5 Bad investment habits to kill this Dussehra
As we celebrate Dussehra, and commemorate the victory of good over evil, cutting out the bad investment habits we have inculcated might be a great idea.
Dussehra is the celebration of Lord Ram defeating Ravana in the North and Goddess Durga’s triumph over the buffalo demon Mahishasur in various other places (South India, Eastern States, etc). This celebration sets the premise just right for you to squash all the financial habits that have weakened your investment portfolio. If you are wondering what are the habits that may potentially hamper your investments, read on!
Review Your Insurance
Insurance is one of the few things that most people only look at as a security blanket. Most people don’t think twice about the insurance they opt for or the cover that they have chosen. Sadly though, the Rs 50,00,000 cover that you took when you were in your 20s might not serve the family you have when you are in your 30s. Reviewing the insurance policies that you own and reinvesting into newer, better options is always a practice that you need to follow. Whether it is health insurance or life insurance, go back and take a look at your schemes and run a basic comparison with the newer plans to know if they still fit your needs!
Investing in One Comfortable Fund
There is this sense of comfort that comes from familiar things, which makes you hold on to them. Sadly though, this habit does not do well for your portfolio. One of the oldest and most useful advice to remember while planning your investments is - Don’t keep all your eggs in the same basket. Diversifying your portfolio and finding a good balance of instruments that arbitrage your risk and returns and ensure that your future is secure.
Related: Why investing early is important?
Invest for Goals
Most people begin investments because someone told them to. However, investing just for the sake of it, doesn't take you anywhere. The one simple lesson you need to learn is to invest for goals. Understanding that investments are the key to having a sound and secure financial future, and not a gamble to make some easy money, is of the essence to have a reliable financial plan. So set your financial goals and ensure that your investments are directing you in the right way. Here are tips on how you can set SMART financial goals?
Know where your money is
While you take all the help possible from your relationship managers and investment planners, it is important to still be 100% aware of the choice you are making. Whether it is knowing the stocks in your kitty or the type of funds that form your Mutual Funds and ULIPs, knowing exactly what you are putting your money into is a habit that is highly beneficial for all. Trust your investment planners to make good decisions, but recheck that you are also in line with these decisions!
Related: 6 practical ways to reduce investment risk
Family and financial decisions
Investments are extremely private decisions that you make. More often than not, having discussions about your finances is not something you enjoy, whether it is with your parents or your partners. However, it is always easier for everyone if your investment plans are out in the open. Whether it is the stocks and funds that you have bought or details about the health insurance cover that you have opted for, sharing this information with your near and dear one makes life a lot easier. In that way, even in the unfortunate circumstances of a calamity, your family will be well aware of all the investments that you have made for them.
There are just some of the habits that directly affect your investments. In addition to this, there are other implied effects of your bad lifestyle habits that can be addressed this festive season. It is easy to take out one day to celebrate how evil was forfeited in the past, but what is difficult but absolutely necessary is making sure that you take the steps to ensure that it continues to be kept at bay, and the good and right always triumphs.