The new financial year 2020-21 has begun from today i.e. April 1, 2020. Now, it is important for all individuals to take some financial decisions to keep their finances on track. It is the right time to keep a track on your investments, taxes, savings, etc to achieve your financial goals.
As per experts, the start of a new financial year is the time when people should take their important financial decisions like choosing their savings, investment options etc. It will help them to get better returns, insurance protection, and tax-saving benefits.
5 Financial Decisions one must make on the first day of the financial year:
1. Debt situation:
Review your debt situation at the start of every financial year. Look at your outstanding loans, debt, income and money outflow towards credit card payments, personal loans, home loan EMIs, car loans, etc. Reviewing your debt situation helps to plan your investments & savings accordingly. It helps you to figure out where you stand in terms of financial goals.
2. Tax Planning:
Tax Saving Investment is important to save maximum tax. Don’t choose it at the last minute. It is not right as you do not get the required time to evaluate all options & sometimes you get stuck with the tax-saving instrument that offers low returns. So, evaluate all tax options on the very day of financial year.
3. Financial goals status:
You can simply do it by reviewing your portfolio, savings, risk profile and investment time-frame. You can also consult a financial adviser or investment expert for any help.
4. Insurance Policy:
Review your insurance policy as life is unpredictable. This is the best time for you to buy an insurance policy that will help your dependents if something were to happen to you. If you already have one, then make sure they offer you adequate coverage. It is always better to choose an insurance policy that will ensure that your family is properly covered.
5. Contingency Fund:
An emergency fund is very much important. In case, you already it, then maintain your investment so as to build a fund large enough to sustain you & your dependents without any income.
