PF is your most valuable asset!

By | April 17, 2011

Withdrawing from your PF and investing the funds in equities is not a desirable suggestion any financial advisor will give you. There have been some cases where people, due to emergencies tend to break the PF for meeting their requirements but breaking the funds and investing in equities is not worth.

Your Provident Fund carries a lot of benefits which you will be benefited from both in the short term and in the long term. It’s a guaranteed zero-risk product. Your employer’s contribution is tax-free and you are on to an EEE product—which means exempt exempt exempt. It is taking away 24% of your income into something that is highly beneficial. So, the thought of taking funds away from such an investment is quite disturbing!

Invest your additional savings into SIPs through the Mutual Funds routine. This will guarantee you better returns in future. Apart from these investing avenues, opting for a life and health insurance covers of higher value is also important. If you already own such policies, increasing the value of the cover is what is advised.

So touching your PF is a bad idea, not for a marriage, not for the house, you don’t touch that money—it’s your long-term asset. In order to not face any emergencies in future, it is important for you to note down what your long term and short term financial goals are. Start saving funds accordingly. Planning, this way, will avoid you the trouble of breaking any long term valuable investments and enter into any kind of debt of availing a personal loan, home loan etc.

So, start investing early and take full advantage of the current markets’ movement and expose yourself to equities. If you are not an active trader then investing through Mutual Funds will be a better option. Get yourself a life and health insurance covers and make sure you have funds assigned for all your financial requirements as well have liquid cash in your savings account.

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