1. Set aside 1 year's expenses in liquid and laddered short-term debt funds.
2. Then go for a 10+ years long-term diversified portfolio of 1/2 multi-cap and 1/2 mid-cap funds with high star ratings through monthly Systematic Investment Plans.
3. Measure the performance of each investment, comparing it to its appropriate benchmark, for reviewing / changing your portfolio.
4. Review and re-balance your portfolio once a year to compare with your various pre-determined long-term goals.
5. Maintain inflation-adjusted annual returns along with long-term capital growth.
6. Never ever invest money through credit/borrowing/loan - only use net monthly savings.
7. Shun market greed at all times.
8. Of course, your term insurance plan and health plan is a prerequisite before initiating this strategy.
9. Your net worth (what you own minus what you owe) should grow more than the inflation rate.
10. Your solvency (asset to liability ratio) should be > 1 always.
11. Minimise your credit card rollovers and auto loans.
12. Your savings to income ratio should not include your home.
13. Aim your savings rate at 10% minimum of your carry-home pay.
14. Exercise due diligence before "locking up" substantial savings in second or weekend homes.
15.They should not become a drain on our income stream required for regular expenses, due to their comparative illiquidity.
16. Therefore, keep in mind your Liquidity, Solvency, Debt-to-income, House Affordability, and House Payment ratios too.
2. Then go for a 10+ years long-term diversified portfolio of 1/2 multi-cap and 1/2 mid-cap funds with high star ratings through monthly Systematic Investment Plans.
3. Measure the performance of each investment, comparing it to its appropriate benchmark, for reviewing / changing your portfolio.
4. Review and re-balance your portfolio once a year to compare with your various pre-determined long-term goals.
5. Maintain inflation-adjusted annual returns along with long-term capital growth.
6. Never ever invest money through credit/borrowing/loan - only use net monthly savings.
7. Shun market greed at all times.
8. Of course, your term insurance plan and health plan is a prerequisite before initiating this strategy.
9. Your net worth (what you own minus what you owe) should grow more than the inflation rate.
10. Your solvency (asset to liability ratio) should be > 1 always.
11. Minimise your credit card rollovers and auto loans.
12. Your savings to income ratio should not include your home.
13. Aim your savings rate at 10% minimum of your carry-home pay.
14. Exercise due diligence before "locking up" substantial savings in second or weekend homes.
15.They should not become a drain on our income stream required for regular expenses, due to their comparative illiquidity.
16. Therefore, keep in mind your Liquidity, Solvency, Debt-to-income, House Affordability, and House Payment ratios too.