If 2020 was the year of COVID-19, 2021 can be the year for mass vaccination against it. As the world prepares for vaccination, here are the top money hacks to ensure that you are ultra-successful in your finances in 2021.
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Hack #1: Emergency fund
Put away 9-12 months’ worth of expenses as an emergency fund. This money can be kept as a combination of liquid cash, fixed deposits and liquid/overnight mutual funds.
Hack #2: Health insurance
Ensure to have a minimum of Rs. 10 lakhs worth of health insurance. Also, go for a family floater plan that can be used by anyone in the family.
Hack #3: Take a top-up plan
To reduce expenses on health insurance premiums, take a base cover of Rs. 5 lakhs and then a top-up plan of 15-20 lakhs in addition to it.
Hack #4: Take sufficient life insurance
If you are married and have dependents, take a life cover which is equal to 10-15 times your annual salary.
Hack #5: Hire a financial advisor
Hire a financial advisor to review your finances and help align them as per your goals.
Hack #6: Mutual funds
If you are new to investing, start by investing in mutual funds. Mutual funds offer the advantage of experienced finance professionals to manage your money at low expenses.
Hack #7: New investors stay away from direct stock investing
New investors should stay away from directly investing in stocks for the initial 2-3 years. They should use this time to study and gather knowledge about the stock market. Only after that, they should try their hand in direct stock investing.