BA­SIC TIPS FOR MONEY MAN­AGE­MENT

Friday - - Beauty -

Q I am 29 and a sin­gle wo­man. I’d like to learn some ba­sic money man­age­ment skills to lead a debt-free life and en­sure I have enough sav­ings. A When it comes to fi­nan­cial in­dul­gence, we need to en­trust our­selves to take con­trol and cap­i­talise ev­ery prospect to make our money work for us. It’s not dif­fi­cult to do this, pro­vided you un­der­stand the power of your money and utilise it in a man­ner that keeps your fi­nances se­cure for life.

It’s very im­por­tant to iden­tify what you need against what you want as it will help to re­duce spend­ing. Al­ways cre­ate a bud­get and have a clear un­der­stand­ing of where the money is go­ing and how you al­lo­cate the fund to­wards your fi­nan­cial goal.

Once you have enough liq­uid­ity, di­ver­sify your funds; it’s not ad­vis­able to have all eggs in one bas­ket and in the long-term this strat­egy will help you cur­tail the risk if one doesn’t per­form well.

Along­side, it’s im­per­a­tive that you keep away money to shield a min­i­mum six-seven months of daily ex­penses. Keep an emer­gency sav­ings ac­count in a place where you can eas­ily ac­cess it when you need it, with­out penalty – ei­ther with a money mar­ket ac­count or high-in­ter­est sav­ings ac­count.

When it comes to sav­ing and in­vest­ing, it’s im­por­tant to have a balance; with in­vest­ments the re­turns are higher, as are the risks; a sav­ings ac­count of­fers as­sured in­ter­est on your de­posits.

An­other im­por­tant step is to have a well-cov­ered in­sur­ance pol­icy that ideally should carry life in­sur­ance that’s equal to six to eight times of your an­nual salary. If you have de­pen­dents, then add more. More­over, you should have a crit­i­cal ill­ness med­i­cal in­sur­ance cover to avoid any pit­fall dur­ing the course of your life­span.

Have money men­tors, who can guide you with the right fi­nan­cial plan­ning, as a lit­tle ad­vice can go a very long way.

DHIREN GUPTA, man­ag­ing di­rec­tor of 4C Mort­gage Con­sul­tancy, is a fi­nan­cial ex­pert

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