The escalating global pressure is affecting our economy and causing the average citizen to lose a significant amount of their purchasing power.
This has disproportionately affected the African economies, but to the wise, such circumstances are a great reminder that saving and having a proper financial plan is essential to comfortably navigate an uncertain future.
With all of this in mind, most people ask: How specifically should I invest my money right now, considering my situation and future goals?
People often tend to think of achieving their financial goals through work and investing, ownership of land/property, venturing into business, agriculture and cattle rearing etc.
Unfortunately, some of these methods include a high-level risk that most people are not prepared to take, and on the other side, people are limited by the large amounts of money required and the time it may take to make a return on their investment.
But did you know that BK Capital is prepared to address these uncertainties by providing investment advice that is tailored to one’s life?
BK Capital is a subsidiary of BK Group Plc, and specializes in providing investment services both for institutions as well as the average individual.
However, before you can develop a strong investment plan, BK Capital recommends you first need a financial plan which provides a roadmap for the future and can be developed regardless of your life stage.
The financial plan is a blend of investment, insurance, tax, estate, retirement, and cash flow planning that we can set to reach our financial goals.
STAGES TO FINANCIALLY PLAN FOR YOUR LIFE
Financial planning starts with analyzing your strengths, stages in life and vulnerabilities. These goals tend to change as we go through different stages of life.
Below are some tips on what plans you should be making according to the stage in life you’re in, and ways to achieve them:
STARTING OUT (~ 21-30 YRS)
As you start "adulting,” there are steps you can take to start out on the right foot. These include:
·Developing financial independence from your parents
·Creating a budget and savings account
·Starting to save for retirement or for emergency needs – Saving is never early. Learn about your company’s pension fund if employed, you can also review available private retirement funds like the BK Capital Aguka Fund, the Rwanda National Investment Trust fund, or public programs like Ejo Heza.
·Maximizing employer benefits - Does your job cover medical insurance/maternity leave? — Understand what's available, know what benefits can roll over to the following year.
·Navigating financial apps and investing services out there — Familiarize yourself with financial services and learn how to perform certain tasks necessary for financial planning like, understanding loan structures, and establishing return profiles of different financial products.
SETTLING DOWN (30-45 YRS)
This is the stage where most people start forming families or getting a partner. Financial planning needs to be adjusted here to account for more dependents.
Planning for this stage involves:
Pursuing your first mortgage/loan
Preparing financially for children: Having a baby is one of the most exciting times in your life. However, kids come with a lot of unexpected expenses that may cause a great deal of financial stress if not planned for correctly, hence a proactive action is needed earlier.
Creating or updating your will: Adjusting your will to label your child/partner as a beneficiary and designating a guardian can save a lot of headaches and give you peace of mind, knowing that your child will be in good hands.
Reviewing your insurance coverage
ENTERING MIDLIFE (45-55 YRS)
At this stage, you are transitioning to a stage where long-term financial education is important.
Things to keep in mind include:
·Teaching your children good money habits and financial knowledge — These will be necessary once they reach adulthood.
·Saving for your children’s higher education and other life events — without jeopardizing your retirement.
·Estate planning — Getting your wills, asset/property documents in order.
·Updating insurance policies — especially as medical expenses may start increasing.
NEARING RETIREMENT (55-65 YRS)
You’ve done your dues and are retiring soon from the workforce.
There should be two aspects to focus on in this period:
·Understanding your social security and pension benefits as well as Supporting adult children and holding their hand to walk with them in this process.
ENJOYING RETIREMENT (65 AND ABOVE)
Finally, It’s now time to enjoy the fruits of your labor!
This means free time with friends, family and hobbies.
So, make the most out of your retirement package by:
·Claiming Pension at the right time and reviewing your medical benefits
While financial planning is an important skill to have, it should not deter you from pursuing your personal endeavors, nor are the stages of life mentioned above meant to be an accurate description of what you should have attained by then.
Therefore, be flexible with your planning, and make decisions according to your means and retirement goals.
Regardless of your life stage, BK Capital is trained and prepared to work with you on everything from providing investment advice to saving for retirement.