Having an adequate amount of money to meet specific goals, fulfill unexpected expenses, and build wealth over time is something everyone desires. Establishing a budget or a financial plan to save and invest money is essential to achieve financial security and freedom. However, taking an active role in managing finances and investments is something not everyone is good at.
To help out, there are several financial advisors and investment experts who can guide you to build a financial framework and improve your lifestyle. And if you’re situated in the UAE, you can hire the expert services of financial advisors Dubai offers to residents and expats alike.
Financial Planning in a Nutshell!
Financial planning is a thoughtful process to create a framework for achieving your short term and long-term goals without encountering shocks or hiccups of any kind. It lets you determine capital requirements, devise financial policies, and build a pathway to use financial resources to maximum advantage, and build wealth eventually.
In other words, it’s a step-by-step approach or a guide for your life’s journey that helps you increase your income, control your expenses, and manage your money to achieve several financial goals. It teaches you to save a substantial amount of money for use at the right time. The importance of financial planning comprises of:
- Sets the roadmap to achieve your financial goals
- Reduces financial risks and uncertainties about future
- Helps you maintain a good financial score and enhances your creditworthiness
Financial Planning in Dubai!
While financial planning is an umbrella term that covers several aspects of money management, it all boils down to creating financial security for the future and experience financial freedom.
It predominantly includes managing your money in a planned way and making the right investments is a proven way for experiencing financial freedom. While it may seem a herculean task, managing your money isn’t rocket science. You need to show a good degree of commitment and common sense to plan your expenses and build income.
You may need to buy something, and using your credit card for everything pushes you into a debt trap instantly. While there are several financial goals, you need to have money. Hence, saving becomes the first step to experience financial freedom. Saving money works as a double-edged sword that also helps you build wealth over a period of time.
While saving your money in a bank is a good option, it doesn’t earn you much interest. It helps you meet your short-term financial goals, but the bigger goals need strategic planning and commitment. Investing your money in a liquid fund is a great option, and investing in mutual funds in Dubai is a remarkable option.
Irrespective of the amount you’re saving, ensure you invest it in liquid funds like debt mutual funds that let you invest in fixed-income generating financial instruments like FD, certificate of deposit, etc.This type of regular savings carried out over long-term builds wealth way beyond any traditional financial instrument offers.
Getting Your Risks Covered!
There are many aspects to financial planning, saving, and investing in order to build wealth. However, these are one part of increasing your income. But what if you experience unexpected expenses and financial surprises on the way? Building wealth is also about cutting down unexpected expenses by making secured investments like life insurance.
Your life and your property are subject to risks, and it can lead to a significant loss of income while putting your dependents in financial soup. While you build wealth via investments, make it a point to preserve your hard-earned income through insurance.
Check out the several types of the best life insurance UAE offers and understand each benefit and the risks they cover. There are options like term insurance that offer a very high-risk coverage compared to ULIP and other types of insurance. There will be moneyback options, but ensure the sum assured is nothing less than 10 times your annual income.
Compare different life insurance policies from different insurance companies before picking the one that meets your requirements at affordable prices. Combining life insurance with an effective health insurance multiplies the advantages and secures you and your family in the long run. A good health insurance will allow you to receive high-quality healthcare at low costs.
Effective Financial Planning Tips!
There are other fool proof tips that help you secure your finances and build wealth, enabling you to plan for retirement early in your career.
When you have surplus cash and don’t have a financial plan, you tend to overspend. Instead, this money can be used wisely and invested to make you financially sound and self-sufficient. Add inflation, and everything will become costlier soon, and without financial planning you will fail to bridge the financial gap triggered due to inflation.
The leading financial advisors Dubai leads the investment domain stress on the importance to invest to channelize surplus cash and counter inflation.
Likewise, you can plan early for your retirement by choosing the best life insurance UAEdevises to cover several unexpected risks and health conditions that catch up faster than ever. Plan for your retirement by deciding the age you want to retire, and make an estimate of the amount of money you need every month.
The Final Word
If you’re new to financial planning or don’t know where to begin, you can always take expert advice from reliable sources and seasoned financial advisors. You will learn the art of diversifying your income, and reap the benefits of professional fund management from a young age that can be passed on to future generations.