Life takes many turns. However, some events are more perceived to be stressful to one’s and one’s loved ones well-being then one may take a wrong step and go back financially. Here are six ways to maintain your wealth:
Have one years of fixed expenses
Regardless of the nature of situation one needs to have 1 year’s expenses on a fixed basis. This would include grocery; basic services needed like mobile and data services, basic travel expenses, electricity bills, insurance premiums, rents,staff salaries.
Write a will
A will helps to identify the recipients and plan one’s assets post the writing of the document.
A will can be contested however a good lawyer can help with drafting it well. It also removes ambiguity from the minds of the beneficiaries. It helps to maintain relationship within the family well. it is important to not only people in their fifties ,but also in their thirties. There have been instances of people dying earlier on account of stress, bad relationships, bad work habits.
Be sufficiently covered
One needs to have sufficient life cover as well as mediclaim.This takes care of problems of depletion of resources in an extreme situations,
For instance, a premature death can result in gaps in education of a child. This can be avoided by taking term plan. It could also be relevant if one has a loan.
Also being careful on amount of mediclaim is important. Depending on the family medical
History coverage can be decided.
Understand the opportunity
A wise person knows the opportunity and is ready for it. Extreme events globally provide us an opportunity to buy assets at a reasonable price. This could be any asset class. It is a good strategy if one has sufficient liquidity or is in an income generating mode.
This helps to take advantage of an otherwise challenging situation. What separates the winners from the losers is the ability to see and execute things which nobody is doing.
Exit if needed
If the view from a medium term point of view is that the opportunity is no longer there, it is better to exit. It can be considered in stages to obtain a better price. Sometimes it would be better to exit at one go in the interest of arresting the downside.
These things if done religiously ensure a peace of mind in most situations and help to tide over the bad phase.
Reduce the debt burden
It is important to reduce debt in a planned way to be calmer. I recollect the time when I had paid off my loans a couple of years back. I felt good and relieved. This also helps to prepare for the upside as and when it can be created or it arises.
In good times prepare for bad times, in bad times prepare for good ones!
