Depending on your job, as a singular income source, it may not be the best method to create a substantial safety net for yourself and your family. Since the idea of pluralism is enshrined in finance, the foundation of your future plans should be laid on a diverse and dynamic set of financial activity in the present. In saying that, here’s what you can do to make sure that you are well prepared for all contingencies, financially,

• Set aside your savings before you start spending: 

The first thing you need to do is allocate a certain portion of your income to keep aside as savings. Keeping this amount in a separate account will ensure that you do not spend it while its value continues to grow. Setting aside a certain percentage of your income every month allows you to steadily build a large pool of money over time. The earlier you start, the more you can save. Identifying the goals for which you are saving can motivate you to start working on your savings, and estimate exactly how much you need. As a rule of thumb, everyone is recommended to save 10% of their post tax income, but your financial advisor will be able to help you identify exactly how much you are capable of setting aside.    

• Build a substantial emergency fund: 

Accidents and emergencies are unpredictable. They can happen at any time and usually require immediate action. So whether it is a medical emergency, or a last minute payment, having an emergency fund will ensure that your cash flow is not deterred. In this sense, your emergency fund is not goal oriented, but is primarily a safety net in the case of contingencies. While there is no fixed amount to maintain as an emergency fund, a good measure is around 3-6 times your household expenses. 

• Diversify your investment portfolio: 

Invest in a diverse set of equities, mutual funds, property and other such assets that will grow in value over time. Diversifying your investments is a good way to mitigate risk. Aggressively investing in the right equities, by making smart and researched choices, can help you compound your investments quickly.  Further, long term investments are a great way to amass wealth for the future. Consulting a financial planner can help you identify the best investment strategy for the particular goals you have laid out. 

• Procure adequate insurance coverage: 

As mentioned earlier, you need to prepare for all contingencies. An extremely important step in planning your finances is identifying and purchasing the right types and quanta of insurance you need to secure yourself, your family and your finances. In this sense, basic general insurance and term life insurance are extremely essential. If you can afford the premiums, whole life insurance is another great way for you to build a nest egg. 

Financial planning is not a one size fits all type of operation. In this sense, these points should be seen as general guidelines to inform your unique financial plan. Working with a certified financial planner or wealth management firm, you can efficiently develop a financial plan that caters to your specific needs and goals.