The most awaited festival of the year – Diwali is here.
It is the time of the year when family and friends get together and celebrate by worshipping the goddess of wealth.
On the one hand, most of you might have received a bonus, which is good news. On the other hand, it spills off your pockets in the form of buying gifts, sweets, new clothes, etc.
We are not saying that you should not spend on gifts and clothes, well without it what is Diwali after all. But there are a few things that you can keep in mind before you do needless spending.
Here are a few financial practices that can be learned from the festival of lights. It will help you get your finances in order and invite the goddess of wealth to your homes.
1. Stay safe
As the festival of lights approaches, one practice that is most stressed upon is safety.
Diwali cannot be fun without the joy of lightning diyas or the thrill of lighting crackers. But some caution practiced alongside makes your celebration happy and memorable.
Every investor knows nothing more satisfying than taking a calculated risk and earning a huge profit from an investment. However, it is best to practice caution. Getting yourself into unforeseen risks can be very harmful to your portfolio.
You can make sure you do your research, get to know the risks involved, and analyze if it is suitable for you before investing. Every asset comes with its own risk and rewards; it is up to you to choose what is best for you.
2. Plan for the Future
About a week before Diwali, most of our time will be spent on a lot of planning. From deciding what clothes to the entire Diwali party, we plan ahead of time to make the day a perfect one.
Planning is an essential part of anything important to us.
Millennials believe in spontaneity, but spontaneous decisions made while investing can be hazardous. You need to plan ahead of time to have a smooth financial journey.
Please make a list of your goals and needs and then analyze the best way to achieve them. Put your money into different buckets, such as savings, expenses, and investments.
Planning early in your life by listing your goals and needs allows you to make informed decisions and pushes you to grow faster.
3. Bring your house (balance sheet) to order
It is believed that the goddess of wealth will enter your house only if it is kept clean.
For this reason, every home is put to a thorough cleaning process just before the Lakshmi puja during Diwali. While your house is brought to order, it is time for putting your finances straight too.
We all make one mistake of unnecessary purchases on EMI, bringing your house balance sheet under check by tracking and measuring how is being spent where can help you optimize your financial health.
You can also plan your expenses and invest periodically in short term plans. This way, you can tend to your needs without burdening yourself with debt.
4. Revive your Goals
Diwali is an excellent time to reflect on your needs and goals as you pray for prosperity and wealth.
Financial planning should start with analyzing your objectives and needs. Goals define the time horizon of your investments. Achieving some goals may require short-term investments while others take the long term.
Defining your goals gives you a clear perspective of which type of investment is suitable for you. Your risk tolerance, time horizon, and choice of assets all depend on your goals and needs.
5. Variety is fun
Imagine celebrating Diwali with just one variety of food or one type of firecracker. Boring right?
Variety brings happiness, and this principle applies to finances also.
Investing in just one asset that is anticipated to yield high returns will also expose you to high risk. But by spreading your investment across various asset classes, you can minimize risk to your portfolio.
Not only that, diversification allows you to enjoy the returns of different assets. If you have a mix of both high and low-risk investments, it will shield your portfolio from any crisis that may occur.
Factors such as safety, future planning, organization, analysis, and diversification determine your financial health.
Make this Diwali an opportunity to build better financial habits to help you make the right financial decisions and achieve financial freedom.
I would love to know how these financial practices brought about a change in your finances and illuminated your Diwali. Tweet your stories to us on @CoinSwitchKuber.
Happy Diwali, Folks!
[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]
Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.
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