Last Updated : Dec 11, 2017 02:29 PM IST | Source:

Personal finance this week: Don’t worry about corrections, stick to your financial plan

Whatever happens in the financial markets, your savings should work hard for you.

A little bit of volatility in the stock market and some individuals start reconsidering their investment decisions. Though the markets closed on a positive note on Friday, there are many who are expecting lower targets for Nifty in the near future. Domestic factors such as the Gujarat elections and international factors such as geo-political instability along with the US Federal Reserve’s decision on interest rates will weigh on the markets. Simply put, markets will remain volatile and there will be more anxiety in the minds of traders.

Whatever happens in the financial markets, your savings should work hard for you. Your investment plan should ensure that you do not stray from your financial goals. The best way to ensure that is to keep your investments tagged to your financial goals.

If you are saving money for the financial goals that are due in the next year or two, consider investing in low-risk investment options. Stay away from stocks and equity mutual funds. These are better investment options when you have a long term investment timeframe, typically more than five years.

If you have long time to invest – say you are preparing for your retirement when you are young, then it makes a lot of sense to invest in equity mutual funds. You can opt for systematic investment plans in these schemes to invest your hard earned money at regular intervals. Here are some tips to retire rich.

If you are worried about the relatively small savings you have today, here is how you can increase your investments over a period of time.  Even if you start small, you can build a large corpus, if you keep increasing your regular investments each year.

While the asset side of your money matters is discussed at length, do not forget to pay heed to the liability side. Pay your loans on time. It helps to build your credit score. If you are wondering whether to foreclose your loans (paying off the entire loan before the due date), here are some tips that can be of some use.

If you are considering a balance transfer of your home loan, here are some tips that can be of immense help. The recent monetary policy was neutral and the interest rates were left unchanged. But experts expect upward pressure on interest rates.

This simply means that interest rates on your floating rate home loans will go up. If you are planning to part repay your home loan, this could be a good time to do so. It also means that your investments in long term gilt funds may see some amount of volatility going forward.

If the US Federal Reserve raises interest rates and the global bankers including India follow them, then it is the beginning of the new era. It pays to review your portfolio and realign in such a manner that all your financial goals are achieved as per the schedule.
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First Published on Dec 8, 2017 10:41 pm

tags #Planning

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