Celebrate the New Year with These Simple Financial Resolutions

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(MENAFN-Mid-East.Info)

Make a resolution for the new year. How about considering a financial resolution for 2022? Financial Resolution can help you improve your financial health and hopefully inspire you to stay engaged year round.

Whereas nothing can be better when life seems easy and everything goes the way you want it to. But due to lingering concerns about COVID-19 variants, if someone encounters life-changing experiences, such as the death of a spouse or partner or the loss of a job due to a major change in the economy or a disability due to accident or illness or, for example, health concerns due to serious illness, these disruptions could derail their trip significantly.

However, proper and effective planning requires considering the “what ifs” that happen when you don’t expect them. Making the following financial decisions can make an individual financially healthy.

Take out adequate term life insurance

The most important shield that everyone should have is term insurance. The sum insured is the amount that your family or candidate will receive in the event of an unfortunate incident such as death, disability or serious illness. Make sure it’s important enough for your family to live a stress-free, financially independent life after you factor in inflation. One should choose the maximum policy term available, as this will also ensure a relatively lower premium.

Health insurance to cover unforeseen medical expenses

Adequate health insurance is the need of the hour for you and your family. Choosing a health insurance plan can help individuals reap the benefits of extended coverage options as they age. Most policies have a pre-existing waiting period that applies if you have a pre-existing medical condition. This period will be negligible while you are still young and healthy, giving you the benefit of comprehensive coverage that will come in handy if you become ill later in life.

Strive to improve credit score above 700

People with a score of 700 or higher have the best credit terms. One can achieve a good credit score by paying off IMEs, credit card bills, and other loans before their due date. A lower score not only means higher interest rates, but sometimes also a loan refusal.

Commit to maintaining zero credit card debt

Rewards credit cards offer an attractive proposition, the promise of free points and miles for every dirham spent. Avoid falling into the debt trap by seeking rewards. Also, the credit limit may tend to be cut off, which can lead to financial squeeze in an emergency.

Prepare for unforeseen events

Build an emergency fund with your salary. We may have a job now, but who knows what might happen in the near future. The emergency fund should be kept in an easily accessible account, such as a bank account or high yield savings account.

Having all of this would not only reduce your financial burden by the end of the year, but also instill a disciplined financial approach into your life to come.

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