6 Financial Resolutions for 2024
By Akhil Chugh
Date December 31, 2023
Embracing the dawn of a new year offers an opportune moment to chart a course for personal financial growth. By commencing with a blank canvas and devising a strategic roadmap for the financial milestones you aspire to achieve, you position yourself for a dynamic start in 2024. Recognizing that the fulfillment of financial objectives is a gradual process and that it’s easy to veer off course as the year unfolds, the significance of establishing well-defined goals and measurable benchmarks cannot be overstated.
Now, let’s delve into 6 pivotal resolutions that can contribute significantly to your long-term financial well-being. These resolutions serve as a robust foundation, propelling you closer to the realization of your investment aspirations.
1. Invest Wisely, Don’t Just Save
Merely saving without investing is insufficient. While saving is the initial step in wealth accumulation, its true potential is unlocked through strategic investments.To achieve substantial growth, it’s essential to move beyond saving and embrace long-term investing, leveraging the power of compounding.
To capitalize on this potential, consider a diversified investment approach, aligning with your risk tolerance and time horizon. Caution is advised against blindly pursuing returns; instead, prioritize asset allocation to achieve a balanced risk-reward profile in your investment portfolio. Connect with Net Brokers’ team of experts today to tailor a financial plan aligned with your goals and risk tolerance.
2. Set Your Financial Objectives:
Initiate your financial planning by documenting your financial obligations. Classify each goal as short, mid, or long-term, specifying a target and completion date. Utilize the following guide:
- Short-term goals: six months to five years.
- Mid-term goals: five to 10 years.
- Long-term goals: beyond 10 years Concentrate on prioritizing and selecting investment options aligned with your specific requirements to effectively pursue your financial goals.
3. Build an Emergency Fund:
Maintaining an ample emergency fund can be the determining factor between navigating a crisis or facing a precipitous fall. Regardless of your salary or monthly EMIs, allocating 5-10% of it to an emergency fund, ideally in easily accessible and secure investments like liquid or arbitrage funds, can prove pivotal during challenging times.
Investors should commit to building an emergency fund, aiming for a starting point of 3 times their monthly income, with 6 times being an ideal target and 12 times considered a prudent goal. This financial cushion empowers individuals to navigate life’s challenges while appreciating its smoother moments.
4. Secure Health Insurance Coverage
In addition to maintaining an emergency fund, ensuring you have health insurance is crucial. Insurance serves as a safeguard against life’s uncertainties, addressing concerns about covering exorbitant medical expenses during hospitalization. The solution to managing skyrocketing healthcare costs lies in having comprehensive health insurance coverage.
This serves as a general overview of sufficient health coverage. However, it’s crucial to assess factors such as family history, age, pre-existing health conditions, and local healthcare expenses.
If you currently lack health coverage, take the initiative to create a budget and promptly acquire the appropriate health insurance plan.
Reach out to us for further insights on available Health Insurance plans.
5. Start Tax Saving Early:
Don’t postpone your tax-saving investments until the end of the fiscal year. While there are only three months left for FY23, it’s wise to initiate planning for FY24. If your goal is to avail tax benefits under Section 80C through ELSS, consider starting an ELSS SIP without delay. This allows you to contribute towards your tax savings every month, leveraging the advantages of rupee cost averaging.
Connect with the Net Brokers team today to select the ELSS mutual fund that aligns perfectly with your financial goals.
6. Unlock Wealth Creation by Investing in Mutual Funds via SIPs:
A mutual fund combines funds from diverse investors to invest in various asset classes, including bonds, money market instruments, stocks, and other securities. Serving as a versatile investment medium, mutual funds provide access to multiple asset classes, such as equity, debt, and gold.
With a wide array of categories and schemes tailored to different risk appetites and investment horizons, mutual funds historically demonstrate returns that often outperform traditional fixed-income instruments like bank FDs and PPF, particularly in the case of long-term equity investments.
For those seeking to eliminate the stress of market timing, mutual funds offer the Systematic Investment Plan (SIP) route. Through SIP, investors can commit a predetermined amount at specific intervals (monthly, quarterly, etc.), fostering financial discipline, leveraging rupee cost averaging, and unlocking the power of compounding for long-term wealth creation.
Choosing the right approach to save and grow your money is crucial. Whether it’s through mutual funds or other avenues, adhering to your financial resolutions is paramount for cultivating healthy money habits.
Whatever your financial goals for 2024, Net Brokers stands ready to assist you with bespoke financial plans tailored to your investment horizon and risk profile.
It is very important to seek the consultation of an unbiased financial expert to help you in your financial planning and investments. With the growing complexities of financial markets and the plethora of funds available in the market from balanced mutual funds to multi-cap mutual funds, it is highly recommended to take help from finance experts of Net Brokers, who can chalk out the right investment plan for you based on your goals and risk appetite.
As you welcome the new year, reflect on ways to enhance your financial well-being and set the stage for pride-worthy accomplishments in the coming year.
Wishing you a Happy New Year!