Common financial ailments, symptoms and remedies to follow
The ailment involves the desire by the patient to own traditional but expensive insurance policies with the simple thought that they are investments. The investments are eventually to fund goals that lead to the ignorance of low returns and insufficient cover.
Diagnosis: The family and its finances become vulnerable to low cover and meeting of goals turn out to be problematic since the funds are tied up in other unnecessary areas.
Therapy: Use debt or equity instruments for investments and as per goal requirements and a term plant to cover life.
It’s all about payment of taxes and filing tax returns, tasks not done on time
Diagnosis: Penalties and tax notices
Cure: Set some reminders as to when taxes should be paid perhaps two months in advance. In any case deploying a professional would be good enough.
Filing tax returns renewing insurance policies, filling up forms and updating information are all illnesses under this category. They can easily cause hypertension as well as blood pressure.
Diagnosis: Miss-selling, inconveniences and monetary losses that one can hardly explain.
Cure: Complete the necessary work on time and consistently.
The illness more often than not sets in during goal setting because of the possibility of forgetting inflation calculations that affect long-term goals.
Diagnosis: Smaller corpus resulting from inflation of value for money. At the same time, there is an erosion of the purchasing power.
Therapy: Obtain up to date information on average inflation figures, at least, every six months.
As the name suggests, the illness has everything to do with cash constipation due to loans.
Diagnosis: Difficulties in carrying out income-expense imbalances leading to the abortion of goals due to lack of funds
Cure: Debts should not be more that 40% of the income. Use credit cards sparingly.
It is for those who love money, and lack of large amounts idling in their bank accounts makes them get withdrawal symptoms.
Diagnosis: Impacted goals due to the opportunity cost of holding cash that is usually so high.
Cure: Instead of the big chunks of money in the bank, ensure only the presence of the mandated average balance. Let the rest be in instruments that will give higher returns.