3 Important Financial Instruments
There are 3 important financial instruments every investor must have in their portfolio.
1) Term Plan:
The first and foremost step towards Financial Planning is having a term plan up to 20 times one's Annual Income.
Recently, the term plan awareness has picked up but still it is availed by less than 4% people in India.
2) Health Insurance:
The cost of Medical treatment has sky rocketed with the advancement of medical science.
Accordingly, investors having medical insurance have not increased their medical insurance and many have not taken health insurance at all.
One must have Health insurance up to 2 years annual income, or Rs.10 lakhs whichever is higher.
3) SIP:
SIPs should be done for one's long term financial goals.
● SIP for Retirement:
Retirement corpus should be adequate enough to take care of your financial needs for 30 years.
SIP works the best for retirement planning. One should start SIP for Retirement as one starts earning income.
SIP for children's higher education cost planning and SIP for children's marriage cost planning are other two major financial goals one can plan through SIPs.
Financial Goals differ from person to person. One can also plan for goals like a new car, a new house, world tour etc through SIPs.
