We bid goodbye to 2024. Hope it was a great year for all of you and expect 2025 to be even better. The new year will inevitably bring new opportunities and new needs at the same time. While you should look to meet your needs, don’t lose sight of your ambitions either. Often fulfilling both depends on money. The money you borrow and the money you invest to build your wealth and insure your dear ones in case of an eventuality such as your unfortunate death.
While you would love to shop, spare a moment for your wallet too. See how much burden it can handle. At the same time, you might feel content with your savings. But there’s always the need to multiply the same to ensure a buffer should you go through a tough time like an extended job loss.
So, let’s discuss the credit, investment and insurance behaviour to display in 2025.
Let’s Start with the Credit Behaviour You Should Adopt in 2025
Never Take a Loan if You Don’t Need it
We are living in times where peer pressure takes over. Fancy iPhones, cars and other luxuries are all on the wishlist of the modern generation. If you have the savings that can let you live such privileges without any financial discomfort, go ahead! If not, then build the base by avoiding such temptations. Don’t take a loan to buy such things. You will only feel burdened if you take a loan to do so.
Review Your Existing Credit in 2025
If you have already taken a loan, 2025 is the time to review it and see where it stands. For example, if you have a personal loan at an interest rate of say 20% per annum, you might think of a balance transfer. It’s an effective ploy to reduce the personal loan interest rate. A balance transfer is a way to shift the outstanding loan balance to another lender at a lower rate of interest, reducing your overall interest outgo.
Continue Displaying Effective Credit Card Behaviour in 2025
Glad to know that people are becoming aware of how to use credit cards to their advantage. Effective use will multiply reward points that can be used to shop for your needs. However, if you have been caught on the wrong foot with credit card interest compounding at 30-40% per annum, be proactive instead of letting the situation go out of hand. Your debt will multiply to insurmountable levels if you don’t take action today.
Take a personal loan at a lower interest rate to pay off your outstanding credit card balance ASAP. Then show the financial discipline to have enough to pay off the personal loan comfortably month after month.
Let’s Talk About the Investment Behaviour to Display in 2025
Invest in Top-performing Equity Mutual Funds
If you have stayed away from investing in stocks because they are risky, you are losing out on building wealth that can help withstand inflation that’s only going to multiply with time. Yes, investing directly in stocks is advisable only if you know the market dynamics, in and out. If not, trust the power of top-performing equity mutual funds that have delivered impressive returns over 5-10 years. Check out mutual fund research websites that showcase returns.
Fund managers are in charge of mutual funds who handpick stocks based on their performance, the current market situation and how it’s going to perform going forward based on various political and economic developments. The ability to offer inflation-adjusted returns makes mutual funds the go-to-option for investors. There can be lows during the investment journey, but a carefully chosen equity mutual fund will recover and continue to surge ahead.
Have Some in Fixed Deposits Too
Stability can’t be overlooked! It’s always better to have assured income regardless of the market. Something a fixed deposit assures to investors throughout the investment period. As of December 30, 2024, fixed deposit interest rates have gone upto 9.50% per annum.
Never Rule Out the Power of Gold Investments
Gold prices have been continuously rising since the COVID pandemic. At the onset of the pandemic, gold prices were a shade above INR 30,000 per 10 grams. Within two months, they surged to INR 50,000, and are now trading at around INR 80,000.
Insurances You Need to Have in 2025
A Term Insurance is a Must
Never hesitate to take the best term insurance plan offering enhanced coverage of upto INR 50 lakh-1 crore for a lower premium. A term insurance plan comes in handy for your loved ones in case of your unfortunate death during the policy term. Having it at the earliest will lessen your premium drastically.
No Compromise on Health Insurance in 2025
Health insurance covers expenses incurred on the treatment of several ailments you can get affected by. With hefty treatment expenses, it’s almost impossible for most households to bear the same. A health insurance policy offering enhanced coverage helps you and your loved ones financially in the case of a medical emergency.
Conclusion
It’s about riding the right path with the right loan, investment and insurance action. Never be under the false impression, take the right financial steps as outlined in the article. We wish all of you a great 2025. Happy New Year!
