Uncertain events such as the Covid19 pandemic expose not only the vulnerabilities of the society but also unveil how susceptible we are to reaching complete financial instability. If history proves one thing it is that during recessionary periods, even well established businesses could file for bankruptcies leading to thousands of furloughs and job losses.

So an all important question we all must ask ourselves is are we really financially stable enough to deal with sudden financial shocks. Can you provide for your family incase of a job loss or if you have fallen severely ill with age while being unable to work?

If not then planning and finding ways to secure your future becomes the need of the hour. Benjamin Franklin once said, “By failing to prepare, you are preparing to fail”. With that in mind, let us look at a few ways you can set yourself up for a more financially stable and secure future.

  1. Spend Less and Save More – This may sound like an obvious thing to do but you’d be surprised to know that many actually don’t save enough. Moreover, a lot of the younger generation in India have higher debt burdens than their yearly income.
  2. i) Preparing a family budget is one of the best ways to begin this exercise. Creating a budget will help you in identifying unnecessary spends and incentivise you to start saving more.

    ii) Restrict using Credit Cards – Credit spends come with huge interest costs. The more one spends by borrowing, the further you are pushed away from achieving financial independence.

    iii) Open a PPF account – This would compel you to save a fixed amount yearly so that you can add it to your PPF account. Moreover after a few years, the amount saved is returned with interest.

  3. Make the money work for you – While we all know that we have to work hard to earn money as salary, Warren Buffet once said, “If you don’t find a way to make money while you sleep, you will work till you die”. What he means is that you will not achieve financial independence unless you make the money you earn work for you. So how does that work?Well, investing your capital in running side businesses is one such way to make money work for you. Not all businesses require large investments and full time attention. For instance, investing your savings in real estate and then renting your property is an example of a side business. In this case you earn a fixed income as rent from the property that you own.
  4. Start Investing for the Long Term – If you simply save money and store it in your bank account or as cash, you are actually losing money over time. This is due to the effect of time value of money.

If someone asks you whether you would want Rs.1000 today or 5 years from now, anyone would choose today. This is because the value of 1000 today is more than what it would be worth 5 years from now. 20 years ago, a mere Rs.5 was enough for a full day’s meal. But today you cannot even buy a pack of chips for that price.

So our aim should be to invest in instruments that have a higher rate of return than the inflation rate. When such investments are made for a fairly long time period, you can truly multiply your wealth due to the power of compounding

The stock markets, bonds, gold and mutual funds are a few great options to invest your savings. While stocks and mutual funds are risky in nature, their average returns are far greater than other financial instruments and over a long time period, the risk is significantly reduced.

Another advantage of investing in stocks is that many companies pay dividends over and above the capital appreciation that happens for you. You can find high dividend paying stocks and invest in it for a long term.


All in all, to achieve financial independence and be able to retire as early as aged 40, or secure yourself from any impending financial shocks, it is important to 1. Cut down on unnecessary spends 2. Invest the money you save in high interest generating instruments 3. Find ways to increase your passive income.

In this fast paced world, you never know when the next recession strikes and no one in the world can predict how it will strike. So it is best to take steps today to safeguard you and your family’s future.

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