
These are few examples for the long term goals for very parent. They have to plan very early to achieve the goals listed above. It is good idea if you start the right savings or investment plans when the child born. It will easy for when they grow and want to go for the higher education or getting married.
3. Short term goals
In the above section I have explained about the long term goals in your life and how to plan for it. Normally long term goals are considered as more than 15 or 20 years of time. In the same way every human has their own short term goals which he can not wait more than 5 years. Most of the case short term goals are buying luxury items for the family and improving the living standard. The following are few examples of short term goals:
Purchase Car
Buying Jewell
House hold items
The above are few examples which they feel necessary for a family. Not every one can not afford to buy a car if his income is below Rs.30000 per month. In that case they need good planning and attain the goals on time. I won’t advice any one to buy those items by taking the loans. The loans will cost you more because the high interest rates.
My Suggestions for the short term savings:-
Equitey Linked Saving Schemes(ELSS)
National Savings Certificate(NSC)
Fixed Deposit (If the interest rates are very good)
Invest on Silver
4. Follow the references
If you want to learn about personal finance and investment tips, you must follow some of the good websites and experts. There is number of good resources available in the internet to learn without wasting too much time. One important thing is what you read is only their advice, it is up to you to decide which one is suitable for you family. Also don’t just blindly think that who ever writing are experts in the field. For that reason you have to follow some of the very good resources in the internet. Here I would like to provide some of the interesting investment related websites for your guidance:
Web Sites
Money Control
Google Finance – Live Stock Prices and Company News
Personal Blogs
V Subramanyam’s Subramoney
Manish Chauhan’s Jago Investor
Raag Vamdt’s Financial Planning Demystified
Amandeep Singh’s Equi Tipz
Last but not least, follow our site for the daily investment tips through e-mail subscription.
5. Don’t blame others for your mistakes
It is your responsibility to protect your money. Don’t ever blame others if you have lost money because of third person’s advice. You have to decide whether the investment is right for you. In this case, you have to complete the through study about the statistics and risk involved in the investment before putting the huge amount. This point is suitable for the risky investments like stock market, real estate, etc. If you are investing in the wrong time, your entire savings may wipe out your whole life savings. Keep in mind that, you are the only person responsible person for your mistakes.
It is very common that, agents mislead the customers for their own benefit. They will be looking out only for their commission and will hide the important factors related to the product. So, don’t blindly trust every one. Do your home work and take the tight option.
6. Review your portfolio
Periodically review your portfolios. Portfolio is the place where you track all the investments and liabilities. It is a single place where you will be monitoring all your financial health. It can be a money manager account or any private company with consulting fees. Do a complete review for your portfolio periodically and eliminate the poor performing investments and add the better one.
7. Use Money Manager
If you are avid internet user, it is good idea to use the money manager to track all your bank accounts, credit cards, loans, etc. The main advantage of using the money manager is viewing all the transactions in single window. It helps you to make quick decision on your financial needs. Apart from that, money managers provide their own tools to display the graph like chart for your expenses and income. It gives you whole idea on flow of money. Some of the popular money manager websites are :
ArthaMoney – A times group company
Intuit MoneyManager – Tied with MoneyControl.com
I am using both the money managers. Soon I will write a review about each of the money managers. To get the updates please subscribe here.
If you are using any other money managers, please post it in the comments section.
8. Avoid unnecessary expenses
Try to cut down the unnecessary expenses from your pocket. Before making any purchase, think yourself that you really have to spend for that product. Also don’t make expenses more than your capacity. For example, don’t take loan and buy the luxury items if you don’t have no balance in your bank.
9. Explain your family about financial planning
It is one of the most common mistake done by every person. Ask yourself, how many of you have discussed in detail about the financial planning and investments with your family. I would agree that not every person will be interest to know the inside of the personal finance. But, there is people who have interest on the topic but not given the enough chance to implement it. That may be any of your family member. I sincerely advice you to teach your family about the importance of personal finance. Also make them work independently even you are not present.
10. Do good things
There is an old proverb says “Every person should donate at least 10% his total income to non-profit organization”. Don’t laugh at the statement by asking why should I spend hard earned money to others. Because we are so lucky to get all things we need in our life, but there is millions of people dying every day without food and shelter. There is nothing wrong in hiving them the helping hand. It gives you pleasure when help others. Just experience the happiest moment in your life by helping others!!.
There is number of organizations working for the same purpose. Here I am posting one of the group started by my friend Raghavan. He recently started website for the group Shade. It not very popular group, I am posting it here because I know them very well and I too contributing for that group.