Why April is best month to start your financial planning?
The word financial planning is becoming buzzword now days. In each discussion with colleagues or in social gatherings we all discuss “Planning”. Even on Google, the number of searches with phrase ‘planning’ is increasing every day.
But sadly, while we discuss and discuss again, the execution takes back seat. We make plans but don’t do (actual) planning. As a result most of the investments are done in period of February and March predominantly to save Tax. Because of such last minute rush, the focus shift to “Tax” rather than “Returns” and in long term this investment pattern yields sub optimal returns.
Incidentally, if you copy paste the title of this article (removing one word: financial) on Google (Why April is best month to start your planning?), you will be surprised to know results. The search shows ‘Holiday’plans’ instead of ‘financial’ plans. Please try to search yourself. It reinforces the idea that we have to put “financial” in our planning from the start itself.
We at Grow Wealth Advisors strongly believe that we have to begin at the beginning so as to meet our goals at the end. Below listed are key points that should be kept in mind while devising plan for the year.
individuals. An important change that came into effect this year is Long Term Capital Gain
(LTCG) tax which potentially affects every investor in equity and equity Mutual Funds. Tax
changes may make some investment avenues more attractive than others. An investor must
factor in Tax Liabilities while making investment decisions. One may go for one time (lumpsum) investment or staggered investments (SIP) as per cash-flow and this add flexibility to overall investment process. As the saying goes that ‘early bird gets the worm’, starting early would help an investor making rational and long terms decisions and would definitely help an investor in his quest towards Wealth Maximization.
We introduce ourselves as “Grow Wealth Advisors”, a neo Financial Advisory that focus
on Goal Based Investments. We specialize on Mutual Funds and Life Insurance solutions. Kindly let know in case you seek assistance in achieving your financial Goals. You can reach us at +91 9325295502 or at [email protected]
But sadly, while we discuss and discuss again, the execution takes back seat. We make plans but don’t do (actual) planning. As a result most of the investments are done in period of February and March predominantly to save Tax. Because of such last minute rush, the focus shift to “Tax” rather than “Returns” and in long term this investment pattern yields sub optimal returns.
Incidentally, if you copy paste the title of this article (removing one word: financial) on Google (Why April is best month to start your planning?), you will be surprised to know results. The search shows ‘Holiday’plans’ instead of ‘financial’ plans. Please try to search yourself. It reinforces the idea that we have to put “financial” in our planning from the start itself.
We at Grow Wealth Advisors strongly believe that we have to begin at the beginning so as to meet our goals at the end. Below listed are key points that should be kept in mind while devising plan for the year.
1. Budget Planning:
Starting point of any planning would be to tally the Assets and Liabilities. These liabilities then need to be further divided into short term & long term and investment should be done keeping in mind the timeframes. Also for investors with Kids, the expenses for school, tuitions Fees and other activities must be considered. Salaried Persons would be getting their bonuses/increments/variable pay in the month of April. Additionally, each person will have his/her own spending pattern. In this process, Insurance needs to be given a separate consideration (not just because of 80C). Insurance need may increase because of many factors such as Salary increase leading to higher Human Life Value, birth of child etc. Therefore because of such multiple variables, Financial Planning would vary from person to person and investors would be better off by consulting their financial advisors in this process.2. Initiate Tax Savings keeping in mind Tax Changes:
In each budget there would invariably be few Tax changes that will affect personal finance ofindividuals. An important change that came into effect this year is Long Term Capital Gain
(LTCG) tax which potentially affects every investor in equity and equity Mutual Funds. Tax
changes may make some investment avenues more attractive than others. An investor must
factor in Tax Liabilities while making investment decisions. One may go for one time (lumpsum) investment or staggered investments (SIP) as per cash-flow and this add flexibility to overall investment process. As the saying goes that ‘early bird gets the worm’, starting early would help an investor making rational and long terms decisions and would definitely help an investor in his quest towards Wealth Maximization.
We introduce ourselves as “Grow Wealth Advisors”, a neo Financial Advisory that focus
on Goal Based Investments. We specialize on Mutual Funds and Life Insurance solutions. Kindly let know in case you seek assistance in achieving your financial Goals. You can reach us at +91 9325295502 or at [email protected]
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