From Millennials to Boomers: The Best Investment options
Investing without a plan is like sailing without a compass. But what is the best plan for your age? We give you a fresh perspective.
Wondering where to put your hard-earned money? Buckle up because we're about to take a wild ride through the wacky world of investing according to your age in India!
Mind you, you’re not alone. The Reserve Bank of India has set a minimum standard for financial literacy. It has been found that only 27% of Indian adults have met this standard.
Financial literacy can be described as a blend of financial consciousness, understanding, competencies, mindset, and conduct that are essential for making wise financial choices and attaining personal financial wellness.
Whether you're a twenty-something risk-taker or a senior citizen looking for a steady income stream, we've got tips and tricks to help you make the most of your money. So fasten your seatbelt, grab your popcorn, and get ready for some seriously quirky investment advice!
In Your 20s
In your 20s, you are just starting your professional life, and your focus should be on building a strong financial foundation. At this age, you have the advantage of time on your side, so you can afford to take more risks with your investments.
The first step in building your financial foundation is to start an emergency fund. This fund should be equal to at least six months of your living expenses, and it should be invested in a low-risk liquid fund or a fixed deposit.
Once you have your emergency fund in place, you can start investing in equity funds, which have the potential to fetch high returns over the long term. You can start with a small amount and gradually increase your investment as your income grows.
In addition to equity funds, you can also invest in other high-growth assets like stocks, real estate, or even cryptocurrencies, depending on your risk tolerance.
In Your 30s
In your 30s, you are likely to be more established in your career and earn a higher income. At this stage, your financial goals may include saving for a down payment on a house, starting a family, or building a retirement corpus.
To achieve these goals, you should continue to invest in equity funds, but you should also look towards debt funds, which can provide steady returns and help balance the risk of your equity investments. Maybe seek the help of balanced funds.
You can also consider investing in real estate, either through direct investment or by investing in real estate investment trusts (REITs).
If you haven't started saving for retirement yet, now is the time to do so. You can consider a retirement-specific fund designed to provide higher returns and tax benefits for long-term investors.
In Your 40s
In your 40s, you are likely to have several financial goals, including saving for your children's education and funding your retirement. At this age, you should focus on reducing your risk exposure and diversifying your portfolio.
To achieve these goals, you should start investing in a mix of equity and debt funds, with a higher allocation to debt funds. You can also turn to gold or other commodities, which have the potential to hedge against inflation and market volatility.
If you haven't started saving for your children's education yet, you should consider a dedicated education fund. These funds are designed to provide higher returns and tax benefits for long-term investors.
In Your 50s and Beyond
As you approach retirement age, your investment strategy should focus on preserving your capital and generating a steady income. At this age, you should reduce your exposure to equity funds and focus on debt funds and fixed-income instruments.
One option is a Senior Citizen Savings Scheme, which provides a guaranteed return and is designed specifically for retirees. One good alternate option would be post office monthly income schemes, which can provide a steady source of income. An annuity plan is also a good post-retirement option.
If you have a substantial retirement corpus, you can also consider a good health plan that takes care of you in your second innings at life.
Your investment strategy should be tailored to your age and financial goals. When you are young, you can afford to take more risks, while as you approach retirement age, you should focus on preserving your capital and generating a steady income.
By following these guidelines and investing wisely, you can achieve your financial goals and secure your financial future.
You must’ve noticed that we have not asked you to buy a healthcare plan in all of the above examples. That’s because there is no fixed time to get a medical emergency. You must always be prepared for it. Getting a Kenko Health Plan can be the answer. Affordable plans that bring all your medical bills to ZERO!