Do not postpone Your Investment Decisions





Delay can not only result in monetary losses but also lead to avoidable confusion and legal hassles.

Have you put off retirement planning because it's too far away? Are you avoiding writing a will because it's too morbid to consider at 50? Do you typically wait till March to make tax-saving investments? Postponing important financial decisions can inevitably lead to losses and crises. Saving in the tax season is one of the worst habits. Do not look at everything from the tax perspective. This is because you not only suffer losses in terms of the opportunity cost, but also end up with expensive investments that do nothing to help reach your goals.

The cost of procrastination can dent your financial future by significantly reducing your corpus for long-term goals. For instance, if you start saving `10,000 a month in an equity instrument that grows at 12% when you are 25 years old, you will have a corpus of `5.5 crore when you retire at 60.However, this amount will be pruned to only `91.9 lakh if you start at 40. If you park your funds in a lacklustre debt option that grows at 8%, you will barely muster `57 lakh

In another instance of dilly-dallying, not planning your inheritance or failing to make nominations for your bank accounts, insurance policies or mutual fund investments can lead to avoidable confusion, financial complications and legal problems for your dependants at a later date. In fact, hanging fire on any kind of paperwork, be it shifting or closing accounts, removing hypothecation or setting up ECS mandate, can cause fiscal irritants in the future.

The best way to tackle this bad habit is to prepare a list of financial tasks in the descending order of urgency, preferably at the beginning of each financial year. Then tick them off without delay.

IF YOU DO, YOU SUFFER FROM PROCRASTINATION BIAS

You like performing less urgent tasks on a priority instead of the more critical ones. You keep putting off pending tasks and difficult decisions till the last minute, often paying a heavy price for the delay.

HOW TO OVERCOME IT:

Make a list of important tasks and fix a time frame for each. Set alarms for reminders. Do the most unpleasant and difficult task first and leave the easier ones for later. As an incentive, promise yourself a reward for completing the task