4 New Year’s resolutions for salaried employees to improve your financial wellbeing
As you embark on a new year, here are 4 recommendations from us that can help improve your financial well-being.
1. Educate yourself
Carry out a thorough research about various financial products available to you. Always look at the fine print carefully. Many savings, borrowing and investment products thrive on being confusing in their terms. Make sure you understand the compounded interest rates and other charges incurred. Learn about credit score and how it affects your borrowing. Educate yourself about improving and maintaining your credit score. Learn about credit card interest rates and hidden charges. Financial literacy helps you make informed decisions about your money.
2. Plan your finances
With a better understanding of how financial products and services work, plan your finances in a way you get the maximum out of the money you borrow and save. Keeping your income, expenses and loan payment schedules in mind, develop a financial calendar. Have an investment and saving schedule, keeping your short-term and long-term goals in mind. Look at your various loans and consolidate them so that you can get out of unproductive loans.
3. Use formal financial channels
Use formal channels of payments, investments and borrowing. Use the power of mobile and digital to avail benefits and enjoy efficiencies in transactions. Avoid cash payments, informal high-return investment/insurance products and moneylenders. Chit funds are risky investments and do not guarantee profits and affordable loans. Participants might not get the chit money when needed. There is no check of credit-worthiness of the people taking part in the chit.
4. Borrow money carefully
Take short duration loans to the extent possible to avoid high interest payments. Pay back your dues on time to maintain a good credit score. Ask your employer to help you before going to informal moneylenders. Be careful about credit card loans, pay dues on time to avoid penalties and late payment fees on top of high interest.
We wish you a financially productive new year and we hope these tips help you achieve your financial goals.
Disclaimer: This information is purely illustrative and should not be construed as financial advice. Please consult your financial adviser before making any financial decisions on the basis of this information. Interest rates are illustrative and may significantly vary depending on various factors. PerkFinance does not accept any responsibility / liability for any loss or damage incurred by any person on the basis of this article.