Hello Readers! 

‘The early you start investing, the big you end accumulating’ this very advice is given to all those who start their earning career. Now, most people start their earning journey in their 20’s, however, their financial management journey starts somewhere in their 30’s or 40’s. This is because only during this time people actually attain their financial maturity.

By financial maturity, I mean a disciplined approach towards managing their income, saving, and investment. 

Although experts advise you to start investing early, it's never too late also if you start investing in your 40’s. Let us see how you should plan to invest in your 40’s and how you can plan the right investment in your 40’s!

Is Planning Investment In Your 40’s Beneficial? 

The fact is nobody is getting younger and with the increase in their age, their responsibilities also increase. One must therefore seize the opportunity in time to get themselves financially prepared for their responsibilities.

While you enter your 40’s, you are already engaged with the big responsibilities, like your spouse, your children, their education, your old age parents, household expenses, and lifestyle expenses. With all these, it becomes difficult managing your money and then saving an ample amount that you can invest for future goals.

However, you cannot waive off the idea to start investing, as only investing in the right place can help you provide a good lifestyle for your family, a good education for your child, and happy retirement days for you and your spouse, in the future. Thus, investing is necessary even if you have reached your 40’s and would definitely prove beneficial, only you need to invest right.

Allocation In Growth Asset Would Help Much! 

Your future goals like child education and creating a retirement kitty require a big corpus to achieve them and to create this kind of big corpus you need to invest your money at a place where they can create good wealth for your goals.

For this, you can consider investing in growth assets like Equity Mutual fund. In fact, not only investing but investing for long-term say 5 years+ in equity mutual funds will help you accumulate big for your goals. This is because the longer you stay invested the more your investments will be compounded, thus adding more and more to your corpus to be created.

While you plan to invest in equity mutual funds, you need to look at how much you need to invest monthly via SIP to accumulate the required corpus for your goals. Once you calculate how much you need to invest monthly, plan to save that part from your monthly income. Consider your basic monthly expenses and prepare a budget. To save good, go on cutting your expenses on your wants and try spending only for needs.

Growth assets are important to build wealth if you aim to beat long-term inflation. Ramp up this part of your portfolio, if need be, even at the cost of current consumption.

Have A Stable Investment, Catering To Contingency! 

Well, if you consider your Pension Funds or Provident Funds as a part of your stable investments, then dear you need to understand that you are going wrong. Your pension fund is a small part of your big retirement kitty, and not a part of stable investments. Your stable investments are basically meant for any short-term money requirement, it could range from medical expenses for elderly parents to spends on children and for other contingencies.

You can put your money in either debt funds or liquid funds to build up the stable investment part of your portfolio.

Let Us Sum Up! 

Being a person responsible for your dependents, present, and future expenses, you need to understand that saving in your bank account cannot help you achieve all the goals you are planning for, that too in a scenario when the inflation is increasing only to eat up your savings. You need to plan bigger than savings, you need to plan to invest your money even in your 40’s. Most important, remember it's never too late to plan to invest for your goals! 

Keep reading our articles for more updates on finance and investment!!

For any kind of query you can contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.

Happy Investing!

(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee to future returns).