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    Here are key financial tips one should follow

    Here are key financial tips one should follow

    Here are key financial tips one should follow
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    By Anshul   IST (Updated)

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    There are multiple ways to achieve financial goals, it helps if you making a budget and take advantage of insurance

    While one may have a fixed salary, it could be insufficient to meet certain expenses. In such a scenario, proper financial planning is required. From making a budget to taking advantage of insurance, there are multiple ways to achieve financial goals.
    Here are key tips to strengthen your finances:
    Make a budget
    It’s important to have a clear idea of all the cash inflows and outflows. According to experts, inflows include salary, any assistance amount received, rental income from property, alimony amount if any, etc. Outflow account, on the other hand, is all expenses such as loan, debt, EMI, mortgage, recurring household and lifestyle expenses.
    Making a budget will help one to have a grip over their finances and have a clear idea of how much money they can spend.
    Living within means
    While credit cards and loans allow people to live a certain quality of life instantly, they can impact their financial stability in the near and long-term. Hence, it's vital to learn to live within means. Individuals should follow the 50-30-20 rule so that they can comfortably allocate post-tax income to all three buckets.
    Here, 50 percent of the income should go to needs, 30 percent to wants and 20 percent to savings and investing.
    Build an emergency fund
    According to Arun Kumar, Head of Research, FundsIndia, individuals should build an emergency fund via bank fixed deposits or safe fixed-income funds that can cover at least six months of expenses.
    An emergency fund can go a long way in meeting short-term goals and be financially cushioned during sudden situations like job loss, medical emergency etc.
    Buy life and health insurance
    In order to ensure the maximum financial security, Kumar suggests people should have adequate life and medical insurance cover.
    Invest wisely
    Investment products must be chosen that suit the risk profile, cash flow requirements, investment horizon and should be low on cost.
    According to Kumar, SIP in a combination of good equity and fixed income mutual funds makes is a good bet.
    Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.
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