Rule 1: 30% of the income must be used for monthly living expenses.
Rule 2: 30% of the income must be used for liabilities repayments (if any).
Rule 3: 30% of the income must be saved and invested for the future living.
Rule 4: 10% of the income must be spared for entertainments, vacations, etc.
Rule 5: 6 month’s income must be available for the emergency purposes.
Rule 6: Home loan must be registered and applied in the name of both husband and wife (Both can get benefits on Home loan Tax benefits).
Rule 7: Buying a second house for investment is not advisable (Survey reports – it will fetch you only around 3% return).
Rule 8: After 45 years of age, do not enter into any BIG LIABILITIES (Higher education of children and wedding of children will happen around 45 to 50 only, so plan now for the same.)
Rule 9: Have a joint savings account in any of the banks.
Rule 10: Property must be registered on both husband and wife name (As per legal act – after husband first legal heir is the wife, after wife it will go to children only).
Rule 11: Regular check on nominations at all financial instruments. If not nominated, do it now.
Rule 12: Only in the insurance policy, claims payable to the nominee. In other financial instruments, legal heirs certificate is essential to get back the settlement.
Rule 13: Must have term insurance to financially secure future of your dependents.
Rule 14: Don’t take any financial investment decisions emotionally. Avoid last minute tax saving investment decisions. Plan well in advance.
Rule 15: MEDICLAIM is must despite the group mediclaim coverage given at the office. After retirement (50-55 years of age), there is no mediclaim coverage.
Rule 16: For your jewellery locker and fixed deposit, only one lakh is payable by the bank, in the case of theft or fire, provided insurance is done.
Rule 17: Have a knowledge of all the tax implications. You cannot avoid paying tax but you can minimise by way of tax planning and investments.
Rule 18: All financial documents must be kept safely and keep family members informed of the same.
Rule 19: Financial investments must be followed through a personal financial advisor.
Rule 20: Review your portfolio every six months.