Brief Financial Education For Doctors
To enjoy life, we need good health, enough wealth and enough time. The people go to doctors for their health, why don’t they go to financial planners for their wealth. Is wealth not so important? People can’t manage their health without doctors; similarly doctors can’t manage their wealth without financial planners. Some secret tips have been discussed here which will help for all doctors. Know about inflation: The price of everything is increasing day by day and we can understand it in terms of inflation rate. It means suppose today the price of a pen is ? 100 and the current inflation rate is 7%, then you will have to pay ? 107 to purchase that pen after 1 year. The inflation rate in 2016 (Jan to Jun) has been between 6-7%. Before investment, we should remember 4 important thing Return should be more than the inflation rate: Your investment should beat inflation i.e. invest where you get returns more than the rate of inflation. Tax efficient: Under 80C, you should be able to save tax. Liquidity: You should be able to withdraw your own money anytime. Security i.e. government security. [You can avail above mentioned facilities in mutual funds through financial planners. Mutual funds can provide on an average 15-18% compounded annual growth rate (CAGR) returns] if you stay invested for long term]. Rules to manage salary to create wealth: Rule 1: Save first and then spend. Don’t do opposite. Rule 2: Save at least 30% of your salary. Rule 3: Invest in mutual funds and stay invested for long terms. Invest in general funds for wealth creation and invest in ELSS to save tax as well as for wealth creation. q Best option to create wealth: Take general funds. They give on an average 15-18% return. There is no lock-in period and so you can withdraw your money with interest at any time and the money returned is tax free. q Best option to save tax: Various options to save tax are policies (return 5-7%), FDs (return 9-11%), PPF (return 8.6%). About 98% people have these schemes which are actually not recommended by experts. Actually you need ELSS (return 15-18%). In ELSS, you can save tax under 80C, you can grow money in long term and the money which you get is tax free.
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