Investment Planning:
Investment planning is more than just managing money; it is about aligning your finances with your life goals. It’s a way to help you figure out how you want your money to work for you. You expect your money to be available when you require it to fulfil your life goals at various milestones.
This includes regular savings and investment planning and foresight for future needs like retirement planning, purchasing a house, health, and child education.
The cost of a college education has been on the rise in recent years, making it more important than ever to start saving for your child’s future as early as possible.
Tax Planning
Every investment has three components:
You invest money from your taxable income and earn interest which may also be taxed. Some investments can be deducted from your taxable income. Similarly, some instruments are exempt from tax on maturity. Look for instruments that fall under the Exempt-Exempt-Exempt (EEE) category.
Children’s Future Planning:
Planning for your child’s future goes beyond covering school fees; it is about helping them achieve their dreams and milestones with financial confidence. From higher education to marriage and career goals, thoughtful financial planning can ensure that money never becomes a barrier in their journey.
- Assess your child’s needs: Plan according to their current stage, higher education if in school, or career goals if in college
- Start early for better growth: Invest early to benefit from compounding; consider long-term options like PPF and ULIP
- Ensure adequate insurance: Take sufficient life cover so your child remains financially secure even in your absence; child endowment plans can provide lump-sum benefits at maturity or in case of death
Estate Planning:
Estate planning ensures that your assets are distributed smoothly after your lifetime, reducing legal disputes and emotional stress for your family.
- Will Creation and Execution in India: A will is a legal document that states how your property should be distributed after your death. You appoint an executor to carry out your wishes. Knowing the difference between privileged and unprivileged wills is important for proper planning.
- Power of Attorney: A power of attorney authorises someone to act on your behalf in legal and financial matters. Having it in place helps ensure smooth management of affairs if you are unable to act for yourself.
- Trust Formation: A trust allows you to distribute assets gradually for your beneficiaries’ education, healthcare, and financial needs. A clear trust deed must specify the trust’s objectives, trustees, and beneficiaries to avoid future disputes.
Setting financial goals is an important part of financial planning. It can help you focus your efforts and ensure that you are on the right track to achieve them. There are different types of financial goals that you can set, and you should tailor them to your circumstances.
