Though we Indians have upgraded our phones and lifestyle in a big way in the past few decades but when it comes to investing money, our pattern is still very old fashioned. The trend is changing but at a snail pace. Still most of the savings we make are parked in to fixed deposits (FD) or traditional insurance policies which hardly generates a return of 5% to 6.5%. On FDs you end up paying huge tax and so your post tax returns are very less. Apart these, there are people who keep getting money accumulated in their savings account, so its high time to upgrade investments.
Love for real estate
You always need one house to stay in and beyond that whatever investments you want to make in property should be purely to make money. Real estate has always given positive returns but what we fail to realize is that even this has crashed in the market big time earlier. Calculate the compounded annual growth rate of property returns and you will see it is totally opposite to contrary perception. Do build your dream house but beyond that be careful with your real estate strategy.
Not following a well thought financial plan
It is very natural that financial planning always takes a backseat since there is a huge pressure on majority Indians to manage their family due to high costs and the ever-increasing job or business pressure. These also leads to hasty wrong decisions. Start creating a well thought financial plan suiting your lifestyle and with aim to meet your financial goals in time.
Investing in Gold
Gold buying has been always considered as a safe haven investment in our country for generations. You should invest in gold but it should not cross more than 10% of your overall portfolio and given the current scenario you can stay from it for some time as it has not given any returns in the last three years. The returns of gold post inflation is hardly anything.
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