Financial wellness seems challenging? We can convince you otherwise. Know how to frame a decent long-term investment plan.
What is financial wellness to you? Do you need a long term investment strategy to achieve it?
Is it just getting a decent job or having your own house? Is it retiring early or setting up your own business? Is it having a broad financial portfolio or just the basic FDs?
Well, ‘financial wellness’ can be different for different people. The only connecting dot is perhaps having enough money to never have to fall into debt for basic necessities.
The present time is full of unexpected turnovers. While getting a decent job was enough to survive one decade ago, that is no longer the reality.
Even with a high paying job, there is a risk to your financial security. Perhaps this is why the basic mantra of any financial guru is to have multiple sources of income and an active financial portfolio.
Well, one of the best strategies to plan out your investments is to keep a long-term investing mindset.
Basically, the more you’ll focus on your long-term financial goals, the more you’ll be willing to actively invest and save.
Why is a Financial Goal so Important?
A financial goal or plan is a nice way to introspect your financial capabilities. Whether you are a risk lover or a risk averse (understanding your risk profile) can be identified once you start to set a financial plan.
In addition, while doing so, you can know your spending habits and conclude whether you are a careful spender or a reckless one.
Knowledge about spending habits is what will help you manage your budget effectively.
All this information will help you to devise the strategy that suits you the best and keep you invested in achieving your financial ambitions.
If you are looking for an effective financial strategy with a long term investing mindset, the following points will give you a kick start!
Long-Term Investing Strategy
1. Start Saving and Investing sooner
Is it the first time you are being suggested this? Certainly not. But why is it so crucial to start investing as early as possible?
Well, investing early gives you two explicit benefits. First, you have enough time to experiment with and try out various things.
Second, the more time you spend in the market, the more your investments will grow. However, it will only be possible if you invest ‘early & regularly’.
A once a year investment won’t fetch you any profitable returns. Be early and be regular if you wish to attain financial wellness. So, set up a regular savings and investment plan and stick to it.
You don’t necessarily need to have 10 different plans. Even with 3 smart and devoted investment plans, you can attain your financial goals.
You only need the right balance of risk in your portfolio to make it grow quickly.
Also Read: Delayed Investments to Plan your Retirement can Cost you Dearly? Find out How.
2. Don't try to Hassle your Entry-Exit in the Market
If you are an impatient investor- this tip is for you. While making speculative decisions is the key to getting good returns, you must make sure that they are hassle-free.
While trying to figure out the perfect time to enter the market and exit just after a little fluctuation can take a huge toll on your investments.
You may even accidentally skip on times of high returns and make mistakes in the next time frame.
Remember that investments that promise high returns, like equities, generally take a long time.
By frequently entering-existing the market, you will gain nothing but create instability for yourself.
3. Its okay to begin with the ‘Familiar’ Strategies
Not familiar with crypto or bitcoin but interested in mutual funds and real estate? Go for them.
Don't try to run away from making investments altogether just because you are not aware of some particular investment strategies.
If you know and are comfortable with some of the others, invest in them.
It is normal for us to get drawn towards companies that we’ve heard of or plans that we generally see around us.
If you find them reliable enough, don’t hesitate to invest in them.
And once you get settled into the market, educate yourself about the unfamiliar and new investment plans and start investing in them.
4. Manage your Cash- try Auto Investing and Saving
Money management is not easy. We understand that. But you can help yourself by at least starting budgeting.
If you don't wish to pick a pen and paper, automate your plans!
There are a dozen online tools and apps that will allow you to auto invest and manage your money.
There are plans that you can run just with your spare change like Jar’s digital gold investment plans.
Auto-investments have a plus point- they help you to maintain consistency when it comes to regularly investing.
There may be times when you feel reluctant to invest yourself. But if you have put up an automatic system to handle this in place of you, there is no way your money will just sit and get wasted.
5. Let your Funds Grow- its good to Sit back and Watch
The next crucial step is to let your investment grow. This is when you have physically decided how much you want in your bank account, your savings account, your emergency funds, and your different investment options.
When things are all clear in front of you and you have enough cash to back it up, it is definitely time to step a little back and let the market work with its forces to multiply your investment.
Just make sure to invest in diversified portfolios and forget it!
Additional Read: Compound Interest: How to use the most powerful tool for your finances
6. Don't sleep on Stocks!
Bonds are definitely an integral part of any financial portfolio. But with new uncertainties and new low interest rate regimes, you might wish to play with stocks more.
Stocks are turning out to be one of the smartest investments for you to make. Be it through increased prices or high dividends that are available nowadays, there is no way we would suggest you to skip on investing in stocks.
In order to build a strong long-term financial strategy, you must include stocks in your investment plan and stay active in the stock markets.
Long-term financial goals are an interesting way to invest. With this type of plan, you don't necessarily have to compromise on your current lifestyle. Rather, you can make small changes and create huge differences with them.
With simple strategies like investing early and considering stocks, we are sure to promise you a stable-return portfolio.
Download the Jar App to convert your jiggling coins into sparkling gold. With just Rs. 10 you can invest in 24k pure digital gold and get it home delivered.
Round off your spare change and double your investment amounts- both are possible with the Jar App!