The beginning of the New Year brings us closer to the end of the financial year. So, after bringing in New Year with a bang, people are now scramming to fill up their tax declarations and making last-minute attempts to save money on taxes. While on the surface this seems like the smart thing to do, in actuality the last financial quarter is the least ideal time to begin new investments. Why, you ask? Read on to find out.
No Concrete Plan
When you set out to make investments on the very last leg of the financial year, all for the purpose of saving tax, the chances of you having a well thought out plan drops exponentially. New investments made during the JFM quarter are generally made in haste and very poorly thought through, leading to complications or maybe even money loss later on.
Increases Scope for Mistakes
They say, ‘haste makes waste’ – this statement stands true no matter what scenario you apply it in.
The chances of making a bad investment increases when you make hurried decisions.
An investment product that may seem good to you in your rush, and may even meet your tax saving goals, might come to bite you after. It’s always better to take your time and deliberate thoroughly before parting away with one’s hard earned money. Because, if things go wrong, you may lose a lot more than you actually saved in taxes!
Interference with Financial Planning
Reckless last-minute investments also pose a threat of messing up your well thought out financial plan. It is a given that investments you make for the mere purpose of saving tax are but a last thought, the chances of you actually having them factored into your financial plan are low. As such, you part away with a substantial amount of money, which could have been better utilized in an investment that gives you better returns if only you’d taken the time to think twice. Now that you know the perils of investing your hard earned money without considering the above points, why not resolve to never put yourself in that situation? It is the New Year after all and it’s not too late to make resolutions for 2019.
We urge you to resolve to stay clear of making reckless investments in the JFM quarter for the mere purpose of tax saving. Instead, we suggest you take your time, plan right, get informed and then invest in products that will help you multiply your wealth!
And with that, a Happy New Year to you!