Stepping stones to a stress-free living
There is no kidding with the power of compounding. It really works. So start early, even it is only Rs 2,000 in a mutual fund SIP (systematic investment plan). Remember the adage ‘the early bird gets the worm’. Rs 2,000 set aside each month for 10 years (i.e. Rs 2.40 lakh) in an investment fetching 10 per cent p.a. will amount to Rs 4.10 lakh at the end of 10 years. If you continue this for another 10 years, it amounts to a whopping Rs 15.18 lakhs.
Have a budget
A budget gives you control over your finances and a direction to your spending. It ensures that you know where your money is going with the idea that you can then distinguish between essentials, necessities and luxuries. However, definitely allow for some extravagance. What’s the point of working hard if you can’t enjoy it and enjoy it now. But set a limit for these extravagance and stay within the limit.
Buy insurance cover
You may not have any dependents today. You do not have any loans. You only have some assets. But
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