Every individual’s financial position is unique, and hence, so is the financial advice they require. So, a financial plan that suits A should not necessarily fit B. But, as a family, their financial plans merge because the goals are similar. However, each family’s financial plan differs from the other. Therefore, one cannot cherry-pick any financial plan and say it is the best. This article shall discuss the best way to find a financial advisor.
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Stop reading the newspapers where you find people giving financial advice.
Generally, you find Q&A sessions in newspaper articles where people ask what their ideal financial position is and how they should invest in securing their future. We suggest you stop reading the answers because the answers are usually fit for a Utopian world where everything is ideal. It is as far from reality as Delhi is from Chicago. If you go through their answers, every family requires crores of rupees to secure their lives. 99.9% of Indian families would have been bankrupt now if that were true.
Be your financial advisor.
One of the most significant golden rules of finance and investing is that you should never spend more than you have on hand. It is like "Aamdani Athanni, Kharcha Rupaiyya." If your income is smaller compared to your expenses, there is no financial advisor on the planet who can help you out of the mess. So, the best solution is to be your own financial advisor. Remember that most situations in life do not require any financial advice. Common sense should prevail.
Stretch your feet according to your blanket.
The statement might seem philosophical, but it is 100% true in the case of financial advice. Just because your neighbor’s child is studying in the US does not entail that you send your child there to study. First, you should check whether you have the finances to do so. You can argue that banks give education loans for studying abroad. First, however, you should see whether you are eligible for that loan. Do you have the collateral to secure the loan? If you have them, you can very well take the loan. That is what we meant by stretching your feet according to your blanket.
Start investing early in life.
The best mantra for financial success is to start investing early in life. Your investments need not be big. It could be as much as you can manage, but if you start investing early, you will have the momentum to pursue it and achieve your financial goals. For example, you have the Atal Pension Yojana, where the scheme is open to all Indians between 18 and 40. Suppose you go through the premium table carefully. In that case, you will find that the monthly premium payable by an 18-year-old is considerably less than what a 40-year-old individual pays to receive the same amount as a pension.
Investing in a chit fund is also fruitful.
Chit funds appear to be small investments, but they can help you achieve bigger things comfortably. A registered online chit fund platform like Money Club ensures sufficient returns that even bank deposits or stock market investments do not. Therefore, it is advisable to tap into these financial instruments rather than stick to the traditional low-risk-low-gain investments. We do not say that investment in chit funds is risky. If you go through the fund's credentials well, you can decide whether the investment involves risk or not. Usually, investing in a registered and reputed chit fund is not risky, but the returns will always be uncertain. It is not like investing Rs 1 lakh today and getting assured returns of Rs 1.25 lakhs after four years. So, if you have a good risk appetite, the chit fund is an excellent investment vehicle.
Keep track of your expenses.
You might not even realize that you could be spending far more than your means. Therefore, monitoring and tracking your expenses is crucial. You need not note down each expense in a diary. You have financial apps on the internet that do the hard work for you. You can input the details, and the apps analyze everything for you. After a month, you can quickly realize where your expenses are concentrated. Accordingly, you can plan your finances.
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We have discussed six points in this article. Do you feel you need an MBA in Finance to suggest these alternatives? You can do that yourself from your personal experiences in life. You will need these theoretical financial advisors only if you have received a windfall of money from some unexpected sources. As far as managing your finances from your regular income sources, no one can be a better guide than you yourself.