Financial planning is a practice where everyone has to define goals of their life and verbalize a plan which will help us meeting our financial goals in life. We believe that every financial decision in our life should be based on some goal. The goal can be building a retirement nest egg, saving for your children’s college education or wedding, saving for a down-payment for property purchase, protecting your family from financial distress due to unforeseen risks, protecting your family from health risks, protecting your home or business from fire or other hazards etc, but unless you have an objective, you will not be able to make the right decision.
You need to prepare your household budget through which eventually you can draw savings Rs 2000 a month. The amount saved need to be invested in mutual fund schemes, doing so; you can easily build a huge corpus. In the beginning of your job when you are young, you can invest in equity mutual funds where you can even earn higher returns as stated.
If you don’t want to take much of risk, then you can minimize the risk by diversifying your portfolio. This way you can maintain your average returns throughout the tenure of your financial goal. After investment, you need to regularly review your fund with the help of your financial advisor, who will help you manage your funds. Financial Planning helps you become rich and more rich.