Every New Year features impulsive gym memberships, expensive salsa classes, and optimistic diet plans. Why not work on a list of resolutions that you can actually keep? Resolutions need not necessarily mean that it should align with your physical health. This year, make resolutions to improve your financial health as well. How about buying the best life insurance policy to secure your financial future? Or what about creating a monthly budget and sticking to it so that you can cut down on unnecessary expenses? Not sure where to start? We bring you a list of interesting ideas to ensure this year's resolutions are a success!
Sometimes, financial issues also cause stress. Try keeping your finances on track by making certain necessary changes in your life. Starting a New Year with a resolution is easy. But continuing the resolution is challenging. However, you can always start by taking the initiatives. Things may sometime go out of your way, but you have to bring them back on track so that you can achieve your milestones.
This is one of the most important money-saving tips for 2021. Creating a budget can help you a lot by giving a clear overview of your finances and how much money you have left each month after paying for all the expenses.
A budget plan can vary from one person to another, but a perfect budget for young people is usually the 50/30/20 plan. This approach involves setting aside 50 percent of your income for daily needs, 30 percent for future needs, and 20 percent for repayment of any debt.
By maintaining this plan, you can balance your monthly expenses and save for your future aspirations and debts.
Knowing your credit score is a very critical process if you want to manage your finances efficiently. The credit rating defines a person's financial capacity, and a good CIBIL rating can help you obtain loans in less time with low-interest rates.
A credit score is a measure of your financial history that shows how reliable you are as a borrower, and these factors decide whether you are eligible for a loan or not. Therefore, having a good credit score also indicates how effectively you can manage your finances.
If you are in a lot of debt or have taken many loans from banks or loan sharks and cannot pay them, this can indicate your inability to maintain good financial health. The mention of debt in your financial books can be detrimental for you and can cause stress.
Suppose you have borrowed money from a relative and are unable to pay them. In that case, it can lead to tensions between personal relations, or if you own a credit card and can't pay the installments, then you may get into even deep financial trouble.
However, this problem also has a solution: using the debt consolidation method, which includes taking a single loan to repay the most expensive loans. Also, you can pay off the debts and credit card bills all at once and then continue to pay the single loan in easy EMIs.
A fixed deposit or FD is the most widely used form of investment and tops the list of financial tips for 2021. The fixed deposit is the simplest and the most efficient way of investing for those who want to avoid unnecessary risks.
Fixed deposits are a great way to achieve long and short-term financial goals and allow you to have different deposits with varied interest rates.
A ULIP is also known as a unit-linked insurance plan which provides an investor with life insurance and other investment perks all under a single financial model. Many term life insurance firms offer unit-linked insurance plans, and one can choose a plan according to their risk management.
The ULIPs work by investing in various debt and equity funds and offer a long-term investment opportunity along with an inbuilt coverage of your investment as well as savings.
To sum up, it can be easily concluded that investing your funds in some money-saving investment plans will always warrant that your funds remain guarded and will further yield higher returns in the future.