"we retain for the present, and we sustain for the future"

As a certified financial planner in the Indian context, the statement "we retain for the present, and we sustain for the future" holds significant relevance in the field of personal finance and wealth management. Let's explore this concept in the Indian context:

Retaining for the Present:

Emergency Funds: It is crucial to retain an adequate emergency fund in the present to cover unforeseen expenses such as medical emergencies, job loss, or major repairs. This fund should typically comprise 3-6 months' worth of living expenses, kept in liquid and easily accessible assets.

Short-Term Financial Goals: Retaining for the present involves setting and achieving short-term financial goals such as saving for a vacation, purchasing a vehicle, or down payment on a house. It requires prudent budgeting, expense tracking, and disciplined saving to fulfill these goals within a specific timeframe.

Sustaining for the Future:

Retirement Planning: In the Indian context, sustaining for the future is closely tied to retirement planning. It involves saving and investing to build a retirement corpus that can sustain individuals and their dependents during their post-retirement years. Various options like Employee Provident Fund (EPF), Public Provident Fund (PPF), National Pension Scheme (NPS), and Mutual Funds can be considered for long-term wealth accumulation.

Education Planning: Sustaining for the future also encompasses planning for the higher education expenses of children. By investing in education-oriented savings schemes like Sukanya Samriddhi Yojana, Public Provident Fund, or dedicated education plans offered by insurance companies, parents can ensure financial support for their children's educational aspirations.

Insurance: Adequate insurance coverage, including life insurance, health insurance, and critical illness cover, plays a crucial role in sustaining financial well-being. Insurance policies provide financial protection against unexpected events, mitigating the potential impact on one's financial future.

Wealth Creation: Sustainable financial planning involves making informed investment decisions to generate wealth over the long term. This can include a diversified portfolio of investments such as equities, mutual funds, fixed deposits, real estate, and other asset classes, based on an individual's risk profile and financial goals.

Tax Planning:

Retaining for the present and sustaining for the future in the Indian context also encompasses tax planning. Efficient tax planning strategies help individuals optimize their tax liabilities in the present while ensuring long-term savings and wealth accumulation. This may involve utilizing tax-saving investment instruments such as Equity-Linked Savings Schemes (ELSS), National Savings Certificates (NSC), and tax-saving fixed deposits.

Estate Planning:

Sustaining for the future also involves estate planning to ensure the seamless transfer of assets and wealth to the next generation. This includes creating wills, establishing trusts, and considering inheritance laws to protect and preserve wealth for future generations.

In summary, as a certified financial planner in the Indian context, "we retain for the present, and we sustain for the future" means focusing on prudent financial management and achieving short-term goals while also planning for long-term financial security, retirement, education, insurance, wealth creation, tax optimization, and estate planning. By adopting a comprehensive approach to financial planning, individuals can strike a balance between present needs and future sustainability, ensuring a secure financial future for themselves and their families.

Raja Bhattacharjee

https://www.investmentjunctions.com/

This post is purely for educational purposes and not to be treated as personal advice.