Are you someone who has just entered the 30s club? Charging over a stable professional career with a hefty paycheck in hand?
Well, that is one of the perks of being in your 30s. However, with higher salaries, the 30s also come with more responsibilities. It is a decade full of pivotal decisions, where you might buy your first house, try out new careers, plan out your marriage and kids, or even start a new business. It is a decade to pan out the possibilities and plan for your future. Moreover, being in your 30s is an interjunction to plan your retirement.
As you navigate through these changes, it becomes increasingly important to come up with a reliable investment strategy to plan your future finances.
Therefore, it is time to take control of money and head towards wealth creation.
So, do you want to grow your wealth and make accurate investment decisions that will benefit you in the long run?
If yes, then we have just the right plan for you!
Here are a few things to remember while investing in your 30s:
You should start by Identifying your future financial goals while you’re in your 30s. Be honest with yourself while identifying the requirements. Entertain every possibility of future expenditures and needs. Create a budget for every financial goal.
Divide the long-term and short-term goals to prepare a budget for both. Here, short-term goals can be buying a house or family planning, and long-term goals can be planning a world tour in your 60s or retirement planning.
Of course, the future will be dynamic, and not everything can go according to plan. But having a plan provides a roadmap for achieving the goals.
Being in your 30s provides you with the financial freedom you always wanted. It's like giving adult money to a child. You want to purchase every gadget and riches you’ve always admired in your 20s.
But the 30s bring you more responsibilities than your dreams. Learn to cultivate discipline for your expenditures. Track and analyse your expenses periodically to minimise reckless spending.
Do an optimal categorisation for the necessities and luxuries after planning for the savings and emergency funds. Alter the expenses according to the income and analyse them regularly. Once you have over your expenses, be strict with your spending habits and stick to them.
Unexpected losses can arise at any given time. It is important to have an emergency fund, even after having savings or credit facilities. A general emergency fund can be created with small amounts from your paycheck dedicated every month to ensure your financial standpoint. It is advised to have a fund that covers at least 3-6 months of your living expenses.
While an emergency fund is essential for your financial well-being, retirement funds are another checkbox of your 30s. You can secure your financial future post-retirement by creating a retirement fund & contributing to it regularly. The earlier you start saving for retirement, the better your future will be.
However, it must be noted in red that never touch your retirement fund for emergencies, even in the utmost distress. You might stop the compounding of money. Also, you might risk financial stability in your 60s, when you may require it the most.
One of the advantages of being in your 30s is that you’re brisk in planning your future finances. It gives a chance to make bold moves in the investment world. Diversify your investments over instruments such as asset leasing, stock, corporate bonds, commercial property, mutual funds, PPF, gold and other alternative investments. It helps you to mitigate the risk factors and to earn diversified & stable returns.
Debt is an important instrument when it comes to finances. It is important to understand the usage of debt instruments in your daily life.
Analyse the credit facilities availed in the past few years. It is highly advisable to repay the high-interest debt as soon as possible. This helps you achieve financial freedom.
Analyse the credit report regularly to close all the unused debt accounts and improve your credit score. This will help to avail the cheaper credit when you might actually need it, such as while purchasing a house.
The future is very uncertain in nature. You can’t predict every possible expenditure that comes your way. However, you can stay prepared to deal with it. Protect your finances with appropriate emergency funds and insurance plans.
Nowadays, employers provide the benefit of health and life insurance. But try to purchase a comprehensive plan that covers all general cases. Analyse your plans regularly and opt for the better plan available.
If you’re in your 30s, you might be more focused towards moving forward in your career aspect and addressing the financial responsibilities.
So, it is best to have a balanced & diversified portfolio that provides short to long-term benefits.
Well, here are some risk-avert investment options that can diversify your portfolio and earn inflation-beating returns.
Asset Leasing is an alternative to regular investments such as stocks and mutual funds. It involves leasing assets to businesses/individuals to generate fixed monthly /quarterly returns.
With platforms such as Grip, you can invest in stock exchange-listed and rated opportunities from creditworthy partners which provides an IRR of up to 18%. These investments are rated and provide a diversified edge on your investments.
Invoice discounting is an investment where businesses sell their invoices to a third party at a discounted price than the invoice amount. When the invoice is due, the third party collects the full amount of the invoice upfront.
It is a short-term investment option with minimum tenure ranging from 30 to 90 days. It provides an average return of 10-15%
Corporate bonds are bonds issued by private or public organisations which raise money for a variety of reasons, such as M&A, expansion etc. These are debt-based securities with an annualised return of 8-12%. These bonds are from 5-15 years, where bonds with a tenure of below 5 years are short-term bonds, tenure with 5-10 years are medium-term bonds and above 10 years are long-term bonds.
PPF is an excellent investment option for long-term investments. It enjoys tax exemption benefits for both salaried and self-employed people. It provides an average return of 7% with a maturity period of 15 years. It can be further extended by 5 years each time.
You can also invest in tax-saving FD, debt mutual funds, and Sukanya Samriddhi Yojana to diversify your portfolio and earn a stable income.
The financial journey of your 30s is filled with many unknown responsibilities and obligations. However, you can glide through a strong financial plan. Understand your financial habits and optimise them for better decisions. Secure your future by mitigating investment risk.
Be prepared with a diversified portfolio with alternative investments to deal with any uncertainty. Sign up on Grip and diversify your investments with new-age instruments providing an inflation-beating return on your investments!
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Disclaimer: This communication does not constitute advice relating to investing or otherwise dealing in securities and is not an offer or solicitation for the purchase or sale of any securities. Grip Invest Technologies Private Limited ("Grip", formerly known as Grip Invest Advisors Private Limited) is not registered with SEBI in any capacity and does not advise, encourage, or discourage its users to invest or not invest in any securities. Grip is solely an execution-only platform and does not guarantee or assure any return on investments made by you in any opportunities sourced by Grip and accepts no liability for consequences of any actions taken based on the information provided. Your investment is solely based on your judgement. Investments in debt securities are subject to risks. Read all the offer related documents carefully.