You’ve had your 20s to enjoy yourself, party and even perhaps to do some experimentation and to ‘find’ yourself. Your 30s is ideally when some wisdom dawns; the first wrinkles or the occasional aches and pains start to hint at middle age and then old age to come. It is at this time that you realise that finances are serious business – that your financial future needs attention right now! We tell you five key moves that should lay the foundation for a better financial future.
Secure your long-term career prospects: Chart a career trajectory that you see yourself taking. As importantly, clarify how your income generation ability will increase in a couple of decades to come – to provide for children's education, ageing parents and other responsibilities. To this end, invest in yourself by either improving your specialisation or consider diversifying by taking a course, attending workshops or seminars to secure your financial future.
Buy that house: Property is among the soundest of investments. Even if the market does hit the doldrums from time to time, it will resurrect. Your house is not only an investment, it is your security – once you have your own house, there is a significant sense of being in charge of your destiny, of being settled and knowing where you will be ten years down the line. Plus there is no landlord to kick you out, no issue about making the rent each month nor any issues with rental increases from time to time.
Cater to future risks: The right insurance products are important for your financial future. Now is the time to buy health insurance, while you are young and unlikely to have any type of major ailments that could impact how much health insurance premium you pay. Family health insurance policies are a good idea too. Now is also the time to buy insurance tailored to meet future educational needs of children.
Plan your tax savings: Devise your savings plans in a way that you're minimising your taxes (several types of insurance offer attractive tax incentives), while optimising your savings. If you envisage that your income will rise in years to come, plan ahead for this as well.
Diversify your investment portfolio: Fixed deposits are safe, but unlikely to keep you ahead of inflation. Be a little less risk averse and consider investing in equity for higher returns. If you are uncomfortable with the idea of working the stock market yourself, look out for sound mutual funds that not only offer great returns on investment but could also help in lowering your tax liability and securing your financial future.
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