Puzzled by the numerous financial plans touted as savings plans? You are not alone. This breakdown will help you make sense of it all.
A seemingly distinct phrase gets expanded into a blanket expression over time. The term ‘Regular Savings Plan’ has now become a ubiquitous terminology that’s loosely splashed around and used rather lightly these days.
Covid-19 is an incontestable tragedy to many industries, and a phenomenon that has incited a momentous paradigm shift in the way the world operates. However, the structural change it exacted has inadvertently unearthed that mortgage and insurance monthly commitments warrant measures. Authorities recognize these can be heavy financial commitments with repercussions for non-delivery of such commitments.
To me, Regular Savings Plans should not financially penalize a person for their inability to commit. However, lack of commitment is not without its own set of consequences and trade offs.
COVID19 revealed that you should take into consideration, your future earnings volatility and its impact on sustaining the financial commitments of these regular savings plans. First understand that there are a few categories of such plans. Each with its own nuanced characteristics.
As a reader, the next natural question would likely be along the lines of: ‘How do I easily distinguish between them?’, or ‘What would be the best way to discern which plan is best suited for my needs?’
Explanation of table:
Taking a deep breath:
Risks. The term itself can describe volatility of price/outcomes.
Legal/Estate. Unique Offerings.
A call to open-mindedness, attention to personal preferences and facing the consequences of choice.
I strongly suggest taking time to understand the basic characteristics of what each category of ‘Regular Savings Plan’ would entail for you because the trade-offs and ramifications can be worlds apart. If you’re still unclear and uncertain of which plan (or a blend of plans) to consider adopting which would add the most value to your unique lifestyle needs, don’t sweat it too much.