Few tips to be financially Successful

Everybody wants to be financial successful. However to become financially successful its not just the money in your account or investments you made but our habits and behavioral pattern along with emotional quotient is equally important. Below we have outlines certain habits which are  in build to a financially successful persons behavior, these are the habits which streamlines the wealth creation and also preserves it in future.

Planning…Planning anything is the first and most important thing to succeed in any kind of venture. For Financial success we need to budget our finances, frame financial goals and decide about time frame to achieve them. Unless we know our current location and where we wish to reach, we will never be able to figure out how to reach to the destination. Once we have planned our goals then we should stick to it until unless there is very peculiar situation to modify it.

Taking decisions…We can’t sit on the shore and wish to cross the river. Decision is the key and delay can lead to monetary losses as well as create confusion and legal hassles. By postponing important financial decisions we may lead to losses and crises. The cost of procrastination can dent your financial future by significantly reducing your corpus for long-term goals. The best way to tackle this bad habit is to prepare a list of financial task in the descending order of urgency, preferably at the beginning of each financial year.

Being Proactive…. We should do the research before making any investment. We are also required to keep track ongoing rules and regulations, scams and mis-selling so as to avoid losses. Riches are churned out by people who put in time, effort and money into research, they are satisfied with being satisfied, and so they seek out the best investing option, the best career avenue, and the best way to achieve a goal. They do not compromise on the quality or suitability of a product or service because it meets their basic needs. 

Think twice before action… Many actions cannot be reversed or cost heavily if we want to change so think twice and wait before taking action and analyse all pros and cons of attractive options. Be cautious and understand all aspects Be it buying stocks that have suddenly shot up, redeeming mutual funds units at the first hint of a market correction, or changing your job just because you are offered a higher pay package are all impulsive reactions. Discipline is at the core of any aspect of financial planning. We should inculcate discipline by sticking to our decisions, strictly following the initial decided budget, and don't digress from asset allocation.

Review the past decisions/actions… Reviewing/Monitoring is critical to know if we are on course. In terms of criticality, this habit is equally important as of planning. A spectacular plan is only 50% of our final objective because, in the absence of a periodic review of our finances, we may never reach our goals. Monitoring the portfolio has a three dimensional impact: it helps to weed out non-performing assets, re-calibrate investments if the goal seems out of reach, and maintains asset allocation.  

Be prudent for debt decisions… Most people need to borrow for funding current needs/comforts by paying from future income to secure our future and improve current lifestyle. However it is important to learn the art of delaying gratifications and considering the impact of our actions, this is the reason debts are an anathema to most successful people. While some loans such as those for home and car are virtually inevitable, the financially prudent prefer to do the cost benefit analysis of these loans and avoid loans for luxurious items. Beside, stretching loan tenures is not advisable as it balloons the interest cost despite the tax advantage that some of them offer. Hence it is best to prepay costly loans at the earliest and avoid unsecured loans at all cost.

Always remember the risk… Remember there are various uncertainties and don’t forget to cover them by securing insurance, this ensures that our dependents and investments are protected, as it is not possible to predict misfortune but we can have the right tools to tackle the unforeseen events. This can be done by having the right insurance and contingency in place. Most successful people ensure that they cover all their risk adequately.