It’s a truth universally known that life is easier when you have good money-management skills. And while money can’t buy you happiness, it can definitely bring a sense of security. Now, if you’re anything like me, managing your money may sound overwhelming. Fortunately, it’s not too difficult to get one’s finances on track.
To help us understand how to manage our money better, we reached out to Sheetal Thakkar of DSP Investment Managers and asked her to share her expert tips on ways we can improve our financial habits. Scroll down to read all that she had to share!
1. Think Long-Term
We mean decades, not years! That’s when the power of compounding will start working its magic.
2. Don’t Follow The Herd
This behavioural bias can have serious consequences in the investing world. An investor needs to design an individual investment plan and process and follow it with discipline, instead of following the crowd.
3. Create Goals With A Professional
Plan and create goals before making investment decisions. When investing, the “shoot, ready, aim” approach doesn’t work. Pause. Consider what is best for you. Work with a professional to determine the risks you can take and are willing to take. You need to consider your life goals, income, age, health, other family members, the type and quality of your existing assets, tax bracket…the list goes on and on. Plan your finances with a pro!
4. Invest To Potentially Make More Money
When you are totally financially independent, your money and how you spend it is your business, with no strings attached. Invest for control and independence. Then stay invested and watch your money grow over time.
5. Start Early, Don’t Wait
When you start your first full-time job, investing and providing for your future may seem like something you do later in life. You have other priorities such as paying the rent or mortgage or saving for holidays. But it’s never too early to start investing. The earlier you start the more money you can make as compound interest works its magic.
6. Invest Then Spend
Compound interest and regular investments of small amounts (consider SIPs)can make a significant difference over longer time frames. As your money grows over time, you will have the ability to spend on all your indulgences!
Have you started investing yet? Please share it with us in the comments below!
For more information, check out DSPIM and DSP Mutual Fund.
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