#Womenomics

Financial Tips for Younger Indians 

 At SouthEastern in my interaction with many young people who do not realize that your years as a young adult are very important to your long-term financial security.  Young adults often make financial mistakes and only realize that they have acted irresponsibly when it is too late.  It can be especially difficult to save and manage finances when paying for college.  Based on my various interaction with young people at SouthEastern training programs, I have summarize my findings which help you stay on track with your money in order to meet your goals.

Things to Remember: 

1. I always insist in my communication with teens that keep track of what you spend.  You are the target of millions of Rs. of advertising and these Companies want you to buy what they are selling, but you are ultimately the one in control of what you buy and spend.  It is important that you know how to discern between what you truly need from what you only want.
2. I specially focus on one thing which is Education, Remember, your education is crucial.  Going to college or pursuing other educational opportunities and performing well in school will help you earn a better income and get a job with better benefits.  This will let you have an income that allows you to save extra money so that you are prepared for whatever uncertainties life may bring.
3. The choices you make now are important.  Financial choices that you make now can greatly impact your future, so it is important to become educated and develop good financial habits early on in order to be financially stable in the long run.
4. Stay Organized.  Your financial success depends on keeping track of your expenses and planning how you are going to afford everything you need.
5. Protect your personal information.  Always be wary about giving out any account numbers or other personal information, especially over the phone or online.  Disclosing too much personal information may allow someone to steal your identity or your money.  If you are unsure of who is asking for your information, look up their information and call the actual company or your bank to verify the veracity of the call that you received.
6. Do your research.  You may be able to save money by researching and comparing different bank account options, especially for checking.  Finding the best rate can prove to be worthwhile.  This is also an important step in investing or making large purchases.
7. Your credit history is very important.  This is one of the most important things to follow and verify from an early age.  Make sure to keep track of your money so that you do not spend more than you have.  Never bounce checks, as this will hurt your credit score.  Credit card companies charge huge interest rates, and if you only pay the minimum balance, you may end up paying twice the amount of what you purchased or more.  Your credit score will impact your ability to get good rates on future loans for school, a car, and a house, so start building good credit now.
8. To get started, try setting some long-term and short-term goals.  If you make a realistic plan for what you want to achieve in the near and far future, you can start taking steps to reach some of those goals.

Informational Interviewing
At SE we explore another option that will help you prepare for your career is informational interviewing.  This is a way to talk to professionals in your field of interest to gain a better understanding of what they do.  It can also be a valuable networking tool to gain advice, recommendations, and contacts for possible job opportunities in the future. You can identify individuals with careers that interest you through family, friends, teachers, or previous employers, or you can use your school’s alumni listings.

When Warren Buffet Said "Not to Put All of Your Eggs in One Basket" what it mean in practical investment:

• It is very hard to predict what investments will do best in any given year. You need to save your money in different investments so that you are taking advantage of the earning power of higher return investments, while also protecting some of your money in less risky investments.
• Stocks have historically had the strongest record of high returns over the long term.
• In some individual years, however, bonds have the best returns.
• Cash investments usually provide the lowest return, but they also come with the least amount of risk of losing value.

@ SouthEastern we share Investment Information in a very simple format which is easy to understand, Now Learn how to invest wisely in Govt Securities, Bonds, Fixed Deposits, Recurring deposits, Mutual Funds, Gold, Equity and other investment vehicles. Here re some basic information to get your started:

When I speak with our investors @ SE forum about Investment, they are not able to find the proper way out on Asset Allocation, Risk Analysis, Long & Short term duration of investment etc, after this topic you will get basic Idea on this terms.

What is Asset Allocation?

@ SouthEastern Asset allocation simply means that you decide how you will invest your savings among the stocks, bonds, Real Estate, Govt Securities and cash.

For example, if you are going to invest Rs. 100 and you have decided that you want to have:

     15% in Cash, 25% in Govt Securities, and 60% in Stocks

You would put:

     Rs 15 in Cash, Rs 25 in (FD's, bond etc), and Rs 60 in Stocks.

Each time you invest, you would split up your money in the same way.

How Much Should I Put in Each Type of Investment?

@ SouthEastern we often give different examples or formulas, depending on a number of different circumstances, including how much risk you want to take and how soon you will need the money.

Rule of thumb: If you are saving toward a goal that is:

• 1-3 years away, put more into cash investments.
• 3-10 years away, put your money into a mix of cash, stocks and bonds,
• 10 years or more, invest primarily (but still not solely) in stocks.

@ SouthEastern we suggest an easy formula in which you subtract your age from 100 and invest at least that percentage in stocks.  For example, if you are 45, you would put at least 55% into stock funds (100-45=55). Others suggest that is too low, especially if you are saving primarily for retirement, which would still be 20 years away. There is no perfect answer, but don't let that stop you from investing. Do the best you can, and get help from Experts in the field.

Other Example Allocations: 

Conservative: 20% in Cash; 40% in Bonds; 40% in Stocks

Moderate: 10-25% in Cash; 25-30% in Bonds; 50-65% in Stocks

Aggressive: 5% in Cash; 15% in Bonds; 80% in Stocks 

There are three basic places where you can invest your money:

1. Cash - includes certificates of deposit (CDs) and money market funds; cash does not earn enough interest to keep its value due to inflation

2. Govt Securities (G-Sec Bonds) - a certificate of debt from a company or government; includes Treasury bills, and mutual funds can also include /or government bonds

3. STOCKS - a share in a company; mutual funds can include stocks known as large-caps, mid-caps or small-caps that represent the size of large, middle-sized or small companies

Money Management

Learn how to keep track of your money with SouthEastern budget worksheets, use our investment calculators, and more.

A Few Simple Ways to Get Started on Managing Your Money:
In the current digital world you can down load an app and start with it, but @ SouthEastern we suggest this activity in an old school ways, buy a small notebook and take it with you everywhere that you go for a couple of weeks. Write down everything that you spend money on.

• After a few weeks, start putting your expenses into categories, like food, transportation and clothing. Look at how you spend your money. You may be surprised, for example, that you spend so much on food when you are not eating at home.
• Make a list of bills you have to pay on a regular basis, like health care insurance, rent or mortgage payments, dental checkups and even gifts that you buy every year. 

Add up your total income - all of your money you receive in salary, other payments and benefits and any earnings on investments each year. Divide your annual income by 12 to calculate your monthly income. We have a very well acknowledge inflow spreadsheet to calculate your inflow analysis, the spreadsheet can be requested by email at support@SouthEasternpro.com

• Subtract all of your regular monthly bills and the other monthly expenses that you found by keeping track of your spending in your little notebook.
• This will tell you what money you have left for emergencies, like care repairs. Try to set some money aside for emergencies, so it will not completely throw off your budget.
• Finally, look for ways to start setting aside some money for a savings account. Make a plan to start investing, even a small amount, so that your money can start to grow.

What is Financial Abuse?
Financial abuse is one of the fastest growing forms of elder abuse and takes many forms. It occurs when someone takes money that should have been spent for the elderly person. Financial abuse sometimes goes unreported because the perpetrator is a family member or "friend."

Scams And Frauds To Look Out For

@ SouthEastern we believe that smart saving and investing means knowing how to avoid financial scams. Educate yourself about the dangers of predatory lending and financial abuse.

Types of Financial Exploitation

• Misuse of credit cards, ATM cards or joint bank accounts;
• Mismanagement of income/assets;
• Cashing checks without authorization;
• Abuse of Durable Power of Attorney;
• Appropriation or theft of benefit or pension checks;
• Transfer of assets under duress;
• "Loan checks" sent by Credit Card Company that are stolen and forged by others. Always tear them up if you don't plan to use them. They are also treated as cash and carry a higher rate of interest than a charged item