Close

	Receiver's Name:		*
	Receiver's Email:		*
	Your Name:		*
	Your Email:
	Your Message:

Five Financial Mistakes To Avoid in 2009

The start of the New Year is a great time to start with a fresh look at your finances. Here's a quick tip sheet on mistakes to avoid:

1. Don't ignore the stock market: Just because the market is low does not mean that it is not a good time to invest. Lets say that you go to the supermarket and your favourite product is marked at a steep discount, wouldn't you buy more of the product? Well, it's the same with the stock market right now. Its cheap and on sale. So, don't ignore the market but at least consider buying mutual funds or equities. Don't speculate, buy wisely based on your ability to take risk.
2. Don't be under-insured: All of us at iTrust wish you a safe and healthy 2009 and a long-life. But, we are also aware that accidents can happen. Nobody wants to be left paying expensive hospitalization bills or finding a family unable to make ends meet because of the untimely death of the chief breadwinner of the family. So make sure that you always have adequate health insurance coverage, and equally importantly have adequate life insurance coverage. Don't make any of these policies lapse as the consequences can be devastating for you and your family.
3. Don't take loans for consumption goods: Sometimes loans are necessary because they make the unaffordable into affordable, like when you need to take a home loan to buy a house. But, don't take loans for consumption oriented items like say buying the hottest cell phone, fashion items, holiday spending etc. Only take loans to buy things that will appreciate in value. Otherwise, you would have consumed your purchase and have nothing of tangible value to show for it. In the current tighter economic climate, spend wisely and avoid taking personal loans as much as possible.
4. Don't ignore tax savings: We prepare 1,000s of tax returns for many clients every year and it surprises us that a large number of people don't use up their annual Rs 1 lakh tax exemption. Why leave free money on the table for the Government? Use your annual allowance and save up to Rs 33,000 in the current tax year.
   
   10 tips to save up to Rs. 1 lakh through intelligent tax planning
   Click here for free income tax advice
5. Don't sit still: Its your money, be proactive. Its not sufficient to hope that everything will work. Its not ok to ignore your finances and not plan your financial situation for 2009. If you don't do something about your money, nobody will do it for you. You can't predict the future, but you can be better prepared for it if you plan for it.

Recognize that you must devote at least sometime per week or per month reviewing your finances and what the future might hold for you. Are there big financial decisions you need to make, like buying a house/car, paying for your kids' education or for your parents' retirement? If you don't plan for any of these events, you might not like the outcome you end up with.

Comments

Thanks for your comment