Financial Planning कैसे करें ? Simple Financial Planning for Everyone

Summary

This video highlights the essentials of financial planning, emphasizing the importance of a simple and effective approach. It outlines four critical steps: securing life and health insurance for family protection, utilizing the National Pension System (NPS) for retirement savings, and investing in Equity-Linked Savings Schemes (ELSS) for tax benefits and returns. The speaker, Pranjal Kamra, advocates for a balanced financial plan that ensures good returns, tax savings, and adequate insurance coverage, all facilitated through a user-friendly app, ET Money, for hassle-free management.

Takeaways

• 😀 Simplified financial planning requires a straightforward approach that is easy to execute and understand.
• 📝 Avoid financial instruments that are complicated to purchase or come with excessive paperwork.
• 💡 A balanced financial plan should include good returns, effective tax savings, and adequate insurance coverage for emergencies.
• 💼 Life insurance is essential for earning members of the family to protect dependents in case of unexpected events.
• 🏥 Health insurance should cover all family members, as medical expenses can arise unexpectedly.
• 📊 The recommended life insurance coverage is 20 times your annual income, ensuring financial security for dependents.
• 👵 The National Pension System (NPS) is a beneficial retirement planning tool with higher returns compared to other retirement products.
• 🔒 NPS funds cannot be accessed until retirement age, promoting disciplined savings over time.
• 💰 Investing in tax-saving instruments like ELSS (Equity Linked Savings Scheme) provides returns without compromising on benefits.
• 📲 The ET Money app allows users to manage life insurance, health insurance, NPS, and mutual funds conveniently and paperlessly.

Q & A

What are the two essential qualities of a simple financial plan?

A simple financial plan should be easy to plan and execute, with fewer instruments that are easy to buy.

Why is life insurance important for earning members with dependents?

Life insurance is crucial for earning members because it ensures that dependents are financially secure in case of the breadwinner's untimely demise.

How much life insurance coverage is recommended based on annual income?

It is recommended to have life insurance coverage equal to 20 times your annual income. For example, if you earn ₹5 lakh per year, you should aim for a ₹1 crore policy.

What should a health insurance plan cover?

A health insurance plan should cover all family members to safeguard against medical expenses, ideally providing at least ₹2 lakh coverage per person.

What are the benefits of the National Pension Scheme (NPS)?

The NPS offers higher returns compared to traditional retirement products, allows you to withdraw 60% of the fund upon reaching 60 years of age, and provides tax benefits under both old and new tax regimes.

What is the tax benefit limit for investments in NPS and ELSS?

You can receive tax benefits up to ₹1.5 lakh for investments in NPS and ELSS under Section 80C, plus an additional ₹50,000 for NPS.

How can financial planning become more convenient?

Using financial apps like the ET Money app can make financial planning more convenient by allowing users to manage health insurance, life insurance, NPS, and mutual funds in a paperless manner.

What is the difference between life insurance and health insurance in terms of coverage?

Life insurance covers the financial security of dependents in case of the policyholder's death, while health insurance covers medical expenses for the entire family.

Why should you purchase life insurance at a younger age?

Purchasing life insurance at a younger age typically results in lower premiums, which remain fixed for the lifetime of the policy, making it more economical.

What is the lock-in period for investments in ELSS funds?

ELSS funds have a mandatory lock-in period of three years, during which you cannot redeem your investment.