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Financial Planning in your Forties

Financial Planning in your Forties

“Too many people spend money they have not earned, to buy things they do not want, to impress people they do not like “– Will Smith.

Every phase of life comes with different sets of financial challenges and opportunities. The twenties, is most carefree time of your life where financial planning is never in the picture. The thirties bring in a new set of responsibilities of career, marriage, and children. But by the forties, you are settled down and calmer as you are earning well, and the initial struggle to balance family and career would be resolved.

However, with the forties comes a different set of financial challenges – that of saving for your children’s education, while preparing for your own retirement. Says Gaurav Gaur, CEO and Founder, Mudrahome

Saving for children education

As a parent, you wish to give your children the best education possible. By the beginning of forties, you should start saving money for this keeping in mind the kind of course your child shows interest in. You can either create a separate fund or start a new SIP.

Manage your lifestyle appropriately

One of the biggest advantage of being in the forties is the financial stability you achieve. By then you would most likely be making a decent amount of money and can afford certain luxuries along with your basic needs. A sound financial plan, will let you enjoy the luxuries as well as save for your future. You can enjoy some odd luxuries like family vacations and a good car and house, but it is also important to not spend all of your money on upgrading your lifestyle or following every trend in the market.

Plan for your retirement seriously

A sound retirement plan should start when you are in your thirties. By the forties, it is time to upgrade your retirement account contribution. You can boost up your retirement contribution by creating different saving accounts, diversifying your investments and contributing money towards Pension plans.

Reconsider home improvement projects

It gets tempting to get a short-term loan for home improvement projects but it is necessary to understand that home improvement is not an investment. Often such projects end up hurting your wallet more than you imagine. Weigh the spending on renovations along with the funds you would require against your savings, investment or loan payments.

Staying healthy –

Forties is the age when you get prone to serious health problems, especially if you have been living a careless lifestyle. Try to maintain a regular fitness program, like cycling, morning walk, yoga, gym, meditation, etc. A healthy lifestyle will keep you away from unwanted medical treatments and costs. But make sure you’re covered against critical illnesses.

Maximize your earning –

Maximizing your source of income boosts up the financial stability. Doing other part time jobs or earning through hobbies, working online can act as added source of incomes. Make sure that you are taking full advantage of the employee benefits that can contribute to your retirement security as well as build up your wealth.

Insure Yourself –

Life can take you on a roller coaster ride anytime and it is always advisable to be prepared. Make sure you have sufficient life cover and savings, so that your family’s future is always financially secure. Also spend some amount in medical insurance to meet any unpredicted emergency.

Saving money for your retirement, your parents, and college education for your children becomes a priority when you are in your forties, however never forget to enjoy your money and die with regrets of not doing the things you wanted to.


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