By Ankur Kapur
Edited by Liz Maria Kuriakose, Associate Editor, The Indian Economist
Everybody wants to be rich and famous but very few of us have actually sat and thought about how rich do we really want to be and what will keep us secure in life. Something along the lines of ‘what makes you happy’ – think about it and the answer might surprise you.
Having your own money in your hand every month does not guarantee you the lifestyle you deserve throughout your life. Circumstances and needs always keep changing. Today’s sound financial situation does not guarantee an equally sound future. A loss of income, even temporary, can eat into your savings or can lead to debt. An uninsured loss can wipe out your accumulated wealth. Insufficient savings can force a reduced lifestyle during retirement. Frequent or unplanned borrowings can leave negative money i.e., debts for future. Also, poor tax planning can result in paying higher taxes than what you are liable to pay. All this, combined with changes in your life cycle needs and/or external economic changes can make you and your future generations financially vulnerable.
You would need to plan and manage your current income (the money you earn today) and your future income (money you can expect to earn in future) according to your needs. These needs are your goals, are your dreams.
People who write their goals are much more likely to achieve them. Sit down by yourself or with loved ones and start to imagine your future. Consider what drives you in your life and how that has changed over time. No one can tell you what you should want in life, the below list of questions should provide you a fair idea of how you should think about your future.
What milestones do you see in the future? – start a family, send kids to college, buy a new home, retire, others
If you could do anything, time and money aside, what would that be? – spend time with family, buy a second home, start your own business
What would you like to add in your life?– more time, more money, more social life, others
What would you like to reduce in your life? – debt, job stress, others
Having a vision for the future and planning for that vision are as important as money in achieving a contented life.
Envisioning your dreams and putting them down on a paper is the first step in making them a reality. The next step is to prioritize the goals that are most important to you and to establish milestones for reaching them.
Reflect on your life, your dreams, your goals. Unless you know what you want to achieve, you will never be able to reach where you want to be. Start planning financially for your dreams.
Ankur Kapur is a co-founder of Finqa.in, a Financial Literacy and an Investment Management company. Ankur is an expert on Personal Finance and Wealth Management with over 10 years of experience. An ex-McKinsey, ex-Ameriprise professional, Delhi School of Economics alumni and CFA (USA), Ankur is passionate about Finance and education. He also regularly conducts corporate workshops, classes on Udemy and is a regular contributor to CNBC MoneyControl.com and IBNLive.com.