Independence Day Special: If you want freedom from the tension of money, then follow these tips
Saving just isn’t enough
Contrary to the common man’s thinking, only saving is not the way to get a huge fund. But financial planning means growing your money by investing smartly to deal with inflation. For example, when it comes to retirement planning, most people don’t pay attention, especially during their working years. But this is the time to invest.
Managing Investments to Avoid Risk
As we have seen stock market trends during the pandemic, the right way is not to wait for the economic slowdown before investing. The stock markets can never be as favorable as you would like and this is why it may be too late. However, if the idea of investing in the volatile stock market doesn’t sound right to you, there are other options available for risk-averse investors.
Guaranteed Return Plan
Instead of the stock market, you can invest in a guaranteed return plan, so that there is no risk. Such plans come with a guaranteed rate of return which is locked in at the time of purchasing the plan. The less risky option is an annuity plan. If you have a corpus ready, you can choose from immediate or deferred annuity plans and start getting fixed income or lump sum amounts as per your choice.
take advantage of tax benefits
Talking about tax benefits, some investment options come with a tax-free limit of up to Rs 1.5 lakh under section 80C. Whereas ULIP plans are tax-free under section 10(10)D on an annual premium up to Rs 2.5 lakh. Along with investing, take advantage of tax benefits.
It is important to keep an eye on the portfolio
After choosing your preferred investment instrument, it is important to review your portfolio from time to time. It is important to see if the investment meets your changing needs. For example, if you are investing for your child’s education, it is advisable to rebalance your portfolio annually in line with rising education inflation.