Regular monthly income key to Dignity.

     

 I use my Mind ,Body, and Time to generate cash which I use it to purchase ,day to day expenditure like groceries, utility bills, children education fees, maintenance bill, payment to maid,etc .

   My regular income can only be used to make such day today expenditure.

        Of that total income I should save atleast 20 percent in such leveraged asset which can yield regular future monthly income to take care of this monthly expenditure which are bound to happen at age 60, my retirement age when my active income will stop.
       Have I made provision for such leveraged asset. 

Essentially people invest the n Mutual fund, fixed deposit, property, Insurance,etc.

Let's first check mutual fund whether it qualifies under leveraged asset.

I earn 1 lakh of which 20,000 I save in mutual fund regularly. This I continue for 8 months.

And suddenly I met with an accident and I die.
Now what will my family get 20000* 8=  160000.

My family is used to 80000 monthly expenditure.

How long will this money last. 2 months right.

So is it a leverage asset. Absolutely not.

      Now let's say monthly I save same amount in Lic endowment plan for 1 crore sum assured.

 Now on my death my family will get immediately 1 crore and endowment plan will also generate  expenditure income regularly for family expenses to which they are used too.

          Ow assume if I don't die by this leverage d asset I have created a risk free income for my regular monthly expenses till I am alive.

 Thus insurance is only one asset which is leveraged asset. Once I turn 60 I have created a regular monthly income till I am alive. 

So  essence is "My Goals  should decide selection of asset".

 And best is to first have protection and than I think about any other investments Avenue.