Making A Portfolio

Q. I am 30-year-old married man. My monthly income is Rs 17,000. Please guide me how to make my portfolio.

- Shatrudhan Kalindi, on email

A. Shatrudhan, in my last column, I had explained the concept of financial planning to one of the readers. I would think that you are in a similar situation. As a married man, you now have a responsibility towards your dependants – to provide for them. Starting with a life insurance cover which would at least be 10 times your annual income, you will also have to save regularly for your personal goals such as buying a home, retirement, children’s education, etc. Saving with a goal in mind makes it easier to plan and given a direction, the plan would sail smoothly. You will have to fix the value of your goals and then calculate backwards to see how much you will have to save per month. You will have to budget your expenses so that sufficient savings can be made. (Unless you know how much to save, how can you determine whether you are overspending or not? Now you see the importance of quantifying your goals…)