Financial goals are the targets you want to achieve with your hard-earned money. It is different for every stage of life, which varies significantly from person to person and time. For example, retirement planning may not necessarily be a priority in one’s 20s. Still, it becomes more critical when approaching 40 years old as securing future golden years has become an imperative goal. Here are some points you should consider if you are in your 40’s
- SECURE A HOME
There has been a hot debate about renting versus owning a home. Yet, owning a home is usually a top aspiration and priority in India. It is a lot more than just a place to call your own; but it also provides security for the future. Clearing home loans by the time you are 40 or in your 40s can help you set yourself up with more time in retirement without burdening finances when they’re needed most. In addition, you’ll be eligible for tax benefits from sections 80C, 24b, and 80EEA once you buy one of these budget-friendly abodes.
- ACCUMULATE AN EMERGENCY FUND
The importance of establishing an emergency fund cannot be overstated. A survival plan is necessary at every stage in life, but some whose needs increase as they get older and become more established professionals. The best way to protect yourself against the various ills that come with age or success is by having a well-stocked safety net ready for when you need it most – this includes health emergencies, job loss, urgent travel plans, etc.
- BOOST YOUR INCOME
You are a prime-time earner at the age of 40. As a result, you have to make critical decisions about personal finances and what skills you want to monetize now that your salary is skyrocketing. To take advantage, this might be an excellent time for you to consider starting up your own business. You can do so on the side or by looking into more part-time work opportunities in addition to working full-time with one employer so that you can save as much money as possible before retiring comfortably later down the road when it’s most convenient for yourself financially!
- OBTAIN HEALTH AND LIFE INSURANCE
When you are in your 40s, the number of people that depend on you multiplies manifold. You work hard while also making an effort to give them a comfortable life. It is also essential that you fortify them against death and disease. Therefore, it is mindful to pay attention to your insurance requirements. Life insurance and health plans are crucial to ensure that your family will be taken care of financially if the unexpected happens. In addition, health insurance will aid you to deal with high medical inflation making hospitalizations and treatment of critical illnesses challenging.
- PLANNED RETIREMENT
As you approach your 40s, you can’t afford to delay planning your retirement. Time is money, literally! The longer time you spend waiting, the harder it becomes for your money’s power to compound over the years and grow into wealth that will last a lifetime. The retirement corpus you’ll need by the time you’re in your 60s needs to factor in the expenses of your current lifestyle adjusted for inflation.
When your financial life reaches maturity, there is little room for mistakes. If you were to make any errors at this stage in the game, they would greatly magnify when you turn 60. To guarantee that retirement will be a comfortable one and not just scraping by each month due to low income or lack of investments, speak with an investment advisor because he can help plan out what kind of money management scheme best suits you – be it stocks, bonds or mutual funds!