How to Manage Your Money

Amidst all the talk about tomorrow, let’s not forget the joys of today. When it comes to managing money, there’s no fixed rulebook. But here’s a simple guide, sprinkled with happiness and practicality, ensuring a present full of smiles and a future full of security.

Alright, imagine this: you’ve finally landed that dream job or cracked the business, and now you’re sitting pretty with a hefty pay check every month. But before you start planning your extravagant escapades, let’s talk about how to handle that cash like a true desi boss.

So, you’re bringing in a solid 1 lakh a month after taxes. But hold your horses before you go on a spending spree bigger than a Bollywood blockbuster. Let’s break down how to manage that cash flow into seven parts with a pinch of practicality.

1. Essentials: 50,000 rupees

First up, the essentials. Rent, groceries, bills – you know the drill. We’re setting aside 50,000 rupees for all those must-haves, plus a little extra for those weekend chai sessions and maybe catching a movie or two. Because let’s face it, you can’t survive on dal-chawal alone. After all, life isn’t just about surviving; it’s about savoring those little joys that make it worth living. So, let’s ensure we have enough to cover the basics while also treating ourselves to a bit of indulgence every now and then.

2. YOLO Fund: 10,000 rupees

Now, onto the fun stuff – the YOLO fund. We’re talking about 10,000 rupees reserved for those spontaneous adventures and random splurges. Whether it’s a road trip to Goa or finally trying out that fancy restaurant, this fund is your ticket to living life to the fullest.

And hey, if you haven’t got any big plans lined up, don’t let that cash sit idle! Think of it like planting seeds in a garden – invest it wisely, and watch it grow. The more your money grows, the more epic your adventures can be!

3. Emergency Fund: 5,000 rupees

Emergency fund? Absolutely crucial. Let’s set aside 5,000 rupees for those unexpected curveballs life throws at us. Picture this: your trusted smartphone suddenly decides to bid farewell, leaving you disconnected from the world, or your refrigerator gives up the ghost, leaving your groceries at the mercy of the Indian heat. And let’s not forget about those surprise medical expenses that can crop up out of nowhere, hitting your wallet harder than a Mumbai local train during rush hour. In a country where surprises lurk around every corner, having that extra cash can mean the difference between a minor inconvenience and a major disaster. So, stash away that 5,000 rupees like your financial safety net, ready to catch you when life decides to throw you a curveball.

4. Insurance: 5,000 rupees

Next, insurance. No, not the boring kind your uncle keeps bugging you about. We’re talking about safeguarding your future with style. Allocate another 5,000 rupees to ensure you’re covered for everything from a surprise hospital bill to unforeseen emergencies. Because in life, unexpected events can arise when you least expect them, and having the right insurance coverage can provide peace of mind and financial security

5. Investments: 20,000 rupees

Ready to jump into investments? Let’s craft a plan. Allocate a cool 20,000 rupees for the stock market adventure. But remember, while the market can be a thrilling ride, don’t sweat the bumps. Allocate 75% of this amount, which is 15,000 rupees, into equity, mainly through mutual funds for diversity and stability. The remaining 25%, that’s 5,000 rupees, should cozy up in liquid funds. These act as your financial safety net, offering easy access to cash when needed, while still earning a modest return.

6. High risky Investments: 5,000 rupees

Feeling the urge for a bit of adventure? How about tossing an extra 5,000 rupees into the risky investments pot? Think startups, perhaps even SME shares — it’s like rolling the dice in the world of opportunities. Sure, it’s a risky bet, but with proper guidance and thorough study, the potential rewards can be tremendous, potentially outperforming your traditional investments. It’s like exploring uncharted territory, where with a little courage and careful navigation, you might just uncover hidden treasures beyond your wildest dreams.

7. Invest in Yourself: 5,000 rupees

Last but not least, invest in yourself. Yup, you heard that right. Set aside 5,000 rupees to feed your mind, body, and soul. Whether it’s yoga classes, a gym membership, or finally learning how to cook a decent meal, invest in the most important asset you have – yourself.

Remember, this is just an initial plan. As your savings grow, so too can your investments, paving the way for even greater financial stability and freedom. I’m excited to incorporate your suggestions to enhance this strategy, and I’m looking forward to diving deeper into investment products in my upcoming posts. By exploring a range of investment options and providing valuable insights, I aim to empower my connections to make informed decisions and optimize their financial journey. Together, let’s navigate the world of investments and pave the way towards financial success.

 

Author: CA Parikshit Sancheti

Contact: +91 8955555714