Have you noticed ants and squirrels running around and collecting stuff in summer?
You probably would not have because they can be too discreet for human eyes to notice. But they do; they collect nuts intending to save for the winter.
Even these little beings invest for a goal.
Likewise, humans too have their goals for investing.
If you do not have a purpose, then what is the point of investing, right?
Specifically, millennials are known for their spontaneous attitude. Many of them want to live life as it comes. But, there is one problem with that; you never know the impact of whatever comes.
Goals add meaning to your life, and you can attain true happiness by achieving them.
Importance Of Setting Financial Goals
Setting goals is an integral part of a financial journey.
Without a plan, you will not be able to tell how much money you need to put aside and for how long. In many cases, when a clear goal is missing, we tend to live spontaneously and struggle through any crisis.
For instance, during the pandemic, people living from paycheck to paycheck fell into a financial trap when their jobs were at stake.
Short, medium, and long term goals are essential for becoming financially stable.
Common Goals For Which People Invest
If you lack goals, there are more chances that you will spend more than what is required.
I was hoping you could read this guide on goal-based investing for more perspective, and let me tell you today what are some of the popular goals for which people usually invest.
1. Dream Vacation
Wanderlust happens to be the goal of many people in our country. More and more, us are spending money on travelling the world.
Whether gawking at the scenic of the western ghats or wandering the streets of Europe – everyone wants to spend their holidays on a vacation.
Although it can be fun to travel, the costs that come with it are enormous, especially if you’re going to travel to a foreign country. Hence, many save and invest in visiting their dream destinations.
This is a fundamental goal everyone should have.
As we grow old, we want to spend our lives in peace. A decade ago, retirement was bliss. Almost everyone was entitled to a pension from the company in which they were working.
Presently, the concept of assistance is slowly vanishing.
Even if you hold a government job, it is most unlikely that you will receive a pension. Retirement planning is a vital goal for everyone in the present generation.
3. Wealth Creation
This is the ultimate goal of every investor.
Wealth creation means growing your wealth for the future by investing in assets. All your other goals eventually build up your wealth.
Most investors start investing for wealth creation at a very early stage. Proper planning and discipline are vital for long term wealth creation.
4. Owning a house
Buying a home is a dream of every citizen of India. It is looked upon as a sign of achievement.
Firstly, it isn’t easy to live in a rented house after your retirement due to the rising rental rates.
And second, owning a home gives you security, a place of your own. You won’t have to rely on anybody for shelter. The property’s investment value keeps rising with time, which allows you to do inheritance planning for your family.
5. Paying For Child’s Education & Marriage
In India, parents take responsibility for their children for much longer years compared to the west. We nurture them and educate them to become successful and independent.
Many parents dream of giving their children the best education possible. They aim to send them to big schools and colleges for higher education.
But all this comes with a cost – education fees. Premier schools and colleges charge an expensive fee for quality education. Hence many parents have their child’s education as a goal for investing.
Also, the big fat Indian weddings have a significant impact on the pockets of the parents.
If not for themselves, they want to host a grand wedding for society. As a result, they start investing early to make their children’s’ lives colorful.
How to Achieve these Goals?
A goal that is not achieved is just a dream. Making it a priority and fulfilling every goal with your own earnings can give you the most satisfying feeling.
Goal-based investing is the best approach to fulfill your goals.
To begin with, you can start jotting down all your goals, the sum of money required to satisfy those goals, and its time horizon. This will give you a better picture of where to invest.
For instance, if your goal is to save for your child’s education, it is a medium-term goal that requires you to invest in a vehicle that can give you good returns within 5-10 years.
Choosing the right investment space and keeping a separate investment for every goal enables you to harness the most of your savings.
Plan, analyze, and invest smartly to achieve every goal and live a satisfying life.
[su_note] KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing. [/su_note]
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