Investment tips for a newly married couple – Axis Direct
Feb 14, 2020
7 investment tips for a newly married couple
7 investment tips for a newly married couple
One of the first things to do as a couple, once the pangs of your wedding celebrations have worn off, is to sit down and have a chat about the many investment options available for you both. While it might seem daunting to take the first step towards investing for your future as a couple, it is essential for creating wealth so that you can enjoy a comfortable life together. If you’re unsure about where to begin, here is some excellent investment advice for newlyweds that can help you get going.
Determine your investment budget
Before you go ahead and decide on which of the many investment options to park your funds in, you need to determine your investment budget. Identifying the amount of money you can afford to invest can help you obtain clarity on the choice of investments. List down your combined sources of income and compare them against obligatory expenses like rent, EMIs, and monthly utilities. The amount remaining is what you have to invest. Set aside this sum each month and stick to your investment budget consistently.
Build an emergency fund
This is an important investment advice for newlyweds to follow. Life can often be unpredictable, and you never know when a financial emergency may crop up. By investing a portion of your income in a safety fund, specifically for unforeseen eventualities, rest assured, you can always have a kitty to fall back on to keep your family financially secure. Ideally, your emergency fund should be kept in a different, joint account that is detached from your other investment options. In addition, start building a short term corpus by investing in liquid funds which can be accessed during emergencies.
Identify your short-term and long-term goals
Not all investment options are similar. Some can fetch you high returns in a short time, while others can take years to fully mature and deliver capital appreciation. For your investments to deliver maximum benefits, it is highly essential to establish your short-term and long-term goals. Goal setting can give you clarity on how to split your investment budget between short-term and long-term investment options. A healthy mix of both is required to achieve maximal financial security.
Diversify your investment portfolio
When you’re investing your earnings, it’s always a good idea to minimize your risk exposure. A great way to do this is to spread out your savings over multiple investment options and asset classes.
For instance, you could invest a portion of your savings in a high-risk-high-reward asset class such as equity. And to balance out the risk posed by your equity investment, you could invest another portion in government bonds.
With us at Axis Direct, you can park your funds in a variety of investment options, including low-risk instruments like KisanVikasPatra (KVP), Atal Pension Yojana, and Public Provident Fund (PPF), as well as high-risk-high-reward options like equity and commodities.
Consider Systematic Investment Plans (SIPs)
Deciding to opt for Systematic Investment Plans (SIPs) is one of the best investment tips you can follow. SIP essentially means that a fixed amount is debited periodically from your account and invested in a mutual fund. As an investor, it is entirely up to you to decide on the amount and the frequency of your investment plan. Also, you can choose to increase or decrease the amount of investment at any point in time, making SIPs perfect for investors looking for flexible investment options.
Invest in protection covers
As a couple, investing your money in a good life insurance policy needs to be an essential part of your financial planning. You can also enjoy low premium charges if you purchase an insurance plan while you’re young. Life insurance plans offer plenty of benefits. They can protect your family from financial troubles in the event of your untimely demise. Additionally, the premiums you pay towards your policy can be deducted from your total income as per section 80C.
Axis Direct gives you the option of purchasing a comprehensive life insurance policy from Max Life Insurance.
Buying a health policy with maternity cover
This is a must have and comes handy while you start planning your family. Since most health insurance policies have waiting periods, it's always best to get one early on, to tide through the waiting period before you get started with parenthood. Before deciding on the insurer and the plan on offer, go through the coverage details, policy fine-prints, limitations, sub-limits etc. to avoid surprises later. A health insurance policy with maternity cover takes care of the new mother’s medical expenses, treatment of the newborn, newborn vaccinations for up to 90 days and baby's hospitalization charges for up to 90 days after birth.
Save up for retirement
It is never too early to start saving up for retirement. In fact, it can prove to be highly beneficial to you and your spouse if you begin this exercise at a young age. Some of the investment options you can focus on as part of your retirement planning include National Pension Scheme (NPS), Public Provident Fund (PPF), debt funds, and real estate. In addition to providing you with a steady source of income, many pension and annuity schemes also come with income tax benefits that help lower your tax liability.
The investment tips offered thus far, make for some of the best investment advice for newlyweds. To head to a brighter and more financially secure future, you can start off small, by incorporating one or two of these investment tips in your financial planning each year. And before long, you will have made significant progress in your investment journey as a couple.