** Source: HT Archives, media reports, Outlook magazine, e-commerce companies

THIS REPUBLIC DAY, GET YOUR FINANCES IN ORDER BY FOLLOWING THESE 7 STEPS

Set Financial GoalsSetting goals is a pre-requisite to any fi nancial plan. If your goal is to buy a new smart television, name your Mutual Fund as “My New Smart TV Fund”. This will help you avoid distractions from investing.

Seek Financial Advice Financial advisors are professionals who study the market. They can guide you about good schemes. They even keep a track of your Fund and help you get maximum returns.

Diversify your PortfolioDifferent assets have different risk-return profi les. For example, Equity-based Funds witness short-term volatility but can give high returns in the long run. Similarly, Debt or Liquid Funds are relatively low-risk category investments. You must have a balance of these assets to balance your risk and return.

Plan your Exit StrategiesYou plan your investments for your goals. However, after reaching your fi nancial goals, you need to plan your Fund exit strategies as well. You can plan a separate exit strategy to match every goal.

Consider Infl ation Foreign education overseas for your child cost a few lakh rupees

not long ago. Now it runs into crores. A fl ight from Delhi to Mumbai was `140 in 1947**. Now, you will have to pay approximately `6,788. Similarly, the cost of

healthcare surges over time. Infl ation is your enemy number one.

Invest for Emergencies and RetirementUncertainties can eat out your savings and retirement is an inevitable life-goal. These goals can help your other goal-based investments stay on track. By building your

strong retirement corpus, you can even retire early.

Long-term is the KeyThe earlier you start, the better your corpus gets,

due to compounding. The secret to long-term fi nancial independence is long-term, regular investments.

4 PLANNING TAXES IN THE LAST MOMENTWhy do I have to struggle to invest a lump-sum amount for saving Taxes?

You can make your Tax planning process easier by starting it early. Ideally, you should begin your Tax planning from the beginning of the fi nancial year. You can divide your Tax saving investment into 12 parts through SIPs.

What you can do: Start investing in Equity Linked Savings Scheme (ELSS) from April.

5 NOT PLANNING FOR EMERGENCIESWhy do emergencies push me away from my goals? You would have not faced this question, had you invested for your emergencies. Having an Emergency Fund can help you be fi nancially prepared for uncertainties like infl ation, medical emergencies, job loss among other things. What you can do: Invest regularly in Liquid Funds till you have enough money to pay for six months of expenses. Liquid Funds don’t have a lock-in period. They can be your alternative to your savings account or Fixed Deposit.

3 NOT MAKING GOAL-BASED PLANSWhy do I fall short of money while fulfi lling my dreams?This problem can painstakingly be overcome by smart goal-based fi nancial planning. Your goals can be as small as buying a microwave oven. Similarly, they can be as large as travelling the world. You can invest for all your goals through Mutual Funds.What you can do: Make a list of your goals. Divide them into short-term, medium-term and long-term. Have a separate portfolio for every goal.

You might have resolved to start your journey towards financial security this year. You might be looking forward to learning more about financial planning. But let’s first learn how your faulty financial habits can push you off-track.

Here are 5 habits that come in the way of your fi nancial

freedom struggle:

Being financially independent means being able to achieve one’s goals and being prepared for financial uncertainties. Improper financial habits can also push us away from our financial goals. By following the right financial behaviour,

your journey towards financial security can become easier. This Republic Day, let’s take steps towards financial independence.

*This content was created exclusively for UTI Swatantra. Visit http://www.utiswatantra.com for more information

*This content was created exclusively for UTI Swatantra. Visit http://www.utiswatantra.com for more information

ARE YOU ON THE RIGHT FINANCIAL TRACK?

Steps to download and scan a QR code: 1) Download QR code app on your phone. 2) Run app and scan the QR code. 3) Your smartphone reads the code & navigates to the destination.

Scan this QR code to know how investing helps youget freedom from anxiety.

Scan this QR code to calculate your Tax liability and how much you need to invest to save Tax..

*This content was created exclusively for UTI Swatantra. Visit http://www.utiswatantra.com for more information

1 NOT TRACKING EXPENSESWhere did my salary go? Well, you would have had an answer to this if you would have kept a record of your expenses. Tracking your expenses helps you curb impulsive buying. What you can do: Maintain a diary.

Record each and every expense you make.

At the end of every month, take note of

excess spending categories.

2 SPENDING FIRST - INVESTING LATERWhy I have no money left for investing? You need to reverse this. Spend only after

you invest. If you invest as soon as you get your salary, you will force

yourself to manage your expenses with the amount

left after investing. What you can do: Invest through

SIP (Systematic Investment Plan) at the beginning of every month.

It's never too late to march towards a fi nancially independent future; start today!

WHAT NEXT?

Want to strategise your fi nancial freedom struggle? How a smart fi nancial plan can help

you come closer to your goals is discussed in

the next section!

For more details, follow us on Twitter @utimutualfund; Email queries or suggestions: info@beswatantra.com Please mention ‘Swatantra in TT’ in subject line.

For more such fi nancial advice, head to our website: http://www.utiswatantra.comMutual Fund investments are subject to market risks, read all scheme related documents carefully.

In the next edition: You created a huge retirement corpus by smart long-term planning. However, the planning does not end there. The next step is to utilize this corpus during your post-retired life.

In the next edition, we will look at how a Systematic Withdrawal Plan (SWP) can be your old age companion.

SIP CAN BE YOUR FREEDOM TOOLSWATANTRA KUMAR EXPLAINS: ENDOWMENT EFFECTEndowment Effect refers to people’s tendency to ascribe a higher value to assets, just because they possess them. You are willing to pay a lesser price for the object. However, after your ownership is established, you over-value your possession.

Consider this: Say, you are owning a house worth `2 crore. You want to sell it for `3 crore. By selling that house, you want to utilise that money to buy a bigger house in the same locality. Thus, the endowment effect has an infl uence on your property valuation. You tend to overvalue the object, regardless of its market value. This applies to your investments as well. Here, you may put your money in your already owned investments, rather than looking or researching for new investment products.

To avoid endowment effect, you may do the following: ● Look deeply into your portfolio. Ask

yourself if you are willing to purchase the assets at their current price

● Remind yourself of the reason why you purchased the assets in the fi rst place

● Do thorough research before making investment decisions

To know more about retirement money and SWPs, tune into UTI Swatantra Facebook Live on 30th January 2019 from5 pm onwards and catch the live show on 'SWP - The key to happy 2nd innings'.