Financial Security

What makes a person secure about something? As security expert Bruce Schneier states, “Security is both a feeling and a reality.” The belief of not having enough is what makes one insecure. It is important to cater to the internal and external reasons for insecurity and then work towards the awareness of releasing yourself from the pattern or mental block

Let us see what gives us external financial security

Steady income. This is the foremost factor that makes one feel secure. If you have a steady income, your lifestyle expenses and the running costs are taken care of

No Debt. The lesser the debt, the lesser the stress. Clearing present debts gives a sense of empowerment. Credit card debts are a strict NO-NO Mortgages increase the pressure and hamper one’s mental health

Insurance. Life, health and so on. Accidents can and do happen, and if one is adequately insured, he is saved from financial ruin. Insurance provides protection to the assets built by your hard earned money

Emergency savings and Investments. This is a safety net for urgent or unforeseen expenses or more serious ones like illness or unemployment

Homeownership. Is probably the biggest financial and emotional decision of a person’s life. It gives a person a sense of pride and security

When all these are achieved one gets a sense of financial security. Now the question is how does one attain these goals With a basic understanding of saving, budgeting and investing, the probability of a solid financial future increase

Act and Earn

Financial security can be increased by financial literacy
Extra income never harmed anyone. Have an additional stream of income apart from the regular, steady source for the unforeseen events that lie ahead

Plan a budget and stick to it

Plan a practical budget. Consider all your expenses including rent, utilities, food, tuition fees, transportation and any other miscellaneous expenses. If after all this you are in the negative, you need to trim your budget. If in the positive, its time to save.

Think before you spend

Like time, spending money also expands to one’s income. Prioritize your expenses. Spend less than you earn. Dispensible expenses can be cut and the same finances used to find the bigger dreams in life. This will need some self-control but will reap high benefits in the future. Live simply today to have a comfortable tomorrow

Save

Saving will help improve net worth. Have a portion of the income automatically go into term deposits or other investments, compulsive savings is the only way one can get into the habit of saving. Spend what is left after saving. Have daily, monthly and annual goals for savings. One very important thing to remember while investing is ‘Do not put all your eggs in the same basket’ so you have a backup that you can bank on. Choose something to save for, a house, your child’s education or your retirement.

Be Debtfree

Take loans as far as possible only for the most important assets, home, education loan. Pay bills on time, it not only saves you from paying penalties but also gives you a good credit score. Never borrow money to support your lifestyle

Protect your assets

Risk management is an important aspect of protection of assets. Protect yourself, get a health insurance; and life insurance to protect your family

No Procrastination, no waiting for a magic solution. Pull up your socks and start working towards a financially secure future!!

By NSS

20thJan2018

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