4 Step Financial Strategy for the New Parents

 

Bringing a new life to the world comes with a lot of happiness but at the same time brings in a lot of responsibilities as well as financial liabilities. Parents aspire to provide the best opportunities to their children.

Here are 4 handy tips for parents to achieve their financial goals.

1. Create goals for your children

Starting from nursery to pursuing masters abroad, education has become expensive. You must create and define the goals for your child related to higher education in India or abroad. Cost of foreign education could easily cost Rs 30 lakhs or more depending on the country and the course. You should think of creating a fund for your child to begin a new business or create a fund for the marriage.  Once you have clearly identified the goals along with the expected amount required for the goal, you can identify the right investments to reach your goals. In addition to this, one could also consider HDFC Life YoungStar Udaan plan which enables parents to plan for their young ones’ milestones.

2. Explore equities

One of the most lucrative investment options is the equity market. Equity markets have delivered the highest return than any other asset class, in the long run. It is also an asset to diversify your investments, to generate alpha returns.

3. Educate your children about finances

Conversations about money and finances can be very difficult. Traditionally, we have not been successful in talking openly about the concept of money and managing funds. Financial literacy for your children at a young age can prepare them for the way ahead. You should explain the concepts of power of compounding, benefits of starting early, the concept of inflation etc.  

4. Remain protected against uncertainties

There are certain expenses that are uncalled for. Medical insurance and term insurance are two types of risk cover tools that everyone should have, for your family. It is very important to ensure your family is well-insured so that they can fulfill their aspirations even in the absence of a key member. HDFC Life Click 2 Protect Super is one such term life insurance plan with multiple benefits.

Conclusion

As much as it is important to create a financial strategy, it is very important to review your plan at regular intervals. Regular review allows you to sync up with your long-term plans and the direction for the same. 

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