How to Plan Your Financial Life

Financial Management

Financial Management or Strong Financial life means planning, organizing, directing, and controlling the financial activities such as procurement and utilization of funds of the income. To become strong financial life.

Correct Your Past Mistake

Never Mix Insurance & Investment.

Insurance – Insurance is a means of protection from financial loss. It is a form of risk management, primarily used to hedge against the risk of a contingent or uncertain loss.

Investment – Investment means owning an asset or an item with the goal of generating income from the investment or the appreciation of your investment which is an increase in the value of the asset over a period of time

Secure life Present and future.

Health Insurance.Term Insurance

Health Insurance – A contract that requires your health insurer to pay some or all of your health care costs in exchange for a premium

Term Insurance – Term life insurance or term assurance is life insurance that provides coverage at a fixed rate of payments for a limited period of time, the relevant term. After that period expires,

Better Loan Management.

Take Loan Only in case if necessary

Not buying any loan for a luxury lifestyle.

Never take a loan to invest in risky assets

Pay your all Loan

Credit card, Personal Loan, Car loan, Education Loan, Home Loan

Do not put all your money in FD.

Build An Emergency Fund – 6 Months of salary or 6 Months of Your income

Build Your Capital –

Build your skills. – Personal development skills are important because they allow you to create strategic and tactical plans for personal and professional growth towards your goals (To get better opportunities in your job or promotion and increase your value)

Generate your side by Side income.

Earned Income – This is your day job and most people’s primary source of income. this one’s easy to understand and most people’s primary source of income. You trade your time for money.
Business Income – You own a business. You either make and sell something, or you provide a service.
Interest Income – This is income you make from lending your money out. This might mean a CD, P2P lending, real estate crowdfunding, funding fix-and-flip debt deals, or simply money in a savings account.
Dividend Income – This is money that’s distributed as a result of owning shares of a company.
Rental Income – You own something and you rent it out. Probably the most common is owning a rental property, such as a multifamily apartment building (renting apartments in exchange for monthly payments).
Capital Gains – This is money earned when you sell an investment, like stocks.
Royalties / Licensing – You create a product, idea, or process, and you let someone use it. They pay you a small fee every time they do.

Investing or trading – Investing and trading are two very different methods of attempting to profit in the financial markets. Both investors and traders seek profits through market participation. In general, investors seek larger returns over an extended period through buying and holding. Traders, by contrast, take advantage of both rising and falling markets to enter and exit positions over a shorter time frame, taking smaller, more frequent profits.

Reduce your expenses – Identified your unwanted expenses and monitoring their monthly expenses and plan to minimize your expenses and find out the alternatives

How To manage your Fix Month Income / Salary

Follow Rule = 50% – 30% – 20%

50% = Total earning 50 % amount use in Your Daily needs

• Daily Needs-
• Rent
• Bills
• Grocery
• School Fee
• EMI
• Credit Card Bill
• E.t.c.

30% = Total earning 30 % ammount use wants to became a luxury

• Became a luxury
• Lifestyle Improve
• Save Security Ammount
• Utilize in skill development
• Afford Bike or Car

20% = Total earning 20 % amount use in Saving / Investments

• Types Of Investment– टैक्स सेविंग एंड ग्रोथ इन्वेस्टमेंट
• Tax Saving Investment
• EPF
• PPF
• NPS
• Sukanya samridhi Yogna
• ELSS

Growth Investment – 100- your age= Equity investment 100-33= 67 (67% equity portfolio equity product)

• Types Of Growth Investment
• Direct in Stock
• ETF/Mutual fund
• Small case
• 25-30% – Debt Product
• Debt mutual fund
• Invest in bonds

• 5-10% – Invest in Gold
• Sovereign Gold Bonds
• Digital Gold
• Gold ETFs

Real Estate – 1. Invest a minimum 1 house in your life ( depend on your family size) for the mental satisfaction
2 Always looking Plot as an investment.

Investment Risk Management – Diversification of risk to Manage your Risk

Important Tips or Guidline