From teaching you how to walk to teaching some of the harshest yet invaluable life lessons, fathers play the role of superheroes that no one ever can. One of those lessons in finance. Somewhere in the future, you will have to make some major financial decisions. Under those circumstances, your father, more often than not, will be your guiding saviour.
His wisdom in such financial matters makes decision making easier for you. However, if you are facing financial difficulty now and are unable to grasp your father’s wisdom, then here are some of the most important investing tips my dad taught me. Maybe some of them will help you when you need
10 important investing tips my dad taught me: Beginners guide to help make important financial decisions
1. Learn to save more than spend
Now, this tip seems quite obvious and you might have heard your father chanting it a gazillion times. However, no matter how many times he says, its importance couldn’t be stressed enough. Learn to extract 25-30% of your earnings and decide your expenses from the remaining lot. It does not matter how much money you earn or spend on material things, this is one of the most important investing tips for beginners.
At the end of the day, the money you actually earn is the money you’ve saved. You’ve earned your money with assiduous work and toil, therefore learn to respect it and spend it only on things that you need.
2. Always have a purpose behind the earned money
Earning money for the sake of earning it or seeming to be rich will only make you pray to unnecessary frugality and sometimes, can even lead your course otherwise. Therefore, whatever money you earn, always have a purpose or a meaningful end for it.
For instance, if the money you’ve earned is spent on learning a new language will be more purposeful than the money you’ve spent on buying branded clothes.
3. What’s your plan?
Now, this is one of the most important investing tips that cannot be stressed enough. Always have a plan set in your mind. How do you envision your life in the next 10 years? How do you want to lead your life? What are your life goals? Are they concrete and realistic? If they are, are you working towards them?
In the end, make sure that in all this hustle and bustle, you do not forget to save some amount of money as an emergency fund. It will help you in dire circumstances. Therefore, make sure that you abstain from using it up until and unless you are tete-a-tete with the situation.
4. Don’t be afraid to explore other options
If you decide on investing in a certain product, then don’t delimit yourself to only this one. Explore other options and compare its terms and conditions, hidden costs, liabilities and other covert information which might not be visible at first glance.
You never know, you might be able to save your costs through research and analysis and also avoid some irrevocable blunders.
5. Secure your family:
Securing and protecting your family’s future should be one of the most essential things while you are making any financial decisions. Make sure that all your family members have adequate life and health insurance because they can shield you financially during unpredictable events.
Keep in mind that insurance should always come before investment.
6. Put your eggs in different baskets
It would be foolish to put all your eggs in just one basket. Do not be afraid of putting your eggs in different baskets. Try buying gold, investing in secure bonds, stocks, real estate, etc. This will create an interesting diversity in your means of earning.
As a matter of fact, investing in one source won’t secure a sufficient amount of income for you. Investing in the right sources, at the right time and with the right amount of money, can make you exorbitantly rich. Therefore, you have to be extremely prudent while investing in various sources at the same time.
If you want to diversify your funds in plot or other properties, don’t forget to pay heed to your father’s prudent real estate investing tips.
7. Keep an eye on the governmental schemes
Investing in government schemes is one of the financially prudent steps you can take for securing an economically stable life. Schemes such as Public Provident Fund (PPF), National Savings Certificate (NSF), Post Office Saving Schemes, National pension Scheme, Sukanya Samriddhi Yojna, etc. All these governmental schemes secure a financially stable and balanced life that can help you deal with unexpected events.
8. Do not hesitate to extend your hand
Investments can not only be done in gold, stocks or real estate. People can be invaluable investments too. As mentioned earlier, there should always be a deeply thought purpose behind earning money. Therefore, make sure that you invest a small portion of your earnings in helping people whenever you can.
This can include charity or awareness programs for the socially marginalised. Such steps can brighten the future of people who are unlucky to be born on the darker side of fortune.
9. Be consistent and sincere
Although this investing tip might seem a bit odd in the list, it couldn’t be more important. As a form of commitment, you need to schedule some hours of your week to review the progress of your investments. Lacking awareness of such things can backfire and can create a huge mess in the end for you.
Make sure that you pay all your investments, taxes and fees on time. With consistency and discipline, you will be able to enjoy the fruits of your investments.
10. Finally, have some patience
The desired fruits of your investments will not ripen in an ephemeral time unless it is poorly thought. A prudent financial decision will unravel its effects in the future which will be marvellous. Every day when you invest a small sum of money in the banks, the compounded interest will make your future self thank you loads.
These are some of the invaluable investing tips my dad taught me. Read them carefully and research various investment options. It is your money, spend it carefully!
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