If we are to ensure a promising retirement, sustainable financial health and a solid bequest strategy, then we need to make financial decisions based on facts, reason and realistic life events.Whilst certain events are uncertain and would likely take us by surprise during the course of life,the mind that stays prepared, focused and arduously stick to building the fundamentals is likely to survive in the worst days.
In his quote, Dr. Samuel Johnson writes, “We may take fancy for a companion but must follow reason as our guide”.
To improve our lives , that of our families and to ensure the reasonable dissemination of wealth in the society and retire with dignity, we need to make smart and sound financial decisions through drawing reasonable and intelligent conclusions based on present realistic circumstances.
In this contest, fundamentals could be illustrated as developing a life plan (vision, goals, objectives, action plan ), evaluating economic trends, understanding your level of risk aversion, the extent of investment in tangible skills, health risks, spending habits, saving across strategic priorities and building a strong value system. Additionally, we need to rigorously take well calculated investment risks and opportunities and where there are complexities, we need to seek credible assistance.For instance,retirement planning could be a complex endeavor that would definitely need the help of a financial planner.But still the basics of self-discipline and making the right choices depends on you.
But first we need to get the basics and the foundation right. For instance,invest in education where skills are valuable and marketable, allocate portions of your income across strategic priorities, delay instant self-gratification, re-invest earned funds, and be entrepreneurial – seek opportunities and take business risks.
Furthermore, you need to set the financial facts straight and don’t create and entertain a false sense of financial stability or that retirement would magically take care of itself.
If you are not doing the below whilst young, then there is a good chance your financial vision is not fully crystallized. At least by the age of 25, you should be doing the below.And if for any reason,it is getting more difficult to do these, then seek an advice.
- Saving money
- Delaying instant self-gratification
- Re-investing earned income
- Developing a retirement plan
- Focusing on developing tangible work skills
- Developing a relationship with the right partner
And ask yourself whether you are adequately prepared to cover expenses during emergencies or disability. Would I retire comfortably and in dignity? If the answer to this question sends a chill and it’s a no, then the next logical step is to derive a plan to change the outcome of these in-actions or actions.
In certain instances, to better understand and evaluate the fundamentals of certain financial route and decision, you may need an expert help or you can educate yourself financially through reading good financial blogs and personal finance books. But there also need to be a constant and consistent evaluation of goals, objectives and strategy every step of the way.