If you have been able to build a sound portfolio, and allot your savings accordingly, where in you have provided for your family’s future requirements, it is time for you to rethink whether your rate of return will be able to beat the inflation 5-10 years from now.
Keeping this clause in mind, it is important for you to start saving early and give more exposure to risk. Invest in equities for a long duration as it has been observed that the markets will be performing on the upside for quite a long time from now. Investment avenues like NSCs and other long term lock in period instruments’, will not provide you returns higher than the inflation rate. Therefore, you will not be making good use of your funds.
If you have a company health insurance policy, see if you can transfer the policy on your name at the time of leaving the organization. If not, get an individual policy cover adequate enough to cover your medical requirements. In addition to that, you should also have a term plan for yourself. Ideally look at around five years of your earning as the term cover.
Try to save at least 40-50% of your income. This way you can guarantee yourself long term returns and a strong investment portfolio. Opt for investing through SIPs. The monthly investment can be done by a combination of funds—diversified, large-cap, mid-cap and hybrid—equity, and for debt exposure your existing PF and dynamic debt (also to provide some liquidity to the portfolio) through mutual funds.
Try to prepay you loans; credit card, personal loan, car loan etc., as soon as possible. Since these loans, unlike a home loan, do not carry tax benefits and charge a considerable amount of interest. So prepaying them will be wiser as it can help you to focus your funds into avenues where maximum returns can be obtained.