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Goals
List 5 Goals that you have set for yourselves (if you have not set any goals, what would you like to set as goals) 1. ____________________2. ____________________3. ____________________4. ____________________5. ____________________
How can we achieve these Goals ?
• Let's go back to the goals• What is a Goal?
o Goals are statements about where we want to end up• Are all goals achieved
o No, Most of our Goals are not achieved• How can we make sure Goals are achieved
o Set SMART Goals Specific Measurable Achievable Realistic Time Bound
Some examples
Now, do you want to restate/revise your goalsHaving understood how to set goals, do you want restate/revise the 5 Goals you have mentioned earlier 1. __________________2. __________________3. __________________4. __________________5. __________________
Steps to Achieve Goals
1. Understand Current Networth2. Protect Current Networth3. Manage Regular Expenses4. Generate Surplus to Invest
What is your current networth ?
Networth = Assets - Liabilities
Assets : All those you ownLiabilities : All those you owe
1. List down all those things you own2. List down all those things you owe
Calculating your NetworthAssets :It is not easy to calculate your assets (Not all you own are useful for you)• Things that you require for your day to day living cannot be included in Assets like,
o Televisiono Home where you are staying (You will need a house, whatever happens)o Fridge etco These are called life style assets,
• You should include only income generating Assetso List all the income generating assets
Yourself (Salary you earn) Deposits in Bank Gold etc
Liabilities
It is however easy to calculate what you oweo Pending Billso Credit Card Loano Personal Loano Home Loan
So, What is your networth today ?
Remember, your networth can change every day, depending
on the value of your assets
What are the chances that your networth can Change ?List 5 incidences that can reduce your networth 1. ______________2. ______________3. ______________4. ______________5. ______________
List 5 Incidences that can incresae your networth
1. ________________2. ________________3. ________________4. ________________5. ________________
How to ensure that your networth is not reduced ?• Protect yourself (Your Monthly salary is one of the biggest
asset to your family, ensure that your income is always available to your family, by protecting your life - Take an Insurance covero For Lifeo For Health
so that in case of any unfortunate happening, Income still be made available to family)
• Protect your other income generating Assetso Home- Home Insurance
Quick Recap
• Importance of Setting Goals• Steps to Achieve Goals• Understanding networth• Protecting the networth to ensure that our networth is not
eroded Next,• Managing Regular expenses• Generating Surplus for Investments/Savings
What happens if you stop working ?
• Do you have pensions plan?• How much pension you will need ?
o Rs 20,000 a month,Rs 30,000 a month, ... • How long you will need pension ?
o for 10 Years, for 20 Years, for 30 Years • Will your spouse also need pension ?
o What will your spouse do alone, does she have separate plan
• What are you planning to do for your daughter's marriage• What you planning to do for your children's higher education
Is it possible to manage all those expenses
Yes, provided if you plan well in advance.
How much in advance ?
You have to start today, right now.
Understand power of compounding
• If you save Rs 10 a day for 10 Years at a bank which gives you 8% interest how much money you will have at the end of 10 years?
• If you save similar amount for 20 Years how much it will be ?
• What do we understand from this ?• Why is the difference between 10 Year investment and 20
Year investment so much ?
Where to invest
Please consult a trusted financial advisor (or your banker) before doing any investements• Safe Investment options
o PPFo Bank Depositso NSC/KVP
• Medium Risk Investmentso Company Depositso Mutual Fund Deposits
• High Risk Investmentso Investments in Stock Markets
Be Careful before investing
• Financial Products like insurance, equity and other innovative schemes which claim to guarantee more than 15% return are difficult to understand by you and me
• Most of these products are sold by commission agents who are trying to maximise their earnings
• Identify a trusted advisor, who will be able to provide guidance, who is not interested in earning commissions
• Do reference check of the advisors before you engage with them
• Make your own research about the product before you buy,• Learn Basics skills of Money Management • Ask all details about the charges, There are lot of hidden
charges when you buy financial products. Do comparison of the charges yourselves
BudgetIt is easier said than done• Make a budget for your family immediately
o Rent/Loan Repaymento Travelo Foodo Entertainmento Educationo Misc
• Ensure that you stick to your budgeto There will always be temptation to exceed your budgeto Think twice, thrice before you make expenses which are
not in the budget• Budget should always produce surplus for you (Rework
Budget to create generous surplus)