The days of stuffing away cash in cupboards, in your bed-boxes and password-protected safes at home are over. Sure, keep some cash with you for expenses that can’t be met with digital money. But beyond that, there’s little need for cash. That is a fact, and also the thinking of the Prime Minister Narendra Modi led government.
There are enough avenues for your cash—some that grow your money over long periods of time and others which promise lower returns for short periods. The options range from savings deposits to flexi-deposits and liquid and short-term mutual funds for your “ready cash” needs to fixed deposits, tax-saving bonds, public provident fund, growth mutual funds and insure-linked savings and pension plans for your long-term needs. There is also real estate for long-term, high value investors.
The other significant aspect that’s been spotlighted by the demonetization move of the government and several other recent global developments— like the restrictions on visas for IT professionals by the US—is “uncertainty”. The feeling that anything can happen that might change your circumstances and expose your carefully planned life and finances to a hitherto unknown risk. Technology too is playing a disruptor and impacting careers like never before. In fast changing times like these, it is imperative that you take the risk out of your lives. And the way to do that is by insuring yourself against them.
Insurers across the spectrum are developing new products to meet the ever-changing needs of people and this allows you to guard against sudden shocks. Goods & Services Tax is the new disruptor on the block. And while most welcome its introduction, no one is quite certain how this will impact business on the ground, especially in the near term.
But no matter what, the basic principles of good financial planning will stand you in good stead. So get your finances right. Plan your spends and savings. Do your homework before investing, before buying a house, taking a loan or signing up for an insurance policy. If you get your personal finances in shape, no new development will be able to rock your boat.
There may be hiccups, sure. And course corrections. But a good financial plan will help you navigate through the challenges and keep your life on an even keel. So, what’s stopping you? Get your financial ship in order.