Apart from investing in funds that can guarantee your returns which in turn might help in funding your financial requirements apart from wealth creation, it is important that you buy the appropriate insurance policies that can save you from any rainy day. After all it is your hard work and investment that will help in accumulating all the funds and if you are not in a position to enjoy it on a later date then who will?
In order to build a strong portfolio it is important that you pick funds that have been consistent performers in the past and have fared well in various market cycles. Remember the more your expose your investments to equities the better will be your return on investments. Investment in equities is supported only for those investors who keep a long term growth plan for their portfolio and not short term. Long term implies those investments whose tenors are more than 5 years. If there are any market irregularities, they tend to even out in the long term. As far as insurance is concerned it is important that you consider a cover that provides you a protection that is 5 times your annual pay.
With a lot of insurance policies available in the market it becomes difficult for the investors to choose a cover that is beneficial to them since the type of covers differ from each policy holder to another. In such situations it is advised to compare more than two insurance products that provide the required insurance covers as per your requirements. For getting a better idea you can also contact a market agent who can explain to you in detail about the product and provide you guidelines based on the same after which you can decide.
Apart from your own health insurance it is advisable for you to take a cover for your dependents, especially if the dependents are your parents. Buying a hospital plan along with a health insurance cover can help you tremendously as when it comes to financing any hospital fees which is the only aspect the policy supports.
If you are a home loan borrower, it is important that you avail insurance for the loan amount. In the eventuality of a job loss or any other reason where you may not earn any income, this insurance cover can help you get rid of the burden. A general life insurance policy that many investors adopt is an endowment policy that may not be very helpful when it comes to loan related issues. Investing in additional plans like a step-down insurance or a term plan which can help you as and when your responsibilities increase. Make sure that you read the terms and conditions of all the policies before zeroing down on any of them. Also while you are deciding to buy a dream home, opt for the houses which are ready to move in or which is ready for immediate possession. Apart from the fact that you know what exactly you are buying you also get the flexibility to pay your EMIs right from day one instead of paying a pre-EMI interest, which generally happens when the EMI starts and when the complete loan is disbursed. But the major disadvantage is that these kind of properties are generally expensive than the properties that are under construction.
If you manage to choose your funds for prudent financial growth of your portfolio and also choose appropriate insurance covers for benefitting not only yourself but also your dependents then you have managed to build a successful portfolio whose benefits can be reaped by you and your family.