No Liquidity? Think Again!

What is the use of the investments in the products that you can’t liquidate when you need them in your worst period of life?

Think about this before you commit yourself to long term plans. To name a few such investments like ULIPs, Endowment Plans, Real Estate, etc are the ones.

A person I met today has properties worth in crores, also has few endowment policies in the name of investments.

Now, What happened is, his daughter diagnosed with a hole in the heart and he needs money for her treatment but he doesn’t have cash and none of his investments can be liquidated. What’s the use? Please Plan accordingly.

Now he is looking for Personal Loans and even ready to use his credit cards for his daughter’s treatment. With no hope of any cash flow in the future. Please Plan your Emergencies. Liquidity is very important.

You should not have all your savings & investments where liquidity can be a concern. Firstly you should avoid such investment products, but even if you do so then you should not have more than 20% of your net worth in such products.

Where Is Liquidity?

Savings that you do in Fixed Deposits or Recurring Deposits which can be pre matured in case of emergencies.

Investments that you do in Mutual Funds (without Lock-In), Equity Shares, Gold which can be withdrawn anytime during an emergency or can be easily converted into cash.

Prefer 80% or in fact 100% of your net worth in these types of savings & investments which can be liquidated whenever you want.

This gives you the comfort as well as keeps you away from miserable life. Stay happy, keep investing & Stay Safe!