Diwali is a festival of lights that symbolizes new beginnings, prosperity, and the victory of good over evil. These days, besides family gatherings, rituals, and exchange of gifts, Diwali is aptly ideal for making financial resolutions and freshening up your money management. Traditionally, businesses and homes clean and prepare their environment for the new year at this time. It's a great time to reflect on your habits and make new resolutions for the future.
1. Stock Your Current Financial Condition
To start making effective financial resolutions, one must assess one's current financial position. Just as the New Year is for many of us, Diwali presents an opportunity to take a step back, account for spending behaviour, and identify where it aches. Note what you earn, spend against, save, and payout in debt for an accurate financial profile. It will then be easier to draft more precise, achievable goals from there.
Resolution Idea: Take up a financial review every Diwali to know how you have grown, what to work on next time, and what should be the new financial goals set.
2. Making Financial Goals for Next Year
Diwali being the festival of renewal and prosperity is the perfect time to usher in short-term and long-term financial objectives. Saving for a big purchase, developing an emergency fund, or starting to invest for future wealth, having some sense of direction can drive and motivate you to get closer to your dreams.
Resolution Idea: Set SMART financial goals for the next year-such as saving a percentage of your income, or paying off a particular debt.
3. Save for Festival
Gifts, celebrations, and travel always involve an additional expense during the festival times, especially on Diwali. Plan this and save adequate amounts for all these festive activities so that you are not burdened with financial anxiety at the last minute. This Diwali, promise yourself that you will create a festival savings account and make regular savings of a fraction every month.
Resolution Idea: Open up a separate savings account or fund specifically for festival-related expenses, so that you're all set when next Diwali knocks at the door.
4. Stop Wasteful Expenditure
Diwali can be a great time for an analysis of spending. As one celebrates by spring-cleaning their home, one can also "spring-clean" their finances as well through the elimination of wasteful spending. These include impulse buys and subscriptions that are not necessary, and lifestyle habits sucking the money out of your wallet, but don't add much value to your life.
Resolution Plan: Track your expenditures for a month, pinpoint the unnecessary expenses, and promise to curb them during the following year.
5. Boost Your Investments
Diwali marks the beginning of good times. It is the ideal time to invest in Gold, real estate, or stocks. Use this time as a chance to either initiate or enhance your investment portfolio. Diversify your assets try to get more investment ideas or boost contributions to pre-existing plans such as mutual funds, stocks, or retirement savings.
Resolution Idea: Increase investment contributions by a certain percentage every Diwali with an intent to save for the long run.
6. Review and Revise Your Insurance
Insurance plays a very significant role in financial planning and protects the wealth of the person and ensures security for his family. Use this opportunity of Diwali to review your insurance policies, ensuring that the coverage is adequate and up-to-date with any life changes. For example, you will need to increase the sum assured if you are changing your job, getting married, or having children.
Resolution Idea: Make this a bi-annual Diwali ritual so you always check and review your health, life, and property insurance policies so that you are well covered.
7. Boost Your Emergency Fund
All the best plans can be disrupted by unforeseen expenses, a loss of a job, or even a medical emergency. But with security and prosperity being central to the festival of Diwali, it is the perfect time to promise oneself that this is the year to work on one's emergency fund. According to experts, at least 3-6 months' worth of living expenses should be kept aside in reserve for unforeseen eventualities.
Resolution Idea: Contribute regularly to your emergency fund so that it continues growing and providing a financial safety net.
8. Pay for Charity
For instance, providing and being charitable are also part of Diwali-themed considerations. This can then be translated into monetary resolutions in the form of charity and donations for causes and purposes you feel dear to your heart. Save for this line of giving, it offers a balance of spiritual fulfillment and even more tax benefits to increase your wealth in line with social welfare.
Resolution Plan: Just assigning a certain percentage of your earnings to donating through contributions and volunteer hours could be an important part of your Diwali financial resolutions.
In Diwali, with renewal, prosperity, and light as themes, this would also be a good time for self-introspection and developing resolutions not only for the mid-year but in coherence with long-term goals. Maybe you're saving for specific targets, reducing debts, or choosing better investment options – using Diwali as a financial milestone ensures you of a brighter and more prosperous year ahead.
