Money grows best when invested. Investment helps you to get more out of your actual investment over the time, whether short-term or long-term. The amount, purpose, channel and duration of investment differs from person to person. Over the time, people have become more and more active and are now making more informed decision when it comes to invest their hard earned money, and now the importance has shifted more towards investment than saving. Though the fact that saving is important can’t be denied but apart from that investment is thing by which you can increase the value of your current money. Basically in investment we spend our money in buying some policy, asset which have a potential to increase the value of our money with time. Some of our investment can even provide us money on regular basis. The main motive behind investment is to increase our net worth and to financially secure our future.

Although, investment is always a personal preference depending on the individual’s choice and capability amount, duration of investment and the risk appetite, one should follow certain principles, that can also be called “Thumb Rules”. These thumb rules answer all questions about investment and make investing an easy affair.


Future is always unpredictable. No one knows what is going to happen even next minute. So it is very important to secure the future of our family members who are dependent on us and to have a life insurance is the best option for it. In a life insurance while paying a small amount as monthly or early premium you are securing your family’s future. It is always advised to you to have a life insurance whose cove should be 5x of your annual income so that your near and dear ones don’t have any problem even after you. While you are securing your family’s future on the other hand with life insurance you are saving your taxes too. One thing more you should know about life insurance is that death benefits are even tax free to the beneficiary too.

And why stop at just insuring your life? There are other valuable assets which need to be insured as well: your and your family’s health. Life is unsure, and so is the health. Some severe ailments can leave a big dent in your pocket. It is advisable to opt for a health insurance policy which provides covers for all major diseases and ailments for the entire family.

Home and its content take a lifetime to acquire, and it takes just one natural calamity of a few minutes, or a robbery when the house is left unattended, to take everything away. Home and its contents have various memories, uses and importance attached with them and it is wise to have them insured. An insurance cannot get back the original stuff, but at least will make sure that their cost is covered.

Accidents can happen anytime to anyone! And it might not even be your fault. If you own a vehicle, your vehicle takes the first impact of the road accident. With automobile costs rising day by day, repairs can be a costly affair. A vehicle insurance, both for car and bikes, help you to recover the costs of the repairs. Always make sure that you compare different policies from different insurers so that you get the best deal.

Emergency Fund

There can be many emergency situations in our life such as medical emergencies, urgent travel and many more. Suppose you lose your job without any prior knowledge, then what will you do at that time. You should have at least some savings so that you can go on with your day to day needs for at least few months. So it is advised to you to always save some of your money as emergency funds. Ideally, your emergency fund should be equivalent to 6 month of your expense.

Retirement Savings

How Much Do You Need to Save for Retirement?

At least 10% of your monthly income should be saved by you for your retirement.

If you spend all your earning even monthly think what will you do after your retirement as many companies don’t provide pension after retirement. So it is very important to save for your future. Saving 10% monthly is not a big target. You can do it easily by being strict to your monthly expenditures. If you save 10% monthly in your working life span you will have enough fund for future and you can live is a good way even if you are not having pension or anything.


Most of us have more than 1 credit card and/or more than one loan. If your case is similar, you will be paying towards it for sure. But you should always try to pay off those loans whose interest rate is high. In this way you can save more annually. Credit Cards in general, are the costliest debts, where the annual interest rates range from 24% to 36%. Hence they should be your first priority of repayment, followed by business loans, vehicle loans, personal loans and home loans.

Home Loans and Down payment

Saving for Home Loan Down-payment

Your home should not cost 3x of your current annual income.

Buying a home is also an investment as the value of your home keeps on increasing and provides you financial security for future too. But when you plan to purchase a home always keep in mind that the cost of your home should not be more than 3x of your current annual income. This is suggested because, suppose you purchase a house whose worth is more, than you will have to take a home loan of more principal amount which will result into paying more interest along with more down payment money. So be a smart investor and go for a house whose cost will suit your pocket. This way the EMI which you have to will never be a problem to you. It is also suggested that if you are planning to buy a house than start savings from 1-2 year in advance so that you can afford the down payment without borrowing.