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An Introduction to Wealth Management

By: Anshika Bajpai

Last Updated: February 13, 2019, 12:19 IST

Representative photo. (Image: Reuters)

Representative photo. (Image: Reuters)

Wealth Management is a service that gives you financial and investment advice, accounting and tax services, retirement planning, legal and real estate planning for a specific fee.

The ultimate goal of working hard and earning money is so that we can have a peaceful and wealthy lifestyle later. But a lot of times we don’t know how to grow our wealth to achieve those goals. It requires a lot of planning, investment, right information and discipline. This is where wealth management comes in handy and makes your life easier. It is a long term process that helps your money grow over a period of time.

So what exactly is wealth management?

In simple terms, it’s a service that gives you financial and investment advice, accounting and tax services, retirement planning, legal and real estate planning for a specific fee. You get onboard a wealth manager who coordinates with financial experts, your own attorneys, accountants and insurance agents to give you consolidated advice for your long term goals.

Irrespective of your future plans there are a few factors that you always need to keep in mind to manage your wealth for the future.

1) Create a financial plan for yourself

This helps you to know your worth and consequently know your assets and liabilities. When you know where you stand you can easily determine where you want to go with the money you have and if in case you are not headed in the right direction, it can always give you a wake-up call.

2) Spend consciously

Now, this is quite obvious that you should spend less than what you earn. If you want to do investments for your future plans, you need to have that kind of a surplus income. So make a budget and keep track of it to refrain yourself from spending all your hard earned money.

3) Invest wisely

There are a gazillion schemes and products in the market to invest in. However, it’s wise to first do a background research and then invest your savings in a financial instrument that will ensure growth based on your goals. If you do not understand a scheme, it’s better to get some expert advice or not invest there at all. Other than that, you also need to consider your risk taking appetite before you think of investing in an instrument. It’s always good to take advice from a wealth manager for the same.

4) Diversify your investments

The one thumb rule of investment is never to put all your eggs in one basket’. It helps minimize your risk and reduces dependency on one source of income. So research and have a standard variation in your investments.

5) Give your investments its due time

We all know that investments are subject to market risks. But make sure you don’t panic at any sudden fluctuations in the short run. Trust your investments and give it time to settle and mature. In case you get too worried, seek the help of a financial advisor before jumping into any conclusion. The market can be extremely volatile, but you need to stay patient to get the most out of it.

6) Monitor your investments

Keeping a close tab on your investments helps you know which investments are performing better and which are not to help you plan accordingly in the future. If you know how your investments are performing, you can always reshuffle them to get more returns.

7) Plan your taxes

The tax brackets keep changing over time, but what doesn’t change is its effect on your investments. Don’t wake up on the last day of filing returns. Instead plan your taxes well ahead of time or get a tax planner to help you make your investments to get the highest tax benefit.

8) Plan your retirement

One of the most important aspects of wealth management is planning for your retirement. You need to plan your investments in such a way that they give you a steady income even after your professional career is over. It would be even better if those investments keep generating more wealth for you.

After all, that’s what will give you the ultimate peace of mine. A happy and content retirement.
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This content has been created in association with YONO SBI.
first published:February 08, 2019, 16:20 IST
last updated:February 13, 2019, 12:19 IST