It’s easy enough to live for the moment and be generous with our spendings. However you do not need a financial expert to remind you that being adult isn’t that easy. As you read this time is flowing and in a few years there are going to be certain life goals that you would need to achieve. Rather than being caught by surprise, wouldn’t it be wiser to prepare for them while you still can?
Where do you see yourself 5 years from now? Rather than burdening yourself with the weight of your lifetime, we recommend tackling your life’s goals 5 years at a time. Here are a few tips to help you balance your investments and life goals.
- Know your priorities
What are your goals? Do you plan on buying a place to stay it? Or an international trip? Do you plan on studying further? Or celebrating your marriage? List down all you would like but at the same time rank them in accordance with your priorities. In this way you understand exactly which goal is most important to you in the next 5 years.
- Appreciation vs Depreciation
A lot of research will be needed after figuring your goals. The cost of real estate, vehicles, celebrations and trips are constantly fluctuation and either increasing or decreasing in value. Understand the current value as well as the possible appreciation or depreciation 5 years from now. This way you will have a rough estimate as to how much your next goals would cost you. Talk to an expert – a car dealer, real estate agent and so on – to understand this.
- Prepare for Retirement
Despite of planning only the next 5 years, it is crucial to decide the age you plan to retire. Here’s why this is important – if you plan to retire early you will need to save and invest now but if you plan on earning even later then you need not worry yet.
- Where will you Invest?
Our market today is offering multiple choices to invest in. We can choose between low risk, high risk, short term and long term. You may choose something that is easily convertible to cash or something that is locked away for a while. The choices are plenty. We recommend doing your research and speaking to someone who has been investing regularly for a genuine perspective.
- Emergencies
Emergencies are mostly uncertain and never welcome. It’s best to prepare for such eventualities while you can. You never know when you may be in need of additional funds due to some unfortunate circumstances. This is the reason why you need to choose your investments accordingly. Insurances and certain government funds and schemes have been created entirely for this purpose. Understand these so you’re prepared in advance.